The election might now be a three horse race but in the Money sections this weekend there were only ever two runners in the blog stakes: volcanic ash and the prospect of a hung parliament. Now that the skies are once again patterned with vapour trail, the hung parliament it is.
Kenneth Clarke warned earlier in the week that a hung parliament would be a disaster and, judging by the weekend’s money sections, he is not alone in this belief. Matthew Vincent’s column in the FT Weekend, aside from blaming women and young people for making a hung parliament a real possibility, included the views of various fund managers to find out common opinion of how markets, gilts, GDP etc would be affected. General consensus is that the three parties will not be able to form any kind of coalition and chaos would ensue.
Ian Cowie’s piece in the Telegraph continued in much the same vein with various experts detailing why they think a hung parliament would be bad news for the personal finances of the Great British public. The Daily Mail goes so far as to say that a potential visit from the IMF as a result of an inconclusive election would be ‘Armageddon’ for the economy. This may be exaggerating the situation a tad, but it does appear that many are viewing this prospect in the same ‘disaster’ category as that pesky volcano.
The Sunday Telegraph, while very much keeping with the ‘hung parliaments are bad’ theme, tried to be slightly more positive by giving tips for where to invest if such a situation arises. Robert Cole’s Personal Investor column in the Times also offered a note of comfort by pointing out that shares are best placed to deal with the risks of a new parliament, in whatever form it may take, and remain the investment asset of choice.
So in summary, a hung parliament will be bad, but it doesn’t have to mean the end of the world for investors.
And the scores this week are: