Three Longs & Three Shorts

Singapore Sends an Alert to the Investing World

Author: Andy Mukherjee
Source: Bloomberg (
Temasek, Singapore’s state investing firm, has in its annual report raised the spectre of “secular stagnation”: “The concept of a persistent downturn that doesn’t respond to easy money featured in the Singapore state investment firm’s annual report for the first time since 2016, one of three possible troubling scenarios alongside a hard landing in China and a severe escalation in trade and tech tensions.”
Columnist Andy Mukherjee says that “If a patient investor with S$313 billion ($230 billion) in assets is barely able to turn in a 1.5% annual return, even with a global remit to invest in both listed and unlisted equity, then other asset owners and money managers will want to know if this is a blip or a potentially permanent shadow over their performance.”
Temasek had flagged secular stagnation as a risk in 2016 but then the Fed started raising rates and the fear faded. Then Jerome Powell took charge of the Fed in December 2018 and started cutting rates again. “For investment bank analysts, it’s time once again to consider the twin effects of an aging global population and the rise of the robotic arm. Pension pools are swelling, but where can they find returns? Certainly not in government bonds: More than $13 trillion of them are trading at negative yields globally. How will wage growth and wage-led demand take root as algorithms make a lot of human work dispensable?”