Anything is possible..

It is nearly 100 years to the day since a roulette wheel in Monaco caused quite a stir. At Le Grand Casino, the colour black came up on 26 consecutive spins of the wheel. That night the casino made several million francs. Why? Because after the tenth spin yielded black, there was a stampede towards the table in question as people began to wager huge amounts on the colour red coming up on the next spin. This is often cited as the gambler's fancy. Although the chances of that sequence of black spins was over 1 in 136 million, people foolishly lost sight of the fact that the chances of red or black coming up on an individual spin were exactly the same each time - 18 in 37.

It illustrates nicely the warning which is attached to financial investments "Please note past performance is not an indicator of future performance and the value of your shares can go down as well as up". Perhaps what is even more amazing is the fact that the gambling industry is thriving in Monaco a hundred years later. It must be the uncertainty which people find attractive because all around them, their sense of logic is screaming at them to walk away.

Life is all about risk when we break it down. From the amount of alcohol we drink knowing its downside to the amount of fatty food we eat knowing the price we will likely pay later we all take choices which fly in the face of logic - and quite right too. If we all led lives based purely on logic, the world would become even more restricted than it already feels.

What history does not tell us about the incident in Monaco is whether anybody had the nerve to wait for the 27th spin of the wheel to place a huge sum on red. I like to think so because there is usually that one person capable of holding their nerve better than the next guy. As the saying goes, "everything comes to he who waits".

This seems to be the approach of the new Governor of the Bank of England. He has made the announcement that interest rates will remain at their historic low of 0.5% until unemployment falls below 7%. I don't want to sound like I know what colour will spin next but we can rest assured that we are entering a long period of low interest rates for richer or poorer.