Six Months as a Global Nomad

A journey of a thousand miles starts off with a single step…

Six months ago, we stepped out of our brownstone apartment in West Chelsea New York and set off on a journey to experience the world. I resigned from my job and we pared down all our belongings to 2 suitcases (and later further down to 1 suitcase) and started our journey chasing the sun and exploring lands and cultures near and far with a complete open mind, open to all possibilities including settling down in a new location for a short or long time period, embracing the Global Nomad life, or coming back to America having had an amazing adventure. In those six months markets hit all-time highs and multi-year lows as political risks and technical and cyclical pressures seeped into the mainstream narrative and reminded us of the inter-connectivity and flatness of the world today. We saw firsthand the growth of Plutonomy in cities around the world as economic lines are a greater common factor and can serve as a greater dividing or unifying force, than geographic lines. We experienced Climate Change around the world, in different hemispheres, traveling through the hottest summer in Europe in 30 years and the coldest and wettest summer in Australia and New Zealand in 25 years. Having spent the past couple of decades as an investor, asset manager and risk manager I put together an international long/short portfolio highlighting major themes observed while traveling:

All Roads Start in Rome

As with any great voyage we started our world tour in Rome. Italy holds a dear place in our hearts. My wife and I both spent time there as students and have come back multiple times through the years. I was in Italy in late February 2018, right before the elections that brought into power a new government which sought to disrupt the old regime and institutions and breathe new life into the Italian economy and people. The populist low lying fruit of cracking down on refuges and immigrants and ‘standing up to Europe’ by submitting a budget that is right outside of guidelines (but may actually be much more austere than France’s depending on your economic forecast) have been achieved, but the deeper issues Italy faces have yet to be addressed. Unlike Spain, Portugal and Greece who hit rock bottom post 2008 (with various degrees of successful bounce-backs) Italy has succeeded in continuously kicking the can down the road and thereby keeping the bank economy mostly intact, but it has not addressed the real issues that stand in the real economy.

“Italy is a great place to visit, but not to live” is a sentence I heard repeated multiple times from Italians who are still living in Italy and Italians who have relocated away from Italy. This cuts across class lines, from highly educated professionals and academics to the working class. As a tourist Italy is great, we have found prices there to be some of the lowest anywhere, while the quality of service, food and culture is outstanding. As an Italian in Italy you must deal with some of the lowest wages in Western Europe and lack of investment, or willingness to foster risk taking, while the country’s infrastructure, society and institutions continue to deteriorate. The nation is stuck in a disinflationary feedback loop with no real green-shoot prospect in sight. In order to address its real issues, the country must make Italy more competitive in the European and global marketplace. Italy has had a rich history in the fashion, automotive, and food industries to name a few, but it is being left behind as technological disruption and capital flow moves the centers of innovation within all those industries away. It must build partnerships and attract capital and resources to foster a renaissance that brings its economy into the 21st century. This sounds great in theory, but over a decade ago when I spent time in Bocconi as an MBA student our class arrived at the same conclusion and little progress has been made. Change is hard because people often overestimate the value of what they have and underestimate the value of what they may gain by giving that up.

Short Italy (and wait for deep value)

Madrid: Unequal Recovery

Spain has emerged from the financial crisis over the past couple of years and you see it in Madrid. Cranes hover overhead, there are upgrades to the infrastructure and multiple tech startups have attracted capital and talent. The growth has been accompanied by price inflation resulting in higher prices in stores and restaurants and the flourishment of luxury shopping centers. The cost of staying or living here is on par with other large cities we visited: higher than Rome, or Milan, slightly lower than London. For these and other reasons, on a relative basis Spain remains a good intermediate term investment target. There is a willingness and energy to invest in entrepreneurship and provide risk capital and having gone through the pain of the financial crisis there is value to be uncovered. But, there are social issues that cannot be solved by providing liquidity to banks and interest free loans to the wealthy alone. There is a definite a great divide between different classes. We complain about it in New York City and check the Economist and the Gini index to accumulate data and build statistical regressions, but all one needs to do is take a long walk through the street of Madrid. The homeless and panhandlers in the streets are not foreign refugees, they are local victims, young and old, of the rampant inequality that developed post crisis. The feel in some areas is very similar to Buenos Aires and Sao Paolo where we have learned to lend a blind eye and look away.

