Abacus | Look to US, not China for the 2019 financial crisis. Here’s why
- There’s a lingering feeling that the global economy is due for another downturn, as one tends to come along every five to seven years
- But while the West points to China, it’s the US that has most reason to worry. Something eerily similar to its subprime disaster is afoot
After a panicked end to 2018 in the financial markets, and a jittery start to the new year, an increasing number of investors, analysts and economists are beginning to warn about “the crisis of 2019”, as often as not to be followed by “the recession of 2020”.
So, for example, there were the oil crises of the 1970s, the Latin American debt crisis of 1982, the Black Monday stock market crash of 1987, the Tequila Crisis of 1994, the Asian financial crisis of 1997-98, the dotcom bust of 2000 and the worldwide recession that followed, the credit crunch and global financial crisis of 2007-08, and the European debt crisis that peaked in 2012.
Seven years on from that episode, and more than 10 years after the implosion of Lehman Brothers, financial markets have accumulated a whole new batch of excesses that are ripe for correction, as well as some old ones that previous crunches failed to correct.
But although many in the financial world fear a new crisis is looming, there is little agreement about what will trigger the shake-up, or where it will start.
