Trivia time.
If you had to guess, when in history do you think this happened in the UK and the US?
Earlier optimism about a progressive future gave way to a jazz-age nihilism and a pervasive cynicism about high ideals…
Unions atrophied, government weakened, third parties were the rage, and a dynamic marketplace ushered in new consumer technologies that made life feel newly complicated and frenetic. The risky pleasures of a “lost” young generation shocked middle aged decency crusaders – many of them “tired radicals” who were then moralizing against the detritus of the “mauve decade” of their youth. Opinions polarized around no-compromise cultural issues like drugs, family, and “decency”. Meanwhile, parents strove to protect a scoutlike new generation of children.
New tech making life frenetic…
Polarising politics…
The young shocking their elders with “risky” behaviour and indecency…
Overprotective parents and politically correct moralising…
Any ideas? Because whenever it is, sounds remarkably familiar to me…
That’s an excerpt from a book I’m reading called The Fourth Turning, by William Strauss and Neil Howe. It’s effectively a book on Anglo-American history, but with a twist: it doesn’t look at history linearly, but generationally. When we look back on history, most of the time we focus on the individual actors who shaped the period – Winston Churchill and The Few during the battle of Britain, for instance.
However, what that linear view doesn’t show are all the other generations who were alive at the time, and who went on to shape the history of the country after the event. The young who didn’t fight, but were heavily influenced by the Second World War, and brought that with them when they entered politics in later life, for example.
The book instead focuses on generations all the way through their lives. This shows how their early experiences go on to influence their economic, political, and cultural decisions, and how those then influence the other generations, younger and older who are alive at the time.
While no two consecutive generations are ever the same, over the course of the centuries they argue that every generation fits into one of four archetypes, in a grand cycle that repeats itself: Hero, Artist, Prophet, Nomad, Hero, etc. Each generation is born within a period of roughly 20 years, with the four generations creating an 80-ish year cycle.
Though it’s often assumed that the next generation will be like the current one but more so, this is a flawed view, with new generation often taking a totally unexpected direction from that expected by its forebears – much to their chagrin.
That excerpt at the top of this letter was referencing the mood in the UK and the US in the 1920s. The tech that had made everyone’s lives frenetic were the automobiles, radios, phones, jukeboxes and vending machines. And the protected, scoutlike new generation of children would go on to fight the Second World War.
Wind back four generations before that, and a similar situation is in play. This time it doesn’t precede the Great Depression and World War II, but instead the American Civil War. Go four generations before that, and the same prevailing discontentment is in the air, but preceding the American Revolutionary War.
And here we are again today, with all the same forces in play. Faith in institutions collapsing, generations massively divided, polarising politics on drugs, family, and decency… new technology seemingly advancing faster than society and politics can.
We wrote yesterday that the force of the millennial generation has yet to be unleashed upon the world, as some of them are still reaching voting age (2002 being the last millennial birth year before “Generation Z” begins, though this is contested).
The grand trial of this (my) generation has yet to take place. This needn’t necessarily be a war, but it must be a crisis – whoever knows which one stands to make a lot of money. My bets are on Cold War II with China, but only time will tell.
The next elections here and in the US will reveal the extent of the current generational divide, which ultimately will be resolved in the next crisis, once the dust has settled. These elections will reveal the newfound electoral power of the younger generation, the majority of which will vote for higher taxes and fiscal expansion/student debt bailout.
All of these have yet to be priced into financial assets by my reckoning. The momentum behind this new power in politics is being underappreciated.
Before I leave you for today…
Howe’s thesis argues that the process that will bring about the next generation defining crisis is already in play, beginning with the financial crisis in 2008. We’ll have more on that tomorrow, but before I go, I’d like to leave you with another of his broader observations that I found interesting – the constant attempt by man to suppress cyclicality in almost all aspects of our lives. Â
“Only the wicked walk in circles,” warned St. Augustine. At the dawn of the modern era, the assault [on viewing time cyclically] became more fierce. The Reformation not only triggered a renewed attack on pagan holidays (chopping down maypoles) but also popularised the calibrating clocks, calendars, and diaries that enabled people to employ time as an efficient means to a linear end – be it holiness, wealth, or conquest.
More recently, the West began using technology to flatten the very physical evidence of natural cycles. With artificial light, we believe we defeat the sleep-wake cycle; with climate control, the seasonal cycle; with refrigeration, the agricultural cycle; and with high-tech medicine, the rest recovery cycle.
But you can’t escape the next generation: they’ve always got a longer lifespan….
More to come tomorrow. I’m off for a drink of something cold. I wish all readers in the south of Britain the best in their attempts to escape the seasonal cycle today.
Until tomorrow,
Boaz Shoshan
Editor, Capital & Conflict
Category: Market updates