‘Forecasting is a mug’s game’ is a dictum often heard in the financial world, yet more often ignored. As our Reality Check columnist Louise Cooper pithily observes, when it comes to predicting the level of the FTSE100 index 12 months hence, ‘City experts, like me, haven’t a clue.’ This issue of Spectator Money looks ahead to 2016 and beyond, but does not try to pinpoint where markets are heading; rather, it asks a set of ‘What if?’ questions that are acutely pertinent to the intelligent investor’s portfolio choices.
Our guest writers Warwick Lightfoot, Tim Price and Subitha Subramaniam weigh up current negative factors in the global economy, including the downturn in China and a build-up of debt, and ask whether central banks are responding adequately: what if they continue to delay the interest-rate rises investors have already been expecting for several months?
Matthew Lynn asks what if, rather than opting for the much-vaunted ‘Brexit’, UK voters opt for ‘Bray’ — staying in the EU. Robin Andrews asks what if anti-fracking protestors succeed in blocking exploitation of the shale-gas deposits that could transform UK energy supply. And our in-house Speculator, Freddy Gray, actually ventures a forecast — that oil prices will rise — but at least he’s prepared to bet his own money on it.
Serious subject matter; serious risks ahead. But we’re also well aware that Christmas is just six weeks away, so our Spend It With Style section offers festive his-and-hers choices for the ultimate gift: antique or artist-made jewellery for her; a classic 1960s sports car for him. In both cases, beautiful objects that stir the emotions — but also, if well chosen, investment assets that should hold their value for the long term, whatever the unforecastable swings of fortune may bring.