As global crises mount, financial experts advise against panic, echoing the traditional wisdom of staying the course during market volatility. However, with interest rates surging to 18-year highs and geopolitical tensions escalating, a growing unease suggests this time may be different.
Warnings abound in the financial press: the Financial Times flags soaring borrowing costs, the Telegraph reports on stockpiling plans, and a former US Treasury official predicts worse than 2008. City traders now anticipate four quarter-point rate rises in 2026, a stark reversal from earlier expectations of cuts.
Historical comparisons offer little comfort. While some recall 1970s rates of 10-17% with smaller mortgages, today's average mortgage in London approaches £300,000 against a median salary of £39,039. Even the escape fantasy of moving to Australia was dashed by EU Commission President Ursula von der Leyen, who told Australian parliament that distance offers no protection in a 'new reality'.
Faced with this, economist Nouriel Roubini's prediction of a 'Greater Depression' resurfaces. Yet the article suggests two responses: either freeze all activity until clarity emerges, or continue as before, accepting that paralysis may be worse. The choice reflects a familiar dilemma in times of uncertainty.
