Brexit, Trump, Tariffs 1.0, Russia’s invasion of Ukraine, the Truss UK gilt crisis, food price spikes, Trump (again), Liberation Day, the software sell off and now Iran and yet more political upheaval in the UK.
Over the past decade, we've witnessed shock after shock – events that markets treated as anomalies but that are part of a pattern. Rather than a bevy of black swans, these shocks represent something more structural.
Several fault lines are driving repeated political, economic, and environmental shocks, and they're unlikely to go away.
Domestic
International
Environmental
The US has lost close to 5 million manufacturing jobs since 2000
Source: Bureau of Labor Statistics, Macrobond, March 2026
In our full paper, available here, we highlight how these drivers have led to an era of successive shocks and why we shouldn’t be surprised if the kind of political, economic and climate related shocks we’ve seen over the last decade keep on happening.
So far, of the shocks we discuss, only the 2022 shock linked to the Russian invasion of Ukraine has had a meaningful impact on a balanced, internationally diversified, portfolio of stocks and bonds. Even Covid provided only a very brief shock to diversified portfolios.
But just because most earthquakes are mere tremors doesn’t mean they all are.
The investment implications include:
Just as the Japanese now build their buildings to flex to withstand frequent earthquakes, investors should build their portfolios to incorporate the flexibility needed to withstand regular shocks.
Read more about Mike: An introduction to Mike Bell, RBC BlueBay’s Head of Market Strategy
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