With the financial markets on the brink of meltdown, here’s an interview from Radio 4’s Today programme with a financial expert who – to me – sounded like he was telling the unvarnished truth in plain english: Terry Smith from Tullet Prebon – transcribed from programme broadcast Friday July 29th.
Terry Smith: The credit crisis which started in the summer of 2007 – many people didn’t realise how close that bullet is lodged to our heart. Only gradually and over time are people coming to terms with the enormity of the problem.
Sarah Montague: But it hasn’t killed us yet
Terry Smith: No, but I’m fairly confident that it will
Sarah Montague: Which means what?
Terry Smith: We will all be very significantly poorer than we thought we were in the last twenty years – we simply won’t have the same standard of living. There’s an enormous squeeze already going on, on our real incomes; our pension entitlements will be much less than we thought they were, etc
Sarah ends by asking how Terry himself is preparing for the coming crash?
Sarah Montague: Are you putting money under your mattress?
Terry Smith: No, I don’t put any money under my mattress. I own equities mainly, but they’re in very big safe companies that sell our everyday neccessities and luxuries. I do own some gold, and currencies of countries which I think are very safe. There aren’t very many of those, but countries ironically like Norway which have got enormous financial reserves and are very well run.
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