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Issue . 9


Will Self On the black SWan

& the man WhO SaW it all cOming


From Mostly Harmless, the fifth part of the ‘The Hitchhiker’s Guide to the Galaxy’ series


ND AT GO HEN LY UTiny competition: Find the sprouts (above) hiding somewhere in the magazine, before the green shoots are crushed by the regulators in Brussels. Email us with your answers to competition@ squareupmedia. com. Terms & conditions apply.

Editor’s Letter


Cover image by Polly Borland M






Square Up Media 4 Tun Yard Peardon Street London SW8 3HT Tel: +44 (0)20 7819 9999 Fax: +44 (0)20 7819 9840 EDITOR


Mark Hedley ART EDITOR




Zain Alatas, Andrew Baker, Alex Bilmes, Clem Chambers, Jane Clarke, Lou Cooper, Bernadette Costello, Neil Davey, Jon Hawkins, Sally McIlhone, Charles R Morris, Will Self, Christian Smith, Chris Sullivan, Graeme Wallace INTERNS

Alex Bolden, Amin Judeh ADVERTISING

Michael Berrett, Mark Edwards, Vicky Miller, Christian Morrow, Kevin Rudge, Tom Rutherford, Alex Watson ACCOUNTS

Steve Cole, Natalie Jackson MANAGING DIRECTOR


Broglia Press


alm down! Calm down! Come on, everyone: it’s not all that bad. Keep your hair on. Now, I know we all feel like chucking our toys out of the pram and buggering off to Geneva – but take it from me I’ve been there and it’s not all it’s cracked up to be. Granted, the scenery is something to behold and of course the tax regime is quite amenable – but on the downside they’ll throw you in prison for speeding and let’s be honest, you could die of boredom on a Friday evening. There are some unusual suggestions being proposed in the financial press at the moment to cope with the rising spectre of regulation from those demented fat cats in Brussels. One bright young spark, writing in the Independent, on London insurance companies being hit with requirements to keep far more capital on reserve, wrote recently: “One less practical suggestion mooted last week was that insurers send their policyholders free fags, booze and pork pies, and hope the resulting rise in mortality rates reduces their liabilities sooner. Perhaps not.” Sounds like a bloody good idea to me. In a similar vein, perhaps those of you in the hedge industry could pop over to Brussels in one of those PJs the press love to hear about and strike an entirely reasonable deal with the bureaucrats who love to dine on moules frites and a couple bottles of Montrachet, at our expense, for a light lunch with their ‘niece’ who is visiting over from England. And the deal should be this... you can regulate the hedge fund industry as much as you like, my fat friend – but first of all, you have to publish in unexpurgated detail all your expense claims for the last ten years: there’ll be no ‘redacted’ guff here; I want to hear about every limo to the airport, every flight backwards and forwards between Brussels and London, and up to your constituency, then out to Strasbourg, all so you can boff the missus so she doesn’t get suspicious about that ‘niece’ you keep wining and dining in Au Crocodile. That should keep the fat buggers quiet.

Martin Deeson - Editor

Contributors WILL SELF Celebrated author of novels, short stories and non-fiction, Will Self contributes to many publications and regularly appears on radio and television. As well as writing for the Independent, GQ, and New Statesman, he is a regular panellist on the BBC’s Shooting Stars and Have I Got News for You.

ANDREW BAKER Andrew Baker is chief executive of the Alternative Investment Management Association (AIMA), a global hedge fund trade body with more than 1,100 corporate members in over 40 countries worldwide. Previously, he was COO of Alternative Investments at Schroders in London.

CHARLES R MORRIS Charles R Morris is the author of several books including the bestselling The Trillion Dollar Meltdown, acknowledged by many as the first big book on the credit crunch. A lawyer and former banker, he has also written for the New York Times and Wall Street Journal. He lives in New York.

CLEM CHAMBERS Clem Chambers is CEO of ADVFN, Europe’s number one stocks and shares website. He is a columnist for Wired, the Business, the Scotsman, and Active Trader; as well as contributing to a number of UK and US financial publications. He is also a regular commentator for CNBC and the BBC.





72 63 24 44








Few big beasts saw the crash coming – except, George Soros, Warren Buffett and Paul Volcker, says Charles R Morris.

Nassim Taleb not only saw it coming – his fund cleaned up massively. Will Self meets the author of The Black Swan.




You might have missed these pearls so we’ve harvested them for you: Bernie Madoff’s yacht is up for sale (aptly called Bull), you can buy a yearling for racing and ‘When Adolf Met Vladimir’ – a painting of a chess game, not an arthouse romcom.


Leylandii’s turning Japanese at Sumosan.





While the EU is to be lauded for its attempts to introduce Europe-wide regulation it must be careful not to impact adversely on investor returns.


When Martin Deeson went on his virgin big-game fishing expedition, he was hoping for a swordfish, maybe a tuna… he didn’t expect to be going mano a mano with a pretty irritated mako shark.



The London Design Festival hits town this month. We give you the lowdown.


Prosperity’s Quest Fund has given returns to date of 2008 per cent since 1999. This piece is better read than shed.

41 44




Market analyst-turned-financial thriller author Clem Chambers on the omnipresence of volatility in the market.

18 69 75 63


“ If we don’t REWARDS



Arranged around a secret courtyard in a hip Buenos Aires district is a beautifully appointed luxury hideaway. The fact it is a home from home for owner Francis Ford Coppola makes it a must. Christian Smith is unashamedly star-struck.



In a long career of press freebies and overseas travel Chris Sullivan had always managed somehow never to cross swords with Istanbul. Happily, we were able to put that right. Now, all we have to do is persuade him to come back home.



If you’re heading to Bangalore on business, treat yourself to a few days of downtime, Yogic-style at Gokarna’s SwaSwara Resort. Martin Deeson was so chilled he (almost) went teetotal.



charge 2 and 20, no one will take us seriously.

For a little while, given a hostile press (and electorate) it was compulsory to wear a hairshirt in the City. Thankfully, 1 Lombard St ignores such nonsense, flying the flag for fine dining.



One’s not enough, three too many. Our guide to martinis, and where to sink ’em.

Anonymous 3

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Praise the Three Wise Men It was, in terms of the global economy, the Perfect Storm. But just as forecasters had missed that, so too did economists. All except three, that is, says CHARLES R MORRIS

ILLUSTRATION by Steve Brodner;

BUFFETT AND SOROS are among history’s most successful investors, with a record of making money in good times and bad. Volcker is a regulator, one of the greatest of American civil servants, whose entire career has been defined by crises. All three saw this one coming long ago. That last fact is worth dwelling on – almost all official bodies and private forecasters got it wrong. In the fall of 2007, the IMF announced that “the increasing stability of economies and the associated increase in the durability of expansion largely reflect sources that are likely to prove persistent”, especially crediting wise monetary and financial regulation. In a Wall Street Journal poll of 51 leading forecasters in early 2008, only one called the coming downturn. The consensus, like that of most official bodies, was for American growth in the two per cent range, with some optimists predicting as high as five per cent. These greybeards, however – Volcker is 81, Buffett and Soros 78 – understood the gathering storm, and said so. Soros started warning about the ‘Superbubble’ in the late 1990s. Buffett sounded the alarm about the excesses of financial engineering a few years later. Volcker’s worries are long-standing, but he did

not publicise them while Greenspan, his successor at the Fed, was still in office. On the surface, they are very different men. Buffett and Soros have almost diametrically opposed investment styles. Buffett is the classic hyper-analytic value-seeker. He does deep research, buys relatively infrequently, and typically holds his positions for many years, mostly concentrating on American companies. Soros is the global predator, with feline sensitivity to quivers of disharmony in the economic flux. He moves in and out of positions quickly and omnivorously – commodities, currencies, stocks, bonds, wherever there is opportunity. Volcker has never been a professional investor, but deserves primary credit for slaying the American inflation monster at the end of the 1970s. Over the longer term, through four presidential administrations, he was the senior civil servant managing the unwinding of the postwar Bretton Woods currency system. His career and Soros’s are almost contrapuntal, with Volcker managing the financial crises that Soros exploited. Their commonalities transcend the differences. All three have seen the US twice reign as global hyperpower, and twice fall from grace amid overreaching

and economic mismanagement – after the Great Inflation of 1965-1980 and now after the implosion of the Great Asset Bubble of 1995-2005. Significantly, each of those crises followed a decade of near-unanimity among professionals on policy rules for managing the national economy. The ‘Keynesian consensus’ was unassailable doctrine in the run-up to the Great Inflation, much as the theories of the Chicago-school ‘New Classicals’ pumped up the Great Asset Bubble. The collapse of theory has left policy makers flying blind, with professionals divided over whether the world is poised on the brink of inflation or deflation, of recovery or continued collapse And that may be the best reason for studying Buffett, Soros, and Volcker. All three are stories of success under conditions of uncertainty. They prove that, even today, in an age ruled by abstract dogmas as rigid as those of medieval Spain, common sense, good judgment, mature experience, and humility in the face of what one does not know is still a path to great success. H ‘The Sages’, by Charles R Morris is out now (£13.99, PublicAffairs)



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After last issue’s tips for buying a winning thoroughbred, HEDGE is now inviting you to take our advice and bag a top racehorse at the annual yearling parades at Highclere Castle, near Newbury, Berkshire. Taking place from 19-22 October, the parades are the perfect place to join the elite club of racehorse owners. You’ll arrive at Highclere Castle at 10am before being transported down to Highclere Stud (on the castle estate). After a light breakfast, Harry Herbert and John Warren (racing managers to HM the Queen) explain the reasons behind why they have bought each horse, detail their pedigrees and suggest what they’ll be like on the racecourse. You’ll then have the opportunity to take a closer look, and to sign up for a share in a particular syndicate if you want to be part of the action. There’s then a champagne reception at Highclere Castle to celebrate – and lunch in the library before leaving at approx 3pm. If you’re interested in attending, please email


Stephen Grant Hammerguns (1870)

work hard, strike oil.”


The Lanesborough Hotel has recently created the Garden Room – London’s premier smokers’ haven. This may seem like a tall claim, but the new garden not only boasts an exclusive address and world class service – it’s also acquired a box of the world’s most expensive cigars, the Cohiba Behike. These celebrated cigars will be sold for £1,500 per cigar, and the hotel is the only outlet in the world selling them by the stick. Only 4,000 of the cigars have been produced, each one ceremoniously rolled by Norma Fernandez, the renowned cigar maker at the El Laguito factory in Havana. The bar manager Giuseppe Ruo – affectionately known to regulars as ‘Puff Daddy’ – also offers a huge range of preembargo cigars, and is on hand to advise guests on how to pair their tipple with the best smoke in town. Bear in mind that the new Garden Room – which has room for just 35 guests – does not take reservations. So if the sun is shining make sure you get there in time for first orders.

Estimated to go for £50k-£70k, this pair of guns was given to the Prince of Wales by Queen Victoria. They are going on sale on 10 October at Holt’s auction at Louise House, W6.

“Formula for success: rise early,


J Paul Getty




shorts Jerusalem New Town By an anonymous investment banker (with apologies to William Blake) And did those words in City-speak tell us much about what was said? And was this secret place still England now it’s owned by Global Inc? And did the governor (himself divine) Judge like Mercury upon a whim? And was Mammon raised here amidst these bright, intelligent things? Bring me my bonus of burning zeros! Bring me a nod from my manager! Bring a decent appraisal, O career unfold! Bring me a car with two steering wheels! I shall not rest from making millions, nor shall power sleep in my wallet, Until we have built a new Jerusalem where money is without limit.





It’s always healthy to look for a positive in an ocean of negatives – and even in the case of the Madoff ’mare, we’ve managed to find a positive spin. All Bernie’s assets of ill-gotten gains are now up for sale by liquidators – including his stunning 90ft Arno Leopard yacht, aptly named Bull. Marketing agent Wyles Hardy & Co has been entrusted with the high-profile assignment, but apparently has been told to keep it low-key. HEDGE has still managed to dig up some details of the floating mansion, though: the sparkling white ginpalace was built by top shipbuilders Arno in 2007, has a top speed of 42 knots, and boasts three bedrooms, all mod-cons and obligatory sun-lounger decks. In June Madoff was sentenced to 150 years. A reduction for good behaviour means he can look forward to liberty in November 2139. Given that his Ponzi scheme relied on fantastical (fictitious) returns to investors the name of the yacht seems highly appropriate. The more cynical might also point to his insistence that his wife and two sons knew nothing – despite one son taking out a loan from the company of $4.3m just before Madoff confessed. His wife, meanwhile, was said by authorities to have withdrawn $15m from company accounts shortly before the game was up. Since Madoff was arrested, Bull has been moored at the French port of Antibes – so next time you’re heading for the CÔte d’Azur, book an appointment to go on board. It’s the perfect acquisition for anyone who has always wanted to own a pirate’s ship.

Where their countries would 30 years later carve up Poland and eastern Europe in the infamous Molotov-Ribbentrop Pact, here the young Hitler and Stalin’s predecessor, Vladimir Lenin, were more concerned with not losing their queens. This astonishing painting has come to light as it has come up for auction. It purports to show the two men playing chess in the home of a prominent Jewish family in Vienna in 1909, at a time when both men were political refugees in the city. It is said to have been painted by Hitler’s art teacher Emma Lowenstramm, and is signed on the back by the two lovable old funsters. When the family of the house was forced to flee Vienna as a result of their one-time guest’s Anschluss and Kristallnacht, it gave the painting to the housekeeper. Now her great-great-grandson is selling both the painting, and the chess set that features in it. They are up for auction at Mullock’s auction house in Ludlow, Shropshire on 1 October for an estimated £40k each. Check…




When Michael D’Souza first set up his luxury home and gift label Mufti in 1997 it was the residents of Parsons Green who had the chance to sample the former marketing guru’s stylish lifestyle shop. The label offers classic yet contemporary furniture with a touch of old-school Empire. The range of leather and wooden tables and chairs, leather flooring and interior accessories and giftware pieces was an immediate hit. Now everyone can check out the range: a website has just launched, with all the latest additions to the collection, including lamp bases made from trumpets, metallic upholstered dining chairs and new shagreen lighting. As Mufti can make bespoke items for customers, this is the place to shop for the hedgie who has everything.


If you’re involved in the hedge fund Industry and work in London, you are entitled to a FREE subscription to HEDGE magazine.

When wining and dining a Russian client in the environs of W1, I like to take them somewhere impressive, yes; chic, of course; but above all, bullet-proof. Owned as it is by some expat Muscovites with very powerful friends in the highest of high places, I was amused to hear the rumour recently that even the walls of Sumosan are bullet-proof. Something that helps my Russian clients rest easy as they eat the finest sushi in London, and lets me rest easy in case my wife catches me there with someone I shouldn’t be entertaining. Did I mention the food yet? It’s sublime. Of course, there’s black cod – and at least as good as you get in that other place which gets far too much press. Sex in a broom cupboard? I ask you... Quail teriyaki is a favourite, and I hear Will Smith goes for the Sumosan tartar: a blend of fresh tuna, avocado and caviar. Other celeb noshers have included Laurence Fishburne, Gob Geldof, Aguilera, Niki Lauda and Jade Jagger. So far, though, Boris Becker is staying in the closet…

To apply, please go to

Sumosan, 26 Albemarle Street, Mayfair, W1; open Mon-Fri 12pm-2.45pm, Mon-Sat 6pm11.45pm Sun 6pm-10.30pm; 020 7495 5999;


Bonuses are back – and HEDGE has found the perfect place to celebrate. Buy six bottles of Louis Roederer Cristal 2002 champagne for £1,500 at The Metropolitan, and you’ll secure London’s most soughtafter penthouse for the evening. Start your evening with the champagne in the renowned Met Bar, before retiring to the sleek surroundings of the penthouse, boasting floor-to-ceiling wrap-around windows, large separate living room and possibly one of London’s sexiest bathtubs. £1,500 + VAT; available exclusively to HEDGE readers for reservations from 14 September-30 November; 020 7447 1047.




p18 . will self . Meets The Black swan author p44 . curTain raiser . The best of london’s design fairs p50 . The worlD’s fasTesT car? . Gallery


“ I gave the rod a sharp hard tug towards me to sink the hook deep into the mouth of whatever it was that was messing me around. And then all hell broke loose... ” Martin Deeson Shark fishing for beginners . p24


Lord of the Chance

travelled to New York to meet Nassim Taleb – author of The Black Swan – the man who not only saw it all coming, but also made big bucks from the collapse



will self the bLack SWaN

WILL SeLF / gQ © the coNDÉ NaSt PubLIcatIoNS LtD.

