Remember the bit in 'Liar's Poker' where the wise old trader told newbie Michael Lewis to 'buy potatoes', after details of the nuclear disaster at Chernobyl first became known ?

The logic was that the 'fallout' from the accident would blow across Europe (and elsewhere) and ruin potatoes crops, which would result in spud prices skyrocketing. Well, traders are using the same kind of warped logic now in connection with the H1N1 flu virus. The virus scare has seen 'flu' stocks (any company that either produces potential vaccines or has vaccine-related technology) soar in recent days, and traders are hoping that the virus spreads in coming months so that the flu stock play pays off big time. One trader told Here Is The City: 'I don't want anyone to die, but it would help if lots got very sick!'.

And talking of 'swine' flu, Bloomberg reports that, over in America, five Senate pages have been sent home as it looks like they may have got it. Several bank executives are thought to be 'extremely concerned' that the virus may spread to higher-ups in the US lawmaking community. One 'distraught' banker remarked: 'Now wouldn't that just be the end of the world!'.

In the meantime, The Wall Street Journal has a little item Wednesday about alleged culture clashes between former Lehman Brothers employees and their new masters over at Nomura (Nomura took on Lehman's European and Asia-Pac operations). The newspaper quotes unnamed Lehman executives who claim that Nomura 'kicked off a training session for new hires in April by separating the men and women. The women, including Harvard graduates hired by Lehman Brothers before it collapsed, were taught how to wear their hair, serve tea and choose their wardrobes according to the season'.

And Reuters is reporting that jailed fraudster Bernie Madoff has been talking 'frankly' to two lawyers who are representing investors intent on suing him. The three clearly met in Bernie's new 'offices'. Bernie, it seems, is doing just fine, but admitted that he couldn't believe how long he got away with his crimes, especially as US regulator The Securities and Exchange Commission met with him on several occasions (A lot of us have been wondering about that too, Bernie). Oh, and apparently the fraudster is working out too. Careful Bernie - don't make yourself too pretty in there!

The Chicago Tribune reports that Chan Wai-yee, a 77-year-old Chinese woman, is suing UBS, claiming that she lost $26m as the bank allegedly misled her about the risks involved in investing in leveraged derivatives products known as accumulators. One banker told us: 'What does she want $26m for anyway ? She's 77 for Chissakes!'.

Finally, a case of the pot calling the kettle black. Morgan Stanley got it in the neck last week for scaling down trading risk and posting another quarterly loss. Deutsche Bank also saw a fall-off in fixed income trading revenues in its second-quarter, as the German bank, too, reined in risk. But Morgan Stanley analyst Huw van Steenis couldn't help remarking: 'Deutsche Bank remains a powerhouse in fixed income, but the question investors are asking now is whether the ability to monetize this has been reduced. As Deutsche Bank de-risked, it also crimped earnings power'. At least Deutsche Bank remains 'a powerhouse in fixed income', though, Huw..........

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