Investors are
spooked by China's extreme downturn in the market. The International Monetary
Fund had announced a great series of prophecies regarding another possible
downturn for the global economy that could drag us down back into the Third
Great Recession.
According to
Bank of England Chief Economist Andy Haldane, market troubles and Chinese
economic concerns are just the next chapters in an on-going story regarding the
Third Fiscal Apocalypse.
The Slowest Growth Since 2008
The IMF said
global growth is at its slowest in 2015 with a possibility of 3 per cent growth
reduction, which would be painful for many emerging markets with corporate
outfits.
The US'
increased interest rates, one of the many catalysts of the possible depression
according to analysts, has "sucked out emerging economies" that
returned money into the higher-ups of society. This has devalued the emerging
market currencies.
However,
because of huge foreign reserves initiated by the increased interest rates, the
downturn's impact was diverted, said other analysts with a more positive
approach.
The New Reality
Itau Chief Economist Ilan Goldfein from Brazil said to
raise Brazil's financial status, which was pushed down the junk by Moody's,
would mean to work with the budget deficit and "new realities".
He said Brazil would need to adapt to the new terms of
trade that offers different commodities. The economic head is pertaining to the
falling oil prices.
South America is hit by widespread devaluation after
every nation's primary resource had a value downturn earlier this year.
Experts advise that emerging markets needed
adaptability and government market stimulation to uphold and cushion the impact
of impending trouble.
