Ruchir Sharma: top 10 trends for 2025
Projections
about the coming year assume market shifts will be dictated by Donald Trump. But
the global economy is unlikely to revolve around the US
The world is an increasingly fragmented and complex place,
but everyone I meet appears to be obsessed with just one person: Donald Trump.
All projections about the coming year assume Trump will dictate global economic
and market trends. A single factor is never a solid foundation for forecasting.
The world is not unipolar and does not revolve around one personality, not even
one as big as Trump’s. Historically, the impact of US presidents on markets has
often been surprising, and at times minimal. Investors were braced for a
negative shock when Trump came to power in 2017, but that year turned out to be
one of the least volatile for US stocks ever. Trump constantly threatened to
undermine China with tariffs and yet, during his first term, the
best-performing major market in the world was China, outpacing even the US. If
past is prelude, Trump 2.0 will not play out as most investors expect.
Ironically, continuing faith in “American exceptionalism” assumes that under
Trump the world will see more of the same trends it saw under Joe Biden: US
dominance of the global economy and markets, led by its big-cap tech
businesses. But those trends are already very extended and vulnerable to forces
larger than the US president-elect. For a variety of reasons, competitive churn
could return to global markets in 2025 and lead to seismic shifts.
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Regards!
Librarian
Rizvi Institute of Management
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