Populist power is rooted in the belief that regular people have the right and the power to have control over their government rather than a small group of political insiders or a wealthy elite. Populism has swept through the globe over the past few years creating political volatility, instability and unpredictability. We can choose to focus our energy on the results of populism, which at times can be uncomfortable and at other times can be outright disastrous, or we can focus on the root causes and try to systematically identify and address them before they lead to the next economic or social crisis. Now that Spain and the ECB have somewhat stabilized the boat in Spain there is still a window of opportunity to invest in the people by providing sustainable long-term financial vehicles and social institutions to focus on employing and empowering all classes and nudging towards a new economy which breaks away from the old cycles.

Long Spain (with an active awareness of political and social risks)

Scandi-Nordic August

We spent our August in the Nordic region living amongst the locals in Denmark, Sweden, Finland and Estonia and uncovered many pleasant surprises in life, business and innovation. The way most Americans and the American media portray Scandinavia and the Nordics is as a socialist, overtaxed, homogeneous and slow-moving and slow to change region: Bernie Sanders’ paradise. What we found (for the most part) is robust culture, dynamic cities and new energy seeking to move forward into a sustainable future aided by technology and thoughtful, design forward, sustainable entrepreneurship.

In the next 20 years 2 billion more people will live in cities. If the model for those cities would be Copenhagen the world to come will be a much better and happier place. Copenhagen is a model green, sustainable city with a modern, punctual, efficient and clean public transportation system and an active lifestyle is a fact of life: most people choose to bike to work or school, and the majority do not even own cars. Copenhagen lacks the high rises, smug and overcrowding that have come to symbolize the modern metropolis, while having a cosmopolitan feel, rich culture and excellent restaurants and cafes. Danish life as we discovered after spending time and making friends in Copenhagen and the island of Bornholm is ideally Hygge. The Danes concern themselves with absolute happiness rather than what behavioral economist Dan Ariely calls “Relative Happiness”. The majority are genuinely content with their lives and aren’t concerned with the grass on their neighbor’s lawn being greener or picking needless fights to prove their machismo. The Danes dress well, but show no labels; drive good, high quality cars (when not biking, walking or swimming), but don’t try to flaunt anything or cut anyone off; enjoy good high-quality food and service, but don’t worry about being in the “IT” place where their friends and acquaintances could not get a table. They’re just happy, practical and communal. Coming from New York we found it very impressive and heartwarming. They can make long term sustainable decisions because they show trust in themselves, their follow humans, their children and their future. You would think that this level of comfort and “Hygge” would cause the people and government to be complacent and dug into long term antiquated institutions as the world evolves around them. However, I found the energy in the financial community and start up centers to be electrifying. The approach is methodical, systematic and sustainable: plans are made, and businesses are built with a long-term horizon in mind, supported by the community and academic, economic and government institutions. This may be a slower and less disruptive approach than we are used to in New York and San Francisco, but it also carries less tail risk and is more likely to be more socially responsible and generate better median returns and community benefits.

Across the Oersund Bridge lies the Swedish city of Malmo. Malmo is a young city with a long history. Approximately 50% of the population is under the age of 35 and about a third of the population is foreign born. Historically it has been a magnet to various waves of immigration, but these days the foreigners are mostly of Arab descent. This makes for a very vibrant city with a lot of energy and diversity. Malmo has a very exciting startup scene. Around 7 new companies are started in Malmo every day. Its proximity to Copenhagen and major universities (Lund and Malmo), great infrastructure, relative low cost of living and young and educated population all combine to form a great ecosystem to harvest and grow ideas into successful enterprises. I spent some time at MINC, a startup lab which nurtures young entrepreneurs, provides guidance, networking opportunities and a free work-space for any aspiring startup and houses an advanced top notch incubator for advanced startups from all over Europe. Their success has been pretty incredible: last year MINC and Malmo ranked as the 4th best startup hub in Europe. This top-notch support system and infrastructure in a city where work/life balance is great and the cost of living is 20–30% lower than its European peers makes for a very exciting environment for entrepreneurs and should pay off as the rejuvenation and rebirth of Malmo continues in the coming decade. This success does not come without major political risks. Opening its doors to refugees has helped Sweden’s economy as its GDP growth has been trending well ahead of the EU average in recent years, with the growth largely attributed to immigration. Opening the doors to foreigners can also a create a tinderbox for conflict, politics and populism and rising xenophobia was evidenced in the rise of the right-wing parties in the recent elections.

