Excerpt from "Fed’s solo act faces tremors in Turkey and a slower Europe"

The Turkish lira’s slide has little in common with the Thai baht devaluation in the late 1990s that preceded a larger crisis in emerging markets, or to the debt problems in Greece that raised the spectacle of the euro zone breaking apart. Both events raised direct risks to U.S. growth and financial stability and reshaped Fed policy in real time.

But Turkey’s problems, say some analysts, are another piece of evidence that the world is not as trouble free as it has seemed over the last year and a half. Over that period Fed officials, including some of those most hesitant to raise interest rates, spoke of economic “tailwinds” that let them lift rates in five of the last six quarters.

There are many other emerging markets, including Turkey, Iran, Russia India, Argentina, China, Chile and South Africa, that are “sitting on a ticking time bomb of U.S. dollar-denominated debt,” according to David Kotok, Cumberland Advisors chairman. In addition growth risks have rekindled in China; Europe’s suddenly poorer outlook could mean weaker world demand; and to top it all off the threat of a slide in global trade has been magnified by the Trump administration’s tariff threats.

Read the full article at One America News Network - OANN.com.

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