What’s happened?

A growing number of big investors, including bosses at BlackRock, Oaktree Capital Management and Allianz Global Investors, have gone public with predictions that the war in Ukraine will prove an inflection point in the global economy. “The Russian invasion of Ukraine has put an end to the globalisation we have experienced over the last three decades,” wrote Larry Fink, chief executive of the world’s largest asset manager, BlackRock, in his annual letter to shareholders last week. The isolation of Russia from capital markets will promote a trend everywhere towards national independence and hasten the development of rival economic blocs led by the US and China. A world in which cheap offshore manufacturing and smooth global supply chains hold costs down will be replaced by “a large-scale reorientation of supply chains”, and that will be inflationary, says Fink. That implies lower growth and lower returns…

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