19 AUGUST 1989, Page 19


A market with two or three hundred points of fizz and bubbles


t is quite easy to produce a share certificate. You could do it yourself with a John Bull printing outfit and one or two extras like a company seal. The trouble only begins when, like the late Clarence Hatry, you are tempted to run off some duplicates. In these last weeks that creative financier would have been fascinated by the London and New York stock markets — at home in them, perhaps — as he watched the prices being driven up by fund managers afraid that there might not be enough shares to go round. Our own market now has an abnormally high prop- ortion of froth to beer — perhaps, in the FT-SE Index, two or three hundred points of fizz and bubbles. But then, Lord Han- son has just removed some £3 billion worth of shares in Consolidated Gold Fields, Isosceles and its enemies did the same for £2 billion worth of Gateway, and Sir James Goldsmith still huffs and puffs his intention to follow with £13 billion worth of BATs. Now KKR, the Wall Street specialist in buyouts and breakups, has made a pass at Sir Owen Green and BTR, worth another £8 billion. Are KKR's intentions honour- able? Sir Owen hopes so, and in a clinch can look after himself. It was his bid for Thomas Tilling that first taught us that no company was too big to be taken over. Pity the fund manager caught on the wrong foot ' in such a market and scrambling to catch opl Or study the type in The Money Game, where Poor Greville asks the brokers to quote prices, first for the garbage, then for the real garbage, and then for the shares which are still too boring for anyone else to buy. In the end he goes long of Union Carbide. The poor Grevilles have been so busy that the Dow-Jones Industrial and the FT 30-share Index — the old standard measurements of the markets, dominated by the old giant companies like Union Carbide — have both, this month, touched new heights. Markets in such a mood have a way of accepting all news as good news. On both sides of the Atlantic, signs of economic slowdown are taken as signals that official policies are working. Do we hear cries of pain from the high street, where furniture shops are having to go back to their bankers for more money? Ah, says the stock market, that's just what Nigel ordered, so we must be on our way to a soft landing.... Landing on what? Land- ing, as has been evident these many months, on companies' dwindling piles of cash.