Financial Times FT.com

Banking system’s problems at heart of the bear case

Published: December 30 2007 16:47 | Last updated: December 30 2007 16:47

Contemplating the year ahead is, when you come to think of it, a slightly pointless exercise. It is not just that forecasts are generally wrong. More seriously, we tend to worry about stuff that never happens, while getting blindsided by events that nobody foresaw.

But financial markets are discounting mechanisms and forecasts are implicit in prices whether we like it or not. So here is my version, starting with a disclaimer.

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