Why crashes and bangs rarely move markets
The world seems like a much more uncertain place today than it was before the financial crisis. The International Monetary Fund reckons that macroeconomic risk is running at twice the level it was before the failure of Lehman in 2008. The backwash from the crisis, debt-laden governments, low productivity and risk averse businesses and banks, has spelt weaker growth.
Uncertainty has also been fuelled by shocks such as political surprises and natural or man-made disasters. In the last few years, markets have had to contend with a stream of worries, from conflict in Eastern Ukraine and the Middle East, to Brexit, …read more