IF INVESTORS thought they could take things easy in the run-up to Christmas, enjoying the traditional “Santa rally”, they are instead facing the Grinch. Old fears have returned to remind them of the many risks 2015 may bring.

The first risk, ironically, is the consequence of good news. America added 321,000 jobs in November, suggesting that its economy is growing strongly. That, along with a monthly rise in average hourly earnings of 0.4%, raised expectations that the Federal Reserve might start to push up short-term interest rates in 2015. Central banks have been helping to propel stockmarkets for so long that it is not clear whether prices are justified by fundamentals or are simply the consequence of easy monetary policy.

The fall in the oil price is also good news. By transferring spending power from producers to consumers, it may boost global GDP growth in 2015. But while consumers may gain, the effect on some oil-producing countries such as Nigeria, Russia and Venezuela will be extremely adverse. Such a sharp fall in the oil price puts huge pressure on government revenues and raises the prospect of financial turmoil next year. There has also been a sell-off in the currencies of many developing countries, with JPMorgan’s Emerging Market Currencies Index hitting a 14-year low.

Another long-standing worry that has returned to the fore is the stability of the Chinese financial system in the face of weakening growth. After the People’s Bank of China cut interest rates last month, the Shanghai stockmarket went on a tear, rising by nearly a quarter in two weeks. But on December 9th the market fell by 5.4%, the biggest single-day loss in five years. Though it has since rebounded a little, trading has become very choppy. Regulators are reported to be checking that brokers are sticking to the rules limiting margin financing, suggesting that the rally stemmed at least in part from the illegal use of leverage.

But the most scary of the ghosts of Christmases past is the seldom-distant spectre of a renewed euro-zone crisis. Greece’s coalition government has called for a decision on a new president by December 29th; if 60% of its parliament cannot agree on a candidate, a new election will be called. The leading party in the polls is Syriza, a left-wing grouping which opposes the bail-out programme, rejects austerity and wants a renegotiation of (ie, reduction in) the country’s debt. The prospect caused the Greek stockmarket to fall by almost 13% on December 9th, its worst one-day decline since 1987.

If Syriza does take power and demands a renegotiation, or cancellation, of Greece’s debt, Europe’s leaders will face a tricky choice between what might be called the “Frozen” and “Buzz Lightyear” options. If Greece’s demands seem too unreasonable, the temptation will be to follow the advice of the hit song from “Frozen” and “let it go”—cut the Greeks off from financing by the European Central Bank (ECB) and see if a chastened Syriza party comes back to the table. The risk of such an approach is of contagion, with investors fearing that a Greek exit from the euro could set a precedent for other countries to leave, causing a sell-off in the bonds of Portugal or Italy.

The alternative would be to do some deal that extends the Greek debt even further, “to infinity and beyond” in the catchphrase from the “Toy Story” films. In that case, the danger would be that other countries would feel Greece had been treated favourably and demand similar deals. The credibility of the reform process would come into question.

Which option will be chosen? The yield on the three-year Greek government bond has risen above that on the ten-year bond (see chart). A sharp rise in short-term bond yields can mean that investors think the central bank will push up rates, but that is highly unlikely in this case. Instead, investors are clearly worried about taking a write-down on their bonds.

This risk has been building for some time. Mario Draghi, head of the ECB, stopped the rot in 2012 with his “whatever it takes” promise to save the euro. But European voters have since been treated to an endless diet of austerity and lower living standards; they are fed up. They see little difference between the mainstream parties of the centre-left and centre-right and are turning towards the extremes. It may start with Greece but it won’t stop there: look at the poll ratings of Marine Le Pen in France, for example. In Britain, the rise of UKIP may mean another hung Parliament in 2015 and an exit from the EU in 2017. Political risk is on the march.