KO 대한민국
베어링 인베스트먼트 인스티튜트
거시경제 및 지정학

Enjoy the Twenties While You Can

2020년1월10일 - 3 분 읽기

Sooner or later, the decade’s returns will face pressure from populism, technology and climate.

There’s an old joke that a Russian’s idea of an optimist is someone who believes that tomorrow will be better than the day after tomorrow. Even recent headlines don’t compare with Russia’s cruel and tumultuous history, but what passes for optimism in the current tentative market consensus sounds very similar.

The December market rally blew through most price targets for all of 2020, so there was plenty of nervousness around, even before a fresh Iran crisis reminded us just how precarious the global order remains. Still, “tomorrow” doesn’t look too bad for now and we should enjoy it while it lasts. 

The American consumer, also known as the most reliable engine for global economic growth, continues from strength to strength: unemployment at 3.5%, wages growing 3.1% annually and a Christmas spending cycle clocking in at 3.4% more than the year before. The prospect of trade truce with China may help restore enough corporate confidence to raise business fixed investment from its recent doldrums near 2.25% [annual growth down from 7.7% in 2018]. Capital spending does not immediately translate to corporate earnings, but it remains essential to long-term growth. 

Fears of a hard landing in China have also dissipated, as its deft deployment of financial and fiscal tools has helped support demand even as it reined in excess credit growth. Neither Europe nor Japan is poised to soar this year as their structural challenges persist and negative interest rates continue to erode bank profitability. Still, European risks around a hard Brexit or an Italian budget crisis have dissipated. Japan has no further sales tax hikes scheduled. 

There are actually lots of bright spots that are often indicators of better times ahead: semiconductor sales are strong, Japanese machine tool exports are picking up, Germany’s business sentiment is brighter.

GLOBAL SEMICONDUCTOR SALES (M/M)

Source: Factset. As of January 9, 2020.

JAPANESE MACHINE TOOL EXPORTs

Source: Factset. As of January 9, 2020.

GERMAN IFO BUSINESS SENTIMENT SURVEY

Source: Bloomberg. As of January 9, 2020.

Any remaining questions about “the day after tomorrow,” though, are much more complex. 

We are still late in the cycle. Leverage is edging higher, margins are under pressure and earnings growth estimates lack inspiration. High yield spreads are tight by historical standards and some credit standards look frayed. 

U.S. CORPORATE PROFIT MARGINS

Source: Factset. As of January 9, 2020. Calculated as the Ratio of Profits After Tax/Corporate Contribution to GDP.

S&P 500 EARNINGS ESTIMATES (Y/Y)

Source: Bloomberg. As of January 9, 2020.

U.S. NONFINANCIAL CORPORATIONS TOTAL DEBT (% OF GDP)

Source: IIF. As of January 9, 2020.

Central bank accommodation and some prospect for more fiscal spending may help delay the next recession further still. But investors face a much greater mix of problems than a garden-variety slowdown. The start of every decade prompts reflection on the pace of global change, but this one looks like a doozy amid the accelerating forces of populism, technology and climate. 

If current trends of low global growth and low investment returns persist, recent flare-ups of political populism will spread to become fires. Calls to defend national identity have complex roots, but they are surely aggravated when growth looks limited and others—both inside your country and on the other side of the world⁠—seem to be prospering unfairly.

The challenge for investors is that populism has raised questions about fair trade, fair competition and fair pay, which forced governments on the right and the left to intervene in markets. In the United States, President Donald Trump has already launched his redesign of the global trading system with tariffs as his central tool; any Democratic successor will find it hard to take on Chinese subsidies without the threat of tariffs, too. Both Republicans and Democrats are mulling ideas to address the size and market power of the tech giants, and questions of inequality will remain a fundamental part of political debates, regardless of who wins the election.

The start of every decade prompts reflection on the pace of global change, but this one looks like a doozy amid the accelerating forces of populism, technology and climate. If current trends of low global growth and low investment returns persist, recent flare-ups of political populism will spread to become fires.

These dynamics will be aggravated by the rapid technological change that is reshaping traditional business models, eliminating jobs and upsetting the balance of power between citizens and states. Vast amounts of data and powerful analytical tools are on the cusp of transforming entire industries, from mining to healthcare and education to finance, as companies learn to monitor current operations and predict customer needs with increasing speed and ever-greater accuracy.

While the promise of these breakthroughs will be irresistible, they will also open calls for more vigilant privacy protection and more vigorous defense of vulnerable cyber networks. By the way, a bumpy relationship with a Chinese government that is less squeamish about protecting privacy within a very different political model will make these issues far more difficult to navigate. 

Then there’s climate change, which is quickly shaping business considerations globally, even as it remains a trigger point in America’s emotional political landscape. But without touching questions around the causes of recent fires and storms and floods, dramatically different weather patterns are changing prices in ways investors cannot ignore: more expensive insurance in regions more prone to forest fires, cheaper land where flooding risks have risen and shifting relative costs as renewable energy undercuts hydrocarbons.