On the edge of the Nordic region lies the small Baltic nation of Estonia. The country has seen some of the strongest growth and technological innovation as evidenced by the creation of Skype and Angry Birds. Tallinn, its capital is a very small city: you can walk from end to end in under an hour and drive anywhere in under 20 minutes. The city is very walkable. The old fortress castles sit around the old city which seems frozen in time and surrounded by parks. Outside the walls the city feels like it is growing and expanding in front of your eyes with new glass condos and commercial buildings growing everywhere. Tallinn survived multiple invasions through history: it was first conquered by the Danes, then the Swedes and the Russians. It gained its independence briefly after World War I and was gobbled up by the Soviets after WW2 and remained a part of the USSR until its collapse. Nearly two decades later it remains stuck between the old and the new, East and West. The younger generation is technologically advanced and sees itself as Nordic. Its governments have pursued a free market, pro-business economic agenda, and sound fiscal policies that have resulted in balanced budgets and the lowest debt-to-GDP ratio in the EU. But socially, real economic power still sits with Oligarchs that made their money in the East. Governance and control risks remain high, as evidenced by the Danske Bank money laundering scandal that unraveled this year.

We spent the latter part of August in Finland. Situated at the northeast tip of Europe, Finland is often forgotten in overlooked by the rest of the world. We found the country to be beautiful and fresh, the people to be awkward, but nice and many elements are in place to breakout and lead a new wave of innovation and green living.

Finland’s nature scene is intoxicating: The air is fresh, the countryside (seen by foot, bike, train or boat) is very green and blue, the Finnish Archipelago, made up of the most islands of any nation on earth, is amazingly beautiful. The way to fully experience it is to take a few weeks and boat from island to island sleeping in small cottages with no electricity or running water and spending your days exploring nature. We did not do that, but we did venture out to explore a few of the islands a time well spent clearing our lungs and bodies from the New York pollutants.

Finland is the most literate country in the world. 82% of people have a library card. Finns are generally introverted and on the long dark, cold days and nights they love to bury their noses in a great book. Finland’s libraries are some of the most beautifully designed architectural buildings, but at the same time functional, friendly and inviting and our kids spent many hours reading, learning and playing in the libraries of Turku and Helsinki. Finland is the most child friendly country we have visited: On the bus (and all public transportation) mothers with a child in a stroller ride for free. On the train we booked a family compartment which was the nicest compartment we have ever seen and there was even a playground on board. Every restaurant or coffee shop had a high-chair, and some had children play areas. The playgrounds were very nice and encouraged independent play and every museum has a patient educational tour for Children. After visiting and seeing this first hand it is not surprising that Finland’s education system is ranked as the best in the world in many studies. Finland really is investing and vested in bringing up literate and kind future generations.

Finland is known for its design, having produced some of the world’s top interior designers and architects. Finnish design is minimalist and extremely functional. It is a clear reflection of the culture and the people: understated, very thoughtful, modern and in touch with nature.

There is another unexpected current stirring up in Finland in recent years: As a Startup center. Finnish design, technology and innovation have always played a role in the country’s economy, but the energy was mainly mainstream and institutional producing such economic national champions as Nokia. Entrepreneurship was historically frowned upon and discouraged. In the past decade a new rebellious scene emerged. Started by students from the Aalto University in Helsinki, the startup community has grown to be one of the largest in Europe. I visited Maria01, a campus for startups, tech investors and the technology ecosystem. The hub is located at a former 130-year-old hospital campus in central Helsinki, Finland. It is a unique campus with distinct energy that welcome “the weird, brave and ambitious.”