i Was in Midtown Manhattan, two days after Thanksgiving, 2008. The previous day had been so-called Black Friday. The term originated in Philadelphia to describe the markdown frenzy that begins the stateside Xmas wallet-fuck. Out in suburban Long Island a Wal-Mart employee had been trampled to death by a stampede of bargain-hunters. Opinions are divided as to what the ‘black’ in Black Friday refers to – some say it’s the dreadful traffic congestion caused by the punters, others that it’s the black of the stores getting into credit. This year there’d been a consensus that no matter how black Friday was it wouldn’t be able to disperse the red cloud of toxic debt billowing across America. On West 23rd Street I hailed a cab and asked the driver to take me to Grand Central Station. I’m a New Yorker on my maternal side, and usually the city doesn’t hype me up the way it does many Brits, but on this particular bright and wintry morning every little shard of thought pricked me portentously. I recalled one scene from The Polar Express, which my seven-year-old son had been watching in the hotel room the evening before: standing in the saccharine snowfall, the Tom Hanks avatar punched inspirational slogans into the kids’ train tickets. “Believe”, one read; “Lead”, the next. Could the resonance of this banality have been because I was on my way to see Nassim Taleb, the man who in my estimation and that of several serious thinkers I respect had a better handle on the turmoil gripping the world economy than any of the so-called leaders, let alone the believers in the juju of economic policy? As we sped past the Flatiron Building and humped over Broadway, the seatback cab TV clicked into action and Mayor Bloomberg urged me to belt up. Bloomberg – ha! Bloomberg who established the eponymous worldwide financial information service – funny how he didn’t see the red cloud coming. I once had dinner with him and a few other members of the London commentariat. He seemed a nice enough guy, liberal, sincere and wideeyed about the possibility of GM foods eliminating famine in the Third World; at the end of the meal he exclaimed: “You guys are the most left-wing people I’ve ever met!” At the time I supposed he couldn’t

have got out much – now I was certain of it. That late November weekend the ‘Big Three’ American car makers were locked in talks with the outgoing president, desperate for an injection of the only fuel that could stop their clunker of an industry from driving clear off the freeway: high-octane cash. Meanwhile, that repository of all Hope, the president elect, was on the verge of announcing his all-important Treasury appointments. In the event, these turned out to be not that hopeful at all – merely the gaggle of so-called “Rubinistas” that swam around Robert Rubin, Bill Clinton’s old treasury secretary. After his time in office during the 1990s boom years, Rubin fetched up as one of the Citibank grandees responsible for the bank’s disastrous policy of high-income, fixed growth trading. Even the august – and unashamedly Hopeful – New York Times described Rubin as “the essence of the Washington-New York finance axis of power”, and as a man who had presided over “a buckling financial system”. On that Saturday morning – with weeks still to go until President Obama took office – there was already a gnawing sense of tedium vitae in the American body politic; the shocked aftermath of the crash, a wreck that while some had seen it coming, only a handful had possessed the wisdom to swerve around – let alone profit from. But one of these was Nassim Taleb, and an hour later I was sitting in the comfortable – if utilitarian – study of his house in a tiny neighbourhood of suburban Westchester County, and listening to him explain how he shorted the plunging market for millions of dollars. “The weather I can’t predict mathematically,” Taleb said, “but from the satellite you can see the cloud coming. The problem with these guys is that they didn’t know how to fly the plane! I went for the jugular – we went for the max. I was interested in screwing these people – I’m not interested in money, but I wanted to teach them a lesson, and the only way you can do it is by trying to take it away from them”. a cuddlY looking man, balding, with

a greying beard and sensitive mobile features, Nassim Taleb, 49, is the Wall Street derivatives trader who ostensibly wound down his lucrative career to become an academic specialising in the

study of randomness and probability. A distinguished professor of risk engineering at the Polytechnic of New York University, he is also – and this takes some doing in this current age – a genuinely significant philosopher; and by this I mean someone who is able to change the way we view the structure of the world through the strength, originality and veracity of his ideas alone. John Gray, the English philosopher, author of Straw Dogs and former Thatcherite guru turned antiEnlightenment sceptic, is a big fan: “I think Taleb is the real thing,” he told me. “He has this sensibility, shaped by his childhood experience, which has some analogies with that of George Soros – but unlike Soros he isn’t a liberal rationalist. Taleb takes the long view: he really understands these very early sceptical thinkers. But most importantly, his work shows the disastrous consequences of what – to the layman – appear as recondite intellectual errors. Taleb rightly understands that what’s brought the global banking system to its knees isn’t simply greed or wickedness, but – and this is far more frightening – intellectual hubris” Taleb’s first publication – his doctoral thesis, in fact – was the fiendishly technical Dynamic Hedging: Managing Vanilla and Exotic Options. Interestingly, it’s still in print, and regarded as the definitive work on the subject; however, such dry productions were never going to fully express the restless – and essentially narrative – dynamism of his thinking. Taleb’s turbulent upbringing in the war-torn environment of 1970s Beirut bolstered his innate scepticism about the capacity of humans to alter their fate, but he didn’t enter the financial world for any other reason than: “To gain independence. I wanted to be a philosopher, an essayist, but I looked around me at people who worked as journalists and so forth, and they weren’t free.” ▶

“ I tell you one thing,

you tend to think that the crisis is in the middle or toward the end. I think we may be in the very beginning ” 19


▶ Taleb gained his freedom from the material pressures and organisational tedium of Wall Street during the 1987 crash; moreover, he gained it in a way that vindicated his radically original worldview: at a time when the financial markets were being governed more and more by economists who used statistical analysis to stress the predictability of rates of return on investment vehicles, Taleb took the view that “the share of the rare event in the total is... monstrous”. These rare events were the so-called “swans” ranging in tone from grey, through to black that Taleb believes influence the course of human destiny, both individually and collectively, far more than the steady wing-beats of their innocuous cousins, the eminently predictable white swans. The swan riff derives from the observation that no matter how many white swans have ever been witnessed in the world, it won’t allow you to anticipate the existence of a black one; it is, restated, the problem of induction that has troubled philosophers since Socrates dangerously debauched Athenian youths


with his intoxicating speculative thought. Taleb had the leisure and the means to write his first philosophical work Fooled by Randomness, a survey of the ways in which our minds are poorly structured to deal with the agency of luck in human affairs. He then put it out on the web. In due course it was taken up by a small publishing house, placed between hard covers, and in the ensuing five years snowballed into an international bestseller. So far, so business book; for, while quirkily different, there was still a sense that Taleb was a writer read by the sort of MBA suits who thought they were mavericks, even as they carefully knotted their ties and prepared their next PowerPoint presentation. What lifted Taleb out of the airport bookstand and drew his philosophy into the vortex of the zeitgeist was a genuine black swan: the Islamist terrorist attacks on the Twin Towers of 11 September 2001. In early 2002, Donald Rumsfeld – the then American secretary of defense – gave a departmental briefing, and referring to 9/11 uttered the immortal lines: “There are known knowns. There are things we know

that we know. There are known unknowns. That is to say, there are things that we now know we don’t know. But there are also unknown unknowns. There are things we don’t know we don’t know.” Widely derided at the time, Rumsfeld’s rhetoric – which reads like symbolist poetry – has come to be perceived as expressing a vital truth about the nature of the unforeseen, and while the administration he served was hoisted by this black swan and dropped from a great height into the shitty quagmire of Iraq, Taleb began work on his own The Black Swan, a work that fuses recondite philosophical speculation, fictional vignettes, personal musings and hard-nosed mathematics into something remarkable – a book at once profound and yet oddly accessible. Behind his message – not of doom, but deference to the awesome unpredictably of life – there lurked the author himself: impish, wry and impassioned. I had read The Black Swan in the spring of 2007, in advance of its UK publication, and had been struck then by its percipience about the instability of the global financial system. However, I can’t claim to have dwelt particularly on the footnote in which Taleb not only foresaw the credit crunch, but even covertly identified where its first bite would be taken: the rotten apples of the American government mortgage providers Fannie Mae and Freddie Mac, both of which were overripe with bad debt. Of course, had I had this much foresight, I might’ve been still more self-righteous when the crisis gathered pace and possibly, like Taleb himself, a hell of a lot richer. The sTreeTs surrounding the Taleb

household were piled high with swept-up leaves the colour of money. Taleb picked me up from the station driving a boat-like Lexus with cream upholstery. “It’s eight

“ The swan riff derives

from the fact that no matter how many white swans there are, you can’t anticipate the existence of a black one ”

will self the bLack SWaN

PhotograPhS by Mark hedley

years old!” he expostulated as he yawed this way and that through the sleepy sun-dappled Saturday streets, one hand clutching a BlackBerry against the steering wheel. “My only indulgences are books – travel. I have the house here – an apartment in Lebanon. I travel for three or four days a week – I go to Athens next week. I work perfectly well in cafes – typically on the Bohemian side of town. I stay in boutique hotels – not with business people. I walk between appointments. I have a strict rule: if I have allocated a period of time to do a job, and I do that job quicker, then the rest of the time I will do nothing – you see, that time spent doing nothing will help me to think more clearly, deeply, about the problem. Besides, doing nothing makes you more intuitive, quicker, more decisive.” Unusually for a thinker, it also matters to Taleb what someone wears; for him the standard business uniform is a disguise, purpose-designed to deceive. One of his maxims is “never trust anyone wearing a tie”, while he himself favours soft-collared shirts, jeans and blazers. As to derivatives trading, while Taleb conceded that he was still very much involved in the business: “It is just a few minutes a day – no more; that’s all I need.” By now we were sitting in his study – one of two he has in his home. The upstairs one has an old kneehole desk, old bookshelves, leather-bound volumes, and is in the bosom of family life. “Here,” he explained, “I do my reading.” By contrast, the downstairs study is functional and modern not that there was much evidence of hi-tech. I asked him where his Bloomberg machine was or whatever gizmo he used to see how the markets were doing. “I don’t need one!” he cried. “I don’t even have threads on my computer. I mean, I don’t do the actual trading they just update me on the position each morning and I tell them whether it’s conforming to the paradigm. That’s all!” Taleb’s aestheticised lifestyle reminded me of sprezzatura, the concept, elaborated by Castiglione in his The Book of the Courtier, of the effortless nonchalance that the true aristocrat should exhibit in the face of the world’s vicissitudes. Taleb’s father was a doctor, but there are Lebanese deputy prime ministers and other notables in the family tree – certainly, there’s a loftiness to his perspective you wouldn’t expect from

someone who’d spent several years in the bear pit of the Chicago stock exchange. An experience that had left Taleb, as John Gray reminded me, “With the ability to tell if a man had made or lost money simply by looking at his face.” I also knew from mutual acquaintances that Taleb had survived throat cancer a few years previously – an experience he fictionalises in Fooled by Randomness – and it seemed likely that this had tempered his core steeliness still more. I say “core”, because just one aspect of Taleb’s charm is that superficially he’s anything but nonchalant; on the contrary, he’s skittish, abstracted – almost a tiny bit hysterical. When he – very kindly – drove me back to the station a couple of hours later, he was clutching the Google Maps directions in one hand, while talking in rapid-fire bursts. We stopped at an intersection for some minutes while Taleb made a point then he looked up and saw there was no traffic light. “I cannot” he explained, “talk and drive at the same time.” Talk and drive, or talk in drive-time platitudes. For those British television viewers unfamiliar with the name Nassim Nicholas Taleb, the Newsnight programme that went out on 10 October last year must have been a little bewildering. You can see the roundtable discussion with Taleb on YouTube, although I suspect that primed by this piece you may find him rather less disconcerting than the other two guests, Linda Yueh, the rather vacuous global economics expert, and Kenneth Rogoff, a Harvard economist of precisely the “tiewearing” school that Taleb despises. I was watching the programme live and alerted my wife to Taleb: “This guy’s great,” I said. “Listen carefully to what he says he actually understands what’s happening with the financial crisis.” Yet what followed was less an exercise in easy comprehension of Taleb’s ideas, than a perfect example of how truly avant-garde he is: what he said just wasn’t capable of assimilation to the bland format of such discussions. While Rogoff and Yueh offered the kind of post hoc (after the fact) arguments that are typical of pundits, Taleb, waving his hands about – and in the process percussively bashing his bracelet against the desk – delivered a series of impassioned rants. At the time I was a little deflated, yet

“ There was a great

paradox in all this: Taleb, the man who refuses to make prophecies, had become the most prophetic voice of all ”

when I looked at the clip again I saw that in fact Taleb had both remained completely true to his stance as ‘a sceptical empiricist’, by refusing to comment on things that he couldn’t possibly know – such as whether the financial crisis would usher in an era of political extremism while offering a completely cogent explanation of what had happened, who the culprits were, and what they had done wrong. in a nuTshell, Taleb’s view was that not

only had the world’s bankers – led by those of America and the UK – neglected to guard against extreme events such as the growing amplitude of sub-prime mortgage defaults, but they had also swallowed wholesale – and promoted to business and the political class an ideology of spurious quantitative analysis that banished the realities of risk from their calculations. “Value-at-risk,” thwack! “Mean variants,” thwack! “I would stop fidelity investments from disclosing something called quantitative measures of risk portfolio,” thwack! Taleb’s specificity about some things was only matched by his willingness to say the unsayable for a talking head: “I don’t know.” And to compound it: “I wake up every morning knowing that I don’t understand what’s going on.” Naturally, such genuine humility and intellectual honesty simply couldn’t be assimilated by the pundits or the presenter, so they swerved the discussion around him. It must have been infuriating. On watching the clip again, it struck me that there was a great and distinctively modern paradox in all this: Taleb, the man who refuses to make prophecies, had become the most prophetic voice of all. After outlining the continuing presence of toxic debt in the system, explaining how the ▶


will self the bLack SWaN


▶ bankers had overreached themselves, and observing that the same people were in control of policy who had brought about this mess, he concluded: “I tell you one thing, you tend to think that the crisis is in the middle or toward the end. I think we may be in the very beginning.”


Face oF the Future: Literary essayist, epistemologist, and mathematical financier Nassim taleb, a specialist in financial derivatives, has worked for many Wall Street firms before launching himself on the academic world to get to grips with randomness and the unknown

this if you realise that the turkeys are at their strongest just before Thanksgiving.” Again and again, Taleb came up with pithy and aphoristic remarks; here’s a brief selection: “The rituals the ancients performed before their battles weren’t that serious – they were designed to reduce anxiety.” “Astrology is much less harmful than economics because it doesn’t increase confidence; nobody does anything crazy based on astrology.” “I myself am superstitious – I want to be human in the small things.” “I want to attack policy makers – they hide behind the political system in order to benefit from it.” “My product line is coming up with a systematic and unified way to deal with what we don’t know.” Before I’d gone to meet with Nassim

“ Astrology is much less

harmful than economics because it doesn’t increase confidence; nobody does anything crazy based on astrology ”

This article originally appeared in the May 2009 edition of GQ magazine. A collection of Will Self’s Independent columns entitled Psycho Too is out this November. (£15, Bloomsbury, 2009)

PhotograPhS by Mark hedley

Back in suBurBan New York, Taleb couldn’t sit still for long. He would fling himself down in his leather swivel chair for a few minutes at a time, his toe sheathed in a suede training shoe – tapping the carpet. Then he’d spring up to fetch a book from a shelf that he wanted to show me, or tap the keys of his laptop. Taleb is a polyglot, who speaks four languages and reads several more. Talking to him in English I had the sense of how confined he felt – there was a fuzziness at the edge of his statements that implied he’d have been happier if he could’ve swerved into French or Arabic. We discussed his new book – provisionally entitled Tinkering – which will take his thinking on the problem of induction towards an analysis of the problem of knowledge. Taleb was much exercised by the analogy that medicine offers to the pseudo-science of economics: “In medicine,” he said, “you’d go to jail if you had drugs that worked on a sample but didn’t replicate outside of it.” And yet he also despaired of the paradigm that conventional medicine represents: “Just think,” he exclaimed, “in order for a drug to be licensed by the FDA [the US Food and Drug Administration], it only has to outperform water!” In an hour’s talk Taleb ranged the realm of ideas like a tiger pacing a cage. On evolution, he criticised Richard Dawkins and the other neo-Darwinians for their misunderstanding of probability theory – as well as damning him for his crude reasoning in The God Delusion. Perhaps somewhat surprisingly for a sceptic, Taleb still observes the Orthodox faith he was brought up in, although I doubt the priests of that church would altogether appreciate his view of religion as a “dirty heuristic” – or practical way of coping with black swans. Again and again, he veered back to the current crisis: “Most people who use naïve evolutionary theory don’t understand that we will evolve not into the fittest, but that those who survive will embody the highest amount of hidden risk. You can understand

Taleb I’d had the idea of asking him to invest money on my behalf, but listening to his damning remarks on investment strategists and other professional advisors, I reconsidered: “The typical charlatan gives positive advice,” he said to me. “The idea of giving advice is anathema to me – I can only tell you what not to do.” His Black Swan funds are actually managed according to his own philosophical principles, the biggest percentage being invested as safely as possible, while a much smaller amount is gambled on Rumsfeld’s “unknown unknowns”. As to the current imbroglio, while Taleb eschews the idea of offering policy suggestions, he did concede to me that, “I’m getting very interested in Islam.” What specifically engages him is Islam’s prohibition on debt: “With leverage for one person to make money the other must lose. It is the paradox of Buridan’s ass – financially stated” And while there is still so much toxic debt in the system, he was forthright about the need to nationalise banks: “It’s OK for a local water company to be privatised but these are national utilities, you cannot trust a local business to run them.” While supporting his view with a good deal of scepticism about the role of the nation state itself: “The Iraq war was a classic case of misunderstanding the world we live in. If a bank collapses in Switzerland it can affect people in London far more than those in Zürich” My head was spinning – and that was before we got back into Taleb’s eight-yearold boat of a car to tack our way along the riverine freeway to Yonkers Station, from where I was taking the train upstate. I left Nassim Taleb confused – almost bamboozled but just as with his Newsnight interview, and with his books, the more I thought about what he had said the more it came into focus. Ever since the credit crunch began to mount towards a full-scale recession the policy makers have been talking about the need for a radical rethink, sadly I doubt they have the balls to pay attention to the Black Swan man, not even while the goose that laid the golden eggs is choking to death on the floor of the stock exchange. H


