By Rhys Miles
What a horror movie. Offshore equities are now experiencing declines beyond the GFC and akin to the Black October crash of 1987. Overnight, European equities are off 12%, the Dow is off nearly 10%. What is considered a lacklustre response from the Trump administration coupled with his payroll tax cuts facing challenges in Congress, investors have lost faith in the ability of authorities to contain and respond to the coronavirus pandemic.
Italy has recorded another spike in deaths overnight taking the toll to around 1,000. Major sporting events, professional tournaments such as the NBA and NHL have all been either postponed or cancelled. Countries in total quarantine and air flights to certain countries banned. Expectations of central banks cutting to below zero (going negative) are high, oil is off another 4%.
I’m trying to find something positive, but at the moment the world is coming to an end, just like it was going to in the crash of 1987, the South East Asian Crisis in the late 90’s and the GFC in 2008. Can’t help but think that the moment someone declares a vaccine has been tested and ready to go then we are going to see some remarkable turnaround. Nonetheless, we are where we are and need to adapt accordingly
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