One of the key responsibilities of experts in financial services roles is curation. Entities like Bloomberg distill the big picture down to a handful of key stocks to watch and a particular trend to follow — a micro-version of our macro-economy. Their intent? To make investing easier.

Yet, this simplification comes at a cost. In an interconnected world, wealth managers must be windows, not filters, allowing clients to see the full picture — and my three decades of guiding investors through global market intricacies have taught me that effective investment strategies require more than a glimpse. They need a deep, comprehensive dive into data, far beyond the cursory sweeps that often pass for analysis today, with visualization tools that display that data in a clear, understandable way. 

This panoramic approach not only offers a broader perspective but also unveils the interconnectedness that is crucial for making sound investment decisions. After all, investing made easier by ignoring 90% of the data isn’t necessarily making investing made more effective.

An Interlocking Web of Insights

The global macro landscape is characterized by interdependencies — everything from trade and geopolitical tensions to housing markets and macroeconomic policies — that significantly impact financial markets. We live in an interwoven world, and the markets don’t just illustrate but reflect this.

For example, entities like the International Monetary Fund (IMF) typically dictate that trade growth and GDP growth are historically interdependent. However, since 2016, there has been a disconnect between their traditionally linked performance.

The World Trade Organization (WTO) noted that trade value growth, projected to be near 1.7% last year, was approximately half the level of expected GDP growth. In its 2023 World Trade Report, the WTO emphasized a need for “re-globalization,” concluding that a key challenge to modern international trade is trade fragmentation, which has brought the world less predictable trade policy environments. 

Why is this? The answer requires a broader, macro view. While there are several reasons, one significant cause is the weaponization of trade. Consider the US-China trade war tensions around 2016. Now, fast-forward and examine the use of sanctions meant to restrict Russia’s access to revenue streams the nation would otherwise use to fund its ongoing war against Ukraine. 

We’re seeing that trade can be used to connect us and encourage growth just as it can be used as a weapon to threaten or even reverse that progress. And that means the line between geopolitics and geoeconomics is becoming blurry at best.

Housing Trends: A Window into Global Economic Shifts

The 2023 US housing market exhibited high prices, elevated mortgage rates, and low sales volume, with millennials struggling to afford homes. Despite predictions of a downturn based on short-term data, sales prices have defied expectations. Why?

To understand this, we must zoom out yet again. Long-term analysis reveals that housing unit growth hasn’t kept pace with population growth, vacancy rates have declined for over a decade, and housing prices have shown year-over-year increases since the early 1990s, apart from the 2007-2011 crisis. 

Yet even that crisis exemplifies the US housing market’s global macroeconomic impact, as it triggered a worldwide downturn. And rising housing prices can prompt central banks, like the Federal Reserve, to raise interest rates. This action can lead to higher global borrowing costs, affecting investments and economic activities in other countries. In fact, the European Central Bank recently highlighted emerging financial stability risks associated with higher interest rates, which are impacting funding costs and economic activity across sectors.

This reflects a broader global context. In response to inflationary pressures, monetary tightening is a key theme influencing investment decisions and market liquidity. In an interconnected world, every element has a significant ripple effect on the global macro ecosystem, marking a clear need for institutional investors and wealth advisors to adopt comprehensive, global trend tracking and analysis.

Seeing the Big Picture

As institutional investors navigate the volatile dynamics of global markets, they must adopt a macro-level perspective to ensure their strategies are as informed as they are resilient. This means leveraging modern data aggregation and visualization tools to access insights that stretch not just across the globe but across our history. There is no reason to limit yourself and your returns to narrow windows of time.

In the age of big data, it has never been more crucial to venture beyond narrow selections of limited information. Today, wealth managers must act as the analysts they are rather than the editors they’ve been encouraged to be.

Curated reports offer blinders when what we need are lenses that enable experts and their clients to see the full spectrum of market dynamics. Only with this comprehensive view can professional investors truly safeguard portfolios and capitalize on the connections that shape our world.