The crown is not an economic disaster – unless we leave no One Will

The global system came under unusual and intense pressure over the weekend. New quarantine reports against the crown, a collapse of OPEC negotiations on the level of oil production and a financial market already tetchy collision to produce a global stock market crash and lunch, at time of writing, on March 5 got more than 5% worldwide. faster for a moment fell Monday morning trading, all trading activities was set. Similarly the turbulent returns from the US Treasury declined to the lowest level … ever, flirting briefly with 0.3% compared to the United States 10 years to recover from something. It would be nice to be able to tell if they settle, but as the old market cliché goes, no one rings a bell when the market hits a bottom. We are clearly in a sudden and rapid reset the assumption that until a month ago, it seems appropriate: that the world economy on the putter modest growth, it would be that the US economy may slow down, but it would not stall, and that markets credit and low interest rates were also quite boring. No one can really plan for a pandemic, when it comes to investing and managing a business, and the costs of preparing, as the cost of treatment, as soon as the crisis is also affecting be terrible. It will come in time, there is no shortage of thoughts, but unlike the financial crisis of 2008-2009, which is one of those times when things simply discard. It had market crashes before, of course, and anyone who is familiar with the financial markets understood in the bones that things get very very rarely, very bad. This is clearly one of those times when a global pandemic trigger a wave of insecurity, a sharp and sudden pause in economic activity, which is now the world around splashes. Although viruses subsidies in China and stumbles life before, now intensifying in Europe, parts of the Middle East and now the United States. Without any definite road map, how and when it all plays out, financial markets do what the financial markets do sell and ask questions later and flee to assets such as government bonds, which are perceived as the only port in a storm. This has huge real impact. suddenly lost pension plans, 401Ks, all types of retirement vehicles for millions of families evaluate exactly when assumptions are reviewed on the activities for next year soon. individual sales order and rational instincts, what you can and to preserve what you have, which then act on selling spree connections that hypertext is already loaded and rigid algorithms of computer trading based instead of fear or hope of market dynamics. In moments of fear and panic, we all tend to scramble to the ground and play out the worst. From time to time throughout history, in fact the worst happens – after 1929, after 1939, 9/11, the financial crisis of 2008-2009. Perhaps this is one of those. But the youngest on this list would be too soft while peddling the imprudent cause tectonic shifts proved to be short and sharp, rather than the prolonged agony of the Great Depression and the horrors of war. a global pandemic could kill 10 million to 20 million people will be heartbreaking for sure, but a world population of 8 billion and the fact that the vast majority of deaths since killing those aged over 60, it would not be in the order of his Spanish flu of 1918 and many of the wars that have plagued us. This is not an event of breaking system unless they do not allow us to become one. Our financial system is treated by many as fragile beings and on days like these, all the doomsayers felt not loved their time in the sun. Their voices be noted, adding that the panic and therefore can serve as an additional fuel. But in 2008-2009, our systems were stronger than they, and with the sharp tip of volatile reaction to the real threat of the virus and its economic problems, this flexibility should not be easily disposed of. Stocks trade in economically sensitive areas such as travel and finance and retail, as if a sharp and lasting recession is inevitable, while bonds are traded as if it all goes towards zero. This is possible, but not likely. As hard as it may be conceivable, it will soon give realism and realism, which is the virus and consistent and measured public, financial and policy responses do not dictate the Panic Away. financial advice columns are full of the “do not panic” in the coming days and weeks. Here’s another strategy: the panic. Let succumb and imagine the worst. But do not take action. Play the scenarios and ask yourself if this really is the time when everything is revealed and flat. It is, as they say, only one end of the world, and that it is quite unlikely to be. Fear is a natural reaction, but so strengthened and look at what has happened in the past, what is happening now and what is likely to develop in the coming days. That feels unusual, and it is. But less often than we know that the same deadly virus now, the panic reaction is unleashing and could equally damage. Financial markets are a barometer lightning speed for these fears, but can also be the speed of light barometer of hope when the mood changes. Last week market hoping see-sawed back and hope to fear massive movements to fear. Be prepared for more of the same product; Panic a bit ‘; A buckle according to below; and try to remember that this too shall pass.
Picture copyright by Philip Montgomery for TIME