The International Monetary Fund says in its latest World Economic Outlook that the risk of a global slump is now "alarmingly high." Yet most stock markets, led by the US and Europe, although currently pausing for breath, remain in strong uptrends.

What on earth is happening? Where do things go from here? And as investors, what should we do?

The key to understanding investment markets since the eruption of the financial crisis is always to keep in mind this piece of counter-intuitive logic - poor economic growth is GOOD for the value of most investment assets; when growth eventually picks up strongly, that will be catastrophic for most of them.

Why?

The reason is that the major tool governments are using to try to stimulate economic growth is monetary policy - "money printing," plus abundant and virtually free credit for the least deserving, such as megabanks and fiscally incontinent nations.

It's not true to say that this policy is a complete failure. It has almost certainly prevented a global economic catastrophe. But it has failed to restore strong economic growth, and is unlikely to do so in future.

It will continue to fail because it's not the solution to the problem. That requires fundamental reforms that the inept and wrong-thinking political classes are unwilling to implement and for which the voting masses are unprepared.

If I am right about the prospect of continuing failure, you can be sure that the central banks will persist with their easy-money policies, implementing them in increasingly desperate (irresponsible?) ways. It is commonplace for those in power whose policies are a failure because they're fundamentally wrong, to believe that doubling a dose of the poison will produce the desired cure.

The easy-money policies are having a devastating impact on those without the political or financial power to defend themselves. In Britain, for example, those retiring and having to convert capital into annuities to provide an income stream now get 20 per cent less income that they could three years ago, 7 per cent less than they could just three months ago. The central banks' strongly depressed interest rates are devastating the incomes of retirees.

But easy money is great for speculators and - for the moment - good for investors,

David Fuller's view There is something for everyone in this issue, which I commend to you.