Every day I deal with economic details on a micro-level – one entrepreneur’s retirement, one family’s plan, one business’ projections – to do the best job I can for every individual client. I also believe it’s important for me to understand the world at a MACRO level.

My past few blog posts have been about traveling to hear leading-edge speakers, and the life & business lessons I took away from two speakers: Michelle Obama and Susan O’Malley.

Another one of the speakers who presented at October’s RBC Women’s Symposium was Janice Gross Stein, Belzberg Professor of Conflict Management in the Department of Political Science and Founding Director of the Munk School of Global Affairs & Public Policy at the University of Toronto. She has so many accolades (including Fellowship and Membership in the Royal Society of Canada, Order of Canada and the Order of Ontario) and noteworthy publications that I’m not going to list them all or you’d never finish reading this post.

What I want to share with you are a few of Professor Stein’s ideas from the event I attended and use it as an illustration of the value of professional and personal development; how hearing challenging world views informs business, personal & investment decisions.

In general, we look back at history for lessons and trends and consider the past a good guide for the future. In the presentation I attended, Janice challenged that view…

“As stewards of your clients’ money in an era of the biggest inter-generational wealth transfer I have a message for you: History, I predict, is about to take a jog.”

Then she outlined 6 Resistors to Future Economic Growth -- six factors that are, combined, going to dull the economic growth we’ve been enjoying the past 30 years.

Resistor 1 – Reversing Globalization

As it grew easier and easier to do business around the world, 1985-2007 marked a heyday for

globalization. Janice referred to the period as Globalization on Steroids. With many multinational companies based in North America the prevailing thinking amongst some in the investment industry was that there was no need to invest globally. You could achieve diversification with Canadian and US companies alone. *Record scratch* Since 2007 globalization has stalled. It’s actually reversing, similar to the retreat that economists saw in the summer of 1914. It took 70 years for globalization to gain traction again. Janice urged us to watch public policy and understand how governments matter to markets.

Resistor 2 –Middle Classes in the Rich World and Beyond

The industrial revolution in North America ushered in the middle class as we know it today. But those forces are still evolving. Janice brought our attention to China and India, countries that have been growing rapidly yet appear to be experiencing an economic slow down. Both countries have seen a huge labour shift with people trading rural life for factory life. Billions of people in India and China have moved out of poverty into middle class.

Over the last couple of decades, we’ve seen jobs leave Europe and North America bound for the factories of India and China. These jobs, which had pushed up the middle class in the ‘developed world’ are disappearing overseas, leaving some of the middle class in North America wondering about their prospects for a rich future.

Resistor 3 - Income Disparity and Populism

We know there’s a growing divide between the haves and the have-nots. The top 1% in the world hold 35-40% of world wealth. From 1930 to 1980 the middle class grew, but it has stagnated since then. The US experiences an even more significant gap than Canada does. The combination of Resistors 2 & 3 has created the rise in Populism in the US, UK, France, Germany and here in Ontario, seeing politicians sow doubt in established institutions (business, financial, and governmental) and appeal to the concerns of ‘everyday people’. Of course, we’re struck by the irony that millionaires like Boris Johnson and Donald Trump are discrediting big banks, International Monetary Funds and a host of others. Fueling the fear that the lower and middle classes are losing money and power is the myth that immigration “takes away jobs” for current and future generations.

Resistor 4 - The Internet of Things, Digitization and Artificial Intelligence

Janice reminded us of the role ‘revolutions’ played throughout history in shaping job markets and societies. She spoke several times during this presentation of the “Fourth Industrial Revolution.” I had discovered a lot about the Pre-Industrial Revolution in Sapiens, by Yuval Noah Harari (a tome I found very interesting, 17 hours of listening with Audible, I’ve gone through it 1.5 times already!). Each revolution ushered in a new modernization and a major disruption to the old way of living and interacting. These disruptions used to come hundreds of years apart – Agricultural, Industrial… Mechanization; Electricity; Computers and Automation… until now. There’s only a small gap of about 25 years from Automation to Digital Revolution. With this revolution 35 - 40% of jobs as we know them will disappear. We know from past revolutions that new jobs will emerge, but this latest massive change requires break-neck adjustment speed. For example, Janice had us ponder the affect of self-driving vehicles on the trucking field. She said there are 3.5M (mostly men) driving trucks across North America – how does society deal with the likely displacement of an entire cohort of 45-ish, high school educated men (to generalize)? What jobs will they take up in a new age where robotics and AI take over the routine tasks?

Resistor 5 - Geopolitical Risk

In her field of expertise, Janice has experienced an increase in inquiries from pension and bank boards to help them understand global political risks and their effect on markets and economies. The US recognizes (on both sides of the aisle) the risk that China poses. So did another speaker I heard from – Libby Cantrill, Managing Director & Head of Public Policy for PIMCO, who called it the ‘dirty little secret’ at the Capital; the one thing on which Democrats and Republicans agree. If we assume that, with digitization, the Internet of Things, and increased infrastructure technology that everything will be connected by 2022, we know that cybersecurity, cyber espionage and cyber sabotage will be the greatest risks we face. If one thing goes down, it all goes down. Who and what should be included in core infrastructure?

More on this next week.

Resistor 6 – Massive Intergenerational Transfer of Wealth

We are on the precipice of the largest intergenerational transfer of wealth in history, but despite many reports, according to Janice we’re heading into a period of BUST. She says, if you want to get rich before you get old, your best chance is to do this BEFORE 2030. Declining birth rates leave an aging population without support. AI and Digitization allow for what we’re currently seeing in Japan – robots as caregivers. China’s 1-child rule has resulted in fewer people entering the workforce. When an older demographic, who buy less and spend less, outnumbers the younger demographic, with fewer people entering the workforce and fueling the economy, productivity declines & growth falters.

I agree that, given these major Economic Growth Resistors, there are interesting times ahead.

This is one of the reasons I created the Elevated Conversations Series dinner parties and the podcast I’m a Millionaire! So Now What? (where we’ve already examined the Legalization of Cannabis, Artificial Intelligence and Cybersecurity, among other topics).

I don’t share these ideas to cause stress or fuel fear. I want you to know that I think about this stuff, I’m watching, and learning ever more about the world and the markets. This is part of how I support you. I read. I attend events. I invest in finding quality, real news vs reacting to noisy information. My clients know there will be no knee jerk reactions in their portfolio construction.

I’m serious about finding out what the future holds so I can translate the Big Picture to your picture of prosperity. If you’d like to take a close look at your own prosperity, and its future, visit colleenoconnellcampbell.com – specifically the Real Riches Roadmap tab to apply for your Prosperity Discovery Session.