2020 showed us that many investors could have safely ignored some basic fundamentals around investing – I’m not convinced that 2021 will let us off so easily.
Oliver Hartwich is my guest from the NZ Initiative, a pro-free-market public-policy think tank and business membership organisation in New Zealand.
2021 will be the first year after the biggest disruption my generation has ever witnessed – Investing post pandemic will be different to pre-pandemic – no longer can we ignore the risks of increasing debt levels, how new money is created, and the risks that long term inflation combined with low economic growth will bring. Modern monetary theory, a convenient way for governments to short-cut the need to actually increase productivity, will have massive long-term impacts. Everyday investors still have time to potentially take a position to benefit from this trend – failure to do so in fact, could put one on the wrong side of significant disruption ahead.
I talk frequently about how building wealth in the new world, requires new tools and new strategies. If there’s transformation coming, some will be victims of it, and some will be victors. In 2021, we may see two groups of investors starting to emerge – traditionalists, who insist that mainstream investment ideology is what we’ll eventually revert back to, and alt-investors, those who are actually looking forward to significant disruption, the likes we haven’t seen since the great depression.
So, today’s episode may not be for the beginner, but I urge you to try to understand some of these concepts – investing doesn’t occur in a vacuum or in a static environment. Just as much research should be done on the environment in which your investing in, as the strategies you employ.
To learn more about the NZ Initiative and to sign up to their newsletter, check them out here.
N.B: Shortly after recording this episode, it’s worth noting to listeners that the website Newsroom, ran an expose on then NZ Initiative blog editor, Nathan Smith, which found him to have published racist and misogynistic views on his own personal blog.
Oliver has since described Smith’s writings as “abhorrent” and the organisation is launching an independent investigation to ensure NZ Initiative material has not been compromised. For me personally, I welcome thoughts and ideas from a broad spectrum – it’s useful for creating thoughtful conversations and genuine insights as to how the world works – in fact one of NZ’s greatest strengths is diversity. Occasionally though, we have to make a call and say ‘no’ to hateful and ignorant comments from the far right. I’d do the same for actions and comments from the far left that endorse more control and restrict freedom of speech too. Diversity in thoughts should be cherished, but when you go too far, not much good ever comes of that.
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