Stock market fall

The use of the word ‘fall’ here is a horrible pun.

What is it about the autumn and the sudden impulse for stock markets to just fall out of bed? The October Fund referred to in the novel ‘The October Men’ is an acknowledgement that this is a risky time of year for anyone with anything invested in the markets. Here’s a quick overview of the biggest shakes-ups of the last 100 years or so (September / October falls highlighted in orange – please excuse me fudging it a bit!):

Oct 1907 Panic of 1907 (USA) Lasting over a year, markets took fright after U.S. President Theodore Roosevelt had threatened to rein in the monopolies that flourished in various industrial sectors, notably railways.
24 Oct 1929 Wall Street Crash (USA) Lasting over 4 years, the bursting of the speculative bubble in shares led to further selling as people who had borrowed money to buy shares had to cash them in when their loans were called in. Also called the Great Crash or the Wall Street Crash, leading to the Great Depression
Jan 1973 UK Stock Market Crash Lasting 23 months, dramatic rise in oil prices, the miners’ strike and the downfall of the Heath government.
19 Oct 1987 Black Monday (USA) This followed the Great Storm in the UK (which happened on a Thursday night) shutting the London Stock Exchange down on the Friday. By the time the NYSE had woken up, this may have been the final straw for an over-inflated market at a time of galloping bank interest rates.
13 Oct 1989 Friday the 13th (Mini-crash  USA) Caused by a failed leveraged buy-out of United Airlines
27 Oct 1997 Mini-crash Global crash caused by an economic crisis in Asia
10 Mar 2000 Dot-com Bubble (USA) Although this sector’s bubble burst, it took a lot of other sectors down with it. The value of equities as a whole took a haircut
11 Sep 2001 9/11 Attacks This caused a short-term fall as insurance stocks saw a massive hit
9 Oct 2002 2002 Downturn Downturn in stock prices during 2002 in stock exchanges across the United States, Canada, Asia, and Europe. After recovering from lows reached following the September 11 attacks, indices slid steadily starting in March 2002, with dramatic declines in July and September leading to lows last reached in 1997 and 1998.
11 Oct 2007 US Bear Market Till June 2009, the Dow Jones Industrial Average, Nasdaq Composite and S&P 500 all experienced declines of greater than 20% from their peaks in late 2007
16 Sep 2008 Financial Crisis (USA) This was the collapse of Lehman Brothers, the sub-prime scandal, the bank bailouts – total financial meltdown

So, as I discovered in 2007, don’t go off on holiday on a remote beach in Turkey thinking that all is right in the world. It appears the Big Animals of the City take their holidays in August and come back to work in a bad mood. Obviously the reasons for stock market crashes are more complex than senior traders’ holidays as the table above shows but it does seem to be an extraordinary coincidence nonetheless.

The other thing one has to remember is that a falling stock market is an investment opportunity. The worst time to buy shares is when the market is high; you can only lose money really despite the confidence that a nice, high market can give one.

As I write, the pundits are all predicting a crash. No one is saying where it’s coming from – China? Russia? North Korea? – but the fact that equities have been buoyed up ultra-low interest rates coupled with ‘quantitative easing’ (i.e. free money) means that, when the taps get turned off, there will be a correction.

If I could predict when the crash will come, I wouldn’t need to write a book for a living! (Okay, I did it because I wanted to as well…)

What is time anyway?

Here’s a thing. This is a novel about the evidence of time travel.

By its very nature, this implies that ‘Time’ is a dimension by which you can traverse. It is often referred to as the Fourth Dimension. And that seems rather silly to me for a number of reasons:

  • We have three dimensions that we move about in as a matter of course and they are all measured in feet, inches, metres, miles, whatever
  • Why would a fourth dimension be measured in anything else – such as seconds?
  • And how is it at right angles to the current three dimensions we used to build houses?

Physicists get rather exercised by time. It’s a quantity that pops up regularly in all sorts of calculations and equations and yet, when you want to pick it up or look at it from round the back, it’s not actually there.

We measure the passage of time as it gives context to our lives. If we didn’t, how would we know when to celebrate our next birthday? The movements of the planets mark out our days, nights, seasons and these all give rhythm to what we eat, where we go, whether we are more likely to get depressed, etc.

There’s lots of research that is presented by tabloid journalists as time travel (e.g. worm-holes, near-light speed travel) but it’s not actually breaking the time-space continuum. And anyway, this is all about going forwards in time at a different rate to everyone else. For a general overview of this you could do worse than read Paul Sutter’s excellent blog here.

As for going back in time, my philosophical position is that it makes more sense as there is a Past to go and visit whereas there isn’t a Future one can go to and come back from. (I should add that I’m not a physicist; I studied chemistry at university but I’ve had a few drinks down the pub so I feel amply qualified to expound generously on this subject.)

Nonetheless, I shall leave the last word on this matter to Professor Stephen Hawking who devoted a fair bit of his excellent book ‘A Brief History of Time’ to Time Cones and backwards and forward travel as it related to the expansion of the universe. You might need a stiff gin to get through this, but it’s a beautifully written and argued piece on space and time and general relativity. So, go on, dip your toe in some Quantum Physics and be entertained!