Today,
we are challenged again to reflect about resources, availability of wealth and
how vast amounts of money can be spent wisely or just evaporate. It is also a
call to reflect about priorities, decide on the appropriate ones and how to
fund them. More concretely, all this is about uncertainty and its impact on
capital markets, on short-term decisions and, in the end, on the minds of people.
Today’s
uncertainty is about the coronavirus.
More
concretely, almost every stock in the STOXX 600, the largest European share
index, are trading since this morning in negative territory, in the red, as the
specialists say. This represents around 180 billion euros the investors have
lost during the day, just today. This is about 2% of the entire capital
invested in those companies. But it is a lot of money that has faded away.
The
investors are pessimistic about the impact of the virus and the capacity to
control its transmission. A friend from the East Asia region told me that, in
the current state of world affairs, “when China sneezes, the rest of the world
catches the flu virus!” It is not exactly like that. But for sure the Europeans
that negotiate in the capital markets got high fever today.
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