Assuming the U.S. stock market, being at all time highs, is indeed Trumped-up and bubbleicious, this is easily the kind of exogenous shock that could make things go pop. The Trump Slump global growth recession in 2019 needed a break to avoid more serious consequences. Coronavirus wasn’t the break optimists were looking for.
Dr Andy Xie, Shanghai-based economist, opines:
Luck may be the only thing standing between the coronavirus and a US stock market crash
The slowdown in Chinese manufacturing and ripple effect on global supply chains will hit the global economy hard, even if a recession can be avoided
If the outbreak cannot be contained by summer, a crash worse than the 2008 crisis awaits America’s inflated asset markets
China’s manufacturing sector will take quite some time to get back to normal. The global supply chain is being disrupted, triggering production stoppages in other industrial centres. China will at least struggle through this month. The odds are high, and rising, that the coronavirus crisis will last through March, which may be enough to push the global economy into recession…
Disruption in March looks increasingly likely. The longer the crisis lasts, the more likely is a global recession […]