We’re Gonna Need A Bigger Boat… Hedge editor martin deeson was once ‘Editor-That’sLarge’ of the first lads’ mag, Loaded. In 1995 he caught his first shark… and here’s how. Photographs by Chris Floyd CliCk… CliCk… CliCk went the reel as the line was slowly drawn out of the fishing reel and up through the metal rings on the rod in front of me. It was a blazing hot morning, 30 miles off the coast of America, and although the sea looked calm, the Atlantic swell was lifting us up and dropping us again like the whole boat was bouncing on the end of a bungee cord. The sea was twinkling like a giant disco ball in the sun. It was a beautiful day and we were out to catch sharks. I was strapped into one of those revolving dentist-style chairs they have on game-fishing boats, nodding off to sleep in the sun. Back in the cockpit everyone else I had come with was lying face down on the floor either asleep or seasick, looking like a group of victims from a drug deal that had gone wrong. The two guys who ran the boat were nowhere to be seen. One was off doing something nautical, the other driving. Click... click... click went the reel again, the only discernible sound that was interrupting my dozing reverie. There was definitely something nibbling the bait. Sitting up, I looked out at the mass of water around me. Even with sunglasses the glare was so great there was nothing to be seen as the swell continued to pitch the 30ft boat up and down and from side to side like a cork in a wave machine. I was suddenly struck by the huge awesome size of the mass of water we were bobbing up and down on, and the absolutely tiny size of our boat in comparison. Click... click... click… By now it was unmistakable – this wasn’t the wind or the movement of the tide or the struggling of the live bait. Something was definitely playing with the large lure fish we had put on the hook an hour before. And now


what am I supposed to do? I’ve never been shark fishing before in my life; I grew up in London for Chrissakes. Now here I am on a boat full of hungover berks, out of sight of dry land, with a fishing rod in front of me, which was getting some sort of attention from something no doubt ferocious and pissed off under the ocean. It’s probably not a shark, I thought, as I stood up to get a better look at the reel. Then again, there was definitely something happening. With hands shaking slightly, as much from the lack of sleep as the adrenaline, I gingerly picked the short stout rod out of its hole in the side of the boat where it had been wedged. I gave the rod a sharp hard tug towards me to sink the hook deep into the mouth of whatever it was that was messing me around. And then all hell broke loose... With a power that nearly wrenched the rod out of my hands and into the sea, the reel suddenly went whizzzzzzzzzz. The rod burst into life as though it were possessed and yards of line were taken in a second. The kids’ balloon that we’d been using as a float suddenly disappeared under the water and started to race away from the boat at full speed leaving a spray of water like a receding speedboat. The line wrenched my shoulder muscles as I suddenly started to fight something very big and made of solid muscle that didn’t like having a huge barbed hook embedded deep in its mouth. Suddenly, I was Robert Shaw with a shark on the end of my line – and where the fuck were the others? Our shark-fishing Odyssey had begun

24 hours earlier when we’d pulled up at Montauk harbour looking for a boat to hire. Of all the shark-fishing spots in the world, Montauk has got to be the best. Not

game fishing a long Island shark hunt

just because the fishing is excellent, which it is, but because Montauk is like no other place in the world. Situated at the very tip of Long Island (the fork spit of land that runs along America’s East Coast parallel with New York) Montauk is a salty old sea dog community totally unlike the rest of the island. It also used to be the home of Frank Mundus, the man who invented shark fishing for sport and on whom Robert Shaw’s character Quint in Jaws was based. Though set in the fictional town of Amity, as soon as you see Montauk you can tell where the inspiration came from. Mundus himself was a character made for the movies. There are a lot of stories told about the man, but one of the best is that while serving with the Pacific Fleet in World War II on USS Indianapolis, the ship was sunk by the Japanese and the whole crew ended up in the water. As night drew in, hundreds of tiger sharks started to circle the survivors picking off those on the outside of the group and the night air was filled with their screams. When the ship went down there had been 3,000 survivors, by morning there were 800. Not surprisingly, big Frank made it his life’s mission to get revenge on the sharks, and so a whole sport was born. These days [Ed’s note: Mundus died last year] Mundus is working out of Hawaii, earning big bucks taking the corporate dollar for exec fishing trips, but his spirit lives on in Montauk. A lot of the people here seem to hate sharks. To be fair, most people aren’t too keen on the bastards, the way most people aren’t too keen on wasps and mosquitoes, but in Montauk there’s a sizeable minority who take the whole thing a lot more seriously than sport – it’s a jihad, a holy war, to kill as many of the gilled man-killers as possible. “Exterminate with extreme prejudice” could sum up the town’s attitude to their most famous wildlife. “The number One rule of this year’s Annual Charity Shark Tournament is that there will be no guns!” shouted the baseball capped pot-bellied official through his portable megaphone. “I know a lot of you guys find it a lot easier to use a hunting rifle that’s how we roll: they do things differently in Montauk, long Island, and fishing is no exception, as this poor fellow can testify

“ ‘The number one rule of

this year’s Annual Charity Shark Tournament is there will be no guns,’ the potbellied official shouted ”

when you get them up close to the boat, but any shark found with bullet holes in it will be disqualified at the weigh-in!” We had picked the right day to come to Montauk for a little shark fishing. It was Friday evening, 4th of July week (coincidentally, the same week that Jaws is set in) and this weekend there were hundreds of shark haters congregating on the town for the Montauk Boatmen & Captains’ Association Annual Charity fish massacre – sorry, Shark Tournament. There were 60 boats taking part in the two-day contest and all the skippers and first mates had assembled on the dockside to hear the rules. A more sullen and unapproachable crowd it would be hard to imagine. We had hoped that it would be possible to hitch a ride with one of the boats, but one look at this crowd of sunburned men with forearms like mahogany, mirror-shades and mean mouths made it obvious that a plan B was called for. The man with the megaphone told them we were here, and what we wanted. No one’s face even moved, apart from a couple who slowly looked us up and down and then looked back at each other, eyebrows raised, as if to say ‘I wouldn’t even use ’em as bait.’ On the wooden post to my left were scratched the words, “There once was a Captain called Mundus/His body was covered in fungus/He went out after dark/ In search of a shark/And now he’s no longer among us.” Graveyard humour at its finest. Luckily, among all the old sea dogs out for the kill there was one guy who didn’t pathologically hate city folk. His name was Jim Feraldi, he was a freelance lobbyist at the state assembly, and he described his job as “You pay, we give a shit.” Over large measures of Jack Daniels back on his boat the grey-haired and handlebar-moustached shark chaser gave us the low down on shark fishing, and told us where we could hire a boat for tomorrow. “It’ll be $800 but it’s ▶




game fishing a long Island shark hunt


good boat, and the captain knows what he’s doing. If there are any sharks in the area they’d better look out!” According to Jim, sharks are killing machines, nothing more, nothing less. They never sleep, only one half of their brain is ever turned off at any one time while the other half keeps them moving and they secrete an enzyme that can dissolve a fish hook embedded in their mouth within ten days. They can also still kill a man hours after the body signs indicate the beast is dead. At last year’s contest a shark that had been already cut in half ‘came back to life’ and nearly took someone’s arm off: “They needed a hell of a lot of micro surgery to get that guy’s hand working again.” The minute baby sharks are born they swim away from their mother before she eats them and it is not unheard of for fully grown ones to jump clean out of the water and onto the deck of a shark fishing boat. “If a shark gets on the boat I’m getting straight into the water!” says one of our party. “Oh no, you don’t want to do that,” says Jim. “Its mother might be waiting for you.” The basics of catching a shark will be well known to anyone who’s seen the movie. The most important thing is the chum, barrels of blood and fish and entrails that are used to set up a slick – a cloud of bait in the water that should bring sharks from miles away. On Jim’s boat they also put out polystyrene sheets covered in blue fish to float around as well. The whole exercise is designed to induce a feeding frenzy, when the sharks go senseless with blood lust and thrash around in the water attacking anything edible – and eventually the one piece of bait that’s got a massive barbed hook hidden in the centre. As we left Jim’s boat to go and get an early night before the 4am start he shouted at our backs as we went down the gangplank: “Be careful tomorrow! Don’t think it’s a game, because it isn’t. There’s nothing a shark has got to be scared of, except a bigger shark… and you. So watch out – they won’t come in easy.” aT firsT lighT the next morning, still unslept, we were all waiting on the dock

the eyes have It: never mind the gruesome carry handles, it’s the triple row of razor-sharp dentistry that stands out on this mako shark

“ The most important

thing is the chum: barrels of blood, fish and entrails that are used to set up a slick – a cloud of bait ”

of the bay for Captain Dennis and First Mate Jack, the men who were to lead us out to where the big fish are. As we started the three-hour drive out to the deep water everyone gradually fell asleep, exhausted from the lack of sleep and sickened by the massive swell that made walking on deck a grotesque parody of drunkenness. After a while Fisherman Jack set up the chum slick and stood the rods in the holes along the side of the purpose-built boat. As we waited and waited for something to bite everyone went back to sleep in the sun, and Jack disappeared to practise his knots or something at the other end of the boat. That’s how a couple of hours later I found myself desperately trying to keep a grip on the fishing rod as several hundred pounds of pissed-off muscle swam as fast as it could away from the boat, thrashing around to try and dislodge the massive barbed hook. “I’ve got something,” I screamed as the shark gave another massive tug, nearly wrenching the rod out of my hands and my arms straight out of their sockets. Within seconds First Mate Jack was behind shouting instructions and the others were scrambling bleary-eyed and green-faced from the floor. “Strike! Strike!” screamed Jack. “Strike! Strike!” screamed the others at me, as if repeating the instructions like a bunch of headless chickens was going to be of any help. In the panic there seemed little point in telling them that I had already ‘struck’, that it was this vicious yanking of the rod to embed the hook in the shark’s mouth that had changed its mood from tentative bait nibbling to racing away from the boat at full speed intent on escape. So I struck again and again, yanking the rod towards me as hard as I could. “Harder!” yelled Jack. “Harder!” all the other nonexperts shouted, so I did it again harder. Christ! I know people debate whether fish can feel pain or not but put it this way – if some piece of food I’d been chewing had suddenly turned into a hook that some ▶



baIt and see: though this would have been stuffed and mounted in the uk, over there this handsome beast ends up as bait for the real thing; (opposite) it’s weigh-in time back at the harbour in Montauk

▶ bastard

kept jabbing harder and harder into my mouth, I know I’d certainly be thrashing around like homicidal wildlife. By now I was having a real problem keeping a grip on the rod as it was being yanked to and from in my hands. “I can’t hold it much longer,” I screamed over my shoulder to Jack. “Get up against the side of the boat,” he shouted, “brace your legs against the side.” I took a couple of steps forward and almost fell over. In all the excitement I had forgotten that the boat was still pitching violently from side to side and barrel-rolling at the same time. What with this and the fact that the rod was jumping around in my hands like it had a life of its own I must have looked like a man on a fishing expedition in the advanced stages of epilepsy. I made it to the edge of the boat and stood with my legs pressed against the low wall that kept us in and the sea out. The wall seemed dangerously low,

my mind of my body looking like someone’s hand after they’d plunged it into a food processor ” 28

PhotograPhs by Chris Floyd

“ Images flashed through

as though one sharp tug would pitch me over the side to meet the hooked shark’s loyal mates and then disappear in a bloody, thrashing, feeding frenzy. This was making me distinctly nervous. I’ve seen Jaws. I know the score. Go over the side now and there would be red fountains like someone had opened a champagne bottle full of fizzy blood. Images flashed through my mind of my whole body looking like someone’s hand after they’d plunged it into a food processor. “Use the belt,” shouted Jack as he saw the trouble I was in. Now this seemed like a strange thing to say. Use what belt exactly? I was wearing shorts. Fan belt? Unlikely. “I haven’t got a belt!” I shouted. “What?” shouted Jack? “Get him the belt!” the man with the knowledge shouted, a disconcerting note of panic entering his salty voice. There then followed a panic-filled few minutes as I wrestled with the shark – which now seemed to have stopped running away and was swimming backwards and forwards with amazing speed in a straight line hundreds of yards away, parallel to the side of the boat. Back in the cockpit various amateurs were running around in panic trying to find the mysterious ‘belt’ that seemed to be so important to my attempt to land the creature from the deep, without me turning into human gazpacho.

Eventually it was found and Jack pressed in close behind. That is probably traditional for men who spend a long time at sea, but it seemed a bit intimate to me and certainly uncalled-for at a moment like this. As the motion of the sea kept Jack’s crotch battering into me from behind, I felt like saying, “Not now, sailor boy” but suddenly thought better of it as I felt both his huge forearms encircle my waist. “Uh-oh,” I thought. “Not in front of the others,” but then he started to buckle a huge leather belt round my front, like the ones that weight lifters use to avoid breaking their backs. At the front of it was a long metal tube that hung down between my legs like a stainless steel strap-on dildo. Things were certainly starting to get a little weird. Then everything slipped into place as Jack lifted the bottom end of the rod up, flipped over the metal dildo and shoved the end of the fishing rod into the hollow end of the strap-on. Suddenly everything was a lot easier. I now had a metal plate strapped against my crotch and the end of the rod was secured inside my strap-on. There now seemed no chance of the rod jumping out of my hands as the shark struggled like a tiger on a rope, although the movement was still threatening to pull my arms right out of their sockets. “Right, by now he should be starting to get a bit tired,” said Jack. “Too bloody right, I’m getting a bit tired,” I was about to reply. Then I realised it was the fish he was talking about. To say that my body was cruising at less than peak performance was the understatement of the decade. “I think it’s time to start winding him in,” said Jack. This was when the real fun began. When you’re attempting to bring in a struggling big-game fish that’s considerably stronger than you are there are certain rules to be followed. Unfortunately I didn’t know any of them and Jack didn’t see fit to inform me of them until half an hour after the battle was over. In fact, the rules can be distilled down to one. Don’t fight it – it’s bigger than you. Having grown up on a diet of Jaws films I was under the impression that the name of the game was man against man-eating fish in deadly mortal combat. Apparently not – as I found out later, the name of the game is, in fact, highly intelligent but comparatively lightly muscled homo sapiens against not-very-

game fishing a long Island shark hunt

intelligent but massively muscled and primitive killing machine. The whole thing is meant to be about brain against brawn. Unfortunately, I thought it was my muscle against the fish’s – which is probably why I’m still having trouble using my arms. The upshot of this theory is that when you’re trying to reel in a shark there will be times when the shark is swimming directly away from the boat and there will be times when it is swimming towards you. When the shark swims away from the boat you should do nothing other than move around so that the rod is always pointed directly towards it – and that’s about it. Obviously, there’s no point in trying to use your puny muscles to reel in this superfit swimming machine when it’s intent on swimming away from you. It’s not possible. This is what I found out. Just let it go and don’t fight – the silly sod will tire itself out soon enough and you’ll have your day. All you have to do is wait until the shark’s coming your way, reel in the slack and bingo! Evolved intelligence: one; efficient but rather stupid killing machine: nil. Unfortunately, no one had explained this to me, so I just reeled and reeled for what seemed like hours, regardless of which direction the shark was going. After 20 minutes of this my arms had turned to jelly and my back was a seized-up mass of sweaty muscle but I was slowly winning the game. By now the shark was only 20 feet from the back of the boat. I was running backwards and forwards from one side to the other to try and keep up with the bastard as it attempted to escape the inevitable pull towards death. One of the weirdest things about this situation was that I hadn’t yet seen my adversary. There I was involved in mortal combat with some huge unseen source of power that lived under the sea. I could feel its strength as the stout rod was flipped backwards and forwards like a twig, shooting down and snapping back up in response to the shark diving, but I still hadn’t seen it. By now everyone was convinced it was a shark, but you couldn’t be sure. I had visions of those cartoons where the fisherman wrestles manfully for hours with his catch only to land a rusty old bicycle or a boot. Do they have bicycles in the Atlantic? I didn’t think so, and anyway if this was a bit of scrap it felt more BMW than BMX.

