When the world got caught up in the financial crisis of 2008, the Group of Seven (G7) found they couldn’t solve it alone.

The old industrialised states needed the help of the newly industrialised countries, like China, India and Turkey, to weather the storm.

The G7 became the G20 and going forward this new band of brothers was to tackle world problems together.

“Never again” became the battle song as governments and central banks worked together/colluded to ensure global financial stability.

For a moment the world seemed in complete harmony.

Today the G20 is in disarray. US President Donald Trump has threatened about half of the group with trade wars and financial sanctions.

Trump’s wrath is currently directed at Turkey, which is in a perilous position. Fears that Turkey’s problems will spread to other emerging market economies (EMEs) are justified.

Many EM countries see a capital flight away from them and towards “safe haven” currencies like the US dollar and the Japanese yen.

Investors should pay attention to emerging markets right now.

If the newly industrialised countries run into trouble, trouble will find the old G7 countries too.

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