If there is a simple lesson to be drawn from last week’s market rout, it is that there is fragility in complexity. The coronavirus outbreak has, like the 2011 Japanese tsunami and Thai floods that disrupted auto and electronics businesses, or the 1999 earthquake in Taiwan that brought the semiconductor industry to a halt, shown us the vulnerabilities of our highly interconnected economy and global supply chains.
This time around, the trigger is an outbreak spreading outwards from China, still the factory of the world as well as its second-largest economy. It comes at a time when US politics are in flux, and we are in the midst of what Ray Dalio, founder of the Bridgewater hedge fund, recently called a “paradigm shif