Closer, closer the fish came towards the boat. By now it was only ten feet away and still there was nothing to be seen other than the fishing line disappearing straight down into the ocean swell. And then it happened: there was a flash of white underbelly a couple of feet below the surface and everyone gasped as, for half a second, we all got an eyeful of what I had been wrestling with for the last half hour. It was a shark. “Oh my gOd, it’s a shark! Look out, there’s a shark!” should have been the natural response to seeing a shark in the water only a couple of feet away. Instead, there were whoops of joy all round and an adrenaline rush like nothing else. For the first time I knew for sure that it wasn’t an old rubbish skip I was reeling in or a particularly strong mackerel. It was the real thing. Thank Christ – imagine the embarrassment if, after half an hour of forearm-trembling exertion, with sweat running down my face in rivers, it had turned out that what I was fighting against was nothing more dangerous than an especially butch haddock. But no! Vindication was mine! It was a bloody shark! and judging by the split-second glimpse of white belly and blue back it wasn’t a baby. It was huge! By now First Mate Jack had reappeared from inside the boat with a gaff. “Move it round to the side of the boat,” he ordered. So I stopped reeling in and walked the shark round as instructed. Despite the fact that it was thrashing around like crazy, it had given up attempts to shoot away from the boat like a living torpedo and at last it felt like I’d beaten the sucker. As I leant over the side of the boat I started to slowly reel in the last few feet offline to bring the exhausted fish gradually to the surface. A few more turns of the reel, a few more… and there it was. Six guys’ faces leaning over the side of the boat went slack; six jaws dropped open at the sight, three feet below in the water. There it was: the object of half an hour’s screaming and reeling and rush. It lay in the water held still by the tight wire coming out of its mouth, six feet long and God knows how many pounds of prime mako shark. It looked as exhausted as me. Up close you could see the skin that’s so coarse you can cut yourself on it, the gills opening and

closing and the little tiny eyes as black as sin. Lying there panting in the water an arm’s length below us, for a second it looked so knackered I was tempted to reach out my hand and touch its body. As if reading my mind, it suddenly burst into life and, whipping its back into a U-shape, reached to try and attack us and give us the full benefit of its killer dentistry. It snapped its mouth open as wide as it could go, and it was like looking into hell. Despite being far from fully-grown, its mouth described a perfect ‘0’ at full stretch, big enough to slam-dunk a basketball in. And then there were the teeth: two rows of three-inch-long ragged, curved gnashers, pin sharp at the tip and thick as my finger at the base. They were all angled in towards the centre of its mouth like barbed fishing hooks. One look and you just knew that if your arm got in there it would never come out – the power was there to trim it of fat up to the shoulder, sinews and everything. ▶

“ It lay in the water, six

feet long and God knows how many pounds of prime mako shark. It looked as exhausted as me… ” 29

game fishing a long Island shark hunt


lIFe aFter death: inside a dead shark, a baby shark lives on; (left) three men in a boat

▶ After a couple of seconds, Jack started to get a bit nervous, obviously remembering that despite being caught, this thing still had the power to leap into the boat and make mincemeat out of us lot, and so it was time to cut it free. With a spasm of muscle and flick of the tail the shark disappeared in a splash of water and left us standing in the deck high-fiving and slapping each others’ backs, saying all those pointless things like “Wow!” “Shit!’’ and “Jesus Christ!” that you do in these situations. My arms were trembling uncontrollably from the exertion, my head was buzzing at the sight of those killer teeth but inside I was Captain Ahab, Frank Mundus and Robert Shaw all rolled into one. Shark killer. YES! Back of the net!


“ Inside, I was Captain Ahab, Frank Mundus and Robert Shaw all rolled into one. Shark killer. YES! Back of the net… ”

Unfortunately, that one got away, but the ones on the dockside weren’t so lucky. As the biologist cut his way into the belly of yet another huge shark there were gasps from the crowd as everyone saw that there was a perfectly formed baby shark inside, about two feet long, and a perfect scale model of its mother. He prodded it with his finger, and it started to swim around in the blood and entrails of its mother’s insides. “It’s alive! It’s alive!” everyone screamed as the scientist lifted it from its mother’s open womb and gave it to one of the many children to carry down to the waterside. Everyone rushed down to look as the baby shark was dropped into the bay and swam away. Then the biologist found another, and another… it turned out this huge blue shark had two uteruses. The baby sharks kept coming until seven had been released from their mother’s corpse and put back in the water. Suddenly, the dockside Tannoy system crackled into life and the voice of the competition organiser came booming out, distorted by feedback. “Now you’re really seeing something,” he said, his voice thick with emotion. “You’ve seen death and now you’ve seen life!” This seemed to me to be about as appropriate as horrifically slaying someone’s parents and then boasting about the fact that you spared the children. Poor sharks – just when they thought it was safe to go back in the water. h

PhotograPhs by Chris Floyd

baCk aT The dockside later, it was obvious that not everyone had been as ecologically friendly as we had. I’d managed to catch a shark and still keep my conscience clean about killing it. Mako sharks are not an endangered species, but there’s not as many as there used to be, either. A few years ago, the Annual Shark Tournament would bring in 900 sharks for the weigh-in. This year each boat was limited to one shark each, and there were only 30. Still, nothing could have prepared me for the charnel house carnage that was to be the end of the day’s fishing. By the weighing machine on the dockside was spread a huge plastic sheet covered in dead sharks: blues, makos, duskys and threshers. The biggest was 12ft long and 5,561bs.

Every few minutes another boat would back up to the dockside and unload a dead shark so massive you can understand why the hardcore element carry guns. Around the dockside stood crowds of Beavis and Butthead-like shark-fishing nerds, screaming for more. It was a massacre. The floor everywhere was covered in deep crimson blood and as they hung each shark up by its tail to be weighed its intestines would fall out of its mouth like a pile of grey washing. It was bloodlust, but it was also industry. Within minutes all the sharks were being hacked open by a marine biologist so he could get a quick look inside before the men with knives moved in to turn each corpse into a pile of shark steaks. People hate sharks but there’s also good money involved. First Mate Jack appeared at my shoulder and told me about the time that he had had a 1,000lb great white on the end of his line – it would have been worth about a dollar a pound. “I could see my new TV circling the boat,” he said. “And it was a Sony!”

c o n t e m p o r a r y

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terence trout LONDON


S TO R E 0 2 0


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• W W W. T E R E N C E T RO U T. C O M





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Taking Economic Theory Into the Real World DONALD MACKENZIE, FABIAN MUNIESA & LUCIA SIU on how academics and theorists need to understand that, when it comes to economic blueprints, one size most certainly does not fit all

LA PAZ, JANUARY 1986. The young Harvard economist who arrives at the airport has visited twice before, so he knows what to expect: the thin air of Bolivia’s capital, 3.5km above sea level, which will leave him short of breath throughout his visit; the extreme poverty; the beauty of the mountains; the hyperinflation that is beginning. He goes from the airport directly to the Banco Central de Bolivia, where he discovers that the money supply had sharply increased in December. That economist is Jeffrey Sachs. He goes on to deliver his advice to Bolivia’s planning minister and then its president. The advice may seem dangerous – Sachs was to be summoned by the International Monetary Fund to explain himself – but for Sachs it was a straightforward implication of what his discipline teaches about the theory of money. If inflation is to be brought under control, the pesos that are flooding the economy must be taken out of circulation, even at the cost of spending Bolivia’s precious, limited reserves of foreign currency to buy them up. Later, Sachs was to muse on his meagre understanding of the country whose leaders he had advised. It was only a couple of years after his 1986 visit that he realised that Bolivia’s geography was a fundamental feature of its economic situation, not merely an incidental fact. “I knew that Bolivia was landlocked and mountainous… yet I had not reflected on how these conditions were key geographical factors, perhaps the overriding factors, in Bolivia’s chronic poverty… “Almost all the international commentary and academic economic writing about Bolivia neglected this very basic point. It bothered me greatly that the most basic and central features of economic reality could be overlooked by academic economists spinning theories from thousands of miles away.”

Nevertheless, said Sachs, a meagre knowledge of the context had not stopped his advice on monetary policy being successful. Bolivia’s hyperinflation did come to an end. “Monetary theory, thank goodness, still worked at 13,000ft”. Sachs’s advice to the government of Bolivia is unusual in that it marked the beginning of an exceptional degree of individual influence. Sachs and his former student David Lipton went on to draw up what became the plan of, first, Solidarity, and then the Polish government to shape the economic structure of post-communist Poland; they attempted, less successfully, to

“ The most basic features

of economic reality were overlooked by economists spinning theories from thousands of miles away ”

repeat the exercise in Yeltsin’s Russia. Sachs now advises the United Nations and world leaders on how to end poverty in Africa. In other respects, however, Sachs’s Bolivian trips were simply one manifestation of a far more general phenomenon: the move of economics from the journals, textbooks, and lecture theatres into “the real economy.” The shaping of economies by economics can be viewed as a triumph for the truths discovered by the discipline, or it can be condemned as the damaging imposition of an abstract and unrealistic worldview; such matters remain fiercely controversial. At a minimum, however, what is made clear by the cases of Bolivia, Poland, Russia, and Chile is that economics is at work within economies in a way that is at odds with the widespread conception of science as an activity whose sole purpose is to observe and study, that is to ‘know’ the world. The issue that needs to be tackled in relation to economies and economics is not just about ‘knowing’ the world, accurately or not. It is also about producing it. It is not (only) about economics being ‘right’ or ‘wrong’ but also – and perhaps more importantly – about it being ‘able’ or ‘unable’ to transform the world. Economics swings between representation and action, between science and policy, between academic inquiry and political intervention, both as a discipline and in the careers of many individual economists; Sachs is far from alone in this respect. Economics often seems abstract (to some of its proponents, as well as to its critics), yet it also articulates with, influences, is deployed in, and restructures concrete economies in all their messy materiality and complex sociality. H ‘Do economists make markets? On the Performativity of Economics’ (Donald MacKenzie, Fabian Muniesa, and Lucia Siu, Princeton University Press, £24.95)






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The Best Laid Plans… ANDREW BAKER,

chief executive of the Alternative Investment Management Association (AIMA), says the hedge fund industry welcomes regulation that enhances investor protection and increases transparency, but that the EU must beware the law of unintended consequences

OF ALL THE misconceptions about hedge fund managers – and there are many – one of the most common is that managers are unregulated, and are determined to keep it that way. Such views are popular, yet completely at odds with reality. In the UK and many other European countries, alternative investment fund managers must register with their national regulator, such as the Financial Services Authority (FSA), and disclose certain information to them. The UK Treasury, in its White Paper on Reforming Financial Markets that was released earlier this year, was right to stress that the UK hedge fund industry is already regulated, and that the UK regulatory regime “is among the most advanced in the world”. This is all the more telling when considered in light of the European Commission’s draft Alternative Investment Fund Managers (AIFM) directive, which was published in April 2009 and is now being scrutinised in Brussels. There are certainly elements of the directive that we do support, such as the provision for the universal registration and authorisation of managers. Like the Commission, we believe that an EU “passport” for marketing funds to investors across member states would provide a desirable resolution to crossborder marketing issues. And we agree that

“ The directive risks

imposing a major burden on our part of the EU’s financial services sector and limiting the choice available to EU investors, reducing their returns ”

managers passing on systemically-relevant information to their national regulators would be helpful in terms of assessing systemic risks to financial stability. In essence, we would support any regulatory system that strengthens the European alternative investment industry and ensures that the Union maintains its position as an attractive place in which to do investment business. However, despite the best intentions of the Commission, we do not believe that the draft directive will actually deliver these results. Unless the current text is amended, the directive risks not only imposing a major burden on our part of the EU’s financial services sector but also significantly limiting the choice available to EU investors and reducing the returns they make on their investments. That is important, not only for hedge fund professionals but for European pensioners and savers, who would suffer because of this. It’s the broader consequences of the directive like this that we are now seeking to highlight. In fact, we recognised very early on in our campaign that if the directive were seen solely as a hedge fund industry issue, it would be difficult to make policy makers listen to our concerns. So we have pointed out, for example, not only the effects on pensions but also on commercial real estate markets within the EU that could be significantly affected by the directive. That could spell trouble for a host of construction projects across the EU. Other provisions in the directive could negatively impact inward capital flows, hitting the economies of every member state. We are working constructively with the European Commission, the member states and the relevant committees in the European Parliament in our efforts to achieve appropriate revisions to the proposal. But we are not alone in this effort.

The list of those who have been reported as expressing concern about the current form of the directive is long, and growing all the time. It includes pension funds and industry groups, European institutional investors, global banks, international law firms, commercial real estate groups, private equity firms, ministers from Sweden and the UK, as well as Irish officials, the chairwoman of the European Parliament’s economic and monetary affairs (ECON) committee, the US Treasury, the German funds association, Jacques de Larosière, whose High Level Group on Financial Supervision in the EU produced an authoritative report on the current crisis, and even Charlie McCreevy, the European commissioner under whose aegis the directive was drafted. Now is the moment for all other players that may be affected to ensure that their voices, too, are heard in the debate. We are hopeful – but we are under no illusions that this will be anything other than a long and arduous campaign. H For further information, visit AIMA’s website,, or call 020 7822 8380.





How the West was Wrong and AKSHAY BHUTIANI at Prosperity Capital Management on why you shouldn’t believe what the western press says about investment opportunities in Russia


BACK IN 1999, an unnamed trader told the Financial Times he “would rather eat nuclear waste than invest in Russia”. It was a colourful quotation but – alas for the trader – deeply misguided. Anyone who invested in our Prosperity Quest Fund ten years ago would, as of August 2009, have seen their money grow 20-fold in dollar terms, an average annual return of almost 40 per cent. The S&P500, which presumably did enjoy our florid-tongued trader’s approval back in 1999, has since been flat – returning nothing at all. So, despite all the talk of a ‘New Cold War’, and a relentlessly negative western press, don’t let anyone tell you only fools invest in Russia. Since 2000, emerging market (EM) economies have grown five to six per cent per year, while ‘advanced’ OECD nations have managed only one to two per cent. That out-performance is set to continue. The EMs will expand four per cent in 2010, says the IMF, while the west will struggle to grow at all, with higher EM growth continuing until around 2015 and beyond. That’s not surprising. The largest EMs – the BRICs – boast low economy-wide leverage, hefty reserves and have dynamic, ambitious workforces. Western growth, meanwhile, will be weighed down for years by heavy debt-service, systemic risk and worsening demography. For some time now, the EMs’ share of global portfolio investment has steadily climbed. But the subprime fiasco – and the resulting loss of faith in western markets and institutions – will accelerate and accentuate that trend. As emerging giants come into favour, Russia will benefit disproportionately. So far in 2009, EMs account for all of the world’s top-ten performing equity markets. Russia is among them – up almost 70 per cent since the start of the year. Yet the RTS index of leading Russian shares still has an average valuation of only 7.9 times earnings – the lowest P/E of any major market. Having risen from post-Soviet



ashes, Russia is full of firms with strong fundamentals and low debts, providing non-complex goods and services for which there is demonstrable demand. The world’s eighth largest economy is also, as of last year, Europe’s most valuable retail market. While foreign direct investors have piled in, portfolio money remains coy. A combination of the post-Lehman EM selloff and continued international scepticism means Russian equity remains very cheap. There’s something else. As western governments print money, debase their currencies and rack up more debts, mainstream global investors seek ‘tangible’ assets – not least as an inflation hedge.

“ The post-Lehman EM sell-off and continued international scepticism means Russian equity remains very cheap ”

Russia will benefit from this trend too. As well as world-class hydrocarbons reserves, the country has an abundance of metals/ minerals and ‘soft commodities’ such as timber, water and agricultural land. Prosperity Capital Management (PCM) was founded in 1996. Its specialises in Russia/CIS and control investments worth $3bn, making it the largest stand-alone asset manager in the region. By focusing on second-tier stocks and tapping into ‘special situation’ restructuring and consolidation plays, its Quest fund has returned no less than 2,008 per cent since 1999, while maintaining monthly liquidity terms and with no leverage. Nuclear waste? When Quest launched, Russia was in chaos. Annual inflation was 84 per cent. The country had no reserves and had just defaulted on its Soviet-era debts. Today’s situation could hardly be more different. Russia now has the world’s third-biggest forex reserves, practically no foreign debt and single-digit inflation. Real average wages are 13-times higher than in 1999. In fact, just about the only thing that’s the same as in 1999 is the average valuation of the RTS. That’s why PCM is now launching Quest II. Not only are Russian ‘blue-chips’ back at 1999 valuations, the less liquid second-tier stocks targeted by the Quest strategy are lower still. Taking their cue from the press, many scoff at the idea of Russian investment. Yet PCM’s client base is comprised entirely of western money – and includes highlyrespected pension funds, family offices and endowments, as well as Norway’s NBIM, the world’s third biggest sovereign wealth fund. Yes, Russia is a nascent capitalist society. Yes, investing there requires stamina and skill. But while the situation is challenging, it’s not nearly as bad as the newspapers would have you believe. That’s the real investment opportunity – that yawning gap between perception and reality. H

anyth se rests ike to n gsoh ing. a Discr long o kissing arch, nee g n i d v woul e it a d e term a d t r mana te long on y relati nd telling . F a s t o g . movi nship Gadg wltm er, 40 nex ly fund ng st . w et fre l t m at arb broke t r y in ma ak, o e e l a i a a r , b r fund, n u n le bro of sa d cha ltra fa t m r broke erial thing ly interest k acter e age relati hate st access er with e r with s f d o W o r queu nship long to all LTM and d o w i n . t venu e n g ark p r s m n mart o t H ool. i me w es, Alph uge b route a asters l o r m Discr one u personali . atch, cks, woul ete lo t o n d y n ng on d , l l i e l y k anag onely rstan the da e to willin woul ly fun er, to d , nor s g k d . w t like t Wltm o do i d h p ran th be a t I do, o kee WLT t in MTF ked b st exe C p M o I r i oke cut sm t can tr i g term ust. to execut nnovative that way relati ion seeks r the b opolitan i e ide partn n ri onsh a s er . ip. with ght lights vestor, lik I n d e conti , seek e p nenta frequ s par s hou endent re tn l s ent tr ips to presence er in o e, finds it search and n goo hard US & to c d i Asia. ndep i ende deas, seek ash n broke s r to c t executio ollec n onl t. y

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Seeing the Bigger Picture

The overriding characteristic of the market, says CLEM CHAMBERS, is volatility – you just have to take a longer view. Once you do, you’ll see when to be bullish – and when to make like a bear WE HAVE SEEN historic volatility in markets for the duration of the credit crunch, and post-credit crunch we will certainly see a lot more. Volatility is a key indicator of how recovery is panning out. Volatility is interesting – it can be viewed from many different perspectives. From a mathematical point of view, you could view it as an outcome of how many driving factors hold sway. Traditionally, you can see it as a function of risk. You can see it as an outcome of uncertainty and information flow. It can be looked at as just another random number to chase in the game of trading. Volatility is all of the above, and more. Heaven forbid you look at it across different time windows, because what can look like a calm unvolatile market over a few days, can look like a hugely volatile spike of the price action over a period of weeks. Actually doing this opens up an interesting point of view that can help in understanding market sentiment. I see volatility as a function of randomness or, if you like, a signal-to-noise ratio. Although the industry rails against it, markets are highly random. Anyone who has crunched the data of liquid stocks will tell you as much. In markets, statistical randomness is overwhelming. Randomness equals noise. If we care to agree that the long-term return on a stock is roughly seven per cent a year, we can see that the signal in underlying trading is equivalent to 7/365 or, for the sake of keeping it to trading days, 7/255 (0.027%) – ie, bugger all. Yet

“ If a long-term return

is roughly seven per cent a year, the signal in underlying trading is 0.027% – ie, bugger all ”

a stock like Vodafone will have a daily trading range of, on average, 3.5%. Even the blended FTSE 100 has a daily trading range of 2.79% versus the 0.027% trend. It seems harsh to condemn 99.99% of a day’s trading to randomness but when we select a moving average on a chart we are doing just that – a moving average simply smudges out randomness in a chart revealing the trend. If you want to get clever you can use wavelets, signal-processing mathematics, themselves a moving average, and split the trend and noise out. If you do, you’re back to volatility being the amplitude of randomness in the price action of the market. What does this hypothesis tell us about the markets in recent months and what does it tell us about the markets now and going forwards? If volatility is noise, it suggests that the less volatility there is, the less randomness there is in the market. This further suggests that the market move underway is based on information. By looking at volatility over different time horizons you can see the randomness of the event in question. For example: if a company releases good news during market hours the price will spike up. The shortterm move will be very unrandom over that time window and very unvolatile. Pull back over three months and take into account other news – good and bad – and the picture looks very volatile, the collection of events ending up creating a random picture. Information does not move the market instantaneously. Markets have inertia and information flows over time. The less volatile a series of market moves, the more certain the market is of the ongoing trend. After last autumn’s crash, the market went through a sustained period of high volatility, suggesting the market had no idea of what was going to happen next. What happened was, in the New Year, a final violently bearish leg-down, with very low short-term volatility, strongly suggesting the market was once again in catastrophic trouble.