This rebellious entrepreneurship has now been embraced by the institutions that until recently rejected and discouraged it: Finland is currently the second largest investor in early stage startups in Europe measured in venture capital as a percentage of GDP and a startup group has been established in parliament. The Maria 01 campus, subsidized by state support, is set to expand to cover within 5 years a total campus area of 70,000 sqm of new facilities for startups. The total campus will allow space for over 650 startup companies from early-stage to later-stage and will provide a place of work for over 5000 professionals.

The energy experienced in Copenhagen, Malmo, Helsinki and other hubs throughout the Nordics with state and institutional support and sustainable long-term thinking is a great positive for the region. Technology has made the world smaller and more interconnected. We are moving towards a multipolar world where Capital can flow towards efficient frontiers of innovation and humans can interact and work together while maintaining their unique characteristics and living and working in social harmony. This flow may be at times restrained by protectionism and fear from those living in the past and looking to defend their comfort zones, but it is, in the long term inevitably unstoppable and holds within it great benefits for the future of the global economy and humanity.

Long Scandinavian and Nordic Innovation and Sustainability (with an active awareness of political risk and legacy institutional risks)

Greece: Opportunities arising out of tragedy

Greece was arguably the most hard-hit European economy post the financial crisis and it has yet to fully recover from it. The scars are seen in its tired infrastructure, the beat-up roads and sidewalks, the old buses chugging along and the taxis which have seen better days. Time seems to have stood still here during a lost decade marked by economic depression and political turmoil. Entire neighborhoods have been wiped out and many projects on the mainland and islands abandoned. The populist left withstood multiple hits, but still holds power. A certain sense of stability has helped revive some investment activity and spirit, but the economy remains limited by austerity measures and unnecessary bureaucracy. Starting a business or investing here is not easy and somewhat thriving industries such as tourism are hit by explicit and implicit taxes and regulations. The locals are still in survival mode and instead of working to ease the economic shackles imposed by history, the ECB, the IMF and its own archaic rule making, are more worried about the populist right capturing power in the wave of global nationalism and swinging the social pendulum to an unknown future. But in the shadows of all these challenges there is a positive spirit and undercurrent to overcome and renew. The old social and economic institutions are slowly being replaced and improved by a new generation of entrepreneurs that embrace the nation’s long history and resources and are utilizing technology and better practices within various industries to yield better results. The ancient streets of Athens are rich with mythical stories and history, the people are friendly and there is a new life of entrepreneurship, fresh food and renewed energy. Even the new airport (built by the Germans) is extremely modern and efficient. Alongside this spirit there are real value driven assets to discover. For example, for the price of a closet in Hong Kong one can acquire a two-bedroom apartment overlooking the Acropolis.

Long Greece Deep Value (especially deep value, cash flow producing hard assets)

Tel Aviv: Sababa V’Balagan

We spent the month of October in my birthplace and our homeland. Israel and especially Tel Aviv have come a long way in the past couple of decades. This miraculous growth has come with mixed results and it now faces growing pains that can results in an even greater future but are threatened by lack of sustainable long-term systems thinking.

Israel real estate was untouched by the 2008 global economic crisis, but now prices are completely out of reach for almost all Israelis. Between foreign investors (30% of the market), population growth (demand outpaces supply) and immigration and foothold immigration (French and other Jews moving full time to Israel or buying an apartment just in case antisemitism continues to flare up in Europe), real estate prices in Tel Aviv are now some of the most expensive in the world. This has also led to a big buildup of glassy new condo buildings. But while a new skyline has filled up and new parks and green areas have popped up the older buildings, beat up by the salty air and the sun lay debilitated. Tel Aviv is expected to double in size over the next decade. There is an opportunity to make this city and country fresher, better and more sustainable than it already is, but for that you need longer term thinking, planning and an order that may not be in line with the Balagan (chaos) that prevails, and the short term live for today Sababa (awesome) thinking.

