Insights

It may be surprising to recall how the world has changed in three decades. Back in 1995, the “World Wide Web” was still largely unknown. Released in the public domain two years earlier, only 3 percent of us had logged on. Inventions like the PalmPilot and Windows 95 (with no internet browser!) were considered “landmark.”2 That same year, a young Jeff Bezos sold his first book from his online bookstore, Cadabra, which he ran out of his garage.

As the Roman philosopher and statesman Lucius Annaeus Seneca once said: “Yield not to adversity; trust not to prosperity; keep before your eyes the full scope of Fortune’s power, as if she would surely do whatever is in her power to do.” This sentiment resonates as we examine the current economic landscape shaped by Donald Trump’s victory in the 2024 U.S. presidential election.

How do you view the glass — half full or half empty? This question aptly captures the dual nature of sentiment today. On one hand, our standard of living is among the highest in history, fuelled by technological advances, improved quality of life, substantial and growing wealth and increased life expectancy. On the other hand, this progress is overshadowed by rising costs of living, heavy debt burdens, declining productivity and ongoing geopolitical tensions.

When the Dow Jones Industrial Average (Dow) crossed a new high of 40,000 in May, it achieved a milestone that appeared implausible given recent popular sentiment. Just two years earlier, central banks were still on the path of aggressively hiking rates to curb inflation. Gloomy equity market forecasts abounded.

This question emerged from a recent study analyzing the text of 200 million newspapers spanning almost two centuries. It concluded that both economic and non-economic sentiment have substantially declined over the past 50 years, despite far fewer economic setbacks.