Happily, government intervention finally turned the tide. As I write, we have enjoyed two bullish repricing events – both of which had sharp rises without much intra-day volatility. This underlines that, while many have been surprised by the rally, the market has been adamant that equity prices were way too low. A simple optical check of the S&P or FTSE charts clearly shows the rally typified by lowered noise levels. While we enjoy these low levels of noise we can see that the rally is in place. However, all good things come to an end – this will be typified by an increasing level of short-term noise volatility. Rather than tight intra-day ranges, trading ranges will become wider and wilder. These will be the points for bulls to get nervous and the bears to poise ghoullike, ready to jump in short. After a continuation of this rally, a potentially long one, sometime in the next two years (three years at the very outside), we will get another crash. Tracking volatility will be key to avoiding it. H Clem Chambers is CEO of ADVFN, Europe’s leading finance and markets website (advfn. com); his financial thriller, ‘The Armageddon Trade’, is out now (No Exit Press, £6.99)





Soldiering On

Mark Cann won Charity Times Principal of the Year Award. With the British Forces Foundation in its tenth anniversary this year, Cann explains all. By ZAIN ALATAS

Besides working for the BFF you are also on the board of BlackRock that manages £220m. Can you tell us about it? The fund is called the Armed Forces Common Investment Fund. It’s a grouping together of a lot of armed forces charity money and military money, which is invested at the moment with BlackRock. Though things have been financially difficult recently, I think it is an extremely well-managed fund; the way it conducts itself, the questions it asks of itself and the calibre of the managers and the board. How did you become involved with BFF? In the same way I became involved with most things in my life: by turning it down! Having left the Army, I started my own events and PR company. The BFF had just started in a blaze of PR but they hadn’t got any of the fundamentals or their fundraising right. Jim Davidson, the BFF founder, attended an event I was running, and decided I was the answer to their problems. Though I turned them down, I later became involved with them through my PR and events company when we advised them on how to improve their PR and fundraising. Then, after about a year, I was asked to take on the role of chief executive. I thought I was a bit young at the time to be running an armed forces charity but I took it, and I don’t regret it. What has been key to your BFF success? I call myself the interpreter. At the BFF we are constantly trying to appeal to different

“ You see a lot in the

charity press about CSR, but it has increasingly become part of a larger strategic business plan ” 42


markets and communicate between them: one minute we’re trying to communicate between Joe Public and the armed forces, the next minute we’re dealing with royalty. Being able to comprehend what people are saying from different disciplines, then interpret it, has been crucial. What are the key factors in continuing to run a successful charity? I don’t think you can run it without some kind of significant degree of passion for the cause or the people you are trying to represent. It’s crucial to believe completely in what you are doing, and you have to be stubborn. You’d be surprised at how difficult it is to do things free for the military when a government department and civil servants are involved; you really have to be pretty dogged to get through. I am quite critical of charities in this country; they are all so process-obsessed and defensive. Thankfully, though, charities now are slowly becoming increasingly more like businesses, and that’s certainly how we run the British Forces Foundation. We don’t use the ‘c’ word in the office. How has the BFF developed in your time? Very well – it has certainly evolved. I think it takes five years to build up a body of work that you are proud enough of to say to people, “We did that.” After that you become much more persuasive in explaining why people should fund you. The biggest surprise was when I won the Charity Times Principal of the Year Award in 2008. We were recognised for having articulated very effectively to the public that the public should and could support their armed forces without passing judgement on the mission of the war. How have you secured funding? Over the years we have built up a good strategy of getting support from trust funds, but we are very poorly supported

by companies. That said, we are the relationship charity for BAE Systems, and British Airways is an ongoing supporter. In fact, the three-year deal with BAE Systems was the longest we have ever done. Has the elevated profile of CSR in recent years had an effect on the charity sector? In a word, yes. You see a lot in the charity press about CSR, and it looks good in a company’s annual report, but it has increasingly become part of a larger strategic business plan. As with BAE Systems, companies are asking seriously who they want to support, how they want to support them and how the money they invest can make an actual difference. How can our readers get involved? Our website is a good port of call. The best eight minutes you can spend there is by having a look at our showreel from 2008. Pictures really do speak louder than words. Or just call us up, come to one of our events and we can take it from there. H

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Please Take Your Seats

London is swinging for designers this autumn, with a slew of design fairs and exhibitions in the capital. Our design insider ANTONIA METHUEN gives her tips on the hottest new launches 44



Warm Design Warm designs exquisite contemporary furniture, hand-crafted traditionally in the UK. A renaissance in British furniture design, Warm proves that contemporary design can sit side-by-side with traditional skills, many of which have been slowly dying as we have flocked to flat-pack quick-fix answers to our interiors – thankfully, these are now being re-discovered by a new generation of exciting British furniture makers. Warm is showing with seven other members of Design-Nation at the capital’s premier design show 100% Design which runs from 24-27 September at Earls Court.

Carpenters Workshop

TENT Design Show

Carpenters Workshop Gallery once again makes its mark as one of the British innovators at this year’s Pavilion of Art and Design (formerly Design Art London). And look out for Robert Stadler’s ‘Irregular Bomb’… Berkeley Square W1, 14-18 October

‘The Bodice Light’ by Holo is just one of the exciting new products launching at TENT. This is the third year of this buzzing east London show, devised by Ian Rudge, founder of 100% Design and Jimmy MacDonald, founder of 100% East. Based at the Truman Brewery on Brick Lane, visitors can see transmissions from a live TV studio care of Max Fraser, the hottest new design graduates and the new Tent Digital section, alongside established brands such as Bisque and Ercol. Check out hot up-and-coming talents such as Zoe Murphy. The show runs from 24-27 September.

SCP Furniture

Ian Spencer Furniture Ian Spencer designs and makes furniture and related products in solid woods, taking inspiration from fractals and the chaos of nature and society. His ‘Bonifacio’ coffee table and ‘Rocapina’ chair (pictured) will be on show as part of Design-Nation at Decorex. It’s at the Royal Hospital Chelsea, and it runs from 27-30 September.

Young designer Donna Wilson is certainly one of the talents to watch at the moment – and SCP has definitely pinned its festival hopes on her mast, with the launch of new bone china, made in Stoke-on-Trent and her range of her upholstered ‘Frank, Henry and Ernest’ pouffes, hand-stuffed calico bags, first seen in Milan and pictured, right. They reveal a playful sense of the functional along with old-school Argyll knit. Donna will also be popping up at Liberty’s Britain Can Still Make It and The Dock…





Portobello Dock The Dock is a brand new concept for this year’s festival, created by überdesigner Tom Dixon – it is a must for 2009. Supported by Derwent London, from 21-27 September, the whole area to the north of Ladbroke Grove will be alive with design events including the Veuve Clicquot ‘Comet’ installation (pictured left). An extension of Tom Dixon’s ‘Comet Lamp’, which was launched in Milan, and inspired by the Veuve logo, the ‘Comet’ installations will be part of the temporary café that sits within 40,000 sq ft of exhibitors, including Thorsten Van Elten, Hidden Art, Studio Toogood, Case Furniture and London’s busiest woman Donna Wilson. After the festival, a 1,800 sq ft Tom Dixon showroom will remain.

Tom Dixon rugs It’s my party and I’ll show what I want to! As the curator of The Dock, Tom Dixon has invited the cream of UK design along, but he will of course be showing off his own new work as well. His latest collection for The Rug Company is a series of geometric and optical rugs, inspired by the TV Test Card. ‘Beam’, ‘Tube’ (pictured right), ‘Tile’ and ‘Step’ all play with the repetition of basic graphical forms that are transformed by colour spectrums. The rugs will be shown in a special tent at Dock along with 30 specially commissioned floor cushions, so you can get down with the kids…

Case Furniture The Dock plays host to Case Furniture – a range of awardwinning British contemporary furniture. Established by Paul Newman in 2006, the brand works exclusively with established and up-and-coming designers including Matthew Hilton, Robin Day, Nazanin Kamali, Pearson Lloyd, James Harrison, Marina Butler, Samuel Wilkinson and Bethan Gray. Matthew Hilton has designed two dining collections with quality materials and simple clean lines, that are comfortable and robust – the ‘Theo’ sofa system and the ‘Casefile’ (pictured) celebrate the need for a flexible modern unit.

Thorsten Van Elten Thorsten Van Elten makes and distributes the work of the ingenious and the witty. At The Dock, he will be showing a range of work including ‘Spun Stools’ (left) by Edward Robinson, in aluminium and dark grey. Thorsten will also be showing the clever ‘Kippford Hook’ by Jon Harrison and ‘Little Sunset’ by Shunsuke Kawaguchi.





Helen Yardley The work of textile designer Helen Yardley graces many private and commercial spaces around the world – her work is highly artistic and made in the UK. Yardley celebrates her new Bermondsey showroom with an exhibition entitled ‘Re: Made in Britain’ that celebrates her most recent collection of work entitled ‘Jays’.

Established & Sons Established & Sons is hard at work with events at the V&A, its Mayfair gallery where it’s launching an impressive installation of the Bouroullec-designed ‘Quilt’ and over at its showroom in Old Street, where visitors can find classic pieces such as ‘Bricks & Mortar’ by Sebastian Wrong and Richard Woods (pictured), alongside work by Ronan and Erwan Bouroullec, Matali Crasset, Front Design, Jason Bruges Studio, Maarten Baas, Jaime Hayon and BarberOsgerby. The London Design Festival will see a creative installation of works from 2005 to the latest 2009 collection, launched during Milan.

Hidden Art Hidden Art was established in 1989 to encourage UK designer makers – ‘Transforming Passion Into Products’ celebrates the success of the organisation, and their now stellar designers including Ella Doran, Mark Gabbertas, Kay + Stemmer, Michelle Mason and Rock Galpin. Susan Bradley (her work is pictured below) is one of the latest members. The show runs at Oxo Gallery from 16-20 September.



Shelter Award-winning designer Ella Doran is just one of the impressive list of names who has created works for Shelter. With each piece based on a pack of cards, grab your chance to buy work from the likes of Marc Quinn and The Chapman Brothers at Haunch of Venison and online at the Shelter website.

emerge The graphic arts are certainly on the radar during this year’s festival, with shows at the V&A and the London Transport Museum. Rich Mix, on the border of the City and Shoreditch, will play host to an exhibition of new graphic artists called Emerge from 1927 September 2009. The exhibition, in association with Pentagram, will present an eclectic and innovative display of graphic design by 22 graduates including posters and packaging through to vibrant and exciting conceptual pieces. Check out some interesting ideas, including ‘Murphy’s Law’ by Daniel Camacho (pictured) from London College of Communication.

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Racing Certainties We love metal – heavy, light, tungsten… You name it, we want it. And don’t get us started on carbon fibre. Here, HEDGE picks out some high-octane thrillers guaranteed to get the motor running for red-blooded boys and girls




BLOODHOUND SSC £12M It’s not petrosexual lust, the desire for glory or the need for speed that spurs the Bloodhound Project team on to achieve new heights. (The latest challenge is a new land speed record; the weapon is the pictured Bloodhound SSC – supersonic car, natch.) No, their motivations are far loftier. Project director Richard Noble and driver Andy Green have said they hope to inspire a love of maths, science and technology in future generations. They might have more luck with 14-year-old schoolboys if they persuaded Megan Fox to drape herself across the bonnet in spray-on leather, but far be it from us to cavil… Now for the science bit. The power and thrust comes from a trio of tricks – a Eurojet Typhoon jet, a rocket and a V12 race engine. This sends the Biro-shaped beauty from 300-1,000mph in 40 seconds. That’s certainly more thrust than the ladies at Spearmint Rhino – though a little more outlay, at £12m for your own SSC built to order.




AERO BANG MORGAN £12,950 Strange things happen when you put two craftsmen with a passion for their work together. When Hublotwearing Charles Morgan (grandson of the classic marque’s founder) met the watchmaker’s CEO Jean-Claude Biver, the two men found they shared a love of perfection. And in Morgan’s centennial year, they came up with the idea of creating two interlinked products celebrating beauty in engineering and design. For Hublot, this took shape in the stylish Aero Bang Morgan, named after the carmaker’s flagship model. Like its inspiration, the ‘Bang’ is a fusion of materials – here, tungsten and ceramic. With a discreet Morgan logo at nine o’clock on the dial, the watch’s elegant design features, including the selfwinding skeleton chronograph, cannot fail to get your motor running. Stockist: Marcus, 170 New Bond Street, W1; 020 7290 6500;




AERO SUPERSPORTS £124,200 It’s been worth waiting a century. The Morgan Aero SuperSports makes more than a nod to Morgan’s classic roadster heritage. You can imagine Isadora Duncan taking the corniches of the Côte d’Azur in one of these beauties. (Without silk scarf this time; she should have learnt her lesson.) A roadster in an aerodynamic jet’s clothing, speed-freaks will love the SuperSports’ lightweight super-formed aluminium panels and BMW V8 engine. Unveiled in the 2008/2009 limited-edition AeroMax coupé, this technology was so well received that it was an obvious choice for the SuperSports design. The detachable roof panels transform the car into an all-weather road weapon, while still minimising wind disturbance. So the Bonnie to your Clyde need not fear the windswept look as you tear up the countryside.




KTM X-Bow Lightweight £79,305 If you’re planning a midlife crisis, there are certain wayward activities you simply can’t leave out: namely, snaring an impossibly high-maintenance mistress; getting an ill-advised tattoo; and buying a superbike. The problem with the latter is that at some point you’ll end up dead or in a wheelchair. Two wheels bad, four wheels good and all that. Not any more, though – Austrian bike supremos KTM have launched a superbike on four wheels – the X-Bow. The X-Bow Lightweight, with its off-the-wall looks, carbon-fibre construction and Tarmacmelting 0-62mph time of 3.9 seconds, is the model to have. Park it in a dark corner and your wife might not even notice it…




VERTU ASCENT TI CARBON FIBRE COLLECTION £6,000-£10,400 Not satisfied with giving us the first diamond-encrusted platinum phone, and a phone that comes with a 24hour personal concierge service, Vertu has raised the bar with the Ascent Ti Carbon Fibre Collection. Famed for its use in the aerospace, marine and motorsport industries, carbon fibre has been transformed by Vertu from durable high strength-to-weight material to elite protective casing, creating a twill weave pattern profile that only the crème de la crème will truly appreciate. Those with an eye for detail will notice how the carbon fibres gently embrace the phone’s subtle curves – a miracle of engineering that a precious metal connoisseur will adore.



Enjoy a round on the course… followed by a round at the bar. The Peak Golf and the Club Room at the Jumeirah Carlton Tower. Rest and relaxation in the heart of Knightsbridge.

