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LONG TERM THINKING

Why is long-term thinking critical?

We want to help clients understand the overwhelming economic and geopolitical change that will occur over the next decade.

If you don't think long-term you will get left behind.
The Great Race Report
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MIND THE GAP
Short-term markets ask:

What will happen to earnings, interest rates, inflation and sentiment over the next 3-12 months?

Long-term investors ask:


What will determine the growth of the economy, corporate profits, productivity, capital and wealth over the next 10-20 years?

There is a widening gap between what the economy is becoming and what financial institutions are built to analyse.

Financial market macroeconomic analysis is skewed towards the short-term (demand-side), at a time when the long-term (supply-side) is set to have a huge impact.

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TODAY'S
MARKET FOCUS
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Next quarter 

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Next year's economic data

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Interest rate expectations

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Relative performance and benchmarks

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Short-term stimulus or contraction using monetary and fiscal policy

THE 
ANALYSIS
GAP
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WHAT ACTUALLY SHAPES THE FUTURE
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Next decade

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Structural economic forces, such as technology, demographics and productivity.

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Long term cost of capital

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Absolute long term wealth creation

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Negative or positive long-term GDP growth trade-offs from the nature of productive versus unproductive public spending and the scale of distortionary versus non-distortionary taxation.

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WHY MOST LONG-TERM GROWTH FORECASTS FAIL
Trend extrapolation leads to misleading forecasts

Long-term growth projections are all too often a trend extrapolation of recent average growth rates.

This approach is fundamentally flawed. There needs to be sophisticated analysis of the driving forces behind long-term changes in labour, capital and productivity. That is what Global4cast provides, in a clear accessible format.

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WHO NEEDS LONG TERM THINKING?

It has never been more important to think about the long-term and not be distracted by the noise from short-term speculation, herd behaviour and momentum chasing.

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Pension funds

Preserve capital across decades

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Soverign wealth funds

Allocate capital through structural shifts.

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Corporates

Align strategy with future growth drivers.

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Family

offices

Protect wealth across generations.

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Institutional investors

Identify future winners before markets reprice.

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DEFINING THE FUTURE
We think long-term economic thinking (and the consequences for GDP growth and capital) will be much more important in the future than the past

Here are five reasons why we think this:

Let’s talk about what’s ahead

Whether you have a question about our research, forecasts or how we can support your organisation, we’d be glad to hear from you.

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