Statistically, Israel has developed to one of the top 10 GDPs in the world, but under the hood there are many issues. Income disparity is very high and the cost of living is higher than 2x the median income. That means that a family where both adults work still can’t make ends meet. We found Tel Aviv to be one of the most expensive cities we visited on multiple levels (judging by the cost of lodging or even a cup of coffee) and that has been one of the first thing anyone I met with, whether it is fellow New Yorkers, Europeans or local Israelis, speak about. The official inflation numbers may not show it, but it definitely surprised us and surprises others when Tel Aviv is more expensive than most European cities and on par with London or New York to visit. But somehow, Tel Avivans constantly speak about how hard life is, but still pay up for the cup of coffee, or the high rent for the shoebox apartment because YOLO and you want it to be Sababa.

Israel’s business mentality is also very mixed. The “Start-Up Nation” boasts more innovative tech startups than any community outside of silicon valley. Even more impressive is its R&D prowess. International companies usually engage in M&A in order to basically shut down many cost centers in the target company, but when acquiring an Israeli company the opposite is usually true: they shut down their US R&D center and move the innovation center to Herzeliya. The constant Balagan is actually very conducive to the “Move fast and break things” motto which has guided the tech start up culture of the better part of the past 2 decades. Furthermore, Israel is a flat society: you can find everyone from the generals to businessmen to surfers eating in the same falafel joints and conversing freely. This same mentality prevails in the workplace — open, blunt and very direct without much formalities. This allows fast innovation and at the same time it allows quick retreats from projects that are clear failures, but in other parts of the world might take up many resources and time because no one wants to speak up to their superiors. This part is great! The dichotomy exists in that Israel and Israelis are not doing enough to think about long term sustainability of the economy, companies and people. Everyone’s dream is to start a company, built it within 3 years and sell it. That’s it. There is lack of focus on building companies and champions that are true dominate global leaders, keep Israelis employed and educated and stay Israeli through and through.

The investment community lacks similar sustainable, long term thinking. Israelis care about short term performance and that creates a very risky setup. Instead of looking at long term results on a risk adjusted basis, most everyone cares about short term returns and benchmarking. Couple that with some balagan and lack of accountability and the result is less than optimal and at times dangerous. There is a definite need to develop more robust and liquid capital markets and real risk management standards and practices within the investment industry before this cycle ends.

As Israel heads to the polls once again in 2019, the status quo is unlikely to be disrupted. Netanyahu, facing indictment for corruption and political enemies from the left and right, remains well ahead in the polls and the fragile chaotic balance is likely to remain in place. One can look at the ‘miraculous’ growth of the past decade and look for the fault lines or wait for the miracle to end or bubble to pop. But Israel has all the elements in place to make the past decade only the launch point for one of the strongest momentum economies of the upcoming decade. To continue to ride this tidal wave Israel may at times need to slow down, look past the immediate future, build bridges across the world and set in place systems and practices which embrace generational, sustainable and impactful practices to lead the world into the next century.

Long Israel Innovation (with a keen eye on control risk, social risks and political risks)

Hong Kong and China

We visited Hong Kong in late October just as trade tension between the US and China started reaching its boiling point. This was the first time I ever visited Hong Kong and I was extremely unprepared for the suffocating overdevelopment, dense congestion and pollution. From an environmental perspective China and Hong Kong have tried to protect large parts of the island in order to maintain green statistics high, but in reality this is not a sustainable solution. In the past two decades Hong Kong has become hinged to China which has continued to clamp down on its autonomy and independent spirit. English is spoken less and less and the expat community stands out like a sore thumb. Furthermore, Hong Kong is in the midst of the greatest real estate bubble on our planet and is completely immersed in it. Every other storefront is a real estate office and on the sides of the streets and escalators real estate brokers stand selling multi-million-dollar apartments. Bubbles inflate from time to time and it’s hard to predict when they’ll pop, but when this one comes back to earth look out below.