Special offer for Hedge readers. A free 30 minute session on the simulator at the Peak Golf followed by a drink in the Club Room for the first ten people to contact The Peak on, quoting ‘Hedge magazine’. Why not become a Peak Golf member? You’ll receive a free golf practice session each day and a lesson once a month with the Swing Factory professionals. The Peak Health Club & Spa, Jumeirah Carlton Tower, On Cadogan Place, London SW1X 9PY Tel. 020 7858 7300

p58 . garden leave . Francis Ford Coppola’s Ba hideaway p60 . tale oF two Cities . the dichotomous nature of istanbul p64 . wishing on a spa . eastern delight in india’s gokarna p71 . thirst Class . the capital’s finest martini bars


“ Hedge fund managers looking to relocate to the Caribbean are doing so for the lifestyle. London is, and will remain, the epicentre of the hedge fund industry ” Bernadette Costello Investing in the Caribbean . p76


Francis Ford’s Pergola… In one of the hipper, more bohemian barrios of Buenos Aires, you’ll find the great director Coppola’s hidden oasis – yours for a monkey per night. christian smith whoops it up Some townS you visit it’s fun to be a tourist, some you go to join a crowd, and some – arguably the best – you want just to hang and make like a local. Buenos Aires – or BA, on closer acquaintance – is one of these. It’s not that you necessarily really want to live there (although it’s tempting) but just to feel like you do, for a while. And the locale of choice is surely Palermo, a happening hood that instantly feels familiar, like the East Village, or West Hollywood, or Notting Hill for that matter.


Here there are nice hotels: hip, boutique, like the lovely Malabia House, or the superfriendly (and super-reasonable) Home. But actually, if you want to do this right, if you really want to feel like you belong, the smart way to go is to get an apartment or a house. And then it gets really simple, because no house in town is cooler than Francis Ford Coppola’s Jardin Escondido – the aptly named ‘hidden garden’. Coppola bought the house in 2007 to live in while he made Tetro, his latest movie,

a family drama that recently opened on limited release in the US and Spain and was largely hailed as a return to form. “When I’m in a place for so long, I like to make myself comfortable,” says Coppola, who stayed here for 18 months. “The whole time I was making the film, I was turning the house into something wonderful,” he says. He still stays there when in town, but earlier this year, savvy businessman that he is, started renting it out, as he does with his homes in Belize and Guatemala.

hedge hubs buenos aires

You can take either one of two halves, or both, for a minimum of three days. It goes without saying that it’s stylish. When the door slams shut, you cross over into another world. Coppola likes to call it a sanctuary. Sitting on the balcony on a deliciously cool morning, looking down on the hidden garden itself, with its dark plunge pool and lush plants, that’s exactly what it feels like. Birds flit about and there is a long kazoo sound that must be cicadas. Built in the 1920s, it was refurbished in 2005 by local architects. Now it has an international flavour: bulls’ blood walls and Moroccan lamps give it a riyadh feel, while the heavy teak furniture and lush plantings add an Asian touch. Breakfast is bussed in, made by the pastry chef at La Bourgogne, the celebrated restaurant at the Alvear Palace: superb, and so plentiful, it takes ten minutes to set out, never mind eat. Upstairs on the roof is a herb garden, and a table for eight under a bamboo-roofed pergola where they had the wrap party for Tetro. And that’s what really sets this place apart; that it’s Coppola’s. Yes, it’s deeply uncool to be starstruck, but Coppola is pretty special. Staying at Jardin Escondido feels like the big man himself has chucked you the keys across some Hollywood lot and told you to stay as long as you like – which is pretty much what Willem Dafoe did just before we checked in, for example. Francis and Eleanor take the rooms downstairs when they’re in town. They’re one of a number, admittedly, but this is very much a Coppola home, decorated throughout by Eleanor. “You might say these places are records of my life,” says Coppola. No kidding. Pick up an Annie Liebowitz photography book off the coffee table, and she’s written inside: “For Francis and Eleanor, 2008, Buenos Aires”. Which gets you thinking, these are their books on the shelves: the

“ And that’s what really sets this place apart; that it’s Coppola’s. Yes, it’s deeply uncool to be starstruck, but Coppola is pretty special ”

Rabelais, John Updike, Victor Hugo Bugge, Gabriel Figuerora, and Michael Crichton, too, well thumbed, plus lots of back issues of All Story, Coppola’s magazine, scattered around. Maybe these are their DVDs too: local classics like Vientos de Agua, Cenizas del Paraíso, El Viento (background for Tetro, perhaps) – plus a couple of box sets of The Sopranos (a nice touch). There are pictures of Coppolas here and there too: Francis in the pool or eating with children, a shot of the family en masse on the stairs. Being shown around by Luciana, the wonderfully charming and capable manager, who also worked on Tetro, we opened a storage cupboard, and inside were some of Sofia’s kids’ things. All a bit Through the Keyhole. The art is theirs too: a couple of paintings by Thaís Zumblick, one in the living area, one in Francis’s room, and an abstract work by Marta Parga over the sofa. And the textiles throughout are just fantastic. The Coppolas have always been keen collectors, and living here clearly gave them opportunity to snap up some fine examples, notably the one in the lobby, woven a century ago with Art Noveau motifs, copied by locals from magazines brought by the Brits who came to build the railroads. It came from Arte Etnico nearby, a gallery run by Ricardo Paz, an Argentine collector whose own stunning house was featured in World of Interiors. We dropped in after Luciana called ahead, and were treated like royalty (any friend of Francis’s...). Indeed, it is easy to follow in Francis’s footsteps across BA. We went for lunch to El Preferido de Palermo, an old local cafe we found in one of the books from the house, where we had great Fabada. Coppola had been there before us, and there was a cutting from the paper stuck up on the wall, of him with the owner, both smiling. Other Coppola recommendations include Don Carlos in La Boca, and celebrated cow palace La Brigada in San Telmo. As for wine, just check out the list in the house, a stellar array assembled by the very engaging sommelier Nigel Tollerman, a British expat who says he has the only temperature-controlled cellar in BA, and is a mine of information on wine, what to buy and where to visit. “You can’t go wrong with any Argentinean wine,” says Coppola, calling it the “great secret of the world”. Then there’s a trail of locations from

for proper kips now: (clockwise, from top) the lush grounds of Jardin escondido; the swimming pool is the crowning glory of the ‘hidden garden’; your chance to sleep in the same bed as a Hollywood hero; a window on Coppola’s world

Tetro: Café Tortoni, Confitería Ideal, Bar Nanin, Palacio Sans Souci, Rancho Grande, Cinco Esquinas, Cementerio de Chacarita, Plazoleta en Lamadrid y Garibaldi... And so it goes on. But enough, already. What you don’t need is a great list. What you do need is to go, if you haven’t already, and discover it for yourself. Say Francis sent you. h Prices start from £496 per night based on two rooms plus the studio (a maximum of five guests) including breakfast and concierge service. Book with Exsus; 020 7292 5050;



A Tale of Two Continents Pampered at the superb Topaz restaurant, cosseted by the Ritz-Carlton and caressed by the spirit of the city, chris sullivan fell in love with the beguiling enchantress that is Istanbul

Being pummelled on a slippery marble slab by a 45-year-old man with a bald head, handlebar moustache, biceps as big as rugby balls and a belly the size of Mars certainly felt as if I was in a Bond film. And to be sure, I might well have been – as the site of said exploit was Galatasaray, the oldest hammam (Turkish baths) in Istanbul, which was indeed the location for that ever-so-famous scene with Sean Connery


“ The Ritz-Carlton’s

Presidential suite, the size of a London primary school, bragged a Jacuzzi on its balcony overlooking the Bosphorus and a bed the size of Wales… ”

in From Russia with Love. Built in 1481 by Sultan Bayezid II, from outside, said hamman looks more like a working men’s club in Crewe than a national institution. But inside, what a joy. A magnificent domed hall tiled with ornate mosaic tiles and filled with steam owes nothing to Crewe and everything to exotic Arabia, belying Istanbul’s technical claim of having its big toe within Europe.


It’s that dichotomy that defines Istanbul – although indubitably Islamic, it fields enough alcohol-fuelled, free-minded, let’s-get-down-and-let-rip shenanigans as any European city worth its onions. The attraction is immediate and compelling. So much so that, after a few days taking in its charms, there was only one mystery. Why had I never been before? My first inkling of the city’s worth was my hotel – the Ritz-Carlton – whose Presidential suite, the size of a London primary school, bragged a Jacuzzi on its spacious balcony that overlooked the Bosphorus, a dining room that sat 12, a bed the size of Wales and a bath big enough to play water polo in, while its concierge service was like having an old pal in the hood to show you around. No wonder they won Best Overseas Business Hotel in Condé Nast Traveller Awards last month. Next up was dinner at the incredibly stylish Topaz, in Gümüssuyu, designed by one of Turkey’s top designers, Koray Ozgen. Overlooking both the Bosphorus and Dolmabahçe Palace, it offers superb Mediterranean and Ottoman cuisine. I went for crayfish carpaccio to start, grilled neck of lamb and crushed wheat risotto with porcini mushrooms for main, followed by poached apple and homemade mastic ice cream – all washed down with a chianti as good as any to be found on its Mediterranean cousin’s shores. Replete and content, I walked back to the hotel with a smile as wide as Morecambe Bay. The next morning I woke, pulled open my curtains and saw Istanbul for the first time by daylight. A vast, frenetic metropolis, it is the fifth largest city in the world and home to 12.5 million people. Many consider it to be the Rome of the Islamic world – presumably thanks to its myriad stunning architectural wonders, rather than the permanent river of loudly hooting cars that pour through its highways and byways. Though there is plenty of that, too. The Blue Mosque (main picture, opposite), built between 1609 and 1616 during the rule of Sultan Ahmed almost a century before Wren’s St Paul’s was completed, is beautiful and magnificent in equal measure; the Topkapi Palace, home to the rulers of the Ottoman Empire from the 15th to the 19th centuries, is a breathtaking collection of smaller palaces in the Byzantine

BRIGHT LIGHT CITY: a must-do experience is dinner at the superb Topaz overlooking the Bosphorus, specialising in top-quality Mediterranean cuisine alongside traditional Turkish and Ottoman dishes

tradition; while the Hagia Sophia, the world’s fourth largest basilica (following St Peter’s in Rome, Duomo in Milan, and St. Paul’s in London), formerly a mosque, was the largest cathedral in the world for nearly a thousand years until Seville’s was built. And the Grand Bazaar is surely the world’s oldest, most beautiful shopping arcade: a vaulted and domed masterpiece where antique jewellery and Ottoman artefacts jostle for space alongside spices, fruit and vegetables. The 17th-century district of Beyoglu in the newer European district of the city, is home to the tram line. Wander round the area behind Çiçek Pasaji (Flower Passage);

“ Many consider it the

Rome of the Islamic world – thanks to its myriad architectural wonders, rather than the permanent river of hooting cars ”

you’ll find the most incredible mezze restaurants on Nevizade Sokak. If you’re looking for glamour, pop in for a cocktail at Ulus 29, haunt of Turkey’s models, moguls and media stars. And hyper-trendy 360 Istanbul is the apex of cool Istanbul – as the name suggests, it rewards customers with astounding panoramic views of the city. Formerly Constantinople, Istanbul was the epicentre of the Roman Empire’s eastern bridgehead, and to this day occupies that somewhat anomalous position. With a toe in Europe and the rest of its body in Asia, the city straddles two worlds, and west and east rush together in the magnificent melee that is this metropolis. Sipping cocktails at sunset surrounded by models while outside the muezzin call the faithful to prayer from atop their minarets is a cross-cultural experience few cities can imitate. h Turkish Airlines; 020 7766 9300;; Ritz-Carlton; rooms from €250; +90 212 334 444; Topaz, Ömer Avni Mahallesi Inönü Cad. 50, Gümüssuyu; +90 212 249 10 01;


Hedge Hideaways temple guiting manor


Manors Maketh the Man… …so think what a Sophie Conran-catered stay at Temple Guiting Manor could do for you. antonia metHuen finds the perfect mental detox away from the City at a Cotswolds haven

They don’T rush things at Temple Guiting Manor. They’ve been around long enough to have confidence in their Grade I-listed house and estate – to be able to sit back and enjoy what they have. And that’s exactly what you should be doing. Sophie Conran – of the famous

“ Thoroughly luxurious

and contemporary… Floor-to-ceiling windows make the barn an airy oasis, and the five suites are individually, sumptuously designed ”

Conran design and restaurant dynasty – has brought something new and exciting to the manor and estate, first mentioned in the Domesday Book and in the heart of the Cotswolds. (Chocolate-box village Stowon-the-Wold is a hop and a skip away.) In the grounds of the Manor House, Sophie Conran has taken the barn and made it a space in complete sympathy with the estate’s heritage – old wooden beams traverse the building’s ceilings – yet thoroughly luxurious and contemporary. Floor-to-ceiling windows make the barn an airy oasis, and the five suites are individually, sumptuously designed by Sophie herself. As well as being able to book the barn for a perfect weekend party, though, Temple Guiting puts together some of the best themed weekend packages you’re likely to come across.

These range from foraging for mushrooms with Mark Hix (of his eponymous Oyster & Chop House, Farringdon, fame) to learning nose-to-tail butchery with Fergus Henderson (of the neighbouring St John restaurant). For something that will make a welcome change from heading for the near-freezing expanses of Caledonia to bag some birds this autumn, Temple Guiting has put together the shooting party package par excellence. An eight-gun, 120-bird shoot laid on at the historic Sudeley Estate (with lunch at Sudeley Castle) sets the weekend up, while the following day – back in the warmth and cosiness of the barn – come cookery lessons with Michelin-starred chef Eric Chavot, and the mother of all dinner parties. Now that’s shooting for the hip… H; 0207 706 1309



Heaven on Earth at Om Beach After a round of business meetings in Bangalore, martin deeson was persuaded to take ten days out to relax at SwaSwara – a centre for yoga and relaxation, and the odd cold beer SometimeS, juSt very occasionally, my wife is right. Unaccustomed as I am to these strange incidences when the natural order of things is temporarily inverted, when it happens it can take a few minutes to realise what is going on. The SwaSwara resort in Gokarna was a case in point. After a few days of meetings in Bangalore – a cacophonous call centre of a city where growth is outstripping decay in a very un-Indian fashion – a rest was required, a breather from the chapati oven heat of the plains. First we headed to Mysore, an absolute gem of a city, off the normal pancakesand-dreadlocks trail of the Israeli Wave, Mysore is also off the radar for most luxury travellers. Undeservedly so – if its old-school luxury you want, stay at the Lalitha Mahal Palace, originally built by the Maharaja of Mysore to host the Viceroy of India, and now a hotel. If it’s modern luxury and some stupendous spa action that floats your lotus leaf, head for the Hotel Windflower where the massages and treatments are among the best in India. We instead opted for the Green Hotel. This again was one of Lady Deeson’s more inspired choices: a hotel so simple that it was possible to forget anyone had even invented the telephone, let alone the BlackBerry. Supported by Britain’s Charities Advisory Trust and staffed largely by young adults who have come from the most unpromising starts (and in India a start can be about as unpromising as one can imagine), this was a hideaway of the highest order (with the bonus that all profits go to charitable projects). There was an outdoor restaurant that served food so good it was where le tout Mysore came for their birthday blowouts, a coffee and cake shop where the charming Green Hotel children made baked heaven, – and that was about it. Built in what used to be the accommodation for the film stars and crew during Mysore’s time as a centre of the Hindi film industry from the


1940s to 1960s, and before that the home of Mysore’s princesses, it was the perfect no-frills wind-down centre from which to explore Mysore’s leafy streets, sandalwood markets and the sheer joy of the Mysore Palace – go on Sunday evening when the

“ We went to our room in SwaSwara, and my heart began to melt: we were due to stay three days. We ended up staying ten ”

whole building is lit up like the Blackpool illuminations (with 96,000 lightbulbs) and the atmosphere is like a giant village fête. You can also go for an elephant ride in the Palace grounds. But that would be cruel. (It was 100 rupees, a little over a quid, and so good we went round twice. Tusk… tusk…) After Mysore we headed for Gokarna – one of the holiest small towns in India (although in a country built on the oldest (dis)organised religion in the world, Hinduism, and with many more recent arrivals – from Buddhism to Jainism, Islam and a dozen others – this is a title that many other places would dispute). Here, Lady Deeson had ordained that we stay in

hedge hideaway southern india

yogi flair: (clockwise, from opposite page) few things beat the deep relaxation of performing a few yoga asanas on om Beach; the 24 villas at gokarna all have private courtyards and complete privacy; internet access is available for those who can’t afford to let go; ayurvedic cuisine as served in the resort’s fabulous restaurant

SwaSwara, one of the resorts run by the CGH Earth group which run a series of properties – all with an environmental bent – scattered over the Southern Indian states of Kerala and Karnataka First impressions were worrying. After three days of dusty travelling (taxis, trains and auto rickshaws) we arrived hot and in need of a cold one. Well, I did. And they didn’t serve any. Or spirits. “No G’n’T?” I recoiled like I had been bitten by a snake. “No, but there are meditation classes starting at eight each morning if you wish instead – and we do sell wine.” Praise God for small mercies indeed. And then they took us to the room,

and my heart began to melt (along with my foul mood); the bedroom was an airconditioned glass cube, with sliding glass walls and floaty white drapes in its own red, stone-walled courtyard. The shower and bathroom was an outdoor wet room, we

“ Next go to the Ayurveda

clinic where the world’s mellowest medical system is likely to prescribe a twohour, four-hand massage ”

had an upstairs terrace, again completely private, and a small lawn in our mini walled compound. We were due to stay three days. We ended up staying ten. Within an hour I had discovered that there was a simple beach bar five minutes walk away on the almost deserted Om Beach (so named because it is precisely the shape of the ancient Om symbol – you’d know it if you saw it from hippies’ tattoos) and here it was possible to acquire the other bits and pieces I require for a perfect beach day of relaxation – cold beer, snacks and a great view of the sunset. Within an hour I was admitting that my wife might, once again, have been proven right, and after a small amuse bouche of humble pie we sat down to eat in SwaSwara’s restaurant – and found the food to be delicious, super-healthy and Ayurvedic. Talking of which, SwaSwara includes a full Ayurveda clinic – where the world’s mellowest medical system is likely to prescribe a two-hour, four-hand massage, followed by a herbal steam, for those ailments of stress from which we all suffer. The yoga, too, was a revelation – and while I usually give it a bash when in India with the memsahib, this time I threw myself into it with morning and afternoon sessions, built round a punishing daily schedule of swimming, reading and waiting for the next cold one or massage. Of course, all my good intentions of keeping it up on return to London never materialised – it just doesn’t seem quite the same doing downward-facing dog with a bunch of yummy mummies in Notting Hill, when you’ve been starting the day with a oneon-one yoga session facing sunrise over the Indian Ocean. Oh well… such are the crosses we are fated to bear… We returned from SwaSwara more relaxed than after a dozen regular beach holidays, healthier from the food and therapies, and still smiling at the memory months later. If you want to relax – and I mean really relax – forgo the unsubtle luxury and international cuisine of the usual hotels and head to SwaSwara – your soul will thank you for it as much your wife. Om…. Om…. Omigod! That feels good. H The Green Hotel Mysore, +91 821 251 2536;; SwaSwara, +91 484 301 1711;; see the full range of destinations at



table for two, sir?

