The Garrulous Jay – Private {…blank…}

Back in the 1980s the TV gameshow Blankety Blank was a staple of the BBC1 Saturday night schedule. Usually airing in the peak-time 8.00pm slot, Terry Wogan and his magic wand microphone drew audiences of millions.

This was a more innocent time when gameshows lacked the garish glitz of The Wheel; when contestants didn’t need to put themselves through the humiliation of being The Weakest Link, and when they had no particular want to be a millionaire.

Blankety Blank’s basic format was simple, with contestants asked to fill in the second word, or blank, in a two-word phrase in the hope it matched the answers written down by a panel of celebrities.

I sometimes wonder what the winning ‘blank’ would be if the first word was ‘private’. I suspect it would be ‘property’.

‘School’ might have featured, which would have given the host the opportunity to make the wry but predictable observation that most public schools are in fact private.

And it is probably just my puerile sense of humour that makes me think ‘dancer’, ‘member’ and ‘parts’ might also have featured. The show’s second host, Les Dawson, would have enjoyed that.

Words that I suspect would not have made it into the reckoning would include ‘credit’, ‘equity’, ‘bank’ and ‘client’.

I am struck, however, by the financial services industry’s enthusiasm for the word ‘private’. I think this has much to do with the connotations of secrecy and exclusivity implied by it, beyond it simply being a means by which to differentiate between certain asset classes.

In the case of ‘credit’ and ‘equity’ the term is used to distinguish between assets and funds that can be bought and sold on a public exchange (which is probably actually private), and those that do not openly trade. The latter are likely to be higher risk, partly due to their lower liquidity but also because they are subject to less regulatory scrutiny.

The sense of exclusivity also prevails in the world of PC/PE funds, however, with minimum investment amounts being set at a high level. There is currently much speculation of a bubble in private credit, and a healthy ‘secondary’ market in private equity – PE funds buying assets off other PE funds – suggests here too not all may be well.

So perhaps these entry requirements serve to protect less wealthy investors from themselves.

This is less applicable to the terms ‘private bank’ and ‘private client’. Here the prefix word is used primarily for marketing purposes, to distinguish both an institution and the customers it is seeking to attract, based on the latter’s level of wealth.

The irony is that these banks are not necessarily particularly ‘private’, and I can think of quite a few ‘private clients’ for whom keeping their wealth secret is the last thing they would wish to do.

But the allure of membership of a secret club runs deep in the human psyche, so I suspect the terms will prevail even if they sit alongside other private ‘blanks’ which are altogether a little more low-brow.