The enemy of my friend is my…
This particular time of year is often a time of contemplation and reflection. As families and friends gather for the holidays, many pause to consider the year almost past, and perhaps the year to come. Whether it’s tax-lot accounting for securities bought and sold, or healthcare issues left unattended, or simply holding ourselves accountable for goals unmet, we tackle these issues as an annual right of passage each year.
For some, this annual inventory is simple. For others it’s complex and daunting. For all, however, the season is an opportunity to reassess and rebalance, taking stock in what we have accomplished, or haven’t, and comparing our life by yet another benchmark having elapsed.
Nothing is more striking this November than the chasm across the globe between wealth and impoverished. It’s as if for some these are absolutely the best times, and for others a catastrophe not of their own making.
To be sure, we are all (to some degree) the product of our own initiative. The successful amongst us have earned their success. Perhaps, too, the financial or social laggards have failed to live up to their potential, or have just given up, altogether. Too bad, because all of us have such enormous promise at the outset. There is, nonetheless, a huge gap in the way equity and opportunity is administered. Wall Street typifies and magnifies this inequity greater than most. Consider that the disconnect between wages and wealth is at its greatest in generations. Markets are making new highs, while many feel disassociated from wealth creation.
Decoding the data.
The rising cost of a “household basket”, also sometimes referred to as the “Twelve Days of Christmas” basket, is inflating. And while statistics may show that global inflation is relatively benign, we all know, anecdotally, that very few costs are really going down, particularly in healthcare, foodstuffs, transportation, and other basics. Essentially, the current price dynamic is eroding our purchasing power and savings accounts. Obviously, these data vary by region and country, but the overall trend serves as a bellwether for comparison worldwide. “Basic” is now becoming “premium”, at too great a cost for many.
A main risk lies in hoarding and localization of wealth centers. Global and domestic economies continue to perpetuate a wealth bifurcation by exerting political and financial pressures upon their citizenry. Central banks can only do so much to incentivize capital expansion, but actualizing it is another matter altogether.
As technology and the pace of change accelerates our knowledge base, things appear to be getting worse, or better, depending upon which side of the ledger you fall. Either way, these changes weigh upon our future expectations, our goals, and our collective psyche.
A structural and systemic backdrop is now transparent enough to uncover the vulnerabilities of many economies, businesses, and some households. Governments may try to regulate the discrepancies, but they wind up changing the natural order of things in the process. Globalization magnifies these effects by reconfiguring the map and relocating profit centers not by country boundaries but by pockets of industry and natural resources. These productivity and profit centers gain financial and social leverage over other, less-competitive, marketplaces.
A pillar to sustaining, or deconstructing, economic inequities is our moral and social consciousness. Doing good things knows no geographical borders. Not surprisingly, whatever cycles the market may pass during the next few weeks might be benevolently influenced by an overlay of holiday good will. A gradual shift in the perceptions of what “wealthy” and “well-off” are is causing values to migrate as well. In some instances societal tensions are heightened by this shift, and habits are changing along with it.
I believe that all this conflict leads to a smoother transition into economic and social success later on. We simply need to be patient enough to wait through the headwinds.
Happy Thanksgiving.
Scotty C. George
(212) 624-1147
The information contained herein has been obtained from sources believed to be reliable but is not necessarily complete and it accuracy cannot be guaranteed. It is intended for private informational purposes only. Any opinions expressed are subject to change without notice. Du Pasquier Asset Management and its affiliated companies and/or individuals may from time to time own or have positions in the securities or© du Pasquier Asset Management