The Seychelles are made up of 115 islands, famed for their white, sandy beaches, opal waters and year-round sunshine. Now, thanks to Frégate Island, you can have one (almost) to yourself

If peace and tranquillity are what you’re craving, Frégate Island in the Seychelles should be first on your list. By combining luxury with ethical living, the island is a true paradise. Privacy is guaranteed as only 40 guests are allowed at a time, and there are no day visitors. So if you wish, you could spend a whole day wandering one of the seven gorgeous private beaches without encountering another soul. In fact, the only


human contact you’ll want is with your private butler, who can arrange anything from a champagne breakfast on the beach to a meeting with the island’s apothecary. Frégate Island’s admirable record of environmental preservation is second to none, proved by the fact they were voted ‘world saver’ finalists at the 2008 Condé Nast Traveler Awards. In accordance with the preservation of the island’s ecology,

the two restaurants and two bars serve seasonal produce from the plantation and hydroponics house with the emphasis on simplicity and freshness. Bespoke meals, however, can be arranged anywhere on the island, with high tea on the Glacis Serf lookout being one of the most picturesque. Leisurely activities include a tour with the island’s chef, wine tasting in Frégate’s extensive wine cellar, and a visit to the

Promotion fregate Island

runway to romance: with a maximum of 40 guests on the island at any one time, finding an isolated beach for a candle-lit dinner shouldn’t pose too much of a problem for your butler

Rock Spa – where bespoke products are created from over 160 natural ingredients grown on the island, so you can be pampered as only nature intended. Sounding all a little too relaxed for your liking? Then there are plenty of activity options available for you too. Frégate’s marina overlooks a turquoise lagoon and offers kayaks, sailing boats and yachts for excursions into the crystal clear

waters of the Indian Ocean. Windsurfing, snorkelling and PADI-certified scuba diving are also available. To get even more in touch with the nature of the island, there are ten guided walks available through the jungle where the only other residents you’re likely to encounters are the likes of the Seychelles magpie robin and the Aldabra giant tortoise. If this all sounds appealing (and how

on earth could it not?), then there are 16 villas on the island with their own terrace, Jacuzzi and infinity pool, and the owner’s private villa on a secluded plateau is also currently available for hire. Children are more than welcome (under fives are free), and there’s a Castaway Clubhouse complete with babysitting service to keep them entertained as you relax. H;



SPACE Stress Noise

No. of cares in the world

Population Density Indigenous wildlife

Average monthly minutes of elevator music

family dinners enjoyed in last month

Average CO2 footprint Acid rain

Normal, awesome rain Zebra Crossings

Awkward subway moments

Amount of hours spent with family

Time spent in the office Minutes humming that CATCHY Toto song Sleep No. of daily “it’s awesome to be alive” moments

No. of mimes and other irritating street performers

Length of daily commute

Minutes pretending you’re Carrie in “Sex and the city: The movie”

Minutes pretending you’re Robert Redford in “Out of Africa”





restaurants one lombard street


And That Is Why It’s Number One… One Lombard Street displays the sort of approach to fine dining that was once commonplace. Martin deeson sees in its packed dining room the green shoots – and leaves – of recovery

EvEry so oftEn in this highly enjoyable lark of reviewing restaurants one comes across a place where the food is without equal – and yet, one cannot help but feel that the feeding would have been better conducted on a different night. The first time I took Lady Deeson to One Lombard Street, we walked through the brasserie and bar – with decor inspired by Titian’s Rape of Europa – and found the former banking hall with its Grade II-listed neoclassical interior and domed skylights by Pietro Agostini a throbbing hub of postwork excitement and palpable bonhomie. Imagine, then, our surprise on entering the fine dining restaurant and finding that there was only one other table taken. If you look in the picture above you can see where we sat (far right-hand corner, under the window) and you can see where the

only other table was taken (by two ladies in flat shoes at the next table). This was a few months ago when the sound of belttightening could still be heard like a ratchet round Lombard Street, so perhaps it was considered unseemly to enjoy anything so pre-recession as a fine-dining menu. So, in the interests of fairness, we returned a month later and the food was, as before, exemplary, and the place was rammed midweek – which just goes to show that for those of you in the financial word, the bad days may indeed be coming to an end. A salad of Cornish crab with caramelised lobster tail and a Bloody Mary sorbet was exquisite, the brown crab meat a fantastic counterpoint to the surprising brilliance of the breakfast drink sorbet. Foie gras with a bitter chocolate vinaigrette had similar Blumenthal undertones, and a finish that

was French haute cuisine at its finest. Slowcooked, caramelised suckling pig (for two) as a main was melt-in-the-mouth, and the wines selected by new sommelier Karen Ribier were daring, reaching a crescendo with a tasting selection of three dessert wines. She alone makes the place worth a visit. The food is a first-class bonus. H 1 Lombard Street, EC3; £65pp; 020 7493 1688;

“ The place was rammed mid-week – which just goes to show that the bad days may indeed be coming to an end ”


cockTaiL Bars PrE-dinnEr MArTiniS


The Lobby Bar

The Best, Bar None A client suggests a predinner martini. Impress them with your local knowledge after a peek at our handy bluffers’ guide… Compiled by Lou cooper

Our televisiOn screens are saturated with the presence of the latest sweary, eco-organic, faddy foodies. But there can’t be food without drink. So what of the poor barman? A good one can singlehandedly transport us to tropical climbs with the mere scent of a signature martini, yet they remain strangely elusive. The sole purpose of the mixologist is to hypnotise one’s palate, entrancing the languid masses to surrender to indulgent relaxation. Therefore, it does seem appropriate that their niche skills are secreted away in dimly lit caverns of calm, rather than prostituted on prime-time TV. Here HEDGE visits the capital’s finest cocktail conquistadors for a paradise of pampering... H

With its soaring ceilings, double-height windows and specially designed Chinese-style high-backed chairs, The Lobby Bar at One Aldwych has the grand, aristocratic air of an F Scott Fitzgerald novel. Striking sculptures – Boatman with Oars by André Wallace and The Head of Dionysus by Emily Young – and towering, exotic flower arrangements set on high Perspex plinths provide an opulent backdrop to your pre-theatre aperitif… and for far less than St Martins Lane down the road. There are over 22 variations of martini available, ranging from fruity blends – one made with fresh tamarillo, Wyborowa vodka, peach liqueur and cranberry juice was voted Best Cocktail in London by Forbes magazine – to the refreshingly wholesome Goji Berry Martini, made with boutique British potato vodka, Tyrrells. The lengthy and adventurous drinks menu, which changes twice yearly, has an emphasis on seasonality and ingredients are always fresh, well-sourced and inventive – think passion fruit, lime leaves, star anise. Prepare to be shaken and stirred… The Lobby Bar, One Aldwych, London, WC2; 020 7300 1000



The dorchester Bar The recently refurbished but longestablished bar at The dorchester is no stranger to those of elevated status, discreetly serving as it does royalty, sportsmen and diplomats alike. And all in art-deco surroundings that lately feature an array of red glass stalagmites amidst an arresting gold-and-purple colour scheme. The first page of its comprehensive cocktail menu details a short history of the martini – first served at The dorchester by legendary bartender Harry Craddock in 1930 – as manager Giuliano Morandin happily recounts. Experienced as he is affable, Morandin is a mine of information, extolling the virtues of the Old Tom Gin and Boker’s bitters, which he is so fond of using that when it disappeared from the market several years ago, he took the recipe and persuaded someone to start making it again for him. Competition for the best martini is fierce among London’s top hotel bars but all he will say when i talk of espionage is “i’d rather they copy us, than we copy them”. Highlights include a Perfect 10 martini made with Tanqueray 10, grapefruit bitters and Lillet Blanc finished with a twist of grapefruit and a wonderfully over-the-top Champagne Shimmer made with smooth Snow Queen vodka, Cariel vodka, cranberry juice and elderflower liquor. And if you’re feeling flush, try the champagne glittered with gold dust. The Bar, The Dorchester, 53 Park Lane, Mayfair, W1; 020 7629 8888

The Blue Bar Sampling a martini at The Berkeley’s chic Blue Bar is as much about the experience as it is about the drink. The room is heterogeneous, a david Collins-designed concept that he terms Lutyens Blue (after the name of the original sitting room), a black crocodile-print leather floor, white onyx bar, and faux ostrich leather stools, with listed features from the original Berkeley of Berkeley Square. it shouldn’t work, but it does. The bar, frequented by the likes of Madonna and Kylie, is managed by Australian-born Adam Jannesse, who after a stint at Andersen Consulting decided he’d rather be propping up the other side of the bar. Offering exotic combinations – a sun-dried martini made with Belvedere vodka, sun-dried tomatoes, extra virgin


olive oil, and a dash of tomato juice went down a treat – the eclectic list includes a selection of pouring martinis, such as the long-standing Gingerpine Cosmo, which are shaken and left at your table, to be served at your discretion. Our waitress, davina, was attentive, quick to divulge the merits of each spirit and brand – Tanqueray 10 to 42 Below – as we ogled the mostly media and fashion crowd to a soundtrack of upbeat Europop. The barmen are innovative, with ideas for future creations such as a smoked martini, pre-coated with aged whiskey for a strong, silky flavour. The drinks arrived with little fanfare, accompanied by foie gras and a choice of nibbles. This is suave, sophisticated martini drinking that roger Moore would feel at home with. The Blue Bar, The Berkeley, Wilton Place, SW1; 020 7235 6000

cockTaiL Bars PrE-dinnEr MArTiniS

The Long Bar

The connaught Bar Santino Cicciari’s enthusiasm for cocktails is infectious, which is useful, given his position as bar manager at Mayfair stalwart, The Connaught. Eager to tell us of the “crystal clear” ice balls the bar team has developed, the merits of its pouring technique and the bespoke John Jenkins-designed glasses it uses (available to buy), Cicciari sold 560 martinis in the run-up to Christmas – quite a feat, given that there is only one variation on his cocktail list. The Connaught Martini (found in the revisited section – is made with Tanqueray gin or Ketel One vodka, vermouth dry and an (extensive) choice of bitters (vanilla, grapefruit, cardamom, liquorice, lavender, ginger, and coriander), administered with a pipette. At £15 it’s not cheap, but you get what you pay for, and ours were made tableside by three barmen, one demonstrating an impressive pouring arm, another doing magic with the lemon rind and the third holding court. is this a sign of the times? “The barmen who will survive this downturn are those that do their job with passion, not those just working nine-to-five,” says Cicciari of his closeknit, energetic team. “People want value for money these days.” The place itself is easy on the eye, with oak panelling, low lighting and British racing greenand-tobacco brown crocodile-leather seating. As we were leaving, Hélène darroze, Michelin-starred head chef at The Connaught (who oversees the bar menu), strolled by, eliciting a murmur of excitement from the assembled clientele. Connaught Bar, The Connaught, Carlos Place, London, W1; 020 7314 3419

running the length of this impossibly trendy space, The Long Bar at The Sanderson is nothing if not striking – 80ft of backlit onyx, coupled with ultra-modern designer bar stools, each stencilled with its own private eye. Particularly apt given its reputation as the place to see and be seen. Polish bar manager Maciek Starosolski runs a tight ship – a must, given the volume of people that come through the door (over 1,000 can hit the bar and adjacent restaurant on busy nights) – and the martini list is accordingly succinct. They’re all colourful, jazzedup takes on established favourites that perfectly match the ritzy interior and exotic courtyard – a dater’s paradise that combines romantic lanterns, a cornucopia of manicured foliage, and softly bubbling fountains. “These are high-quality cocktails, but they must be quick to make, and staff need to be vibrant and energetic,” says Starosolski. The emphasis here is on novelty but quality doesn’t suffer, and our experience was of tasty combinations coupled with top-class presentation. A Pretty Lychee martini was a refreshing blend of Cariel vodka, lychee liqueur, fresh lychee and a touch of vanilla sugar, while the Jalisco Sour perfectly matched Partida tequila, shaken with agave syrup and fresh lemon and pomegranate juice. The Sanderson’s more intimate Purple Bar is for members and residents only, but sneak in if you can – it serves 10oz martinis based on the original ‘Martinez’ dating back to 1860. The Long Bar, The Sanderson, 50 Berners Street, London W1; 020 7300 5587

dukes A fine mist of extra dry vermouth, a generous helping of frozen gin or vodka and a twist of lemon from the Amalfi coast. That is how Alessandro Palazzi at dukes makes a martini. Bar manager at this discreet St James’s hotel, which has just celebrated its 100th anniversary, Palazzi believes that a good barman should be “diplomatic, acrobatic and charismatic”; a mantra closely observed at dukes, where gilded portraits of titled gentry adorn the walls and expensive furnishings are formal yet unimposing. Here the martinis are served in frozen glasses on silver trays at table, with absolutely no shaking, stirring or diluting, despite James Bond’s ian Fleming being a regular at the corner table in his time. Owing to their strength, the bar observes a strict two-martini policy, to prevent any rowdiness spoiling the quiet calm, described by Palazzi as a “haven for ladies because no one bothers you”. The martini list is kept to ten, and each drink is made with minimal but carefully chosen ingredients – lemon oil, orange bitters, thyme – indicating that quality instead of quantity is the order of the day. Palazzi and his team are charming and knowledgeable, keeping us entertained with anecdotes such as that of Palazzi’s partnership with Patrick Cox at last year’s Grey Goose Character & Cocktails, while demonstrating various techniques behind their comparatively small corner bar. Our classic Vespers hit the spot – you won’t find a more purist (or potent) version of the martini anywhere in London. Dukes, St James’s Place, London, SW1, 020 7491 4840



Estate We’re In…

Ever dreamt of becoming a winemaker – but lack the requisite millions? Neil davey on how to be a bargain bottle baron It’s been one of those days, the sort of day when only a glass of wine will help. The light plays off the glass in your hand and your thoughts wander. Hmm... winemaking. That’s a career you’d enjoy. Just think how great that would be... Then you remember you don’t have €5m to buy a vineyard, and reality comes flooding back like a bad hangover. It doesn’t have to, you know. Ask Crushpad. As their European president, Stephen Bolger explains: “We allow people to become winemakers, to live that dream at a fraction of the cost.” He laughs. “And without all the hassles of being a landowner in France...” So how does it work? Well, for around €10,000, you get one barrel of wine – 300 bottles – made to your own specification, and the chance to learn just how it’s done. It all begins, though, with one question, – the “most important question” – according to Bolger: “What sort of wine do you want to make?” Once that decision is made – “and it can take ten minutes or ten weeks” – the next step is to select the appropriate vineyards and varietals. “Say you love the character that comes from cabernet sauvignon,”

From Vine to HEDGE In the face of such temptation, we’ve done the only thing we possibly could and signed up for Crushpad. Chateau HEDGE will be a right-bank, St Emilion-style wine. Our base wine has been selected: 80 per cent merlot from the Le Ruisseau vineyard, 20 per cent cabernet franc from Cote Sud. Next year, editor, Martin Deeson and deputy editor, Mark Hedley will be going to Bordeaux to take part in the essential tasting process. We’ll keep you posted on the development of our first vintage – if you’re lucky, we may even involve you in the drinking...


explains Bolger. “Our question would be ‘what sort of cabernet sauvignon are you looking for?’” Crushpad’s vineyard list incorporates the nuances that terroir provides, hence they have two very different types of cabernet sauvignon, three very different types of merlot, and similar range in their other grapes, so the client can get ever closer to their perfect wine. There are other decisions to make, too. Lots of them, in fact, from the sort of wood to be used in the barrels, to the alcohol content, via the label design, number of days of cold maceration, the de-stem level, the extraction goal... Complicated? Yes, but relax. You’re not doing this alone. “It’s really important for us that the client is involved in all the decisions that winemakers have to make,” says Stephen. “Most people go into this to produce a high-end personalised wine and for the educational experience. We talk them through the ‘wine plan’, which very rapidly helps them get a handle on what wine making is truly about.” The clients can be as hands on or off as they desire. Crushpad will send regular updates – and samples – but, if the client wants to pick the grapes or help with the press, they can. “Our winery is their winery,” says Bolger. That’s followed, 12 to 18 months down the track, by final blend: a chance to tweak the wine even more. “The client meets with our winemakers, and they’ll offer advice and a selection of wines that can be added to adjust the wine. It’s amazing how

“ A lot of clients come

right at the end of the process – they like to be there at the end of the line so they can pop open one of those bottles ”

Juicy speculation: (top) Getting your hands dirty is all part of the process – but only if you choose it to be; crushpad’s beautiful chateau

much impact a five per cent change can have.” Then it’s onto the bottling process. Unsurprisingly, that’s the bit where even the most reticent clients get involved. “A lot of clients come then,” says Stephen, “as they like to be at the end of the line so they can pop open one of those bottles.” Sounds good? Then don’t hesitate. With harvest due this month, you need to contact Crushpad without delay to produce your own 2009 vintage. And think, next time you have a bad day, you could be de-stressing with your own wine. Chateau You – what a great idea, for the man (or woman) who’s drunk everything. H

winE crushpad spirits scotch whisky

Scotch Missed?

