{"componentChunkName":"component---src-templates-topic-index-js","path":"/insights/market-economic-perspectives/20","result":{"data":{"topic":{"slug":"market-economic-perspectives","name":"Market & Economic Perspectives","image":{"title":"Market and Economic Perspective","file":{"url":"//images.ctfassets.net/a320zjmb1inn/2mKoY96PiwQdSMHNp5LnPE/60edee6fbc2ec3508edf7c2f83dfbbd9/Market-and-Economic-Perspectives-new-crop.jpg"}},"cta":{"ctaType":"Footer Only CTA","content":{"json":{"nodeType":"document","data":{},"content":[{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"Hi, I'm Becca, ","marks":[],"data":{}},{"nodeType":"text","value":"managing principal, chief business development officer","marks":[],"data":{}},{"nodeType":"text","value":" at Commonwealth. I can't wait to learn more about you and share our Commonwealth story.","marks":[],"data":{}}]},{"nodeType":"paragraph","data":{},"content":[{"nodeType":"text","value":"\n\n\n\n\n\n","marks":[],"data":{}}]}]}},"headline":"Are we a good fit?","buttonText":null,"buttonLink":null,"buttons":[{"content":["Let's Connect","/contact-us"]}],"hubspotFormId":null,"image":{"title":"Becca Hajjar-footer","file":{"url":"//images.ctfassets.net/a320zjmb1inn/7zG02ZVLeHLU1PHlC7UMqV/73f66e2071e4570ba98f309a806afecd/Hajjar_Becca.jpg"}},"signature":null,"sidebarBlockquote":null},"hideFooterCta":null,"seo":null},"allTopics":{"edges":[{"node":{"name":"Compliance & Regulation","slug":"compliance-and-regulation"}},{"node":{"name":"Culture & Community","slug":"culture-community"}},{"node":{"name":"Cybersecurity & Enterprise Risk","slug":"cybersecurity-and-enterprise-risk"}},{"node":{"name":"Fintech & IT Solutions","slug":"fintech-it-solutions"}},{"node":{"name":"Market & Economic Perspectives","slug":"market-economic-perspectives"}},{"node":{"name":"Marketing & Practice Management","slug":"marketing-practice-management"}},{"node":{"name":"The Fee-Only Advisor","slug":"the-fee-only-advisor"}},{"node":{"name":"The Retirement Plan Advisor","slug":"the-retirement-plan-advisor"}},{"node":{"name":"Wealth Planning & Investing","slug":"wealth-planning-investing"}}]},"articles":{"edges":[{"node":{"author":{"name":"Brad McMillan, CFA®, CAIA, MAI","image":{"description":"","title":"Brad McMillan author","file":{"url":"//images.ctfassets.net/a320zjmb1inn/3Vs1Ig5H4OYPyGsRBqsJwQ/5b3cae4121084ea9fc89b19256c8c2b1/BradMcMillan.jpg"}}},"slug":"the-west-and-the-middle-world-a-review-of-destiny-disrupted-by-tamim-ansary","title":"The West and the Middle World: A Review of Destiny Disrupted, by Tamim Ansary","intro":{"intro":"How can we better understand the world outside U.S. borders? Commonwealth CIO Brad McMillan recommends reading Tamim Ansary's Destiny Disrupted."},"date":"07.24.19","articleImage":null,"featuredImage":null,"topics":[{"name":"Market & Economic Perspectives","slug":"market-economic-perspectives","image":{"title":"Market and Economic Perspective","description":"Illustration of a man looking out a window a skyscrapers that ascend in height like a bar chart.","file":{"url":"//images.ctfassets.net/a320zjmb1inn/2mKoY96PiwQdSMHNp5LnPE/60edee6fbc2ec3508edf7c2f83dfbbd9/Market-and-Economic-Perspectives-new-crop.jpg"}}}],"content":{"json":{"data":{},"content":[{"data":{},"content":[{"data":{},"marks":[],"value":"For quite a while, the U.S. was focused on other parts of the world. Wars in the Middle East, the Greek crisis, and North Korea all made headlines and were front of mind for many investors. Recently, though, that view has largely faded. We are still at war in Afghanistan, but no one seems to be talking about. A hard Brexit is looming, same thing. Attention has returned to what is happening here in the U.S.","nodeType":"text"}],"nodeType":"paragraph"},{"data":{},"content":[{"data":{},"marks":[],"value":"This internal focus is the default state for the U.S. and usually makes sense. To understand when it does not make sense, however, it is important to have some baseline understanding of the world outside our borders. Today’s book—Tamim Ansary’s ","nodeType":"text"},{"data":{"uri":"https://www.amazon.com/Destiny-Disrupted-History-Through-Islamic/dp/1586488139"},"content":[{"data":{},"marks":[{"type":"italic"}],"value":"Destiny Disrupted","nodeType":"text"}],"nodeType":"hyperlink"},{"data":{},"marks":[],"value":"—is a terrific tool to just that end. It tells the history of the world from the perspective of Islam. In other words, we get (almost) the same story we know but from a very different perspective. In many ways, the experience is unsettling but also very revealing.","nodeType":"text"}],"nodeType":"paragraph"},{"data":{},"content":[{"data":{},"marks":[],"value":"What Is the History of the World?","nodeType":"text"}],"nodeType":"heading-3"},{"data":{},"content":[{"data":{},"marks":[],"value":"As we learn it here in the West, the history of the world is the story of a charismatic prophet who founded a religion that shaped the world. That religion led to an empire that controlled most of the known world, that still provides the cultural foundations of today’s society, but that collapsed in ruins under the assault of barbarians, leading to a dark age. Here in the West, of course, that story is about Christianity and Rome.","nodeType":"text"}],"nodeType":"paragraph"},{"data":{},"content":[{"data":{},"marks":[],"value":"In the Middle East, what Ansary calls the “Middle World,” we see the same story but with Muhammad and the Ottoman Empire. The story, on broad levels, is the same, providing a connection for the westerner to the Muslim experience, but the perspective is entirely different. The history of the West is about Rome and the aftermath, while the history of the East is about the Ottoman Empire and its aftermath. A big part of those histories, of course, is the intersection of the two. And this is where the perspective of one side can be almost unrecognizable from the other.","nodeType":"text"}],"nodeType":"paragraph"},{"data":{},"content":[{"data":{},"marks":[],"value":"Intersection and Conflict","nodeType":"text"}],"nodeType":"heading-3"},{"data":{},"content":[{"data":{},"marks":[],"value":"Showing that difference—and illustrating where it comes from—is where the book excels. Briefly, despite the superficial similarities, the West and the Middle Word are very different societies. Islam is more than a religion. It is a complete belief system that incorporates religion, politics, and law. There is no separation of church (mosque) and state, and that has given the Islamic world a very different cast not only in terms of politics but also in how a society can structure its economy. (This was one of the most interesting sections for me.) When you look at the intersection and conflict between the two societies, this difference is where it comes from.","nodeType":"text"}],"nodeType":"paragraph"},{"data":{},"content":[{"data":{},"marks":[],"value":"From a western point of view, Islam can appear alien and irrational—but it isn’t. As a civilization of comparable size to that of the West, it follows its own rules and not ours. To understand not just those rules but also the events and constraints that led to them is to better understand why recent history has played out the way it has—and where it might go in the future.","nodeType":"text"}],"nodeType":"paragraph"},{"data":{},"content":[{"data":{},"marks":[],"value":"The author grew up in Muslim Afghanistan and is now a writer here in the U.S. He has seen both sides and is well positioned to speak about the intersection, about misunderstandings about both and by both sides. That intersection is, of course, where the conflicts come—conflicts that although largely quiescent from a U.S. perspective at the moment will certainly be back. When they do return, it makes sense to have a better idea of where they come from.","nodeType":"text"}],"nodeType":"paragraph"},{"data":{},"content":[{"data":{},"marks":[],"value":"Understanding the Modern World","nodeType":"text"}],"nodeType":"heading-3"},{"data":{},"content":[{"data":{},"marks":[],"value":"Huntington’s idea of the ","nodeType":"text"},{"data":{"uri":"https://www.amazon.com/Clash-Civilizations-Remaking-World-Order/dp/1451628978/ref=asc_df_1451628978/?tag=hyprod-20&linkCode=df0&hvadid=312021238077&hvpos=1o1&hvnetw=g&hvrand=14373860503182562945&hvpone=&hvptwo=&hvqmt=&hvdev=c&hvdvcmdl=&hvlocint=&hvlocphy=1018107&hvtargid=pla-435427683755&psc=1"},"content":[{"data":{},"marks":[],"value":"clash of civilizations","nodeType":"text"}],"nodeType":"hyperlink"},{"data":{},"marks":[],"value":" is a valuable but incomplete way to think about the modern world. Better is to acknowledge the clash and to go below the surface to find out where it comes from. This book is an excellent way to do that for the Islamic world. Since we invest in a world influenced by Islam, we should understand it. For me, this book is a great start. Recommended.","nodeType":"text"}],"nodeType":"paragraph"},{"data":{},"content":[{"data":{},"marks":[{"type":"italic"},{"type":"bold"}],"value":"Editor’s Note:","nodeType":"text"},{"data":{},"marks":[{"type":"italic"}],"value":" The ","nodeType":"text"},{"data":{"uri":"https://blog.commonwealth.com/independent-market-observer/the-west-and-the-middle-world-a-review-of-destiny-disrupted-by-tamim-ansary"},"content":[{"data":{},"marks":[{"type":"italic"}],"value":"original version of this article","nodeType":"text"}],"nodeType":"hyperlink"},{"data":{},"marks":[{"type":"italic"}],"value":" appeared on the ","nodeType":"text"},{"data":{},"marks":[],"value":"Independent Market Observer","nodeType":"text"},{"data":{},"marks":[{"type":"italic"}],"value":".","nodeType":"text"}],"nodeType":"paragraph"}],"nodeType":"document"}}}},{"node":{"author":{"name":"Brad McMillan, CFA®, CAIA, MAI","image":{"description":"","title":"Brad McMillan author","file":{"url":"//images.ctfassets.net/a320zjmb1inn/3Vs1Ig5H4OYPyGsRBqsJwQ/5b3cae4121084ea9fc89b19256c8c2b1/BradMcMillan.jpg"}}},"slug":"what-will-the-next-recession-look-like","title":"What Will the Next Recession Look Like?","intro":{"intro":"With growth slowing, many are starting to wonder what the next recession will look like. Let's set some expectations."},"date":"06.28.19","articleImage":null,"featuredImage":null,"topics":[{"name":"Market & Economic Perspectives","slug":"market-economic-perspectives","image":{"title":"Market and Economic Perspective","description":"Illustration of a man looking out a window a skyscrapers that ascend in height like a bar chart.","file":{"url":"//images.ctfassets.net/a320zjmb1inn/2mKoY96PiwQdSMHNp5LnPE/60edee6fbc2ec3508edf7c2f83dfbbd9/Market-and-Economic-Perspectives-new-crop.jpg"}}}],"content":{"json":{"data":{},"content":[{"data":{},"content":[{"data":{},"marks":[],"value":"There has been a great deal of coverage on slowing growth. Indeed, on this blog we have looked at signs that the recovery may be close to the end. What that means, of course, is that a recession may well be in the cards in the next couple of years. Although we are not there yet, now is a good time to take a closer look at what it could look like. After all, it has been more than 10 years since we last had a recession, and that one was not typical.","nodeType":"text"}],"nodeType":"paragraph"},{"data":{},"content":[{"data":{},"marks":[],"value":"Recession Defined","nodeType":"text"}],"nodeType":"heading-3"},{"data":{},"content":[{"data":{},"marks":[],"value":"Let’s first think about what a recession is. The formal definition, and determination, of a recession comes from the National Bureau of Economic Research. For common use, however, a recession is defined as two consecutive quarters of negative economic growth. If we get that, we have a recession. Note that it does not have to be a severe contraction, just a decline. As such, there can be a big difference in what a recession means, which is a key point when we look to the next one.","nodeType":"text"}],"nodeType":"paragraph"},{"data":{},"content":[{"data":{},"marks":[],"value":"2008 or 2000?","nodeType":"text"}],"nodeType":"heading-3"},{"data":{},"content":[{"data":{},"marks":[],"value":"2008 was the Great Recession, the worst since the 1930s. The fear is that the next one will be just as bad. But that prospect is unlikely. 