It is a sobering thought that a year ago the nominal wealth of the world, as registered in bank holdings, stock and bond prices, real estate and company valuations, was twice what it is today. Where has all the money gone? Was it there in the first place? The $50 billion ‘invested’ with Bernard Madoff seems to have simply disappeared into a celestial, or infernal, black hole, leaving ‘not a rack behind’. I heard the other day of a man supposedly worth $6 billion a few months ago, now down to $500 million, so technically he is not even a billionaire any more. He did not actually do anything to cause his fortune to be divided by 12: just sat appalled, watching it vanish, on TV. He might just as well have cast it at random on half a dozen roulette wheels, and watched it spin and click its way into oblivion. I recall my old friend Jimmy Goldsmith, a genuine billionaire in his day, say: ‘High finance is just a game of noughts and crosses, old boy. The market adds a lot of noughts to your fortune, then it comes back and crosses them off. Ha ha!’ Great wealth has a propensity to disappear twice: once of course when you die, and it goes for good, but often enough it evaporates while you’re still alive: it is ‘such stuff as dreams are made on’.
These quotations, note, are from The Tempest, Shakespeare’s great analogy of fortune magically appearing, disappearing, then appearing again. It is about power and position in an Italian duchy, but might just as well, more credibly perhaps, be a metaphor of Wall Street and the City, their bull-rings and bear-gardens. The source of the action is the well-named Prospero, the god-magician of Credit, and his agent is Ariel, the personification of Dow Jones, Nasdaq and the FTSE 100.
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