This podcast is sponsored by Seller Plan from Berry Brothers and Rudd, collecting fine wines for future drinking.

Hello and welcome to The Spectator Podcast. I'm Lara Prendergast and on this week's episode, we'll be asking whether there's such a thing as a good financial crash.

We'll also be looking at the reality of the housing crisis and finally we'll be asking whether it's ever okay to hire dwarves to serve food at your party.

First up, earlier this week, the Dow Jones suffered its worst fall in six years, triggering a sell-off around the world.

In his cover piece this week, Liam Halligan says this is a good sign.

But is there such thing as a good crash?

Liam joins me now, along with the author and economist George Magnus.

So Liam, this crash looks quite dramatic.

Are you really telling us is a good thing?

It's dramatic, of course, if you're caught up in the thick of the trading.

And newspaper editors have been reaching for photos of people with green screens talking about 1987.

But when we had Black Friday in 1987, the Dow Jones, the main stock index of the world,

basically, US focused, lost a quarter of its value in a single day.

We've just seen a drop where the Dow lost 4.6% of its value. Pretty chunky, but manageable when you put it in that historic context.

It is the biggest ever points drop, but that's because the nominal points index has been

careening upwards ever since the Lehman collapse. Since Lehman, there's only been one year where the Dow has produced a negative return,

and it was a very small negative return.

In the last two years, we've had a 13% dollar terms return,

and then a 25% return last year, which of course the Donald is suggesting is because of his genius, but the market's

long been overvalued, it's long been pumped up by printed money, frankly, share buybacks

and dividend payments in some sense is unjustifiable. A correction was warranted. If this is the

first of a series of small corrections with gravity prevailing, then that is a good thing.

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