In the early part of this decade, our Real Return team discussed a qualitative idea for the post-millennial world, which was called ‘A perspective on returns’.

Our view was that the death of the long secular bull market (dating from 1982) had marked a transition to a different kind of financial environment, one characterised by lower long-term returns, but with shorter-term returns following a pattern of alternating booms and busts.

In our new paper, we revisit our thinking following the financial-asset strength which continued into the start of 2018, and amid the financial-market volatility seen in February 2018.

Then and now – a different world

Mapping the profound transformation of the investment landscape since the early 1980s

A perspective on investment returns: infographic

For illustrative purposes only.
Source: Bloomberg, Bureau of Economic Analysis, Thomson Reuters Datastream, US Census Bureau, Newton, January 2018.
*10 years of earnings used to remove the effect of the economic cycle from the P/E calculation.