Practical analysis for investment professionals
07 August 2012

Stratfor’s Geopolitical Weekly: Financial Markets, Politics, and the New Reality

In an insightful commentary entitled Financial Markets, Politics, and the New Reality, George Friedman, founder of geopolitical intelligence firm Stratfor, discusses the roots of the market economy in the context of political structures and — within this framework — evaluates the current state of the European sovereign debt crisis.

Friedman’s argument: Investors typically view the intrusion of politics into markets as a negative because political decisions are unpredictable. But in his view, political decisions are in fact foreseeable — and investors can forecast political behaviors, just as they forecast markets, if they understand the “impersonal forces” that drive politics. After all, Friedman writes, that’s why Adam Smith and David Ricardo — so admired by modern investors and economists — never used the term “economics” in isolation from “politics.” For these thinkers, “political economy” was more than a term of art.

About the Author(s)
Jason Voss, CFA

Jason Voss, CFA, tirelessly focuses on improving the ability of investors to better serve end clients. He is the author of the Foreword Reviews Business Book of the Year Finalist, The Intuitive Investor and the CEO of Active Investment Management (AIM) Consulting. Previously, he was a portfolio manager at Davis Selected Advisers, L.P., where he co-managed the Davis Appreciation and Income Fund to noteworthy returns. Voss holds a BA in economics and an MBA in finance and accounting from the University of Colorado.

Ethics Statement

My statement of ethics is very simple, really: I treat others as I would like to be treated. In my opinion, all systems of ethics distill to this simple statement. If you believe I have deviated from this standard, I would love to hear from you:

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