As you walk the streets and interact with various communities you can tell that the global economic engine: China is slowing down. In the macro sense a Chinese slowdown in growth still produces an economic growth rate which is much higher than the US, Europe or Japan, but couple that with less grease in the wheels in the form of higher rates and protectionist policies and the world economic machine starts to cough ever so slightly.

Taking all those factors into consideration: social pressures, asset price bubbles and slower growth leads one to be very optimistic that a grand trade deal with the US will be agreed upon, but the costs of this slowdown and loss of momentum are unknown. Also unknown is the ability of the global economic machine to restart and ramp back up. In the long term the seeds are in place for the continuous decline of Hong Kong as the Asian Financial Capital and the waves of social unrest that may come due to lack of sustainable long term focus.

Short Hong Kong and China

Japan: Tradition and Pride

I always wanted to visit Japan. Mystified by the proud and ancient culture, the clean and precise thinking and design and the amazing food. I was probably the most excited in the family to visit Japan, but after 10 days there I think we can easily say that we all loved it.

We visited Tokyo and Kyoto and were extremely impressed by all that we saw. Tokyo may be one of the most sustainable and green large city in the world. The contrast with Hong Kong is stark: the cleanliness, abundance of green spaces, spaciousness and thought put into the design and architecture and modernity seamlessly mixed in with tradition. The food quality is superb everywhere and the service is first rate. The people are extremely nice and polite, and the culture is unique, interesting and very different from western culture. There is a great sense of thought and special attention paid to design of everything: food, houseware, clothing, presentation, etc. and there is a unique sense of style, somewhat similar to Scandi-Nordic style. You can sense the pride that people take in their craft and everything that they do.

The infrastructure in Japan is fantastic. The airport is first rate and the train and metro systems are efficient, fast and clean. As seasoned New Yorkers we are used to walking everywhere, and we did so for the most part in Tokyo, but there was no hesitation to utilize public transportation in order to efficiently get from point A to point B.

Relative to other places we traveled we found prices in Japan to be extremely competitive on average and cheap when adjusted for the quality of products, design and/or ingredients. You can have a Michelin star lunch, for under USD$20 and lodging costs were in line with other cities around the world. We can thank the exchange rate and lack of inflation for this value proposition. Abe, Japan Inc. and their economic advisers can look at the combination of very competitive pricing with very high quality of goods as an opportunity to step up economic growth and pump up some inflationary forces in a measured way as rates and volatility move upwards. The challenge is in balancing and controlling these forces along with entrenched institutional resistance to change.

I was surprised by the lack of digital payment and credit card usage. For all its technological prowess Japan remains a cash society. Credit cards are rarely accepted and the paper Yen still rules. Traditional and methodic approach to food, design and many facets of life are great, but tradition must evolve alongside technology in order to survive, flourish and empower societies. There are many opportunities to invest in Japan in order to enhance rather than disrupt long term tradition. The opportunity exists in Fintech, Foodtech and many other sectors and Japan should look to embrace and nudge this change rather than fearing it.

Japan lived up and surpassed all my expectations and I see many value, automation and impact investment opportunities as Japan looks to reboot and grow despite demographic and societal forces which continue to push its economic stagnation. Further evolution and liberalization of corporate governance and market structure would go a long way towards getting back on the path of growth.

Long Japan

Singapore: The Lion City ready to take its place as the financial capital of the world

“They just make it easy” said a friend of mine who has been in Singapore for a decade now, the same sentiment was paraphrased by another friend that had moved there a few months ago from Tokyo. Singapore is in many ways the best model of a dynamic, sustainable and environmentally aware smart city in the world today.

We arrived in Singapore as the Fintech Festival, attended by over 30,000 companies, innovators and investors from all over the world and stayed there as Putin, Xi and others convened for the ASEAN conference. Singapore’s economic, technological and political prowess was on full display. As the US, the UK and parts of Europe foolishly close doors and deny visas to foreigners in an effort to protect the status quo in a wave of xenophobia and protectionism Singapore stands to gain from the flow of academic, economic and entrepreneurial talent. Singapore should seize the moment and capitalize on this opportunity.

