A year ago, I was writing my last financial stability
contribution in the GFSC's annual report. Clearly unable to
resist the allusion to Greenspan's autobiography, I commented
then that I believed the recent past would be remembered as a short
age of great uncertainty with little accompanying turbulence. I
ventured that this would change during the year and made a forecast
that turbulence would return to 'more normal' levels. The
fourth quarter of 2018 more than confirmed this prediction.
Now at Guernsey Finance, I turn to thoughts of this year.
Uncertainties have, if anything increased, not decreased. The IMF
warns of a global downturn. Markets are stalked by protectionist
fears. The US is poised for a second government shutdown. A Chinese
slowdown looks irrefutable. The Fed places normalisation policy on
hold and, absent any impact of a no deal Brexit, the Bank
of England puts the odds of a UK recession as one in four by the
summer.
