Trevor Green: Taking a view on the consensus

MARKETS

13 September 2012 marked the fifth anniversary of the start of the collapse of Northern Rock.

Few of us expected such huge repercussions. Central bankers and their policies have been in the spotlight ever since. It has been very hard for markets to forecast their actions as we are in territory with no historical precedent, hence the lack of consensus on policymakers’ likely actions. One of the most frequently used phrases to explain market or share price moves is how something “differs from consensus expectations”. In his book, The Future of Investors, respected financial writer Jeremy Siegel discusses this. A key message is returns from a stock depend not on earnings growth but ...