After the Bell: No, you're not alone; the world is a mess

Daily Maverick

23-06-2025

As the world teeters on the brink of chaos, with everything from geopolitical conflicts to the unpredictable whims of Donald Trump stirring the pot, one can't help but wonder if we've traded a pandemic for a global financial cocktail of uncertainty that feels even more volatile than before.
I hope I'm not the only one who feels the world is incredibly uncertain at the moment. And in fact I almost feel less certain than I did during Covid.
At least then I felt that we were all facing the same problem.
It would appear that some senior figures in the South African Reserve Bank agree. On Friday the head of the bank's financial stability project, Nicola Brink, stated during a Monetary Policy Review that 'During the review period, the global financial system e xperienced a degree of uncertainty and volatility that is similar to and in some respects worse than… at the onset of the Covid-19 pandemic'.
President Cyril Ramaphosa seems to agree with the bank. He said today at the Constitutional Court that 'the world has become a very dangerous place now, with all of these conflicts that are flaring up'.
It may seem strange to compare anything in recent times with Covid. I mean, during that time it felt like we were facing financial Armageddon.
Stock markets around the world fell dramatically, at one point the oil prices turned negative (because oil tanks were full, people were paying customers to take the stuff).
But actually, the bank is probably right.
This is because the sheer number of elements that lead to instability is so high now. Then it was just one thing. And the whole world was facing it at the same time, if not exactly united.
Also, it was clear pretty early on that Covid was not going to last. It was not going to be with us for a decade, it was going to end.
Covid is a great example of another dynamic in global markets. That in real terms, nothing ever happens.
Considering how much time, thought and sheer energy is put into trying to work out how markets will react to global events, this is incredibly surprising.
But it does appear to be true. Research shows that actually while markets do react to shocks in the short-term, they tend to recover quite quickly.
There is an important reason for this. As The Economist put it, 'The momentum of markets can be relentless. Shares tend to grind higher over time as consumers spend, entrepreneurs innovate and companies grow.'
It would take something messing with this dynamic to stop this growth from continuing.
But until around 10 years ago, I had also been told that property prices always went up. That if I bought a house it would become more valuable over time.
That has not been my experience. Instead, because I bought in Joburg, values are going backwards.
So the same can happen to markets.
And I do worry that the sheer number of elements that are creating instability in our world may be taking us closer to some kind of greater life-changing market event than at any time since World War 2.
Consider the sheer number of ingredients we are dealing with.
In South Africa, the biggest variable is probably still whether the coalition government survives after Ramaphosa goes.
But the rest of the world is a disaster.
Israel is bombing Iran, which may or may not have nuclear weapons; Iran is responding. Meanwhile Israel is using tanks to shoot crowds of people who are starving in Gaza, creating more trouble for the region.
Russia has invaded Ukraine and may well threaten other countries in Europe.
China now has a leader who has almost absolute power and does not appear to have groomed a successor.
Sudan's civil war continues with no sign of an end, and hundreds of thousands of people are running out of food.
But the biggest agent of instability is, of course, Donald Trump. Because of his position and the power of both the weapons and the economy he commands, he is easily the most important ingredient in this toxic cocktail.
But this also underscores how quickly the world has changed in the last six years.
Before Covid the global economy felt like it was doing okay, and we expected our economy to grow as we put State Capture behind us.
Instead the world feels like it is on fire.
I do think we have to be conscious of our own journey through time though.
As I have got older, so the world in which I grew up has receded. As it becomes more and more different to what I grew up in (so often for the better), so it may be harder to understand.
A friend said to me once that he gets really irritated that the rugby authorities change the laws every season because that makes it more and more different from the game that many people now watching used to play when they were younger.
I think that's a good way of understanding how the world changes us.
It also means that probably everyone around you feels the same way.
But for the moment, I think there is good reason to feel uncertain.