A fool and his money

Bringing the good news

Bernard Hollowood

Have you ever wondered about a newspaper's stock market report and the person or persons who knit it together? I don't suppose so: we tend to assume such columns write themselves.

But the other day I took the trouble to track down the bloke who contributes a week-day piece called Market Review in the Planet Chronicle, a paper aimed at an A-B readership. He's called Gonfleur, Rick Gonfleur, and he's a great guy — knowledgeable without being too knowledgeable, disinterested without being too disinterested, superior without being too superior and so on. He made it clear from the outset that half a dozen double scotches and a couple of Havanas would loosen his tongue.

I had .a copy of the day's paper in front of me and I decided to question him item by item.

'You kick off with 'Britain's major banks raised their interest rates yesterday, and gave a jaded stock market a much-needed shot in the arm.' Can you explain that pipe-opener? Nothing like it appeared in other newspapers."

"Well' said Rick, "you've got to start somewhere, haven't yourl heard the news about base rates going up in El Vino and Horace Cope of the Mirror found the news so interesting that he continued with a long and terribly boring story about Antonia Fraser. But Bob Bates was pleased. He's got a few shares in the Midland and he saw the rise in base rate as a bull point for bank shares."

"For bank shares, yes," I said, "but what about higher interest rates for companies short on liquidity? A nasty blow surely?" , "You could be right," said Rick, "but when the market closed 4 points up I had to find some explanation. I didn't actually say so in my column, but I hoped readers.

if any, would think I meant that "a rise in bank shares had sparked off

optimism and brought out the bulls. I don't mind telling you, though, that I always rewrite or re-dictate my opening sentence four or five times. But don't blame me for the headline 'Shares Boosted by Higher Rates.; that was a sub's work."

"Okay," I said. -We come next to 'Trading overall was thin, though some market operators took the view that the undertone of the market is basically firm.' What in heaven's name, does that mean?"

He started on his second scotch and waved to Conrad Fletching of the Sun before answering.

"It's obvious enough. There was very little dealing, chiefly because it was damnably hot and secondly because nearly all the jobbers and brokers were at Lord's. As for the operators who see the market's undertone as basically firm — my, my, what English! — it's quite true that I heard several people in the Long Room saying we'd turned the corner at last, were at last getting behind the ball and standing up to Lillee and Thomson."

"And you took that to mean vague signs of recovery? Weren't you mixing your metaphors a bit?"

"Could be, but the market has a lot in common with cricket you know. I had a bet at Lord's, a double, that the pound would appreciate against the dollar while England would get 400 in their second knock, I lost of course, but when I was scribbling my notes at the Nullabar, before dictating to Annette, I heard a, fellow at the next table say that the long-range weather forecast was dry and sunny, and I feel justified in saying that the undertone of the market is basically firm.

"Everyone knows that hot weather is bullish. People tap their barometers and decide to take a day out or off, but they like to go with an easy conscience, so they expend an erg or two before setting forth for the links or Lord's or the pool and they make a single phone call and buy. Nothing in particular: just a handful of shares so that they can feel their relaxation has been earned. If there's no reason either to buy or sell on a hot day, your average City type will assume that all his colleagues will be taking a day off after making a single small but positive deal. And the sum total

of all this easing of consciences adds up to an unspectacular and• totally meaningless improvement in the market's undertone. Does that make sense?"

"In a way," I said, "but it's all very iffy, isn't it? Let's go on a bit. You write: 'Small buying from the institutions was largely instrumen tal for the good showing in blue chips where gains ranged from lp to 3p.' What I'd like to know is how you know the investors in blue chips were institutional. How can you identify the institutions when they're buying in deceptively small amounts. I mean who told you about these institutions and their small blue chip flutters?

"My dear chap," he said, "you're making a mountain etcetera. I know a few brokers, true, but I get nothing out of them. But if I see George Askwith, manager of the NUP pension fund next to Harry Croome-Benskin of, say, 'GEC at the bar of the Lord Kitchener and both are looking reasonably cheer ful, then I think it perfectly reasonable to suppose that George has accidentally been reminded of the continued existence of GEC. And if GEC shares have moved upwards a bit at the end of the day, I see , nothing wrong in hazarding a guess that institutional investors were to some extent responsible for the good showing in blue chips." "But you wrote 'largely instrumental,' "I said.

"That was because of the Test," said Rick. "The fund managers are not as a rule cricket-lovers. That's my opinion based on years of experience. So they don't flock to Lord's. But the rest of the City does flock and it's a simple matter to put two and two together and decide that if there's been a good showing of blue chips, the managers — in their offices instead of the Long Room bar — have been, as I put it, largely instrumental."

"Very well," I said, "let me turn to your next bit ..." But he made a Gallic gesture with his shoulders to inform me that his quota of scotches had been dispatched and that the interview was at an end.

I still read the fellow. He's one of the shrewdest reporters in the City. Incredible, isn't it?