Faced with the epidemic of Coronavirus whose financial impact had been poorly assessed, investors around the world are turning to safe havens such as US government bonds or gold. The spread of the virus in Italy has caused a complete shift in the financial markets with drops of 4 to 5% in Paris, Frankfurt or Milan.

It is also contagion on the financial markets. For the first time, the coronavirus crisis is raising a wave of financial panic.

So far, global stock markets have rather underestimated the severity of the crisis and its economic impact. As if they did not want to see the negative signals which, however, have been accumulating for weeks with supply problems in electronics or cars, a sudden drop in air traffic and tourism or factories in judgment. But we have reached a tipping point with the multiplication of foci of infection, hence this complete change of footing of the financial markets with drops of 4 to 5% in Paris, Frankfurt or Milan.

Can this trigger a major financial crisis like in 2007?

It is the great fear indeed. It must be borne in mind that the stock markets have risen sharply in recent years. Before this Coronavirus affair, some people mentioned the risk of a bubble. There is therefore a risk of severe dropping out indeed. Fueled by an objective fact, the economy is slowing down. We can see this very clearly through two things, the fall in world demand for oil and the drop in the number of containers transported by the major shipping companies. We also see that investors around the world are turning to safe havens such as US government bonds or gold. It is the sign of an extremely feverish financial planet. There is a vaccine: it is the money of the central banks. But like most vaccines, it is not 100% effective in preventing seizures.