Welcome to the age of global reckless driving

Donald Trump will become U.S. president in a few weeks. The silence is deafening. I feel a deep anxiety around the globe, twisting and turning under the surface. Trump has already made more than a few blunders just during the transition period. Portfolio managers and investment officers are now half-jokingly talking about the new phenomenon of "presidential tweet risk." "Just wait until he gets his hands on executive authority," people say. The talk in the global village is about a new age of uncertainty. 

When I was a kid, Fidel Castro was a symbol of a backlash against globalization. Now we have Trump. This is beyond anything we could have imagined in my times. If Castro's Cuba provided the occasional pothole along the road, Trump is the drunk driver sitting next to you. Welcome to the age of global reckless driving. If you are not worried yet, either you haven't been paying attention or you're in a part of the world where you've grown numb to this sort of thing. Let me explain. 

There are two types of countries: Ones living under perpetual uncertainty, and ones that can identify (sometimes even quantify) risks and prepare for potential outcomes. This is the famous risk and uncertainty distinction of John Maynard Keynes. Risk is something where the probability of outcomes can more or less be measured. Uncertainty is different. It's an amorphous blob of something that may or may not happen. Risk is the likelihood of your plane going down, or the chances you take on the blackjack table. But uncertainty is entering a pitch black room for the first time. There is fundamental uncertainty moving from this moment to the next, and you cannot assign a probability value to that. The future is just blank. It's a matter of environment.

Recently I was...