Wednesday, 22 February 2017
Last updated 3 hours ago
May 21 2012 | 11:20am ET
Odey Asset Management's Crispin Odey may have backed the U.K.'s Conservative Party at the country's last general election, but he doesn't have any faith in the man who that party's victory made prime minister.
In a letter to clients, Odey first damned David Cameron with faint praise, calling him a "good and fair man" and "charming company, too." But, the hedge fund manager warns, his is "no man to see the way out" of the U.K.'s and Europe's economic crisis, taking the premier to task for his decision to implement the Vickers Report, which would impose strict new regulations on British banks.
"Economic problems remain strictly exogenous as far as he is concerned," Odey wrote of Cameron. "By implementing the Vickets Report he is committing the U.K. to the depressionary future of Europe, without any sense of what that will do to his government's ability to fund itself and fulfill the woefully over-inflated expectations of his voters."
By contrast, Odey had nothing but praise for the U.S.
"A banking system that is profitable, a growing loan book, asset prices that are cheap enough to encourage sensible investment and an energy policy, which allows fracking, has given the U.S.A. a marked global competitive advantage—cheap energy," Odey gushed. "At a time when other economies are turning away from market solutions, the U.S.A. still believes 'just' in the good sense of markets."
He was no kinder towards Europe—and particularly new French President François Hollande, who declared the "world of finance" his "enemy" during his successful campaign—than he was to his own prime minister.
European authorities "need literally to print €4 trillion, which they will not do, thus making any recovery almost impossible," he wrote. "Meanwhile, an attempt by governments to spend their way out of a recession without a working banking system is as useless as a car on a boat."