#CryptoTariffDrop
Watching from a flight to Latin America, NYU professor and valuation expert Aswath Damodaran saw not just panic, but the anatomy of a full-blown market crisis in motion.
The crisis cycle
In his latest blog, Damodaran uses the event to map out what he calls the “crisis cycle”—a framework based on historical market meltdowns like the 2008 financial crash and the COVID-19 collapse.
He explains that every crisis begins with a shock, in this case, the unprecedented tariff announcement. This is followed by an immediate market reaction, where investors revise expectations, sell off assets, and demand higher returns to bear increased risk.