Investors went into the year thinking

it was going to be pretty quiet and unspectacular with decent,

but unremarkable returns.

Big stock markets were at record highs

as recently as February, which seems an age ago now.

Then, of course, coronavirus came along.

The scale of the disruption to investors

is really hard to exaggerate.

Wall Street stocks dropped into a bear market

at the fastest-ever pace, and they ended the quarter down 20

per cent, even including a 15 per cent rally from the lowest

point of the year.

UK stocks had the worst run since 1987, which

is not exactly a vintage year.

The dollar squeezed higher, which

is bad news for countries and companies

around the world that have dollar debts.

And, perhaps most alarmingly, the government bond market

started to malfunction.

Covid-19 is a health crisis first and foremost,

and the response - locking down communities, cities,

and countries around the world - produces an economic crisis

too.

In mid-March it also appeared to be

producing a financial crisis.

The financial system itself was getting sick.

Central banks and governments can

do what they can to help the health crisis

and to soothe the economic shock.

But they did step in in force to help the markets,

and it has worked at least to some degree.

Markets are generally much calmer now.

But is it time to step back into risky bets?

Well, investors are not so sure.

As one put it to me this week, it's too late to sell,

but it's too early to buy.

Bargain hunters are out there.

Some hedge funds are raising money

to bet that the worst has passed.

But picking a bargain is tricky.

It relies on assumptions about companies' earnings,

and, right now, that's tough.

In addition, no one honestly knows

how this virus is going to play out

or how it's going to work in the US.

A bounce-back in markets is definitely

possible, but more likely is a slow grind lower from here.

That's better than the 10 per cent

daily drops we were seeing at one point,

but it's still not pretty.

Debt defaults by companies and emerging-market countries

are now seen as all but inevitable.

Investing now is not so much about picking winners

as picking survivors.