2008 involved huge imbalances in the banking system, which took what would have been an ordinary recession and turned it into a crisis. Now, although we certainly have imbalances, they are not concentrated in the banking system. More, much of the post-crisis legislation that limited bank risk is still in place, which should help minimize any damage. Because of these conditions, the next recession is likely to resemble 2000 more than 2008—a slowdown rather than a crisis.","nodeType":"text"}],"nodeType":"paragraph"},{"data":{},"content":[{"data":{},"marks":[],"value":"The 2000 comparison is apt. The economy and the financial markets look much like they did then. If that comparison holds, then we should see the economy contract, but not nearly as severely as in 2008, although the financial markets may take much more of a hit. Worth noting is that, despite all the angst around the market declines of 2000, the fact that the economic decline was moderate helped lay the groundwork for the later financial market recovery.","nodeType":"text"}],"nodeType":"paragraph"},{"data":{},"content":[{"data":{},"marks":[],"value":"Back to Economic Basics","nodeType":"text"}],"nodeType":"heading-3"},{"data":{},"content":[{"data":{},"marks":[],"value":"If we look at the basics of the economy, we see the same thing. If job growth slows, employment will still be high and unemployment low by historical standards. If confidence drops by enough to signal trouble, as we discussed earlier this week, it will still be high. In other words, because things have been so good, we might enter a recession and find that things are still pretty good. These conditions should help keep the recession mild.","nodeType":"text"}],"nodeType":"paragraph"},{"data":{},"content":[{"data":{},"marks":[],"value":"The key takeaway here is that recessions are not usually like 2008. That was a ","nodeType":"text"},{"data":{},"marks":[{"type":"italic"}],"value":"crisis","nodeType":"text"},{"data":{},"marks":[],"value":", and the ingredients of a similar crisis don’t seem to be in place. Even if the economy slows enough to qualify for a recession, that doesn’t mean things will collapse. A recession at this point is something we need to watch for, not something we need to panic about.","nodeType":"text"}],"nodeType":"paragraph"},{"data":{},"content":[{"data":{},"marks":[],"value":"A Normal Recession?","nodeType":"text"}],"nodeType":"heading-3"},{"data":{},"content":[{"data":{},"marks":[],"value":"Even for the markets, a recession and consequent declines would be something to ride out, as in 2000—and not to panic over as in 2008. Periodic bear markets are part of how the system works, and just one more thing to take in stride.","nodeType":"text"}],"nodeType":"paragraph"},{"data":{},"content":[{"data":{},"marks":[],"value":"We have not had a normal recession in almost 20 years, and we need to keep our expectations aligned with what is likely to happen, and not with what happened in 2008. Now is the time to game out what the next recession will look like. Fortunately, it is not likely to be that bad.","nodeType":"text"}],"nodeType":"paragraph"},{"data":{},"content":[{"data":{},"marks":[{"type":"italic"},{"type":"bold"}],"value":"Editor’s Note:","nodeType":"text"},{"data":{},"marks":[{"type":"italic"}],"value":" The ","nodeType":"text"},{"data":{"uri":"https://blog.commonwealth.com/independent-market-observer/what-will-the-next-recession-look-like"},"content":[{"data":{},"marks":[{"type":"italic"}],"value":"original version of this article","nodeType":"text"}],"nodeType":"hyperlink"},{"data":{},"marks":[{"type":"italic"}],"value":" appeared on the ","nodeType":"text"},{"data":{},"marks":[],"value":"Independent Market Observer","nodeType":"text"},{"data":{},"marks":[{"type":"italic"}],"value":".","nodeType":"text"}],"nodeType":"paragraph"}],"nodeType":"document"}}}}]}},"pageContext":{"limit":6,"skip":114,"numPages":20,"currentPage":20,"basePath":"/insights","slug":"market-economic-perspectives"}},"staticQueryHashes":["1305383892","1305383892","2092848105","2092848105","2184437937","2184437937","2856679551","2856679551","4153683896","4153683896","712563084","712563084"]}