“Economic cycles come and go, but sitting above them are the wider structural super-cycles that shape everything from economies to asset prices, politics, and our general way of life.” The current super-cycle “has been gradually fraying at the edges over the last half-decade” and we are likely to look back on 2020 as its end.
There have been five super-cycles in modern times, reckon Reid and his team: the first era of globalisation (1860-1914), war and depression (1914-1945), the Bretton Woods agreement (1945-1971), the arrival of high inflation (1970-1980) and the second age of globalisation (1980-2020). This last era was long and favourable for investors: “The best combined asset-price growth of any era in history, with equity and bond returns very strong across the board.”
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