Donald Trump’s tariff shook the markets

The sharp decline in stock markets around the world does not appear any sign of allowing the United States to impose overburden and swinging definitions, and many ask whether this is qualified as the “destination” of the stock market and what can this mean for them?

The word breakdown was used slightly over the decades and is usually booked for more than 20 % of a modern peak in one day, or over two days.

On October 19, 1987 – also known as Black Monday – The US Securities Market lost 23 % of its value in one day, and other stock markets had similar declines.

This was definitely a crash.

In 1929, the US Securities Market lost more than 20 % of its value in two days – and 50 % within three weeks. This was the famous Wall Street crash that entered the great depression in the 1930s.

In comparison, the US Securities Market lost about 17 % of its peak in February, and now decreased by 2 % in terms of this time last year.

The FTSE index in the UK decreased sharply but not as much.

This is partly because it closes earlier than New York, so it often plays with everything that happens in the United States the next morning.

Follow direct updates

However, this is the largest and fastest declines that we have seen in the global markets because they are offered by Covid-19 in early 2020.

A 20 % decrease in the peak “bear market” – a description of the market that appears to be more vulnerable to height. We are very close to this description now.

While many people own stocks and stocks directly, most people are exposed to stock markets come through their pension plans. There are two types – specific benefits diagrams that guarantee a fixed income for pension, and the specific contribution as your pension bowl rises and falls with financial markets.

This may seem like very specific contribution plans at this sale – but not all your contributions enter the stocks. A lot of money goes to safer investments such as government bonds. This tends to increase in value when the stock markets decrease as it is seen as a “safe haven” along with other origins such as gold.

This is exactly what happened here.

The governmental value in the value that can compensate for some or all the decrease in stocks has increased depending on how to customize your pension savings.

The closer to retirement, the higher the higher percentage of the pension bowl in the bonds – thus the less affected.

There has been many falls like this in contracts since Wall Street’s failure, but in the long run, stocks turned into a good investment – and the provision of pensions is a long -term game.

It doesn’t matter. The company’s share value is a measure of the profitable range of these companies in the future. The falling market is an indication that most people believe that most companies are likely to see their profits decreased.

The markets believe that the tariff bomb for US President Donald Trump is expected to raise prices, and the demand is decreased and the profit reduces, making companies less valuable and more inclined to reduce investment and jobs.

So the real warning sign here is not related to the value of your pension, but about the authenticity of the economy in which we live and work.

Sometimes like this falls, often, it preaches an economic shrinkage. This is more than anxious about the value of your pension, which he has seen and will witness volatility like this over the years.

But this does not mean that this is not a very big moment for the global economy.