Feel the fear for the new World Economic Crisis

        

       In economics it's all about ups and downs. Crises and economic booms are following each other in a fatal dance where all we have to do is figure it out how to keep the pace with this mad dance and remain "financially alive". So we are so used to this word crisis,  especially those from developing countries, that every time when we hear it we tend to not pay any attention. 

        But trust me this time, things seem to move differently and maybe it is that moment when we have to analyse our positions and take the idea of a new crisis more seriously. 

        The frequency of economic crises tend to increase. It is considered the average frequency to be something within the precinct of 58 months. Taking  into consideration the latest world crisis than it should be completely normal to expect a new one in 2015. Will it be this September or lately? The most important is to figure out what is the reason causing so many fluctuations in indexes and shrink of currencies.

           Latest events show that the epicenter could be in China, either Russia, USA or in oil-exporting countries. World economy is so much interconnected that any sudden decline in a geo-political important region automatically brings another decline. After its peak on 27 April 2015, FTSE has been on a slide. All the drops are influencing the economy. Middle East stocks are declining and everyone is asking himself if the currencies will also drop. Remembering the Russian oil crisis and how they supported their currency by using their reserves, are the leaders in the Middle East going to use the same tactics? Even if they decide to do so, it is important to mention that Gulf reserves are much bigger that anyone else's reserves and in short terms the effects of the crisis won't be so visible.

          When it comes to Europe, the Eurozone is condemned to stay in a permanent economic crisis if important reforms aren't made. Another surprise is China's yuan policy U-turn on August 11 led to ripples threatening emerging economies. You can read more here. 

        Digesting all this information, one important question comes in the mind: will the market correct or is it going to be a new world crisis?