The Queen baffled by financial crisis

The Queen, who is said to have had £25m wiped off her personal fortune by the current financial crisis, is clearly a worried woman. On Wednesday, while opening a new building at the London School of Economics, she decided to tap the experts and find out how the meltdown in the money markets came about.

The man she approached was Professor Luis Garicano, director of research at the LSE's management department. Said Garicano after their chat: "'The Queen asked me, "If these things were so large, how come everyone missed them?' "

While a little taken aback, Garicano patiently explained the origins and effects of the credit crisis. He told the Queen: "At every stage, someone was relying on somebody else and everyone thought they were doing the right thing." The Queen then described the situation as "awful".

In April, Her Majesty's private wealth was estimated to be £320million by Forbes magazine, which included a personal investment portfolio valued at £100million. But since then, London's ttock market has lost almost 25 per cent in value. The Queen's investments, largely in British blue chip companies, have broadly tracked the market, resulting in a 25 per cent fall in her portfolio's value.

Like other homeowners, the Queen has faced escalating prices for fuel, food and home repairs which have seen the costs of carrying out her duties double. Her taxpayer-funded Civil List payment of £7.9million has not increased in almost 20 years, and is not due to be renegotiated until 2010. The Daily Mail reports that the Queen is said to go around Buckingham Palace switching off lights to save money.