The melting of US stocks means that after the stock market falls to a certain extent, the market will automatically stop trading for a period of time. Since the beginning of March, the US stock market has experienced three fuses this month. On March 9, the Standard & Poor's 500 opened down 7% because the price of crude oil fell by more than 30%, which triggered a fuse. On March 12, the S&P 500 index fell to 7%, triggering the second fuse this month; On March 16, the S&P 500 index fell more than 8%. The U.S. stock market melted down three times in a row, which witnessed the history for investors. In the long river of the whole stock market, the American stock market has been blown four times, and it has appeared three times this month. After the resumption of trading in March 16, the decline of the three major US stock indexes has not narrowed, but has continued to expand. The Standard & Poor's 500 Index fell more than 10%, and the Dow fell more than 12 1%, the biggest drop since 1987. The impact of the US stock market crash on the entire financial market is enormous, so what impact will it have on the global economy?

The impact of that integration of US stock on the global economy

On the surface, the two major factors leading to the collapse of US stocks are nothing more than the collapse of crude oil prices and the COVID-19 epidemic. But from another perspective, the melting of US stocks also reveals that the global economy is on the verge of recession.

1 The melting of US stocks will directly cause global liquidity tension. In this case, if US stocks still cannot effectively stop falling, the global market will enter further panic selling, and in the case of panic selling, valuable assets will also be easily killed by mistake. If the liquidity crisis is not alleviated, investors will choose to hold money and wait and see, as long as cash is in hand.

2 The global economy is facing greater downward pressure. After all, as the world's largest financial market, the melting of US stocks will bring greater risks to the US financial system, which may directly lead to global financial risks.

3 the interest rate of us debt is down. The melting of American stocks caused investors to panic and led to a large number of selling. Everyone thinks that cash is king and increases cash holdings. It will further affect the decline in the interest rate of US debt and may eventually develop into a financial crisis.