Despite what you might think, risk markets are in a sweet spot

Here's three reasons not to worry.

The next six months could well be easy going for equity markets, and even the more exotic markets, like emerging market bonds, which suffered when the story first broke about ‘tapering’: a possible reduction in the US Fed’s Quantitative Easing programme. Let’s consider this and the other oft-perceived threats to the markets.

QE. Yes, QE may be tapered, but only probably, not definitely, as Bernanke was at pains to emphasise in the Q & A session following his recent speech at a National Bureau of Economic Research conference. It all depends on the data, and he assured us they are actually also worried that inflation may be too low. I think we’ve seen the bulk of the rally in US Treasury yields for now. For the next few months, I think the stock markets can live with this scenario - if data’s weak, QE will go on longer, if data's strong, then companies are going to be more profitable. Taper-shock is rapidly fading.

China. I definitely do not fall into the camp that believes China is a powder-keg waiting to explode, leading to global financial and economic Armageddon. Banking systems rely on confidence. Confidence in the unlimited supply of funding, confidence that borrowers, public and private, are solvent and able to repay, confidence that collateral values, e.g. house prices, will only ever rise.

Now, institutional over-indebtedness may well have become endemic in China, but certainly not amongst individuals, and the whole pack of cards is, as ever, dependent on the same ‘confidence trick’. Although China’s sensible determination to rebalance its economy away from investment-lead growth and towards consumption is no doubt weighing down on headline GDP, in the Chinese tradition the measures will be introduced gradually and pragmatically, as evidenced this week by senior leaders’ comments. Whilst Vice Premier Zhang Gaoli said that the government would "expand domestic demand", he also assured us they would "try every method to provide funding to support SMEs, exporters, and technology firms". Premier Li Keqiang was quoted as saying that the government would "prevent economic growth from slipping below the lower bound".

With $3.3tn in foreign exchange reserves alone, which it could quietly use to rescue the banks - I suspect we’d never even know a banking crisis had happened.

The Eurozone. Portugal, Greece, Cyprus, even France, surely we face a summer of cataclysmic popular discontent on the streets? Nope. The lesson of the Eurozone crisis is the Germans and the ECB will ride to the rescue-sure, there’ll be a to and fro over austerity measures, wrestling with the balance between creation of moral hazard in the South and ensuring the Euro’s survival, but I believe the nexus of self-interests implies we have reached a state of equilibrium. This is admittedly an inherently unstable equilibrium because of the absence of a fiscal union but, once Merkel has won her election that, and its sister, banking union, will be front and centre and suddenly on the cards. Right now she can’t say so, because of the election, but she knows the Euro won’t survive another five years without them. 

Federal Reserve Board Chairman Ben Bernanke speaking at a new conference in June 2013. Photograph: Getty Images.

Chairman of  Saxo Capital Markets Board

An Honours Graduate from Oxford University, Nick Beecroft has over 30 years of international trading experience within the financial industry, including senior Global Markets roles at Standard Chartered Bank, Deutsche Bank and Citibank. Nick was a member of the Bank of England's Foreign Exchange Joint Standing Committee.

More of his work can be found here.

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Want to send a positive Brexit message to Europe? Back Arsene Wenger for England manager

Boris Johnson could make a gesture of goodwill. 

It is hard not to feel some sympathy for Sam Allardyce, who coveted the England job for so many years, before losing it after playing just a single match. Yet Allardyce has only himself to blame and the Football Association were right to move quickly to end his tenure.

There are many candidates for the job. The experience of Alan Pardew and the potential of Eddie Howe make them strong contenders. The FA's reported interest in Ralf Rangner sent most of us scurrying to Google to find out who the little known Leipzig manager is. But the standout contender is Arsenal's French boss Arsene Wenger, 

Would England fans accept a foreign manager? The experience of Sven Goran-Eriksson suggests so, especially when the results are good. Nobody complained about having a Swede in charge the night that England won 5-1 in Munich, though Sven's sides never won the glittering prizes, the Swede proving perhaps too rigidly English in his commitment to the 4-4-2 formation.

Fabio Capello's brief stint was less successful. He never seemed happy in the English game, preferring to give interviews in Italian. That perhaps contributed to his abrupt departure, falling out with his FA bosses after he seemed unable to understand why allegations of racial abuse by the England captain had to be taken seriously by the governing body.

Arsene Wenger could not be more different. Almost unknown when he arrived to "Arsene Who?" headlines two decades ago, he became as much part of North London folklore as all-time great Arsenal and Spurs bosses, Herbert Chapman or Bill Nicholson, his own Invicibles once dominating the premier league without losing a game all season. There has been more frustration since the move from Highbury to the Emirates, but Wenger's track record means he ranks among the greatest managers of the last hundred years - and he could surely do a job for England.

Arsene is a European Anglophile. While the media debate whether or not the FA Cup has lost its place in our hearts, Wenger has no doubt that its magic still matters, which may be why his Arsenal sides have kept on winning it so often. Wenger manages a multinational team but England's football traditions have certainly got under his skin. The Arsenal boss has changed his mind about emulating the continental innovation of a winter break. "I would cry if you changed that", he has said, citing his love of Boxing Day football as part of the popular tradition of English football.

Obviously, the FA must make this decision on football grounds. It is an important one to get right. Fifty years of hurt still haven't stopped us dreaming, but losing to Iceland this summer while watching Wales march to the semi-finals certainly tested any lingering optimism. Wenger was as gutted as anybody. "This is my second country. I was absolutely on my knees when we lost to Iceland. I couldn't believe it" he said.

The man to turn things around must clearly be chosen on merit. But I wonder if our new Foreign Secretary Boris Johnson - albeit more of a rugger man himself - might be tempted to quietly  suggest in the corridors of footballing power that the appointment could play an unlikely role in helping to get the mood music in place which would help to secure the best Brexit deal for Britain, and for Europe too.

Johnson does have one serious bit of unfinished business from the referendum campaign: to persuade his new boss Theresa May that the commitments made to European nationals in Britain must be honoured in full.  The government should speed up its response and put that guarantee in place. 

Nor should that commitment to 3m of our neighbours and friends be made grudgingly.

So Boris should also come out and back Arsene for the England job, as a very good symbolic way to show that we will continue to celebrate the Europeans here who contribute so much to our society.

British negotiators will be watching the twists and turns of the battle for the Elysee Palace, to see whether Alain Juppe, Nicolas Sarkozy end up as President. It is a reminder that other countries face domestic pressures over the negotiations to come too. So the political negotiations will be tough - but we should make sure our social and cultural relations with Europe remain warm.

More than half of Britons voted to leave the political structures of the European Union in June. Most voters on both sides of the referendum had little love of the Brussels institutions, or indeed any understanding of what they do.

But how can we ensure that our European neighbours and friends understand and hear that this was no rejection of them - and that so many of the ways that we engage with our fellow Europeans rom family ties to foreign holidays, the European contributions to making our society that bit better - the baguettes and cappuccinos, cultural links and sporting heroes remain as much loved as ever.

We will see that this weekend when nobody in the golf clubs will be asking who voted Remain and who voted Leave as we cheer on our European team - seven Brits playing in the twelve-strong side, alongside their Spanish, Belgian, German, Irish and Swedish team-mates.

And now another important opportunity to get that message across suddenly presents itself.

Wenger for England. What better post-Brexit commitment to a new Entente Cordiale could we possibly make?

Sunder Katwala is director of British Future and former general secretary of the Fabian Society.