Greece has two options if it is going to default, he says: leave the European Union and surrender to debt in the drachma; or default in the euro. Bullman says the former would be best for Greece. “If you’re going to go bust, go bust big time,” he says, and wipe the ledger clean. But this would be the worst outcome for bigger euro countries. Germany would prefer that Greece default within the union, so it can manage the process. If Greece defaults, it will push Portugal into further distress and imperil Ireland’s attempts to fulfil its aim of issuing debt next year, Bullman says. All the while, Italy, Europe’s third-largest economy, seems in need of a bail-out even after it has introduced austerity measures. Sometime, somewhere, someone has to suffer a big capital loss.

CheckRisk says there is a 75 per cent probability that the economies of the U.S., U.K. and Europe will again go into recession in the near future. But this time, investors won’t be able to rely on China to buoy returns. Bullman says export volumes to America and Europe ahead of Christmas are much lower than in previous years, and raise the prospect of a hard landing for the Chinese economy. This is despite news that Chinese authorities are supporting industries that target domestic consumers, in addition to research and development to foster innovation. According to Ching Tan, managing director of the China office of global private equity business Siguler Guff, more than 200,000 patents were claimed in China the past year. This is a 10-fold increase on the number of patents claimed 10 years ago, Tan says. But manufacturing and exports will be pillars of China’s economy for many years to come and will suffer from less consumer spending in the U.S. and Europe. Investors can only monitor these accumulating risks and buy defensive assets, such as investment-grade corporate debt, at the cheapest prices possible.