A reader likens me to Dr Pangloss, the quack philosopher in Voltaire’s Candide who insisted that ‘all is for the best in the best of all possible worlds’ even after he was reduced to a syphilitic beggar. It’s true that I tend to regard positive indicators — a 22-year high in the BDO index of business expectations, a CBI statement that ‘we’re starting to see the right kind of growth’ — as a pattern of recovery, rather than a mirage in a minefield. But rest assured I’m also on constant alert for ‘black swans’, those change-making events that (so we learned from a more modern thinker, Nassim Nicholas Taleb) come out of the blue and have to be rationalised afterwards.
The January headline ‘Kiev in flames’ might fall into that category, for example, by signalling a dangerous new conflict zone. And I’m watching reports of forthcoming ‘stress tests’ on the capital adequacy of 124 European banks. The results won’t be announced until October, always a popular month for market turmoil. Intended to draw a final line under the financial crisis, they could have the unintended consequence of causing a new one if the findings are too shocking — or conversely if markets don’t believe the exercise has been sufficiently rigorous. New European bank regulator Danièle Nouy has already said that the weakest banks must be allowed to fail if the tests are to be credible, while one analyst of the sector, Davide Serra of Algebris Investments, predicts a €50 billion ‘capital black hole’, with particularly acute problems among German regional banks.
Reader, don’t say I didn’t warn you. And if I may say so, I think I was spot on last week about the ‘smokescreen’ of Barclays boss Antony Jenkins’s decision not to accept a bonus for himself this year. Sure enough, this week he declared a 10 per cent increase in bonuses for everyone else, chiefly on the investment banking side, despite a fall of almost a third in pre-tax profits and 7,000 UK job cuts.

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