For companies, the choices will be difficult and expensive, as government regulation and social pressure force greater attention to carbon footprints. For investors, new winners may appear, but the overwhelming task will lie in identifying firms in their current portfolios that can deliver returns amid these changing costs and shrinking returns. 

Little of these populist, technological or climate headwinds are likely to dampen this year’s returns⁠—or perhaps even next year’s. But today’s investment calculus may look far different by the end of the decade. Enjoy “tomorrow” while it lasts.

해당 자료에 제시된 전망은 작성 시 시장에 대한 베어링자산운용의 견해를 바탕으로 작성되었습니다. 작성된 이후, 다양한 요인에 따라 사전통지 없이 내용이 변경될 수 있습니다. 또한 본 자료에서 언급된 투자 결과, 포트폴리오 구성 및 사례는 단순 참고용이며, 결코 미래 투자 성과 혹은 미래 포트폴리오 구성을 보장하지 않습니다. 투자에는 위험이 수반됩니다. 투자와 투자에서 발생하는 향후 소득 가치는 하락 또는 상승할 수 있으며, 투자 수익은 보장되지 않습니다. 과거성과는 현재 또는 미래성과를 보장하지 않습니다. 

더 읽어보기

또한 본 자료에서 언급된 투자 결과, 포트폴리오 구성 및 사례는 단순 참고용이며, 결코 미래 투자 성과 혹은 미래 포트폴리오 구성을 보장하지 않습니다. 실제 투자의 구성, 규모 및 위험은 본 자료에서 제시된 사례와 현저히 다를 수 있으며, 투자의 향후 수익 혹은 손실 여부에 대해 보증 및 보장하지 않습니다. 환율 변동은 투자가치에 영향을 미칠 수 있습니다. 잠재 투자자들은 본 자료에 언급된 펀드의 자세한 내용과 구체적인 위험요인에 관하여 투자설명서를 반드시 읽어 보시기 바랍니다.
베어링은 전 세계 베어링 계열사의 자산운용 및 관련 사업의 상표명입니다. Barings LLC, Barings Securities LLC, Barings (U.K.) Limited, Barings Global Advisers Limited, Barings Australia Pty Ltd, Barings Japan Limited, Barings Real Estate Advisers Europe Finance LLP, BREAE AIFM LLP, Baring Asset Management Limited, Baring International Investment Limited, Baring Fund Managers Limited, Baring International Fund Managers (Ireland) Limited, Baring Asset Management (Asia) Limited, Baring SICE (Taiwan) Limited, Baring Asset Management Switzerland Sarl, Baring Asset Management Korea Limited 등은 Barings LLC의 금융서비스 계열사로(단독으로는 “계열사”) “베어링”으로 통칭합니다.
본 자료는 정보 제공의 목적으로 작성된 것이며, 특정 상품이나 서비스의 매매를 제안하거나 권유하기 위한 것이 아닙니다. 본 자료의 내용은 독자의 투자목적, 재무상태 또는 구체적인 니즈를 고려하지 않고 작성되었습니다. 따라서, 본 자료는 투자자문, 권유, 리서치 또는 특정 증권, 상품, 투자, 투자전략 등의 적합성 또는 적절성에 대한 권고가 아니며 그러한 행위로 인식되어서도 안됩니다. 본 자료는 투자 전망 또는 예측으로 해석되어서는 안됩니다.
달리 명시되지 않는 한, 본 자료에 제시된 견해는 베어링의 것입니다. 작성 당시 알려진 사실을 바탕으로 신의 성실하게 작성 되었으며 사전통지 없이 변경될 수 있습니다. 개별 포트폴리오 운용팀은 본 자료에 제시된 것과 다른 견해를 가질 수 있으며 고객별로 다른 투자 결정을 내릴 수 있습니다. 본 자료의 일부 내용은 베어링이 신뢰할 만 하다고 판단하는 출처에서 획득한 정보를 근거로 작성되었습니다. 본 자료에 수록된 정보의 정확성을 확보하기 위해 최선의 노력을 기울였으나, 베어링은 정보의 정확성, 완전성 및 적절성을 명시적 또는 묵시적으로 보증하거나 보장하지 않습니다.
본 자료에 언급된 서비스, 증권, 투자 또는 상품은 잠재투자자에게 적합하지 않을 수 있으며 해당 관할권에서 제공되지 않을 수 있습니다. 본 자료의 저작권은 베어링에 있습니다. 본 자료에 제시된 정보는 개인용도로 사용될 수 있으나 베어링의 동의 없이 변형, 복제 또는 배포할 수 없습니다.

20-1054868

X

베어링자산운용은 당사 웹사이트 사용자들에게 최적화된 웹 경험을 제공하고자 쿠키를 사용합니다.
베어링 웹사이트를 이용함으로써, 당사의 쿠키정책법적 & 개인정보고지사항에 동의하는 것으로 간주합니다.