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"3 Ways The Ukraine Crisis Could Destroy The Economy"
by Epic Economist, 3/13/22:
"The ongoing crisis in Ukraine continues to wreak havoc on global financial markets, including the U.S. stock market, and it is threatening to spark a financial meltdown of catastrophic proportions. Even before the conflict started, a massive sell-off of tech and other risky assets was already driving stock markets significantly lower amid an imminent Fed interest rate hike. Now, the second wave of the sell-off is coming from the “destabilization of Eastern Europe by Putin’s advance into Ukraine," explained Mark Grywacheski, a financial advisor with the Quad Cities Investment Group, "This crisis will impact the US economy, but to what extent is highly dependent on Putin. Is Ukraine the final objective?” the expert asks.
The current outlook indicates that a lot more volatility is ahead. With commodity and oil prices rising to stratospheric levels, the stage is set for a financial disaster. Manufacturing costs are also going through the roof, as well as shipping and transportation costs, which, ultimately, will be passed along to the U.S. consumer in the form of higher retail prices. At this point, most investors can see that things will get much worse than they already are. In essence, there are still many other ways this confrontation could get worse than it already is. And every single one of them seems absolutely terrifying.
One thing is certain, this is just the beginning of the financial turbulence, as warned the financial and geopolitical analyst and writer Mikhail Klimentyev. From now on, things are going to get much more chaotic. Today, one of the biggest economies on the entire planet, and one of the largest exporters of energy supplies, and commodities, is being completely isolated from the global economy, sending prices to all-time highs and worsening shortages of a wide range of commodities. That means that the rest of the world will have to figure out ways to keep on running without Russian energy, grain, and raw materials. The same goes for Russia. The Kremlin will have to find alternatives to survive without western capital, technology, and expertise.
In a recent article for the Telegraph, the expert exposed three ways the Ukraine crisis could crash the financial system. While domestic stock markets will continue to plunge week after week, a global stock sell-off is still gaining force as the worsening confrontation and rising crude oil prices shift investors’ sentiment.
Investors have been cutting their positions as they worry about the possibility of a prolonged crisis in Ukraine and its impact on the U.S. economy. “The growing concern surrounding the deteriorating Ukraine crisis has pushed the stock markets into correction mode. The near 20 percent decline from the peak in NASDAQ is a clear indication of the correction that has set in,” said V K Vijayakumar, chief investment strategist at Geojit Financial Services.To make things worse, in a recent note to clients, the head of Matterhorn Asset Management and precious metal specialist at Gold Switzerland, Egon von Greyerz, has warned that the crisis between Russia and Ukraine could lead the world to an apocalyptic turning point.
“The dynamite of a global commodity crisis and shortages thrown into the already catastrophic debt and global monetary fire will create an inferno of nuclear proportions,” von Greyerz emphasized. “If a miracle doesn’t stop this [conflict] very quickly, the world will soon be entering a hyperinflationary commodity explosion combined with a cataclysmic deflationary asset implosion,” he cautioned.
Right now, the impacts of this crisis are still rippling through the global economy, and even though we haven’t seen a crash yet, it is already looming on the horizon - the only question left is how bad the downfall will be. "
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