Then it’s time to renew your acquaintance – whisky has never been so popular, with record sales. By Graeme Wallace the popularIty of Scotch whisky has seen an incredible year-on-year rise throughout the world, with distilleries across Scotland struggling to fulfil the demand. Traditionally, blended whiskies (a mix of a whisky made from malted barley together with a whisky made from another grain) were the preferred drink for connoisseurs, and this type of whisky is still the primary source of income for most distillers. However, the past 20 years has seen a phenomenal growth in the interest in ‘single malt’ whisky (whisky made only from malted barley at a single distillery). This growth is largely down to the desire to sample whisky in its purest form, unblended and ideally from a single cask and at cask strength (where no water has been added to dilute the alcohol level to a standard strength). While a single malt whisky should not automatically be considered better than a blend, all single malts are very enjoyable without the need to add mixers, already having a complex and enjoyable taste. Blends, on the other hand, vary considerably in complexity depending on the ratio of malt to grain whisky. As a general guide, the more expensive the bottle, the greater the amount of malt whisky used in the blend. That said, the inclusion of grain whisky plays an important part, and although lighter in body, it contributes a sweetness that helps to bring balance. Cheaper blends tend to use younger spirit, thus requiring more grain whisky to smooth them out. Ginger or Coke is often added when these expressions are consumed. Blending is a fine art, often bringing together whisky from dozens of different distilleries to achieve the desired result. Consequently, blended whisky should not be automatically ruled out as inferior to single malt. Many blends are highly regarded, particularly in the Far East. Hankey Bannister, for example, is a 40-year-old blend that has been acclaimed by consumers and whisky competitions alike.

Containing some whiskies blended together in the 1970s before being returned to the cask to mature for a further 35 years, this blend includes at least three whiskies from distilleries that no longer exist, and easily measures up to any single malt. Age adds further appeal, as the spirit mellows and interacts with the wooden casks in which it is left to mature. While a whisky must be at least three years old to be called Scotch, it is rare to see a bottle of single malt whisky labelled as less than the normal optimum age of 10 to 12 years old. Younger whiskies normally omit the age statement altogether. The longer the whisky remains in cask, the greater the amount of capital tied up in stock and the longer the period before the distilleries get a return on their initial (very high) investment. In general, the optimum age for older expressions is 16-18 years old, providing a balanced yet complex whisky. At some point, every cask of whisky reaches a turning point when it starts to decline, becoming too mellow and/or too woody. This is where the distillery’s cask management is crucial, watching and waiting for the spirit to reach its peak. Although all casks are made from oak, the wood can vary considerably, resulting in occasional casks that allow the whisky to mature more slowly, way beyond the traditional peak of 25 years. These casks are treasured and monitored even more closely as the spirit inside becomes increasingly rare; such examples can often attract prices well in excess of £1,000 a bottle.

“ Blended whisky should

not be automatically ruled out as inferior to single malt. Many blends are highly regarded, especially in the Far East… ”

For these rare and exceptional cask releases the bottles are usually numbered and consequently become collected rather than consumed. While some distillers such as Highland Park and Dalmore still have a relatively good supply of excellent aging casks, Glengoyne have very few. Therefore to make the release of their 40-year-old even more special, a unique hand-blown crystal decanter (pictured above) has been created to complement the product. The resulting price is £3,750 for each of the 250 decanters released. Aged whisky is set to become increasingly rare as demand puts pressure on stocks. That’s why the Whisky Show in London’s Guildhall on 6 and 7 November has been established to provide people with an opportunity to sample older aged and premium expressions. A limited number of special masterclasses will also be available, giving visitors the opportunity to enjoy a dedicated tasting of extremely rare malts, many from lost or obsolete distilleries. One of these classes will be a VIP tasting of the 40-year-old whiskies referred to above. There’s only one thing for it; you’ve got to go with the grain. H



A Rum Do When It Comes to Hideaways Fears of a mass exodus to tax-free havens when the new top rate of tax comes are significantly overstated, finds Bernadette Costello – though nevertheless the Caribbean is proving attractive for hedge hideaways

Mayor Boris Johnson worries that wealthy City financiers will quit London, leaving him a shortfall in taxes to pay for the 2012 Olympics and his new fleet of non-bendy buses. He says an EU proposal devised with “malign intent” could unintentionally force much of the alternative asset management industry to relocate to offshore centres such as Geneva or the Cayman Islands where 10,000 funds operate tax-free. And who can blame them? Gordon’s looming income tax band of 50 per cent comes as a double-whammy to hedge fund bosses like Crispin Odey who says they are not yet flying out of London but are certainly “fluttering”. Property agents have told HEDGE that savvy accountants are already restructuring their clients’ finances and setting up tax-free residences – but they feel that the Caribbean will be used for holiday hideaways rather than for a main home. “Ultimately, hedge fund managers looking to relocate to the Caribbean are doing so for the lifestyle. London is, and will remain, the epicentre of the hedge fund industry, even in the face of the 50 per

“ The Caribbean offers

hedge fund managers the promise of a decent quality of life – but as to where those managers actually buy will depend on infrastructure… ” 76

cent income tax,” says top London-based property search agent Robert Bailey. “London is still a huge draw owing to its convenient location, infrastructure and good schools,” he adds. Simon Barnes, another London-based search agent, sees the same trend. Both agree that, aside from the internet, hedge boys will want the opposite to London in the Caribbean – peace, space, sea views – though still with good facilities. “Crime is another concern, so gated communities give peace of mind to those leaving their home empty for several months of the year,” adds Bailey. If rental income would be a handy earner to help pay off your bigger UK tax bill, analysts at Global Property Guide say rental yields are low in the Caribbean compared to the rest of the world but tourism, direct flights from London and high-quality accommodation are on the rise. And for luxury buyers, the more developed the island the better. “The Caribbean offers the promise of a decent quality of life – but where fund managers actually buy will depend chiefly on infrastructure and accessibility,” Simon Barnes points out. Knight Frank’s Georgina Richards agrees: “In recent years we saw dramatic interest in up-and-coming islands, such as St Kitts, St Lucia, Dominican Republic and Aruba, with people focusing on resort developments. “However, since the credit crunch, interest has contracted back to more mature markets, especially Barbados.” And what some Caribbean islands lack in infrastructure they all make up in beautiful beach homes, ideal sailing conditions, friendly locals and rum in abundance. H

property CArIBBEAN

Glenconner Beach st lucia “The man who bought Mustique” and gave a plot to Princess Margaret now goes by the name of Colin and lives in St Lucia’s Val des Pitons. Better known as Lord Glenconner, he is building a village at his 480-acre estate in the southwest of the island – he himself lives in an Indian-style palace between the iconic remains of two volcanic peaks, Les Pitons. Glenconner Beach is the exclusive part of Glenconner Village – seven gated and freehold villas carry features such as bars, wine cellars, open-air showers and floating dining pavilions. The octogenarian says he hopes he’ll live to see his dream become a bustling arty community similar to the Jalousie Plantation that once stood there. Glenconner Beach is set to open in 2012 and villa owners will have access to the Tides Sugar Beach spa resort – part of the $100m redevelopment of this World Heritage Site. “Colin Tennant is seen as the eccentric English ‘lord with the elephant’, but he was also the father of tourism in the East Caribbean,” says Glenconner’s project architect Lane Pettigrew, adding: “He’s a genius at transporting the Chelsea lifestyle to a Caribbean island.” ■ PrICE: Five/six-bedroom luxury villas, $7m-$12m ■ CONTACT: Prestigious Properties ■ T: 020 8812 4734 ■ W: ■ W:


property CArIBBEAN


the Grenadines estate

tara’s dream cayman kai, grand cayman The most developed of the three Cayman Islands is Grand Cayman, where both the financial services and tourism industries are well-established. Knight Frank property adviser Georgina richards says: “Buyers predominantly choose the Cayman Islands for a holiday home or as a base to hop between work in the US and UK.” Miami is an hour away while ten airlines fly direct from the UK to Grand Cayman – which is where ‘Tara’s Dream’ (pictured above) is located. This beachfront villa is close to the well-known yacht clubs rum Point and Kaiba – three sandy coves nearby are also up for sale to moor your yacht permanently or build another home in this British overseas territory. There are no direct or inheritance taxes in the Cayman Islands where hedge funds can be managed by an individual or entity located anywhere in the world. “Tax advantages are a bonus – but they appear secondary to the wish to spend quality time in the Caribbean with their families,” says richards. The islands have also recently signed several bilateral tax agreements in line with OECD standards. And Mark Lewis, chairman of the Cayman Islands’ hedge fund association, says financial information could be revealed monthly or quarterly in future. ■ PrICE: $4.75m, luxury villa plus staff quarters ■ CONTACT: Knight Frank ■ T: 020 7629 8171 ■ W:


curaçao Curaçao voted to become an autonomous territory of the Netherlands in December 2008 and good infrastructure includes a new airport terminal. Private jets fly daily from Barbados, St Lucia and Martinique. The island falls within the waters of St Vincent and the Grenadines and despite private moorings located outside the hurricane zone, winter winds can reach gusts of 15-30 knots for avid sailors. The nearest spots are the Spice Island resort in Grenada and diving at Tobago Cays. Villa buyers at the Grenadines Estate, Curaçao, are free to use the facilities at the raffles resort, which hosts the Trump International Golf Club. Of the 24 villas for sale, 19 have already sold. Celia Graham from Aylesford says: “Prices have not reduced in response to the credit crunch. Of course, this is not to say that if someone wanted to make an offer below the list price that it would not be considered.” ■ PrICE: Luxury villas from $3.9m ■ CONTACT: Aylesford International ■ T: 020 7349 5100 ■ W:

Nonsuch Bay north-east antigua British fleets dropped anchor in Antigua during merchant trips to the Caribbean in the 18th and 19th centuries but sailors now come to English Harbour to enjoy Antigua’s annual sailing week in April. Just 20 minutes from this Georgian dockyard – the only one functioning in the Caribbean – is NonSuch Bay. The developer, La Perla International Living, is close to completing the first phase of this 40-acre resort, which includes a yacht club, beachfront villas and townhouses, swimming, tennis, shops and restaurants. La Perla’s rowena Ladeur says: “Antigua has hills of over 1,000ft and navigation can be interesting amid numerous reefs and 365 beaches. “Consistent trade winds help sailors go as far north as St Martin or south to Guadeloupe and Dominica.” The airport is near the capital St John’s, less than half an hour from NonSuch Bay. Off the north coast is rugged Barbuda, famous for diving and hunting. ■ PrICE: Beachfront 3-bed townhouses from $950,000; villa plots from $535,000 ■ CONTACT: La Perla International Living ■ T: +31 (0)20 589 40 70 ■ W:

Scientific research is expensive... CHILDREN with LEUKAEMIA was founded in 1988 by north London businessman Eddie O'Gorman and his wife Marion following the loss of their son Paul, aged 14, to leukaemia. Tragically, just nine months later, their daughter Jean also lost her battle with cancer. What started as a small memorial charity has since grown to become the UK’s leading scientific research charity fighting childhood leukaemia.

...but the results are invaluable Leukaemia is a cancer of the blood. It is the most common childhood cancer. Children under the age of five are at greatest risk; this age group accounts for more than half of all cases.

for the young patients. We also invest in research into causes of leukaemia; why the incidence of this disease has been increasing and what action will protect children in the future.

Acute lymphoblastic leukaemia, the most common form of the disease in children, is treated with two or three years of chemotherapy. Some children will also need radiotherapy, a bone marrow transplant or both.

Science is expensive and successful research projects can take years, but the results – improved treatments and a better chance of survival for children with leukaemia – are invaluable.

Thanks to the huge investments made in research, survival rates have improved over the past four decades. However, toxic drugs used in treatment can cause lasting physical effects and sadly, current treatments are still failing one in five children. We fund research to develop new treatments which are not only more effective at eliminating the leukaemia but carry less risk of side effects

Eleanor (pictured) with all of the bottles of pills and medicines she took during her two years of treatment for leukaemia.

Please help us to fund further essential research and save young lives To find out more about the work of CHILDREN with LEUKAEMIA please contact Pippa Gough or Pip Lewis

Telephone: 020 7404 0808 Email: Website:

CHILDREN with LEUKAEMIA is the working name for Children with Cancer UK, a company limited by guarantee, registered in England 298405, registered office: 51 Great Ormond Street, London WC1N 3JQ



And Up Front He’s Going With Ponzi and Alonso is in dire straits and plans to start a Ponzi scheme of his own. Or would, if he could recall what it is…


THERE’S A NEW viral doing the rounds. It’s one of those YouTube Hitler skits. You’ll have seen it, or something very similar. If you haven’t, you can be sure that at some point it’ll pop up in your inbox. It’s one of those ingenious spoofs where a clever geek with too much time on his hands takes the crucial scene from Downfall, the brilliant 2004 German war movie about the Nazis’ last days, and replaces the original subtitles with new and entirely inappropriate dialogue, so it appears that rather than bollocking his generals for their tactical failings, the Fuhrer is in an explosive tizzy about something else: his computer keeps crashing, someone’s stolen his car, he can’t stand the new Hannah Montana album... In this latest version, Hitler – as played by the venerated Bruno Ganz – is angry about something else. He’s furious, spitting with rage, incendiary with fury. The reason for his displeasure? He’s missed the investment opportunity of a lifetime. “What do you mean we sold our shares in February?” he screams at his advisors. “Most of them were at ten-year lows! The bull market has started and we are sitting on the sidelines! Don’t give me this CNN bear-market bollocks! WE MISSED IT!” Increasingly unhinged, Hitler yells about Warren Buffett and Citibank before going on to suggest “Plan B”: what the Nazis

“ I don’t strictly know

what a Ponzi scheme is. I mean, I can look it up on Wikipedia and hold the facts in my head for a moment, but five minutes later I’ll have forgotten ” 80


really need, he figures, is to create a Ponzi scheme of their own. After, all “it worked for Bernie Madoff”. This is clearly a City boy spoof, a banker’s in-joke, a Hedgie funny. A viral that will appeal pretty much exclusively to those who work in the Square Mile, on Wall Street or in those rather spiffy offices you lot seem to like to rent in Mayfair. No doubt you’ll find it funny, but the joke’s on the rest of us, really, those members of the public – like me – who can appreciate the cleverness of the humour, but don’t really understand the specifics. Because, like most of the rest of the world, I don’t strictly know what a Ponzi scheme is. I mean, I can look it up on Wikipedia and hold the facts in my head for a moment, but five minutes later I’ll have forgotten them all again. Ponzi, you say? A flavour of ice cream? A famous tenorsoprano? A small village in Umbria? It’s not that I’m completely thick. It’s just that I don’t work in finance. (I’m a journalist, obviously. OK, I’m completely thick). I’m aware of Warren Buffet (vaguely), and conscious of the existence of Citibank (fuzzily), and I know the difference between bear and bull (just about, if I think about it for a moment) but even after reading the endless glossy magazine accounts of Madoff’s glamorous double-life and eventual catastrophic fall from grace, his lavish parties and – according to his mistress – his tiny penis, I’m still not entirely sure what he did. I could never be caught up in a Ponzi scheme for the simple fact that I have nothing to invest – and that I think Ponzi plays left back for AC Milan. This ignorance is not specific to Ponzis. It extends to the economy and finance in general. This is what it’s like, to give you moneybags types an insight, to be uninvested: the peaks and troughs of the global economy

have little direct effect on me for the simple reason that I am out of the loop. It’s all academic, and I don’t have an education. This is why, when the downturn hit, I heard lots of people talking about how the high-rolling good times of the past decade had gone and we were going to live through a period of austerity the like of which we hadn’t seen since the 1970s (or maybe even the 1950s, or the 1930s, perhaps even the 1880s – no one could decide). I thought: what high-rolling good times, precisely, are they on about? It’s going to be carnage for the hedge funds, they said. I: what’s a hedge fund, again, when it’s at home? (If hedge funds can be said to be at home, that is. Can they? You tell me.) Frankly, the collapse of the investment banks was a matter of only passing interest to me, since I have no investments. Ditto the housing market: I don’t have a mortgage, or a house. I’d fix all this, if I could, by starting my own Ponzi scheme. (I said I’m poor. I didn’t say I’m honest.) But as I may have mentioned, I haven’t got a clue as to how to go about it. By the way, I did actually look up Ponzi schemes on Wikipedia. There’s a mugshot of Charles Ponzi displayed there. He’s got a slightly rogueish, Mona Lisa smile, even though clearly he’s just been arrested. Maybe he knows something I don’t. He wouldn’t be the only one. H Alex Bilmes is features director of British GQ


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Hedge Magazine - Issue 9 - 'Will Self on the Black Swan'