If Monday was calm, then already on Tuesday the situation in the global financial markets has seriously worsened. Due to the squeezing of liquidity in the global financial system, a new systemic global crisis began to spread to other countries, and the growing outflow of speculative capital in the coming months will finally undermine the growth of the global economy.
Argentina, Turkey and Pakistan have almost completely defaulted the systemic crisis, and today news has come about a sharp decline in the South African economy. The country's GDP unexpectedly showed a decline of 0.7%, and the country has officially plunged into recession. Along with this, the outflow of capital from India, Brazil and Indonesia is increasing and the consequences are already clear. Almost all business activity indexes around the world for August showed a sharp decline.
In addition, the debt market in Europe began to storm. At first, sales began on the Italian debt market, but the chain reaction is rapidly spreading to other countries, especially since the main buyer, the ECB, will finally leave the market this year.
The Italian government itself adds fuel to the fire. The country wants to increase spending contrary to the requirements of Brussels.
The budget deficit in 2019 may exceed 3%. Fitch rating agency has already downgraded Italy from stable to negative. Italy's budget for 2019 is due by October 15th.
So far, the ECB has bought and buys most of Italy's debt, but it is already leaving and will soon go completely. The liquidity crisis will hit all European debt soon, and there are the biggest bubbles. There are no new buyers of debt and never will be, and profitability is already growing.
European stock indexes today fell by almost 1.5% in the morning. The German DAX stock index is getting closer to an important level of 12,000 points, during the breakdown of which a real collapse can begin.
Meanwhile, D. Trump is preparing new duties for China for another 200 billion, and he should report this on Thursday. This week the congress is returning from vacation, so we are waiting for new pressure on the Russian Federation before the November US elections.