Editor’s note: This article was first published in November 2010, and discusses speculation about an event in 2012. That date has long passed without the predicted disaster or market effect, so the premise of the article is obsolete.
People have stopped talking about 24 November 2012, the date on which the world is supposedly going to end, but it is a date we should keep in mind whether or not you believe in the end of the world.
As the date approaches, the subject will come up again. On one side there will be believers and followers of the prophecies, and on the other, people planning to make money from the end of the world (selling and renting bunkers, protection from the gods or stones that make you invisible for the occasion). The problem is not that the world ends, because I think that if it does, we will all meet up in the same place, so there would be no sadness left on the planet.
The question that came to my mind today is how that date will affect the financial markets and the risks facing our long-term investments.
As we were saying, the stock market is driven by two forces: greed and panic. Greed will not go away, as people try to take advantage of the situation, and I am sure there will be no shortage of panic. So much so that, as we were saying this morning in a meeting, all it would take is a chance earthquake to set off absolute panic that would hit the markets.
That said, we have made an exhaustive study of what science says about that day and, frankly, although the end of the world is not expected, the news is not very encouraging. As we have all been able to see, the climate is changing and earthquakes are happening. They may be unrelated or, according to certain sources, entirely related, and they could increase as we approach that date, when greater solar activity is forecast that will lead to the heating of the earth’s magma.
If we add to this an alignment of planets (I don’t know which ones), the effects that this alignment might have on tectonic plates are said to be unknown. At this point the prophecies are the least of it, since I have been hearing them since I was a child and I have already lived through five ends of the world.
There has also been talk that strong solar activity could damage today’s technological systems, including the internet. Far from being the end of the world, that would be a full-blown disaster, although no one knows for sure what will happen, and an equally logical alternative is that nothing happens at all.
We will simply need to keep an eye on our long-term investment portfolio and follow market movements very closely around that date, since many people may be in for an unpleasant surprise.
I may be getting ahead of myself by bringing this up, but it never hurts to keep it in mind, because sooner or later this debate will open up. This is one of the factors that neither the algorithms used for stock market investing nor financial analysts take into account, so we have to do it ourselves, based on our own judgment.
Featured image: Unknown author, Public domain, via Wikimedia Commons.
