The numbers come first. Owen Lamont, senior vice president and portfolio manager at the $195 billion quantitative hedge fund Acadian Asset Management, says the coming three months carry a 10% chance of an 'epic financial disaster,' compared with just 2% for the rest of the year.
Lamont, who has taught at Harvard, Yale, the University of Chicago and Princeton, calls it 'panic season.' His research, published on his blog Owenomics, traces a pattern stretching back to the founding of the republic: major U.S. financial crises cluster between August and October.
The list is long. America's first bubble, 'Scriptomania,' hit in July/August 1791. The Panic of 1857 struck in August, the Panic of 1873 in September, and the Panic of 1907 in October. In the modern era, the collapse of Long-Term Capital Management came in September 1998, Lehman Brothers filed for bankruptcy in September 2008, Black Monday hit in October 1987, and the Asian financial crisis erupted in October 1997.
Lamont's own scars date to August 2007, the 'quant quake,' which he says left analysts 'compulsively checking our phones and having nightmares about screens full of glowing red numbers.'
His explanation is structural, not conspiratorial: thin trading. Lamont cites research showing August and September bring unusually low market liquidity as traders take summer vacations in the Northern Hemisphere. Less capacity to absorb large trades means any shock gets amplified rather than absorbed.
The root cause, Lamont argues, traces back to America's agricultural economy, when money had to flow from East Coast banks to Western farm regions to finance the harvest, draining Eastern liquidity each autumn. He cites economist Oliver Mitchell Wentworth Sprague's 1910 account of crises occurring 'in the autumn, when the western banks, through the sale of the cereal crops, were in a position to withdraw large sums of money from the East.' English economist William Stanley Jevons flagged the same seasonal pattern as far back as 1884. Lamont notes the Federal Reserve itself was created partly in reaction to these recurring panics, citing a 1986 American Economic Review article by Jeffrey Miron.
Lamont told Fortune a crash remains a 'rare event' and that he isn't aware of any particularly leveraged players positioned to spark one today — though he wasn't aware of any in August 2007 either, right before the quant quake hit.
This year's version of panic season looks different on the surface. As of late August 2026, the S&P 500 hadn't moved more than 1% in either direction on a single day since setting a record high on Aug. 13 — a market that appears calm while, in Lamont's telling, churning wildly beneath the surface.
The lesson for investors is not that Washington should smooth over volatility — it's that markets price risk on their own, seasonally and structurally, whether regulators are watching or not. Capital rewards clear rules and punishes complacency; a century of panics shows that liquidity, not policy, is the real early-warning signal.
The Fed was built to answer these seasonal droughts in liquidity, yet the pattern persists nearly two centuries later. That is the market's own verdict on how much any institution can truly engineer away risk that is baked into the calendar itself.
