Few capital markets participants will be sorry to see the back of 2002. Fear dominated the year: fear of more terrorist attacks, fear of the consequences of a war against Iraq, fear of more corporate scandals, fear of losing yet more money, fear of losing one's job, fear of going to jail.
And by the end of the year, another fear had taken hold of financial policymakers, a fear that will dominate the markets for months to come. It is the fear of deflation.
That's a familiar, sickening feeling in Japan but one that has only recently seized politicians and central bankers in Europe and the US in its icy clutch. Even now they can barely bring themselves to name this prospect, like patients who instinctively recoil from even breathing the word "cancer" lest they should, by doing so, bring the dread condition on themselves.
The consequences of deflation for highly indebted companies in the US and Europe would indeed be fearful. It would wreak havoc in financial markets that would make last year's wrenching volatility seem a tame prelude. That's why the world's financial leaders are now fully focused on the threat - even while portraying it as a distant one.