60% Market Crash? Keep Calm and Carry On!

Abigail Doolittle, founder of Peak Theories Research, has said the Federal Reserve's reluctance to raise interest rates from record lows could spark a market correction to rival the slump seen in 2007, during the global recession.

She told CNBC

"Unfortunately, I think it could come on a crash similar to what happened in 2007.

You can see that the entire bull market trend over the past five years has started to reverse. 

When you see that kind of gyration around the trend, typically it suggests you're going to see some severe volatility. As scary as it is, I think that we could see possibly a 50% or 60% correction - an equal and opposite reaction to all these unusual policy moves." 

Maybe so, maybe not.

However, markets go up and markets go down. The world has survived previous crashes and will do so again, because the only way that people make money out of markets is for there to be volatility (both upwards and downwards).