Weekly Geopolitical Report – Reflections on Inflections: Part II (January 14, 2019)

by Bill O’Grady

(N.B. Due to Martin Luther King Jr. Day, the next issue of this report will be published on January 28.)

In Part I of this report, we discussed the issues surrounding predicting inflection points, which are defined as reversals of long-term trends.  In this week’s issue, we will examine two long-term trends that we believe are approaching inflection points and offer guideposts that we think will signal further progress toward inflection.  For regular readers, these two trends should sound familiar as they are topics of frequent discussion.  Some often consider them the same issue, while, in reality, they are separate but affect each other.  By discussing them separately, this confusion should be laid to rest.  As is our normal practice, we will offer market ramifications.  Since an inflection of these two points is significant, this section will be larger than usual.

Inflection Point #1: The End of U.S. Hegemony

Inflection Point #2: The Efficiency Cycle Ends and Equality Cycle Commences

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