I believe that there are two major fundamental and evolutionary trends that a successful investor has to be aware—the technological revolution and globalization.
With the technology revolution, new innovations seem to be appearing more and more rapidly than in the past due to better, cheaper and more convenient communication.
Some of these advances build upon and modify existing products.
For example, computer processor speeds just seem to get faster every year.
Other ideas build upon the original intent of the product. For example, my phone now is a far better and handier camera than any other camera that I have ever had before.
It’s so useful now because it’s usually with me whenever I have the urge to take a snap shot of one of life’s little memories.
And I can then immediately share those pictures with anyone that I want to, anywhere in the world, by the use of email, text or social media sites.
Then there are other cases where entire generations of technology are leap-frogged.
I always think of the Tibetan monks who went directly from nothing to satellite phones and wi-fi hot spots.
And when I talk about technology, I’m not just talking about the electronic gadgets, but rather technological advances.
For example, technological advances in how horizontal drilling and multistage hydraulic fracking have greatly increased the supply of oil and natural gas.
So much so, that you now hear noise from the odd analyst that the U.S. could be self-sufficient in energy in the near future.
Would that change the dynamics of the world? You bet!
The future course of globalization has been supported by the same things which supported the innovations in technology.
Easier, better, cheaper and more convenient communication is changing the view of how the world and corporations should be operated.
National and corporate leaders who pursue economic policies that don’t make sense increasingly run the risk of having their stock and currencies quickly crushed by a well informed and highly motivated network of global investors, analysts and traders who dominate global financial markets.
As soon as I wake up every morning, I get my coffee and check out the financial and investment news on BNN and Thomson Reuters.
If these global investors and traders don’t like how JP Morgan are handling their derivative positions, the bank’s stock price take a smack.
If they don’t like who won the election in Greece, the interest rates on the country’s bonds go up. This trend is making political leaders and corporate managers subject to a round the clock voting process on the wisdom of their strategies.
My only advice that I have for investors is based on the analogy of being a safe driver: Keep your head up, look both ways before you cross the street and assume that none of the drivers see you.