Bear Sleeping
4th July 2023

Summer Doldrums


Summer Doldrums

This financial phrase is used to describe the slow summer months when stock markets traditionally fall or at best drift sideways. The doldrums appear to have started early this year, such that a brief bounce in equities has been fading away since February.

These expressions usually contain a kernel of truth, reflecting a time when investors were typically on holiday and trading volumes declined to a trickle. In modernity the majority of transactions are automated and programme-driven, with little human intervention.

We are of course in the middle of the travel season. Once the stress of negotiating overcrowded terminals and security is overcome, I treasure the time spent on a flight, especially as one must be on flight-safe mode. Returning from my latest trip to my hometown of Liverpool I was pondering a theme for this article and seeking inspiration.

Peering through the aircraft’s plexiglass windows gives one a great sense of perspective. Flying above the Channel I spotted a lumbering tanker which from a great height resembled a motionless toy boat on a millpond. I was immediately reminded of Samuel Taylor Coleridge’s epic poem The Rime of the Ancient Mariner with the immortal line ‘as idle as a painted ship, upon a painted ocean’.

It is a tale of seafarers trapped on a wooden vessel, tortured by thirst in the windless, unchartered waters of the equator, also referred to as doldrums in maritime terminology. The blame for their misfortune was laid upon a mariner who had killed an albatross, as seabirds were believed to carry the souls of lost sailors. He was forced to wear its carcass around his neck as punishment by his shipmates for whom nautical superstition knew no bounds.

For those of a patient disposition the poem takes around 13 minutes to read, including dictionary breaks to look up archaic terms. Alternatively, you can listen to Iron Maiden’s heavy metal rendition which lasts a similar length of time. On that note I will soon be back on a flight to East Midlands Airport to watch the band perform in Nottingham, the place of my paternal ancestors.

Like others, I have yearned for travel following the disruptions of recent years. Having sated what is nowadays called ‘vacation vengeance’ I plan to spend some of the summer closer to home with a visit to Alderney. In Norman French dialect the latter is known as Aurigny, hence the name of the local airline.

While the albatross is a rarity in local waters, the Channel Islands are blessed with the presence of puffins. At barely a foot in height they are plucky creatures, often referred to as ‘parrots of the sea’ who spend most of the year bobbing around the Bay of Biscay. I hope to catch a fleeting glimpse of them as they migrate just before Alderney Week; the timing of the two events is purely coincidental!

Like the ancient mariner stuck in limbo, investors have been tormented by a lack of returns at a time of high inflation. As deposit rates have risen, the case for investing has become strained, particularly after a tough 2022. However, it should also be remembered that as inflation declines then interest rates will likewise fall. This is an ideal scenario for financial markets which would metaphorically put the wind in their sails.

The moral of Coleridge’s poem is one of redemption and respecting nature, while keeping faith that times will change for the better. We too should respect market cycles and hope that the second half of the year provides some relief for long-suffering investors.  

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