The Anger Factor

The global anger vote will have lasting effects on politics and, with it, the long-term economic outlook. It is reshaping government policies, forcing the mainstream political parties to turn away from globalisation and embrace “New Populism”. Fiscal and monetary policies will merge as low interest rates and high levels of debt make the latter impotent. This backdrop will prove counter-productive, dampening the recovery in productivity and pushing already low growth rates even lower. This is bad for long-term financial assets and equities. It is also bad news for EMs, which depend on globalisation to converge economically with rich countries, as well as commodities and energy. However, in a world of rapidly debasing fiat currencies gold can only shine.

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