Zero Interest Rates: The Future Does Not Matter.
Zero interest-rates and quantitative easing have created a fragile world order.
This is reflected by the devaluations across emerging market currencies.
Increasing inequality, social turmoil and the rise of populism.
We must look to these forces shaping the future to find investment opportunities.
What zero-interest rates really mean?
Zero interest rates mean we are living in an anxious world.
Short-term thinking is shaping all aspects of our society.
Companies aren’t investing in the future. They prefer to load up on cheap debt in order to acquire their competitors and execute share buybacks.
Entrepreneurs aren’t focusing on building a strong base to support them into the future, but instead on getting big quick (blitzscaling) at the expense of the future (WeWork).
The political establishment is dominated by short-term issues that lack the focus or desire to execute a deeper plan.
Amazon, Facebook, Google and Alibaba, among countless others, feed the insatiable appetite for consumption.
People prefer instantaneous liking, commenting, tagging and sharing of content.
Society analyzes and decides seemingly everything in the blink of an eye from a screen.
Voters seek instantaneous affirmation to reinforce their beliefs: cult or hate.
Democracy fails when there is a lack of heterogeneity in society.
Our current society is the perfect arena for populists that challenge the status quo.
Zero interest rates also mean that the United States doesn’t care about the US Dollar as a reserve currency for the rest of the world. The monetary policy is only concerned with their national interests.
Same goes for the clashing in global trade and geopolitics.
Short term advantages trump long-term relationships.
Zero interest rates mean that we are living in a world without trust. Without anybody to trust, who cares about the future?
The tension throughout society will drive important technological, geopolitical and social changes. In the words of Henry Kissinger: a New World Order.
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