JAMES GRANT talks about the dangers of political intervention

James Grant is the publisher of Grant's Interest Rate Observer, which has been commenting on markets for 25 years. Grant's has been bearish on the markets for several years, repeatedly discussing the risks lurking in mortgage-backed securities. Mr Grant says the events of the past few weeks could not have been dreamt of by even the gloomiest bear. He think the greatest shock is the "seemingly arbitrary interventions" by the federal government. Politicians and regulators do not understand financial markets. Political risks - such as the interventions by regulators to ban short-selling - should cause a slide in the value of the dollar. "This is all quite shocking, I would think, to the holders of American assets abroad," says Mr Grant.