Industrial Policy's Impact: Debt or Dividend?
In a race to sharpen their competitive edge, nations are re-deploying industrial policy. It’s a defining moment for economies. Nations are vying to be at the forefront of both the coming technology revolution and the green energy transition. Nothing short of economic leadership – as well as growth, energy security and well-paid jobs – is at stake. Yet coming at a time of high debts across many economies, the shift from free-market economics to industrial strategy brings risks.
Finding the Competitive Edge Amid Creative Destruction
The rapid explosion of generative AI for general use has captured the global imagination with what the technology might enable. It’s expected to have a profound impact on economic growth by exponentially increasing productivity. That’s because everything today – from culture to consumer products – is a product of intelligence.
From Distress And Dislocations To Steep Discounts
As credit conditions tighten, opportunities are emerging for smart investors. With banks cutting back on lending, pricing dislocations are appearing in financial markets. This looks like a repeat of previous economic cycles, when investors with patient capital have benefited from uncertainty.
RECORD DEBT, ROCKETING RATES AND UNKNOWN FRAGILITIES
Total global debt reached a record high of $306 trillion in the first quarter of 2022, led by a surge in several emerging markets, as well as China and the United States, according to the Institute for International Finance. By the third quarter, it had dropped to $290 trillion but this remains a very high level. When debt reaches extreme levels, vulnerability to financial crises rises.
ESG AND GREENWASHING
Navigating the tide of fact and fiction in sustainable investing
With climate change set to make unbearable heatwaves more common, legislative climate action is gathering pace and there is a growing sense of urgency that “green investing” plays a vital role in the world’s vision to decarbonize. But is it able to live up to its hype? Or are we in danger of “fiddling” while the world burns?
INFLATION'S UNCERTAIN PATH
Energy and Food Shocks, Supply-Chain Bottlenecks, and Surging Wages
After four decades of low inflation, prices are rising swiftly in the U.S. and Europe, forcing interest rates up and threatening to undermine economic growth.
Inflation has surged because of wage pressures, soaring commodity prices and pandemic-induced supply-demand imbalances. War in Ukraine is amplifying these forces, notably through turbocharging the prices of energy, metals and food.
10 TRANSFORMATIONAL TECHNOLOGIES POWERING THE 21ST CENTURY
A confluence of technological discoveries is opening up great potential for innovation. Quantum computing, artificial intelligence, big data, blockchain, robotics, genomics and space – all are transforming our world. Indeed, today the smartphone in your pocket has 100,000 times the processing power of the rocket that landed man on the Moon 52 years ago – and technological development is accelerating ever faster…
Explore the general-purpose technologies that will revolutionize industries and reshape the global economy.
THE JOURNEY TO NET ZERO
FROM GREENFLATION TO GREENIUM
As big events like November 2021’s COP26 climate conference show, climate change is the most pressing challenge of our generation. More than 30,000 people from over 200 countries will fly to Glasgow to urgently debate the path to net zero. With a third of all investments now sustainable, the momentum towards decarbonizing the globe is building. For policymakers and investors, the duality of greenflation and the green asset premium lies at the heart of the zero-carbon transition.
FRESH FRONTIERS IN THE HUNT
Powerful trends are driving higher-yielding opportunities in private markets
Asset classes such as private credit, real estate debt, infrastructure, and clean energy increasingly offer new opportunities for higher yields, due to powerful forces such as regulations reducing banks’ appetite for lending, the drive for new infrastructure, and the fight against climate change.
STRATEGIC COUPLING, TACTICAL DECOUPLING
HOW TO NAVIGATE THE NEXT DECADE OF U.S.-CHINA RELATIONS
China and the U.S. are at a pivotal moment in their trade relationship. Two polarized outcomes, and a spectrum between them, are possible: a decoupled relationship with long-term tariffs and an adversarial attitude underpinned by protectionism and mistrust; or a thawing in the geopolitical environment, leading to open trade, reduced tariffs and newfound cooperation.