It can sometimes feel like the world is overflowing with bad news. Switch on the TV, scroll your phone, or glance at headlines and you’ll be met with stories of political turmoil, economic uncertainty, or global conflict.
It’s no surprise that investors often feel uneasy.
While some of these stories are concerning on a human level, when it comes to investing, history tells a reassuring story. Over the past century, global equity markets have consistently delivered returns far above inflation for those who stayed invested. Despite wars, recessions, pandemics and political upheavals, human ingenuity has driven sustained growth, as the 100-year chart below shows:
To be a successful investor, maintaining a healthy sense of optimism is essential.
Markets are not immune to short-term setbacks, but capitalism has proven remarkably resilient. By providing capital, investors fuel innovation, entrepreneurship, and growth. In return, they share in the wealth created when businesses solve real-world problems.
The case for optimism is firmly grounded in economic history. Human progress and ingenuity have repeatedly outlasted the crises of the moment. Just think of the advancements in medical science that have extended life expectancy, or the technological innovations that have transformed how we live and work. Progress will not end here, the past suggests that even greater advancements lie ahead.
When it comes to long-term investing, history reminds us that the glass is, indeed, always half full.
