Hedged Bets

To my cynical eye, the people I see on US on television reassuring us about hedge funds are acting just too relaxed - and when I saw one analyst describe fund managers as "much more sophisticated these days" I knew the rest of us had reason to panic. At our conference in Delhi recently, a former urban planner from Germany, Margrit Kennedy made a persuasive case "based on the laws of arithmetic" that the world money system is heading for collapse, and soon. What makes the situation so dangerous, she explained, is that all the currency and gold reserves of all the central banks in the world amount to only the volume of transactions handled in seven to eight hours of trading. Ten years ago, Kennedy was regarded as a crank; today, she gets invited over for a chat by the President of Germany's central bank. At the weekend, Germany's chancellor threw in the towel; yesterday, Fast Company's parent company decided to sell a perfectly good magazine. Those in the know are not happy campers at this time.

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