Turning points & uncharted territory

War, climate change, pandemics, inflation, rising interest rates

The job of investing involves reckoning with a huge amount of uncertainty and intersecting trends while making good decisions, screening out noise and resisting the temptation to overreact. That is, of course, easier said than done. 2022 might just be presenting one of the most difficult and testing environments investors have faced in their careers – did you have all of this in your 2022 forecast? I didn’t, no one could reasonably have, but that isn’t the point – it probably wouldn’t have mattered if you did.

Turning points is an over-used metaphor in investing, but for once might be justified this year in so many ways. Just as we appear to be emerging from Covid-19 we’re seeing inflation rates hitting levels unseen since the 1980s, interest rates finally set for the start of the first major hiking cycle in perhaps 20 years, alongside the ending of the emergency monetary policy measures that have defined much of the last decade. And there is a war in Ukraine which as well as being unimaginably awful on a human level could redefine geopolitics and global economics for a generation.

In this edition of Vista we explore the idea of turning points in several areas, while also staying focused on the core investment practices of staying open and curious to new ideas while always questioning deeply held assumptions, which is never more important than in the changing times we find ourselves in.