The compactness of the city allows for interaction and cross collaboration. In the span of a few days I was able to arrange multiple meetings and meaningful conversations with bankers, technologists, investors and entrepreneurs. There is a range of opinions and many areas in which Singapore can continue to improve and enhance, most of which lie within its social offerings and increasing socially responsible As Hong Kong declines and the centers of global financial and innovation move east Singapore remains the best viable alternative and destination for Capital and talent flow.

There are certain factors that can sow the seeds of discontent in the long term: (1) One party rule continues to prevail in this city-state that prides itself on discipline and the rule of law. This governing body may need to evolve as democratic liberal forces inevitably look to gain power. (2) 40% of the population is foreign born, which thus far has formed a great melting pot and been embraced by the growing population but may at certain times cause conflict. (3) The surprise movie hit of this summer in the US “Crazy Rich Asians” takes place in Singapore and depicts the difference between ‘regular’ rich and ‘crazy’ rich. While Singapore’s population is wealthy as it grows and attracts more migrants economic class stratification may develop and challenge its current comfort zone (4) In a city that seems to have the most shopping malls per capita over-commercialization and over-consumption (5) Balancing between the political pressures from China and the West, while remaining neutral and friendly with all parties is not an easy task in an increasingly acrimonious world.

Risks aside there remains plenty of runway for Singapore to continue to grow and flourish for many years to come.

Long Singapore

Australia and New Zealand

We closed out the year exploring Sydney, Australia, going off the grid on a self-sustainable farm for a couple of weeks on the Pelorus Sound and finally landing in Wellington, New Zealand.

Australia and Australians have gained a lot of wealth in the past two decades. Fueled by the proximity to China, abundance of resources and a real estate bubbles Australians today enjoy GDP per capita which is higher than Germany, Canada, France, the UK, New Zealand and Japan. This wealth has led to a comfort level which now seems to stagnate and slow down meaningful change and progress towards a sustainable future. The great risks in Australia are societal and self-imposed. For all the talk of being environmentally conscious the real action remains limited to a small portion of the population and a smaller portion of overall capital. These voices of a better future: B Corps, Socially Responsible and Impact Investors and Companies that have committed to Social Corporate Responsibility are positive lights in a sea of darkness. But most consumption, spending and investment is still stuck in the old economy, in packages foods, carbon fuel guzzling vehicles and away from progressive social policies.

Politically Australians have pretty much stripped their executive branch of any power. The country is on its 4th Prime Minister in a decade and political stability is nowhere in sight. This lack of political stability hampers the political will to plan systematically for a sustainable future. Thus, while Sydney has sprawled out and the government has supported the build-up of more roads that allow for more gas-guzzling cars, it has not focused on long term green public transportation solutions that would be greener and more beneficial in the long term. It would be a shame for this nation to allow political and societal risks to disrupt its economic ascent, but the future remains unclear.

We closed out the year in New Zealand, in a corner of the world that is for the most part untouched by humans and where the beauty of our planet in its natural form shines bright. It serves as a reminder of the impact of humans on our planet in places like Hong Kong and New York and the opportunity we still have towards a collective better future.

Short Australia Real Estate and the Old Economy / Long the New Economy: Environmentally Conscious, Corporate Socially Responsibility and Impact Investing

There is a quote that spoke to me in a brochure I picked up while visiting a Buddhist temple in Kyoto, Japan:

The things that happen in the world don’t take place in isolation. They are interconnected — influencing, changing and creating one another in an infinite number of ways. Buddhism calls this interconnectedness of all things “dependent arising”. Since we have no way of knowing all the possible effects and ramifications of any single event, it often becomes impossible in real time whether an event is in fact good or bad.

We cannot predict whether the actions of the present, regardless of intention, will result in positive outcomes. But, to build a better future for our children we can focus our energy on the positive elements that unite us, learn the proper lessons from the past and build bridges between societies and from the present to the future. We can steer the forces and flow of our systems, technology, innovation capital and investment and risk management towards a better and sustainable future for our planet, our local and global environment and our collective social wellbeing and quality of life.

Here is to a great journey and to a fantastic 2019 around the world.