City tipster Simon Cawkwell – otherwise known as Bear Raider Evil Knievil – has controversially warned that shares in Northern Rock are worth as little as 5p each.
Knievil has been short of Northern Rock for many weeks and claims that by Christmas he will have made £1 million from the ailing bank.
Knievil is a stock market commentator, best known for publicly identifying companies whose share price he believes will fall and betting his own money on such falls.
In his diary, published on www.t1ps.com today, Knievil says that the Government has written a blank cheque for as much as £25 billion guaranteeing Northern Rock deposits and that without the involuntary support of taxpayers the Bank would not be a going concern.
Since that support cannot last forever and could not be transferred to any third party buying Northern’s assets and liabilities, Knievil believes that the equity of Northern Rock is essentially worthless.
Evil says: “Day by day trading must be getting worse as people realise that this ship is holed beneath the waterline and rush for the exit – the share price has been artificially inflated by armies of deranged private investors buying the shares in the hope of a Government bailout. As the lunatics realise that the game is up the rush to sell will become a stampede – this is the greatest shorting opportunity I have seen in my four decade long City career.”