Understanding Today’s Turbulence Through the Lens of History’s Repeating Patterns

Many of us look at what's happening around the world, on the news and feel that the world is going through unusually turbulent times — politically, socially, and financially. However, some historians and demographers would argue that what we're seeing now is not new; in fact, history, much like markets, moves in cycles. In the context of history, the concept of these cycles has been referred to as "turnings".

Where the Idea Comes From

The concept was first introduced by historians William Strauss (1947–2007) and Neil Howe (b. 1951) in their books Generations (1991) and The Fourth Turning (1997). Strauss was a Harvard-trained historian and lawyer; Howe is a historian, economist, and demographer who has advised governments, Fortune 500 companies, and pension funds on long-term planning. After studying centuries of Anglo-American history, they noticed a pattern: about every 80–100 years, society undergoes a complete cycle of four distinct phases or turnings. Each turning lasts 20–25 years and can shape how people think, act, and invest.

The four stages are:

1. High – Institutions are strong, society is confident (e.g., post-WWII boom).
2. Awakening – People push back, seeking more individual freedom (1960s–70s).
3. Unravelling – Institutions weaken, inequality rises, trust declines (1980s–2000s).
4. Crisis (The Fourth Turning) – Old systems break down, major upheaval occurs, and eventually new institutions are rebuilt.

Strauss and Howe suggested that the United States — and much of the Western world — entered a Fourth Turning around 2008, coinciding with the global financial crisis. In 2023, Neil Howe updated the thesis in The Fourth Turning Is Here, arguing that the current era of pandemics, political polarization, and economic uncertainty fits the pattern almost exactly.

What a Potential Fourth Turning Means for Investors

If we are in a Fourth Turning, history suggests the 2020s may continue to be marked by upheaval before a new cycle of renewal begins. For investors, this has important implications:

• Expect Volatility
  • Crises often bring about larger market swings than we typically experience. This means preparing for sharper downturns — but also being positioned for the strong rebounds that usually follow.

• Watch Government Debt & Inflation
  • Previous Fourth Turnings saw significant financial stress. Today, high government debt and inflationary pressures may lead to a greater focus on tangible assets, such as gold, commodities, and infrastructure.

• Generational Shifts Drive New Trends
  • As Baby Boomers retire and Millennials/Gen Z become the dominant economic force, demand will shift toward sectors like technology, housing, and healthcare.

• New Institutions & Innovations Emerge
  • Fourth Turnings can bring about lasting change, including new political systems, revised economic rules, and entirely new technologies. Today, we're examining digital currencies, renewable energy, and artificial intelligence as key trends.

What Investors Can Do

You don't need to predict the exact course of history to prepare wisely. A resilient portfolio in times of volatility often means:

• Broad diversification — beyond just stocks and bonds.
• Defensive anchors when necessary — such as quality bonds, cash reserves, and inflation-hedging assets.
• Selective growth bets — in areas tied to long-term demographic and technological shifts.
• Patience and discipline — because cycles take time to play out, but history shows renewal eventually follows crisis.

Final Thoughts

The Fourth Turning framework is not a crystal ball, and even its authors admit it's not perfect and obviously can't predict specific events. It is, however, a good reminder that periods of turmoil can feel endless when we're living through them, yet history shows they don't last forever. They ultimately lay the foundation for future growth. For investors, the challenge is not to predict every twist but to build a portfolio strong enough to endure — and patient enough to benefit from the recovery that follows.

This publication is for informational purposes only and shall not be construed to constitute any form of advice. The views expressed are those of the author alone. Opinions expressed are as of the date of this publication and are subject to change without notice and information has been compiled from sources believed to be reliable. This publication has been prepared for general circulation and without regard to the individual financial circumstances and objectives of persons who receive it. You should not act or rely on the information without seeking the advice of the appropriate professional.