Tory donor makes huge profits from falling pound

Conservative party donor Crispin Odey is among those who enjoy huge profits from the falling pound amid market turmoil caused by Kwasi Kwarteng's mini-budget.

Electoral Commission records show the hedge fund manager - which once employed Mr Kwarteng as a consultant - has donated more than £350,000 to the Tories.

Odey Asset Management's European hedge fund is said to be up around 145% after the bet Mr. Odey's firm against the pound and government bonds in the gilt market.

"It has been helpful," Mr. Odey told the Financial Times at about its short position on the pound st erling, while describing his bets against the gilts as "the gifts that keep on giving".

The Tory donor rejected this idea that h We had any business advantage because Mr Kwarteng previously worked for his business.

"There's a crazy idea that one is behind every twist," he said. "All I can do is catch the wind once in a while."

Mr. Odey and other economists believe the pound could fall to parity with the US dollar for the first time. "I don't think you can start being bullish on the pound," the hedge fund manager said, adding that it would continue to "bounce".

The pound stabilized at around 1.08 on Tuesday, as it rallied slightly from a record low of 1.0327 against the US dollar the previous day. UK government bond prices crashed to their highest level in more than a decade on Monday.

Former US Treasury chief Larry Summers said markets were treating Britain like a developing country where "credibility" is lost after Friday's tax cut fueled by the plan loan.

JP Morgan economist Allan Monks told Reuters that Mr. Kwarteng should "reverse or reconsider" its strategy to prevent things from getting worse.

"There is still no clear sign that the source of the problem - the government's fiscal strategy - is reversed or reconsidered. This will have to happen before November to avoid a much worse outcome for the economy."

Paul Donovan, chief economist at UBS Global Wealth Management, warned that investors seemed to see the conservative party in charge of government as "an apocalyptic cult".

The director general of Virgin Atlantic's Shai Weiss also suggested that Mr Kwarteng and Liz Truss should 'reverse course' to end the perception of 'unsustainable perceived weakness in international markets'

The boss of the airline added: "Sometimes all of us in this room should be humble enough to say, 'If I've done something that's not working, maybe I should back off.' It's not a bad thing to do."

German Finance Minister Christian Lindner questioned the "experimental" economic plan.

"In the UK United, a major experiment begins as the state simultaneously steps on the accelerator while the central bank brakes,” he said at an event last night, Bloomberg.

Sir Charlie Bean, the Bank of England's former deputy governor for monetary policy, said the Bank should consider an emergency meeting in light of the current state of the UK economy.

He told BBC Radio 4 Today: I think on this occasion...I would certainly have advised the Governor that I think this is one of the occasions where [and an emergency meeting] might have made sense.

Sir Charlie also warned: "It is now more expensive for the British government to borrow than Italy or Greece, which we have traditionally seen as not quite cases desperate, but certainly less successful sovereign entities. »