I was reading a set of facebook posts from friend this week, and the outlook for everything seemed pretty bleak. Death, disease, division, defeat. Lots to be sad about. Plenty of reasons to believe that things are getting worse fast and will stay that way for a while.
Later in the day, I happened to be reading The Psychology of Money, by Morgan Housel, and really appreciated his chapter on optimism and pessimism. He points out that optimists tend to sound naive and uniformed, while pessimists tend to sound wise and well-educated.
As an example, he included two contrasting visions of the future–one pessimistic and one optimistic.
The pessimistic view was one that ran in the Wall Street Journal on December 29, 2008. You can find it here. It’s a story about a Russian professor and former KGB analyst predicting the demise of the United States. While 2008 was one of the worst years in memory, he had been predicting the collapse of the United States since 1998. And his decade-old projections were finding a greater following in 2008.
Obviously that didn’t happen.
Housel contrasts that with a fictional optimistic message that actually did come true. Imagine, he says, if a Japanese professor had written an article in 1946, after the country had been decimated by war, and was in the midst of famine, that said:
“Chin up, everyone. Within our lifetime our economy will grow to almost 15 times the size it was before the end of the war. Our life expectancy will nearly double. Our stock market will produce returns like any country in history has rarely seen. We will go more than 40 years without ever seeing unemployment top 6%. We will become a world leader in electronic innovation and corporate managerial systems. Before long, we will be so rich that we will own some of the most prized real estate in the United States. Americans, by the way, will be our closest ally and will try to copy our economic insights.“
Seems like a crazy set of predictions for a defeated war-torn country. But it all came true!
Which caused me to imagine what a similar message might look like for the US today.
“Things seem bleak now, but we have a lot to look forward to. In the next 30 years, our economy will more than double. The SP500 will return 15x to anyone who stayed invested. The pandemic has been horrible, but it accelerated innovations that will revitalize the country. mRNA vaccines, one of the most important medical advances of recent decades, have made incredible progress towards widespread acceptance and will be central to huge gains in life expectancy by fighting cancer and viral infections. Remote and hybrid work will make more people more productive from more places–and allow much of the country to join in the prosperity from technology that has been limited to a few cities so far. This will also reduce the political division in America by allowing more diversity of jobs in different places. The withdraw from Afghanistan has been filled with death and human tragedy. But it was the right call. In 30 years the country will have reformed its extremist government by participating in the world economy, and many of the refugees will have created prospering businesses in the US, which is a good thing for America. And, while many thought the US became less of a world leader during this time, these events happened in the midst of extremely authoritarian moves by China’s government. This contrast actually reinforced that the US is the best place in the world to grow a business, build a family, and enjoy the blessings of liberty.”
Admittedly, it seems far-fetched. But I think there is reason to hope for the possibilities that are ahead.