Barclays dropped its annual Equity Gilt Study on Thursday, which is a 200-page behemoth detailing the bank’s views on the big drivers in macroeconomics and financial markets around the world.
Every year Barclays picks one key theme that it expects to shape global discourse over the coming year.
In 2016, the focus was on “how economies were struggling against disflationary pressures,” but this year the goalposts have shifted massively and one theme dominates the report — populism.
From Britain’s historic decision to leave the European Union, to Austria coming close to electing a far-right president, and of course the shocking election of Donald Trump as President of the United States of America, populist, nationalistic politics dominated 2016.
With Trump making his first policy moves as leader of the free world, Brexit talks set to begin within weeks, and populist far-right politicians like Marine Le Pen and Geert Wilders set to win big vote shares in upcoming elections in France and the Netherlands populism continues to be crucial in 2017.
The global populist uprising has been fuelled largely by voter discontent with the centrist establishment that has dominated the Western political landscape for the past several decades. As Barclays wrote back in October, there is now “a perception among ‘ordinary citizens’ that political and institutional ‘elites’ do not accurately represent their preferences amid a growing cultural and economic divide.”
Dubbed the “Politics of Rage” — a term that seems to trace its origins back to a 20th century US populist George Wallace, but popularised in recent months by Barclays, the phenomenon has myriad factors. Helpfully, Barclays included within the Equity Gilt Study a handy flowchart, summarising the key drivers.
“While there are no ‘smoking guns,’ there seems to be a clear connection between voter rage and various forms of globalisation. We have divided globalisation into three components: economic, political, and cultural,” the report notes.
Check out the graphic below: