10 MARCH 1990, Page 25

Farewell symphony

A FRIEND on Wall Street telephoned me the other day: was it true, he wanted to know, that an unspecified number of Cabinet ministers were resigning over the poll tax? The Chicago currency futures market, he told me, was talking of nothing else. I said that I didn't think so but would find out. By the time I had succeeded in scaling the Cabinet ministers down into Oxfordshire councillors, Chicago had found something else to talk about — but the moral was evident: politics are now making the weather in markets. Sterling has had an uncomfortable few days, caught in the blast. In their way, the Chicago traders had a point. It must be a sign of the time when Cabinet ministers, like musi- cians playing Haydn's Farewell Symphony, pick up their instruments and tiptoe for the exit, one after another, explaining that they want to see more of their families or at any rate to beat the rush when the music stops. (I take it that we shall soon see Sir Norman Fowler on the board of a big Black Country company.) Odd as it may seem, the markets most exposed to inter- national influences will be the most sensi- tive to our domestic politics. International investors do not follow the ins and out of the game, but they did well through the 1980s by investing in Britain, and they see Mrs Thatcher as the talisman of their success. Any threat to her position will change their perceptions. Already the Kuwaitis are cutting back their exposure to Britain and bringing what remains under more direct control. If we are in for a sticky summer in the Government and the gov- erning party, the stickiness will find its way into markets — and to sterling most of all.