Gillian's Top Picks: A World in Flux

“Nothing is so painful to the human mind as a great and sudden change.”

― Mary Wollstonecraft Shelley

Change is inevitable, a truth that dogs both the human experience and the markets. Some changes—such as an election year, or the energy transition—are well-telegraphed, while others—such as geopolitical volatility— are nearly impossible?to predict. Resilience in times of change determines our future success, and this week, I will highlight five Asset TV experts who are making sense of a world in flux.

The trajectory of inflation toward the Fed's target is a major theme in the year ahead. Guggenheim Partners Investment Management Chief Investment Officer Anne Walsh offers her view on the road to 2% and the global phenomenon of disinflation.

The climate crisis and resource constraints are among the most troubling changes on the horizon. Haoyu Yang , Senior Portfolio Manager at Impax Asset Management , lays out several challenges facing the Asia-Pacific region:

“We focus on investment opportunities arising from the transition to a more sustainable economy…[and] there are strong fundamental drivers that support investment ideas from Asian environmental markets, including demographic change. As a large amount of people move into cities, there is a rapid urbanization process. Also, resource constraints. Natural resources are very limited in the region, especially when we look at it from a per capita perspective. There is strong policy support in addressing those issues and challenges in the region.”

On the subject of Asian markets, Japan sustained a number of policy changes that drove the Nikkei to new heights. Elisa Mazen, Head of Global Growth and Portfolio Manager of the ClearBridge Investments International Growth EAFE Strategy, breaks down several notable tailwinds, including the unwinding of cross-held shares.

While AI was the wind beneath the market's wings in 2023, there is reason to believe it can continue to deliver good news—including on the subject of climate change. MSCI Inc. Head of Climate Risk Research Oliver Marchand weighs?the failed hope for blockchain against the promise of AI:

"There is a little bit of a tendency for the following formula: take AI and the new large language models plus any problem that you see, and portray it as a potentially very promising solution. And I think we especially see that with climate. Experts that I’ve talked to at COP28, the last UN climate conference in Dubai in December, agreed on the following: the blockchain was a similar technology that proved to be practically, completely useless for climate. To the contrary, what it did was spark the popularity of bitcoin, which is an extremely emission-intensive technology. But AI and climate? I think everybody agrees that it does have a lot of potential.”

And lastly, 麦格理集团 Economist Derek Hamilton discusses the factors that have helped to skirt a recession—including fiscal stimulus—that may wane in 2024, increasing the possibility of a hard landing.

What changes do you expect to define 2024, and how can Asset TV better inform your investment decisions? We’d love to hear from you!