Economist Roger Nightingale is a well-known figure in London investment circles and also a man of trenchant views; refreshingly honest about the limits of his own profession, especially when it comes to foresight.
He has little time for politicians, especially those of the European Union. He hasn’t much more for central bankers and none at all for “delinquent” risk addicts at investment banks who caused the financial crisis.
However, he has at least had a lot of time for equity markets these past two years. Indeed, he has made a habit of being right about them. He spotted early (long before this column did) that the combination of easy money, then printed money, allied with plenty of corporate fat-trimming, would support profits, even if the economic numbers looked awful.
He never suggested investors should buy equity with a song in their hearts and the certainty of impressive growth. Indeed, all the way through this bull market he has recommended that investors stay with stocks “against their better judgement.”
In short, he has been spot-on. Here we are with the S&P 500 90% above the lows of March 2009, and sustainable growth still in the balance.
But here’s the thing.
He changed his call subtly at the end of last week, citing instability in the oil-producing Middle East and heightened risk of military intervention there by the West. These new wrinkles overlay an already chancy backdrop, replete with slowing national economies and the withdrawal of monetary accommodation.