Secular stagnation is here to stay. So is uncertainty, so it’s better to embrace it. The 100 year life is now a certainty, but how is ‘economic longevity’ going to adjust? Six snow leopards to keep an eye out for in 2023. Social fitness matters as much as physical fitness and also needs to be worked on regularly for best results.
QUOTE OF THE WEEK
ARTICLE OF THE WEEK
Olivier Blanchard, Secular stagnation is not over
(PIIE, 24 January 2023)
A bit wonkish, but worth reading nonetheless because the much-respected economist makes a fundamental (and much-debated) point for all kinds of investors. In his opinion, secular stagnation (the concept that refers to economies suffering from structurally low private demand, requiring very low interest rates to sustain demand and achieve potential output) is not over. In short: today’s inflation will not last, but low interest rates will (free access – reads in 7-9 min).
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Huw Van Steenis, ‘Embrace uncertainty’: This is what I learned at Davos 2023
(World Economic Forum, 23 January 2023)
Nothing new here, but some relevant insights from a global CEO who observes that “The mood at Davos was one of relief, along with a measure of giddiness about what comes next. Rarely has the group been so split in its investment outlook.” The dispersion of opinions was indeed a remarkable feature of this year’s Davos. His three key take-aways: (1) Energy security and decarbonization are changing the investment narrative; (2) Hard to discern a new equilibrium among the prevailing macro uncertainty, (3) Hard to tell whether tech and fintech will experience a hard or soft landing (free access – reads in 5-6 min).
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Bernhard Warner, Who Wants to Live Forever?
(The New York Times, 23 January 2023)
Global ageing poses an acute challenge for countries and companies alike. In the words of one scientist: “The 100-year life is here. We’re not ready.” As the various experts quoted in this article make it clear, the “longevity economy” will become a central theme of tomorrow’s economies: as we’ll live longer, we’ll have to adjust some life goals and work longer, too. There’ll be opportunities, but first and foremost, countries will need to undertake serious “policy action to cut age-related spending.” As the widespread resistance to pension reform in France and the discussions about China’s ageing show, this won’t be easy (gifted article – reads in 6-7 min).
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Six snow leopards to watch for in 2023
(The Atlantic Council, February 2023)
We don’t see them, but they’re out there: the snow leopards are “a known but under-appreciated phenomenon” that has the potential to change the world. The snow leopards below are not predictions, but rather prompts to scrutinize overlooked phenomena. The six to watch closely in the coming months: (1) The tightening regulation of algorithms, (2) The rise of pre-emptive corporate decoupling from China, (3) The battery revolution that will democratize electric vehicles, (4) The early glimmers of a global, platform worker-driven labour movement, (5) The risky promise of geo-engineering, (6) The Japan-South Korea rapprochement that could shake up the Indo-Pacific (free access – reads in 8-10 min).
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Robert Waldinger and Marc Schulz, What the Longest Study on Human Happiness Found Is the Key to A Good Life
(The Atlantic, 20 January 2023)
Since 1938, the Harvard Study of Adult Development has been investigating what makes people flourish, concluding that a strong correlation exists between deep relationships and wellbeing. In short: good relationships lead to health and happiness. But how do we nurture those deep relationships? Are we spending enough time with the people we most care about? Like physical fitness, social fitness takes work, but enriching meaningful relationships can in turn nourish our minds and bodies. Investing in our social fitness is possible each day, each week of our lives. Even small investments today in our relationships with others can create long-term ripples of well-being (metered paywall – reads in about 10 min).
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