Tuesday, March 20, 2012

John Mauldin's Outside the Box: The Trends from GaveKal

Outside the Box
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John Mauldin | March 19, 2012
My friends at GaveKal are uniquely positioned to help us think about where we have been in the past decade and where we are going in the next one. Their perch in Hong Kong lets them keep their fingers on China’s pulse, but they also have profound roots in Europe – the Gave family is French – as well as a thorough grasp of the US economy and culture. (Louis Gave, the author of today’s Outside the Box, is a Duke grad.)
We can all second Louis when he notes “the discomfort and uncertainty we find in most meetings with clients” – we’re treading on uncertain turf here and moving into unexplored territory. We sense that the potential, in the next few years, for both creation and destruction (so yes, creative destruction) is greater than at any time in our lives – and greater perhaps than at any time in the history of the human race.
How do we get our heads around something that big and dynamic? Where do we find the confidence that our next steps will take us forward rather than back? How do we allocate and husband our resources, wisely and profitably? In the following piece, Louis Gave takes an approach that is genuinely helpful: he looks back to the crucial year of 2001 and identifies three big events that largely determined global economic and investment trends in the ’00s.
And then he does something that is rather scary but very necessary. He says, don’t look now, gang, but those trends have stalled; and so we had better come to grips with the great trends that are now forming (lest we be like the British guns of Singapore at the outbreak of WWII: facing the wrong way).
And then – GaveKal to the rescue!– he tells us what those trends are. 

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