NEPC’s Allan Martin, one of CIO’s 2023 Knowledge Brokers, was recently quoted in an article to discuss the contribution of international trade and an aging global population to market volatility. View the full article on Chief Investment Officer’s site here.
The markets in 2023 have been as unpredictable as they have erratic. Responding requires expert advice, so we asked CIO’s 2023 Knowledge Brokers for their approach to navigating the tumult.
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Until recently, investors enjoyed a long-term bull market during a low-rate environment. With inflation and rate hikes prevalent over the last year, investors may have to change their approach.
“The post-World War II era has been dominated by a period of multinational negation and removal of trade barriers, leading to an unprecedented growth in international trade,” commented Allan Martin, a partner in NEPC.
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The rise of generative artificial intelligence tools could have a profound impact on the markets, for better or worse. On one hand, it could lead to an increase in productivity; on the other, it may lead to layoffs when workers are replaced by AI.
With birth rates falling in much of the developed world, resulting in older and more lopsided populations, younger generations will have to contribute more to keep services such as Social Security funded and will be on the hook for older generations’ pensions.
“In the longer term, the world’s population is aging, and productivity continues to rise, so the norm of wealth distribution based on work performed will be challenged, with significant implications for the return to capital,” Martin commented.