What Might the Next Cycle Look Like?

While a recession in the coming year isn’t a certainty, we’ll base our view covering the next one to three years on the possibility of one occurring. Coming out of the downturn, we expect there’ll be a transition in which a lot more physical capital will be deployed than in the prior cycle. In the last business cycle, the focus was on intangible capital. Think companies with lots of intellectual property but not a lot of tangibles. In the coming cycle, we’d expect spending on things such as green technologies to take the place of dirty energy. Money will be spent to make supply chains more resilient...