5757 Pacific Avenue
The talking heads of TV and Cable, along with the disembodied voices of the radio airwaves, seem to dwell mostly on the negatives. If these are your primary sources of information, then you are bound to feel depressed. This FYI is intended to expand your awareness of developing trends likely to have a significant impact on our economic future.
The first trend has barely been address by media centers. As the cost of oil has risen around the world, the search for new methods of extraction has led to an energy revolution within the United States. Walter Russell Mead is the James Clarke Chace Professor of Foreign Affairs and Humanities at Bard College and Editor-at-Large of The American Interest magazine. He recently observed:
"If the energy revolution now taking shape lives up to its full potential, we are headed into a new century in which the location of the world’s energy resources and the structure of the world’s energy trade support American affluence at home and power abroad….The energy bonanza changes the American outlook far more dramatically than most people yet realize. This is a Big One, a game changer, and it will likely be a major factor in propelling the United States to the next (and still unknown) stage of development — towards the next incarnation of the American Dream."
How about the rise of the global consumer? Researchers at the McKinsey Global Institute estimate the worldwide population of the "consuming class," or those with disposable income, will nearly double in the next 15 years! The growth of the middle class in China and India leads the advance, but countries in Latin America and Africa also have an exploding consumer class. This translates into an additional $30 Trillion (with a T) in buying power! By the year 2025, the McKinsey report projects for the first time in history more people will be middle class than poor.
In the years ahead, this global middle class will demand goods and services without regard to national borders. Economic interdependence between nations will be driven by a population that wants a better quality of life for themselves and their children. These concepts are part of the American fabric, but totally new for two-thirds of the world's citizens.
Keep an attentive ear for the quiet developments and peaceful revolutions going on all around. Human progress is a function of the inspired dreams of the optimistic among us. So don't let the media's filtered pessimism hide the bright future that breaks upon the horizon. Good morning world!
The views expressed are those of Lindsey Randolph and should not be construed as investment advice. All economic information is historical and not indicative of future results. All information is believed to be from reliable sources; however, we make no representations as to its completeness or accuracy. Discuss all information with your advisor prior to implementation.