Populism: Short-Term Distraction or Long-Term Structural Trend?

When you hear the term “populism,” what is your first reaction? For many people, the word evokes an emotional reaction—some positive, some negative. This polarization is largely because there are so many varying descriptions and understandings of what populism is, as well as its implications. However, geopolitical strategist Matt Gertken argues that populism is neither good nor bad, and assigning a moral value to it is problematic—especially for those who wish to gain a broader understanding of its impact on geopolitics and the global economy.

Though populism isn’t new to geopolitics, it has received more attention recently due to highly publicized events like Brexit in the U.K. and President Trump’s election in the U.S.—both brought about by populist tactics. Yet, populism dates as far back as Andrew Jackson, who was president of the United States from 1829 to 1837, and many believe it’s a long-term, structural movement that is increasingly becoming more important to understanding the state of the world. For long-term investors, this means considering the populism movement and its effects as another component of the investment decision-making process is also growing in importance.

But, why is populism on the rise? And does this growing movement have the potential to threaten the ability of global capital markets to function as they have in the past? To learn more about populism, its potential impact on the global economy, and how CIBC Private Wealth Management is incorporating this mounting structural trend into client portfolios, check out our recent article “Populism Rising” in the Fall issue of The Advisor or listen to the podcast below.

Dan Delany is an equities portfolio manager for CIBC Private Wealth Management with more than 20 years of industry experience.