Risk takes many forms and extends beyond investing.
With 25 years in the CIA, David Bridges, now a research analyst at Fidelity Investments, thinks we may be missing some important ones.
“Because we’re living in the middle of it ourselves, we’re not fully aware of the fact that we are living through the most revolutionary period in human history, bar none,” he says.
The number one revolution is population growth. When Bridges was born, the world contained 2.9 billion people.
Now 7.5 billion inhabit the planet. By the end of the century, according to the UN, it will be 11 billion.
“This demographic growth is placing unprecedented strain and pressure on societies, on cultures, on institutions, but on individuals as well,” he argues. He cites leaders such as Donald Trump, Hungary’s Viktor Orbán, and Vladimir Putin as examples of the popular response to “what appears to be an increasingly confused world where the old rules don’t seem to work anymore.”
In years ahead, developed countries will add a modest number of people. Much of the growth will be concentrated in places that attract few headlines. Nigeria’s population, for example, is set to soar from approximately 190 million today to between 400 million and 500 million by 2040, hitting its peak just as its oil reserves run out.
Universal needs and wants
“Everybody, everywhere wants a better future for their kids,” Bridges says. “Everybody, everywhere wants meaningful economic opportunities for themselves. Everybody, everywhere wants a good job. It’s not a phenomenon limited to the West.
Everybody, everywhere wants to believe that if somebody does something wrong to them, they have recourse to justice. Everybody, everywhere wants access to decent healthcare — it’s a universal human desire. Everybody, everywhere wants a chance to live to a dignified old age. These are universal desires.”
When these desires are thwarted, people vote with their feet, relocating to the closest place that can provide for them. Canada and the United States — in fact, the Western Hemisphere is built on migration, says Bridges, but Europe is not. And Europe is the closest place for many.
Nor is it as prepared for terrorist attacks as the Western Hemisphere, thanks to reduced security spending in the wake of the 2008 financial crisis. “The Islamic State, like its associate Al-Qaeda, continues to plan for what I call the grand spectacular,” he argues, adding that it’s a reprise of 9/11. Europe is the likely target.