When the U.S. economy tanked in 2008, it took a while for everyone to come to grips with what was happening. There was so much conjecture and misinformation being thrown around, no one seemed to realize the magnitude of what was occurring—or that anything substantial was happening at all. As the dust began to settle, it became clear that the crash was not an isolated national crisis—it was a worldwide catastrophe.
I bring this up because it serves as a perfect reminder of something financial experts have come to realize on a new level: Borders are more illusory than ever before. My 15 years of revenue-generating business development experience have shown me that the world is no longer comprised of a series of vaguely connected markets. There is only one market—a global one—and those of us who can’t think on a global level are going to lose touch with the modern economic and world situation.
Seeing the Big Picture
The easiest way to bolster your ability to think globally is by keeping yourself informed of the trends occurring around the world. The more you know about the world situation, the better you’ll be able to understand the macro environment in which you manage assets.
Knowing what is happening at the macroeconomic level, both globally and in regions or countries, is now a requirement to make sound investment decisions. Being able to align this knowledge with the assets you manage is invaluable to your career and competitive advantage. Whether you’re new to the industry or a veteran, today you are expected to understand international business trends and to understand the evolution that banks are undergoing as they operate and expand into global markets interconnected by new technologies, alliances, and influences.
With technologies like smartphones, banking transactions can be completed anytime from anywhere. This is going to have a huge impact on the financial industry, and it won’t be just banks that change the way the field works – tech, aerospace, energy, and a variety of other industries are intimately tied to finance. And the way all of these fields interact is becoming increasingly complex.
What the Smart Players Are Watching
Smart stakeholders, such as government policymakers, multinational financial company executives, asset managers, investors, and business executives, are all looking at a few specific trends. They’re interested in watching tech issues such as cyberattacks and Bitcoin, world economic development, climate change and energy consumption, the national debt, the recent push toward “entitlement” reform, the Euro crisis, and banking reform.
Information about these subjects can be found through a number of sources, but here are five reports I consider comprehensive, useful, and necessary:
“World Economic Outlook: Transitions and Tensions” – International Monetary Fund
Everything changed on a world scale after the recent recession, and the capable analysis presented by the IMF in this report is essential for economists, business executives, and bankers who want to know where the international economy stands now and where it’s headed.
“Climate Change 2013: The Physical Science Basis” – The IPCC
After five years of research, the Intergovernmental Panel on Climate Change has released its findings in its Fifth Assessment Report, and the news isn’t good. The bottom line is that global warming is real, we caused it, it’s getting worse, and its effects are going to be wide-ranging for a long time.
“Diminishing Dependence: Shrinking U.S. Oil Imports” – Economist Intelligence Unit
After hitting an all-time high in 2005, U.S. oil imports have plummeted due to new domestic supplies and lower demand. This has shifted the world energy industry in a fundamental way, and the EIU’s analysis does an outstanding job of explaining the situation.
“Regionalization vs. Globalization” – IMF
The IMF’s analysis of the relationship between regionalism and globalization has drawn many interesting conclusions. While globalization is undoubtedly rampant, regionalization is also going strong, in many ways acting as a counterbalance to its global cousin. The IMF’s conclusions are highly useful for creating governmental and economic policies.
“The Mutating Euro Crisis” – The European Central Bank
Economist Francesco Paolo Mongelli provides an in-depth explanation of how the Euro crisis began, what steps were taken to address it, and how to project for the future. It’s a highly informative read for strategic planners.
These are my five favorite reports of the year, but don’t limit yourself. Seek out any other resources that can strengthen your understanding of the global situation, enabling you to see the macro “big picture” that your micro company is operating within. Success comes to those who are best informed – and most willing to see what’s happening around them.