Crisis causes change. We know this both as human beings and as experienced global investors. The 2008 global financial crisis (GFC) led to a reckoning in how businesses were run, especially in financial services. The GFC ultimately redefined fiduciary responsibilities, shifting more emphasis toward clients and shareholders. Fueled by government bailouts, new regulations, and shareholder activism, the crisis led to more transparency and fundamentally changed the financial world—in most ways for the better.
In the years following the GFC, we have seen seismic shifts in the global economic landscape: In particular, technology has permeated all sectors and industries, creating remarkable efficiencies and capabilities. In some ways, technology has been a significant democratic force, spreading power, knowledge, and sophisticated tools to many. But technology has also been hugely disruptive: Generating significant efficiencies has led to job losses and some industries disappearing altogether. Meanwhile, we have also seen wealth concentration and natural monopolies created with clear winners and losers, which in turn contributes to social and political tensions.
The coronavirus pandemic has pulled forward many disruptive trends to a staggering degree. Social distancing and the shuttering of brick-and-mortar businesses have accelerated e-commerce and communication adoption by years. Businesses are leaning on technology to help employees function in a work-from-home status that may become a more permanent way of life even after the pandemic wanes.
However, even as governments around the world have applied unprecedented monetary and fiscal policy stimulus to create and protect jobs, they have struggled to ease growing societal pressures.
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