Economic matters hardly ever present a clear-cut picture of action and reaction. 2015 has been a year of massive and unprecedented geopolitical uncertainty, with continuing uncertainty from the Arab Spring and the US withdrawal from the Middle East giving rise to the world’s worst terror group yet – ISIS. The geopolitical havoc created by this group and its tentacles of terror have spread far and wide. The recent terrorist attacks in Paris are a case in point, and the knee-jerk market reaction came and went. When French fighter jets started bombed terrorist strongholds in Syria, the price of crude oil initially spiked, and soon retreated. Syria is simply not a big player in the oil market.

Besides for the usual back and forth between the European Central Bank, the Bank of England, the Bank of Japan, and the Fed, it’s business as usual. On the one end of the spectrum you have the US economy in the midst of quantitative tightening by way of interest-rate hikes. On the other end, the European Central Bank is looking to adopt quantitative easing measures by way of interest-rate cuts, bond buying programs and other monetary expansion measures to prevent the Eurozone from going into a recession. Policies of Central Banks at Odds with One Another Much the same is true in Japan which is experiencing a sharp contraction – a recession in fact – in its economy as a result of negative inflation and declining investment spending.

Even without China in the picture, there is tremendous anxiety about the future prospects of the global economy. When you factor in an economic slowdown in China, it is abundantly clear why so many emerging market countries are now up the creek without a paddle. Their currencies have all but gone into free-fall, and central banks across Africa and Latin America are scrambling to protect their currencies by raising interest rates. We are seeing a period of inflation accelerating in Third World countries, as they desperately attempt to safeguard the buying power of their currencies on the international stage. Exports to countries like China are on the decline and this has a profound effect on employment, revenues and profitability.