Shocks, Crises, and False Alarms

CHAPTER 17 After the Convergence Bubble

In recent years, leaders have experienced enormous geopolitical whiplash. Following an era of rapid global integration across multiple dimensions—what we call the convergence bubble—the geopolitical narrative has inflected. After the convergence bubble, divergence overshadows global security, political and economic systems, and the financial realm. Where geopolitics used to be a benign backdrop to global business and investors—a pillar of good macro—it now looks to be an ever-present challenge.

The financial analogy of a convergence bubble is appropriate for the extraordinary exuberance that underpinned the narrative’s ascent. Expectations were linearly extrapolated from a unipolar moment that followed ...