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Today I am in the far north of Scotland by the shores of Loch Ness and staying in Inverness. The skies are incredible here with swirling storms mounting from different directions amid the occasional glimmer of sunshine.

Perhaps I should be dropping my contemplation of global financial affairs but the metaphor for what faces the markets is clear. There is a storm breaking and it is far from over. I doubt this will be like Scotland with its endless bad weather but even here you can not escape the subprime crisis.

Inverness is suffering from a lack of tourists this year. For visitors that is actually quite pleasant. There are no traffic jams, you can always find a parking space and the restaurants have some interesting offers, especially for the Highland products which we love like pheasant and venison.

The real culprit for the tourism slump is high petrol prices. Tourists used to drive up from southern England for the delights of the Highlands with their breathtaking views and fresh air. We heard it was cold here in August and felt that would be a welcome change from the heat of the Gulf of Persia.

But this is not going to be a good season for landlords and ladies who have vacancies in their peak season. It is a sign of how financial problems spread out to the periphery in modern society or the technical term is contagion.

You have to ask yourself if The Highlands of Scotland are feeling the cool wind of recession then how much further this has to go. Sadly I can only see big storms swirling overhead and deceptive glimmers of sunshine for the world economy for a couple of years.

We will see some big banks fail this fall and further pressure on financial institutions. UK hedge funds had their worse month for eight years last month, and anybody who has money under management is generally losing more than they would in a bank account assailed by inflation.

The only winners in the past 12 months have been oil and gold, and related investments like silver and oil services. My sense is that oil will go into a volatile stage, and could easily spike higher before taking a tumble in one or two years. Gold will then be the only place to be, although I suppose cash has the lowest risk of all. I don’t even like money market accounts with bond exposure with inflation heading higher.

However, the risk of a big storm in financial markets is very large and that is the monster lurking out there this summer. It is far more real than anything we are likely to sight on Loch Ness today.