SO, we’ve all heard about what happened in the financial world last year.

Financial institutions crumbled, markets tumbled, policymakers bumbled and Alistair Darling mumbled a lot. Much of this was predicted, but equally important can be what didn’t come to pass.

Well, firstly, no silver bullet was found to blow away the problems in financial markets. Last week, Bank of America secured a share of the Troubled Asset Relief Programme, partnationalising the bank, which is America’s largest.

In the UK, there is no sign yet of a pick-up in the financial arena, despite the rate at which banks lend to each other, the fabled Libor, being at multi-year lows.

The positive effects of the current low rate will, however, take time to filter through to the sector as a whole. Furthermore, China didn’t become “decoupled”

from the wider economic malaise. The theory was that China has now become such a behemoth that it could drive its own growth, independent of the established names such as the US. Domestic consumption is falling, and exports are declining for the first time since the turn of the millennium, exacerbating the global slowdown.

Against this backdrop of mal-forecasting, here are a couple of scenarios that have been touted to happen this year, and why they may not.

It can’t have escaped your attention that interest rates are as low as a snake’s belly at present. With the ability to cut rates rapidly diminishing, attention is turning to the viability of printing more money.

Rumour has it that Mr Darling and his cohorts are planning what they call a “sensible contingency plan”

to be set in motion to stave off deflation, should it rear its ugly head. Printing money is inflationary and, to this end, it may work in the short-term. However, money must be backed up by something tangible – gold or the like – otherwise you have more cash chasing the same amount of goods. One would hope that common sense will win the day here (come on people, I heard that ironic scoff), and that this idea will be rejected.

Most importantly, the avid investors among you will be wondering “will the market reach lower lows?” This seems plausible on the face of it. Indeed, many believe it a certainty, with earnings set to disappoint further.

There is, however, a case for saying that the UK equity market currently reflects most of the bad economic news from now until 2010, which ranks among the most negative forecasts for the beginning of economic recovery.

I, like many in the industry, am looking for the market to turn upwards in advance of the economy, as is its wont, and for the speed of turnaround, as and when it comes, to be initially rapid. Brave investors, eager to recapture lost capital, will not want to miss out on a penny of upside, and buying pressure will be vigorous. I am certainly not going to attempt to put a timescale on it – such estimates have made fools of greater minds than mine, but shares may be well on the way to recovery long before the corporate decision-making bods have repaired the balance sheets and cash flow statements of UK PLC.

■ Michael Rankin is an investment advisor in the Teesside office of Brewin Dolphin, and can be contacted on 0845-213-1340. All prices quoted in the article are from public sources. The views expressed are not necessarily held throughout the Brewin Dolphin Group. You should bear in mind that no investment is suitable for all circumstances and it is important to seek expert advice if in any doubt.

Brewin Dolphin Limited is a member of the London Stock Exchange, authorised and regulated by the Financial Services Authority.