Opinion | Prepare for a stock market crash and take stock of a golden opportunity

Among traders, there have through the decades been two bits of perennial advice, “sell in May and go away” after the bulk of the year’s returns have been made by smart investors who then scarper to the beach. Then, once their golden tans start to fade, “evil October” arrives.

Although stock-market statistics show that performance in October averages out to just about any other month, the month sparks fear in traders’ hearts. It is, after all, the month in which some notable bad things have happened: the Panic of 1907 (a little-mentioned banking crisis, frighteningly similar to 2007), the infamous Black Tuesday, Black Thursday and Black Monday of 1929, and Black Monday of 1987.

Personally, I don’t like Mondays. But October is almost over and there has been no real downturn of any magnitude to worry about (touch wood). Aside from the odd ballistic missile being fired to show who has the biggest rocket and a cold snap this weekend that Hong Kong experts say won’t warrant winter coats, nothing locally has really upset markets yet, although in Europe and the US people are starting to worry about what this winter has in store in economic terms.

There is still time for equity markets to catch the first sniffles of autumn, like I have, before the month is out. As the temperatures drop heading into winter and next year, inflation will spike, driven by rapidly rising fuel prices – now a concern raised by the Bank of England.

The cost of borrowing follows upwards to temper inflation, which will be snapping at our heels by January. And with “greenflation” about to hit us after COP26 in Glasgow, everything may go to hell in a handbasket even before the puffy jackets come out in force. I promise this is all going to happen, and equity markets will crash, I just can’t say when. I think it’s likely to be soon.