To see the problem, think of shares as bets, or state-contingent securities, which pay off well in some states of the world (economic growth) and badly in others (recession or euro break-up). A share price is then the probability-weighted sum of these different payoffs.
Now, at its low point in May, the FTSE 100 was under 5300. You can think of this level as being consistent with investors thinking there was a 40 per cent chance of the market being worth 3500 - its level at the worst point of the 2008-09 crisis - and a 60 per cent chance of it being worth 6500; (0.4 x 3500) + (0.6 x 6500) = 5300. The index is now just over 5800. But this implies that there's still a 20 per cent chance of the disaster striking.