October 1, 2018 was an extremely important day in the economic history of the world. That was the day that the European Central Bank (ECB) actually began to taper their Quantitative Easing (QE). The result was the commencement of turmoil in the global stock markets. That turmoil reflects that as the ECB joins the Fed in reducing QE, (in the U.S. that is allowing the assets on the balance sheet to bleed off, as well as rising interest rates) the impact on assets values around the globe is that they will decline.
It is really quite simple. As the cost of money goes up, the rate of return investors demand also goes up, and that means that they can pay less for an investment.
The talking heads reading scripts prepared by those who do not understand economics tried to make it a story about the trade wars, etc. But the fact is the driving force of the turmoil is that interest rates are rising, and that means that asset values will decline. The only question is how fast?
My prediction – The Fed will either reduce interest rates by July 2019, or they will hold interest rates still for at least two years. That should allow asset values to stabilize and recover.