End Of The Silly Season. Enter The Scary Season

Today marks the end of the silly season. The managerial class are ending their holidays and heading back to London for some work. After a nice break and a summer with no major catastrophes in it, they may even be refreshed.

The newspapers can pack away their silly season reporters and stories and file those for release next year. Instead their own real political and business reporters are back and up for some work.

But back to what? The markets have been on a great run and it remains to be seen whether this is a bull run or a bear market rally. Many in the City seem to think it is the latter and are preparing their hard hats for a storm in September and October. On balance, I think they are right.

None of the economic news has been good, especially for the UK, all summer. All it has been is not utterly desultory and this is not the same as good.

So here we are, starting the Scary season of September and October (this occurs every year because many bonds and long-dated securities are reviewed at this time, a big move in or out, or to cash, can cause crashes in the stock market).

Despite all that, this time last year the world went into meltdown and events aside, this is unlikely to happen again as the situation has been stabilised. The FTSE (^FTSE) won’t fall back down to 3500, but it may well touch 4000 from its current level of nearly 5000. overall, i still expect the year to be broadly flat with the FTSE ending at 4400 odd.

It is going to be a very interesting few weeks.

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