The status quo is crumbling because it is no longer functioning efficiently and productively. We enter 2017 with a wave of populism, manifested by inequalities creating global transitions and uncertainties. These transitions and uncertainties can present opportunities for the nimble.
We entered 2017 in a wave of populism, a manifestation created by real and perceived inequalities. The past year saw more voters and governments turning inwards and this year will encompass transitions globally in response. From governments to individuals, to corporations, the road ahead points to a change in attitudes (mood and behavior). These attitudinal transitions will be broadly felt in the global community; fusing political decisions, economic development, business profits, and consumer choice with economic growth.
2016 A World in Transition
2016 was a year of surprises. Volatility surrounding both the U.K. Brexit vote and the U.S. election proved unfounded. Our Canadian Equity and Brazil Bond exposure were top contributors to positive performance.
OUTLOOK 2017: Jack be Nimble
We entered 2017 with a wave of populism, manifested by inequalities creating global transitions and uncertainties. Bottom line: 2017 will be a capital preservation year where being nimble should be emphasized.
Uncertainties of 2017
President Trump, the future of the E.U. and China are this year's global uncertainties.
Globalization to Localization
Over the past 20 years, G-8 moved to G-20 but momentum has slowed significantly since the financial crisis as local issues of populism, cultural integrity and a movement from Wall Street to Main Street trump global ones.
The world has reached the end of a geopolitical cycle, which has been over 70 years in the making. Foreign policy, China/U.S. relations and global institutions will help structure the new multi-polar world.
Monetary to Fiscal Policy
Monetary policy is becoming exhausted globally. The U.S. looks to be leading the way from Monetary to Fiscal with tax reform, deregulation, and infrastructure spending expected under President Trump.
Early Cycle vs. Late Cycle
Key differences between the start of presidential terms for Reagan and Trump. Currently, we are in the latter innings of the cyclical bull market.
A Time of Rapid Change
A 'good enough' point is where deception turns into disruption. It may be chaotic, creative or disruptive.
Technological change has been a constant thematic focus for us. We are now in the technological period we have been describing over the past decade.
Key Segments for Portfolio Growth
Our portfolio themes remain intact; companies must keep up with the changing landscape of disruptive technology, data integration, mobility and exponential growth or get left behind.
2017 Investment Strategy
2017 will be a capital preservation year (neither bull nor bear market); focusing on hedging and structuring portfolios to take advantage of global transitions and uncertainties. Transitions and uncertainties can create opportunities for the nimble.