Since the end of September, the FTSE100 has fallen by around 7% and by just over 10% since it peaked in May. Similarly, the S&P500 has fallen around 6% since its recent peak in mid-September.

In the last few days I have read a number of articles mostly saying this is nothing to worry about, all perfectly normal, it is precisely what markets do on a regular basis. And yesterday I read an article in The Times business section headlined “Now is not the time to be putting your money into the stock market”.

Which is right?

Nobody knows.

They are all just opinions competing for your attention. And as Warren Buffett quite right says “a forecast tells you more about the forecaster than the future.”

You need to be cynical and ask why the author has written that particle article. Investment managers could well argue such market movements are nothing to be worried about, but they clearly don’t want you to sell your investments because they will then earn less money and lose their job.

Likewise, a journalist may argue this is not a good time to invest and run for the hills, but they want people to buy their newspaper so have to be seen to have a strong opinion.

In 20 years, you could look back and either of them could be right.

But it doesn’t look good for people whose salary depends on them having an opinion to admit “we don’t know.” Their ego simply won’t allow them to say this.

We are hard wired to seek out predictions and forecasts, it could be about tomorrow’s weather, Brexit or this weekend’s football. I think it is an evolutionary survival mechanism; you want to know what danger lies ahead so you can avoid it.

The track record of anybody making good economic predictions is woeful because there are so many moving parts producing positive and negative feedback loops. If you are right you probably fluked it but your mind uses all sorts of tricks to convince you it was skill.  

Apply that to investing and people quite rightly want to know if and when the stock market is going to crash. And the simple answer is, nobody knows. Nobody can predict the future, so ignore those who claim they know what is going to happen next.