By David Clark

“We’re doomed,” said Private Frazer of Dad’s Army fame. The Home Guard platoon member and pessimistic undertaker, superbly played by Scots star John Laurie, said it a lot and it was usually pretty funny.

Anyone watching news broadcasts or reading the papers may be tempted to think along similar lines, though you would be hard pushed to find any of the headlines funny.

Leaving aside the daily tragedies that adorn

the front pages, on the financial front we are constantly assaulted by lots of scary statistics – inflation tops 11 per cent, interest rates heading for 5%, mortgage rates soaring, unemployment on the way up, food shortages, big price rises in supermarkets, dire warnings of a house price collapse and so on.

It would be easy to fall into a pit of despair, but I can’t help wondering if things are really as bad as all that. The FTSE 100 index was at an all-time high only a few weeks ago and is trading only 1% below that as I write.

February and March represent the most important reporting season for companies trading on the stock market, as a large number have December financial year ends and these results give us an idea of the outlook for their industries as their management’s see it now.

Generally speaking, these results have been good. Take the house builders for example. All the quoted builders have been remarkably consistent in saying 2022 was a good year. This year has got off to a rocky start as potential buyers hold off on committing to a mortgage deal when it looks as though rates on those policies will continue to fall. All are agreed the spring selling season is crucial, but none are expecting a catastrophe.

Defence companies such as QinetiQ and Chemring are reporting fuller order books as Europe leads the way with a 45% jump in defence budgets expected over the medium term. The US defence budget is expected to shrink a bit in real terms over the next three years, but this is hardly the end of the world.

Natural resource companies continue to thrive as commodity prices remain heightened with

the likes of Glencore and Anglo American announcing very strong profits. There has, of course, been much furore over the record profits made by BP and Shell. I make no comment on the morality of this or otherwise – it’s just interesting.

As business and leisure travel picks up

post-Covid, companies such as Whitbread and Jet2 are optimistic about their prospects for 2023. Even National Express, which had a tough time during lockdown, is very positive on the recovery of its business as it wins new contracts and benefits from the train strikes. Every cloud and all that.

A while ago I attended a presentation by Tate & Lyle, the ingredients business. I was astonished to learn that to meet the demands of a growing global population we will need to produce more food in the next 40 years than has been produced in the previous 8,000 years. That is what you call a robust demand background.

Even perennial disappointments such as bank stocks are doing well – and so they should. If they can’t take advantage of rising interest rates to improve their net interest margin then, frankly, they have no business doing business.

Don’t get me wrong. I know there are companies out there who are suffering and will continue to suffer. There are pressures on both their top and bottom lines. Supermarkets and general retailers, such as Halfords, are feeling

the pinch and recruitment companies are seeing trading slip from previous (admittedly record) highs. Marketing firms are experiencing a slowdown in advertising, but it has not ground

to a halt.

I am not blind to the irony that insolvency specialists such as Gateley and FRP Advisory are expecting the most buoyant market for their skills in years.

My point here is not that the headlines are wrong – they are not. It is just they are not the whole story. In my line of work, time spent doing a bit more digging is generally time well spent.

It does no harm to get a more rounded view

of the world as it actually is rather than how

it may appear to be when given but a cursory glance.

Not everyone has the time to do this sort of background research, but it does not require huge resources – an internet connection and

a pocket calculator will do the job just fine.

So, the next time you think Private Frazer may be on to something, have pause – in every scenario there is always someone, somewhere who benefits. Always.

And if there isn’t? Then we are all doomed.

David Clark is an investment director of Saracen Fund Managers.