In last week’s issue I picked a portfolio of eight shares to sell short (a way of making money from falling share prices).
It is already showing a gain of 5.8 per cent with significant falls in all but one of the eight shares I picked. A common feature of the eight shares was that they are in companies whose business is primarily in the UK. The message is twofold.
First, shares in domestically oriented UK businesses are in a continuing fierce bear market that is still plumbing new lows. Second, the UK economy is probably heading for a full-blown recession.
I call this a hidden bear market because the indices are holding up quite well. The UK’s FTSE 100 index is 6,100 against an all-time peak of 6950.6, a decline of 8.8 per cent. According to the pundits that does not even qualify as a correction, let alone a bear market.
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