The 2010s were marked by the Global Financial Crisis from the end of the previous decade. It was an era of recuperative, ultra-accommodative monetary policy, relative peace, and low inflation that helped investors outperform many of the world’s top hedge funds using simple buy-and-hold equity strategies. But the 2020s have already been far different.
A global economic wrecking ball called COVID-19 welcomed investors into the new decade. And that wrecking ball, along with the fiscal and monetary responses to it, led to an inflationary hangover in 2021 that has forced central banks into a series of historic and aggressive interest rate hikes over the past two years. Now, there’s war in the Middle East and Eastern Europe, and geopolitical tensions are brewing between the U.S. and China. The 2020s are a whole new decade, with a whole new attitude, and Bank of America Research sees 15 major themes that will define it.
