Crispin Odey: David Cameron is not a leader, doesn’t understand power and doesn’t use it

David Cameron is not a leader,” says Crispin Odey, the City financier and Conservative Party donor. “He doesn’t understand power and he doesn’t use it.” These are strong words for a life-long supporter of the party. But he doesn’t stop there. “George [Osborne],” he says, “we hate more than Dave.”

By “we” he means the City. And when he follows these unflinching statements up with “David’s a decent person and I know him personally,” it’s clear that he is talking business. And Odey knows about business.

This is the man who predicted the recession, and here, in the pink art-lined boardroom of his oak-panelled offices, he delivers another devastating blow: “Property is ludicrously expensive,” he says. “House prices are right at the top of their cycle. I think they could crash. I’m not saying it’ll happen immediately, but I do think they can drop by half.”

Crispin Odey doesn’t look much like a soothsayer, he looks more like a Punch cartoon of an Eighties banker — all paunch, red braces and throaty laughter. He has a messy mop and a mischievous glint: a sort of grown-up Just William. But it would be a mistake to underestimate this man on account of his appearance. The 53-year-old founding partner of Odey Asset Management, a company that manages $5 billion of assets, is known for his contrarian genius and bold statements — “A lot of my fellow hedge fund managers have kept a much lower profile. Probably more sensible.”

He is married to Nichola Pease, a scion of the Barclays banking family and non-executive director of asset manager Schroders. Together they are worth some £455 million. They are City aristocracy, so established that they’ve been dubbed “the Posh and Becks” of finance. (“I am quite well connected,” he says. He waves to someone out of the window: “Hello Philipp!” Then: “Do you know Philipp von Habsburg?”)

Two months ago his eccentricities brought him a wider audience when he submitted plans for a £120,000 Palladian chicken house in the grounds of his Grade II-listed country estate in the Forest of Dean — a move that became neat shorthand for the unnecessary extravagance of the City.

Over the years, he’s donated to Tory coffers but today he is no political ally. “I’ve given up with politics,” he says, “I don’t know who I’d vote for now. Ed Miliband is even worse than David. It’s a choice of evils. David Cameron never got the Zeitgeist. His opening line was that it was all about ‘sharing the fruits of growth’. It showed he had no idea that we were about to go into a cataclysmic crisis. It was easy to see it was about to happen. And it was easy to see how bad it was going to be. It’s not a recession, it’s a depression.”

He elaborates, his tempo speeding up to match his conviction: “Obviously I am just a simple fund manager, but these guys are supposed to be geniuses at numbers, but from where I’m standing, they’re not. In the second quarter of this year everything turned down. However rich you were, you felt poor. And at that moment, David was trying to introduce gay marriage legislation. When people are in pain, you, as their leader, have to show you are sharing it.”

He takes a sip of black coffee. “I find it very depressing, bad leadership.” So what would be a sign of good leadership? “For example: given that the BBC are not the Conservatives’ friends, the first thing to do about the Jimmy Savile scandal is fire the lot of them. Now they are going to be fired, but only slowly. It’s much more impressive to say, ‘Actually there’s corruption in this place root and branch, I’m going to clear away the whole lot. The governor and the rest.’”

And who in the political landscape does he think would make a good leader? “Gove,” he says. “He’s brought in his own legislation. He’s shown leadership. He’s brave: he fights a good battle. He keeps repeating the message; he makes sure he can deliver; he gets rid of those people who are against him. He is , as I see it, a leader.”

The Odey family have long mixed business and politics. On his father’s side he came from Yorkshire industrialists and his grandfather was Tory MP for Beverley. His mother was a member of the prominent Clitherow family. It was this background that also taught Odey the importance of ruthless financial decision-making.

Shortly after leaving Oxford he discovered his father had run up huge debts. The ancestral home was turned over to him by “trustees on the run”. In a drastic move he sold Hotham Hall, a 4,000-acre estate that had been in his mother’s family since 1720. He also sold the entire contents, the proceeds of which went to his parents upkeep. “I was 23, but I learned a lot.”

He says of his father: “He was always short of money so one spent one’s life giving him handouts. He was a wastrel from beginning to end.” He adds, perhaps a little savagely: “And wastrels always need helping.”

Did the experience contribute to his drive to make money? “I saw what he did wrong and took the opposite line.” He also rebelled against his grandfather, “a formidable bully” who insisted that Odey go to the Bar, but he changed his mind while training to be a barrister. “My grandfather disliked the City and he wasn’t used to being countermanded, so he got annoyed.” The final insult: “He left me nothing in his will but an empty suitcase.”

It was back in those early days that Odey met his first wife Prudence, the daughter of Rupert Murdoch. “She was a Voguette,” he says. “Little black dresses, black skirts and dark hair: black being the definite colour.

“I was an impoverished semi-student who’d just got a job and didn’t really know whether it would go anywhere. I was living in a flat-share in Pimlico. I met her and I was slightly surprised that she was, you know, interested. I was charmed. I was flattered. The second time we met she said, ‘My father’s trying to get me to go back to Australia and I need an excuse not to go back. Why don’t we get married?’ It was a big wedding. God!” He throws his hands up in exclamation. “Five hundred people in Park Lane. They say great weddings make terrible marriages, and it’s true. We were certainly not suited. The wheels were falling off the thing long before we got to the wedding, but the truth was that Rupert was not someone you said no to.”

Are you still friends with the family? He laughs: “Well I own a lot of Sky, so…” He trails off. “James was a squit when I knew Pru, and Elizabeth was 17 or 18. But it was an amicable separation.”

Soon after he met Nichola, his wife, a woman who shared his ambitions and drive. “She was a great support,” he says. “She came from a much sunnier and happier family and therefore also had a tremendous amount of natural self-confidence and practicality.” It was Nichola who suggested he set up Odey Asset Management.

The genius of his company has been in his ability to read markets, something he puts down to his “Burkean” approach and a background in history and economics.

“If you want to be a rich man you need to think like a rich man. You need patience. You need to be imaginative, and you need a thick skin to make decisions against markets — to believe you’re right and they’re wrong.”

Can he see a way out of the current economic gloom? “We have got to get the banks working again. That means the end of bashing the bankers. If there is no credit growth there is no economic growth. The last time we were in a depression was the 1930s, and what got us out was cheap money. We need a zero interest rate and a housing boom.”

And so house prices need to come down too? “House prices are not stable. They have a cycle like everything else. America has understood this much earlier than the UK. There, house prices have already fallen by 50 per cent and they are affordable. It goes back to thinking like a rich man: you have to take the long view.”

Odey on...

Michael Gove
"He makes sure he can deliver; he gets rid of those people who are against him"

George Osborne
"George we hate more than Dave"

Rupert Murdoch
"Rupert was not someone you said no to"

House prices
"They could crash. They can drop by half"

His father
"He was a wastrel from beginning to end"

The recession
"It’s not a recession, it’s a depression"