Sarah Sands: The future is fearful. Ask Robert Harris...

Share
Related Topics

Philosophers and politicians may agree that you should face down your fears in order to obtain wisdom and courage, but they are not the ones investing in the stock market at the moment. The stomach-churning losses in the last week may have underlying causes but the momentum of short-selling is attributed above all to the smell of fear.

Still, one person's loss is another's opportunity. The global panic in the markets happens to coincide with the publication of Robert Harris's new thriller. In it, a brilliant scientist invents a computer that can make predictions about the global financial markets. The computer picks up a far more powerful force in the markets than information. It is fear, the most primal emotion. As Napoleon said: " There are only two forces that unite men. Fear and interest." When the two come together in stock markets, the results are catastrophic.

Harris's title, The Fear Index, is close to the market instrument The Volatility Index, a measure of the volatility in share prices. It can tell you how everybody is feeling. At the moment, investors are buying gold. Does that suggest that they think things can only get better?

The strongest characteristic of fear is its contagion. You would guess that since the markets are being scrutinised by experts they could form calm independent opinions. But investors turn out to be more hysterical that the rest of us, probably because they have a lot more to lose.

As Harris's computer creeps into the territory of artificial intelligence, it realises that terrifying people can be a reliable way of making money. I hope that The Fear Index is not the inspiration behind the decision of some famous investment bankers to go and form their own hedge funds. Is this the way the world ends, with one mass global short-selling?

The risk-takers will no longer say boo to a goose. They are hoarding like hairy survivalists. Who will tempt them out of their shelters? After the gigantic hoax of sub-prime lending, financial institutions may never trust each other again. Everyone is looking over their shoulder – Europe at Asia, Asia at America – while investors' heads are swivelling frantically.

The trouble with the fear index is that it crushes hope. Financial giants such as the American investor Warren Buffett may talk of having a "huge bull on this country" but people are too spooked to believe him. Whether or not we are all heading for a double-dip recession, we will talk ourselves into one. No private investment: no growth.

What we need is a genial figure radiating Reaganesque sunny politics, but unfortunately David Cameron is now about as cuddly as Robespierre. The fear index is social as well as financial. We have peered into the abyss of disorder. At first we blamed gangs and criminals, but within a week everyone was citing the Stanford prison experiment – where half the students were told they were guards, the other half prisoners – and civilisation was hanging by a thread.

A young woman who lives in Tottenham told me that she was still afraid to come to work in central London. It was not the prospect of looters she feared but that the riots would be a catalyst for a terrorist outrage, "because we are vulnerable now".

Once fear is triggered, it is very hard to restore calm. But I recommend the banner held aloft by a woman in London. It said: "Everything is OK."



Sarah Sands is deputy editor of the 'London Evening Standard'

React Now

  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
iJobs Job Widget
iJobs General

Recruitment Genius: Project Implementation Executive

£18000 - £23000 per annum: Recruitment Genius: They work with major vehicle ma...

Recruitment Genius: Chiropractic Assistant

£16500 per annum: Recruitment Genius: A Chiropractic Assistant is needed in a ...

Recruitment Genius: Digital Account Executive - Midlands

£18000 - £26000 per annum: Recruitment Genius: They work with major vehicle ma...

Recruitment Genius: Web Developer

£28000 - £30000 per annum: Recruitment Genius: This company provides coaching ...

Day In a Page

Read Next
 

Errors & Omissions: how to spell BBQ and other linguistic irregularities

Guy Keleny
 

South Africa's race problem is less between black and white than between poor blacks and immigrants from sub-Saharan Africa

John Carlin
NHS struggling to monitor the safety and efficacy of its services outsourced to private providers

Who's monitoring the outsourced NHS services?

A report finds that private firms are not being properly assessed for their quality of care
Zac Goldsmith: 'I'll trigger a by-election over Heathrow'

Zac Goldsmith: 'I'll trigger a by-election over Heathrow'

The Tory MP said he did not want to stand again unless his party's manifesto ruled out a third runway. But he's doing so. Watch this space
How do Greek voters feel about Syriza's backtracking on its anti-austerity pledge?

How do Greeks feel about Syriza?

Five voters from different backgrounds tell us what they expect from Syriza's charismatic leader Alexis Tsipras
From Iraq to Libya and Syria: The wars that come back to haunt us

The wars that come back to haunt us

David Cameron should not escape blame for his role in conflicts that are still raging, argues Patrick Cockburn
Sam Baker and Lauren Laverne: Too busy to surf? Head to The Pool

Too busy to surf? Head to The Pool

A new website is trying to declutter the internet to help busy women. Holly Williams meets the founders
Heston Blumenthal to cook up a spice odyssey for British astronaut manning the International Space Station

UK's Major Tum to blast off on a spice odyssey

Nothing but the best for British astronaut as chef Heston Blumenthal cooks up his rations
John Harrison's 'longitude' clock sets new record - 300 years on

‘Longitude’ clock sets new record - 300 years on

Greenwich horologists celebrate as it keeps to within a second of real time over a 100-day test
Fears in the US of being outgunned in the vital propaganda wars by Russia, China - and even Isis - have prompted a rethink on overseas broadcasters

Let the propaganda wars begin - again

'Accurate, objective, comprehensive': that was Voice of America's creed, but now its masters want it to promote US policy, reports Rupert Cornwell
Why Japan's incredible long-distance runners will never win the London Marathon

Japan's incredible long-distance runners

Every year, Japanese long-distance runners post some of the world's fastest times – yet, come next weekend, not a single elite competitor from the country will be at the London Marathon
Why does Tom Drury remain the greatest writer you've never heard of?

Tom Drury: The quiet American

His debut was considered one of the finest novels of the past 50 years, and he is every bit the equal of his contemporaries, Jonathan Franzen, Dave Eggers and David Foster Wallace
You should judge a person by how they peel a potato

You should judge a person by how they peel a potato

Dave Hax's domestic tips are reminiscent of George Orwell's tea routine. The world might need revolution, but we like to sweat the small stuff, says DJ Taylor
Beige is back: The drab car colours of the 1970s are proving popular again

Beige to the future

Flares and flounce are back on catwalks but a revival in ’70s car paintjobs was a stack-heeled step too far – until now
Bill Granger recipes: Our chef's dishes highlight the delicate essence of fresh cheeses

Bill Granger cooks with fresh cheeses

More delicate on the palate, milder, fresh cheeses can also be kinder to the waistline
Aston Villa vs Liverpool: 'This FA Cup run has been wonderful,' says veteran Shay Given

Shay Given: 'This FA Cup run has been wonderful'

The Villa keeper has been overlooked for a long time and has unhappy memories of the national stadium – but he is savouring his chance to play at Wembley
Timeless drama of Championship race in league of its own - Michael Calvin

Michael Calvin's Last Word

Timeless drama of Championship race in league of its own