bne -

The recent crisis has been largely a western crisis, but actually over the last seven years economic and financial concerns were felt more strongly in South America and Africa - except people there are talking about their own difficulties and not the debt crisis that is afflicting the developed world and currently dominates the media.

Erste Bank analysts used Google's insight tool that presents the statistical breakdown of search items entered into its search engine to see how the world's population is reacting to news of the crisis. (Go here and try it, type in "crisis".)

The results are several (see the map chart below). First, all of Latin America except Brazil has been almost constantly worried about crisis since 2004, while Brazilians are a lot more sanguine (this is another of those moving charts: click on the "view over time" option on the global map to see how perceptions change). Second, the US has been in a state of near panic for almost all of the period as well. Third, Central and Eastern Europe was clearly freaked out in 2008 during the worst of meltdown, but quickly recovered again in 2009. However, Russians in particular had a second bout of the collywobbles at the end of last year (which was when the capital flight started).

The results are even more interesting when you drill down into the regions (see second chart). While the crisis has been worst in the US and Western Europe, the people who are most unsettled are all in the Emerging Europe countries. The reasons are obvious: the last crisis the developed world experienced of this size was in 1929, whereas in the east it was 1998 and so the locals know very well what crisis means. Also, while at the macroeconomic level the situation in the west is worse, at street level (for those that have not lost their jobs) life goes on more-or-less as normal, whereas in the east the impact of the crisis hits the population harder, such as the 30% devaluation of the ruble that hit savings.

Erste's Maryan Zablotskyy wrote in a note: "Seasonally-adjusted data for Google searches for 'crisis' shows that CEE countries have seen the biggest concerns over the crisis. European countries felt the peak of the crisis with a few months delay vs. the US. Among the PIIGS [Portugal, Italy, Ireland, Greece and Spain] countries, the Portuguese are the most worried about economic outcomes, while Irish people have remained calm throughout the turmoil. Austrians were the most worried after the Lehman collapse, exceeding the level of concern seen in the US, UK or Germany."

"Fears of a possible new crisis are coming in diminishing waves, although each time they seem to have lesser momentum compared to the previous wave. New ones are arising again globally. The 'second/third waves' of a crisis often mentioned in the press are an interesting economic and likely also psychological phenomenon. That may be a natural result of crisis fears having strong seasonal effects connected to overall depression levels," Zablotskyy said.

These waves of crisis fears are clearly tied to the normal waves of depression that sweep any country over the year and are tied to the weather: the search for "depression" and "crisis" almost perfectly mirror each other and the searches for "depression" are also almost the perfect inverse of the temperature (see first chart).

bne has argued that the recovery will be all about the return of confidence as much as the oil price and, indeed, as the summer arrived the latest statistic on consumption and investment have both picked up strongly. The conclusion is that doing a crisis-saving deal now is a good idea because in September the temperatures will fall and concerns about another crisis will rise fast to peak in November, the seasonal cycle's tradition peak "worry month."