Asset management has steadily become a rebel without an evolutionary cause, in which the chase for nominal return is by insiders pontificated as a sad business to be in. Those insiders are now calling the innovation in the asset management business dead, with more derogatory declarations I prefer to keep to myself.
Everyone appears to be copying everyone else in the pursuit of alpha, with ballooning self-induced beta of subpriming with a musical-chair game of me-too risk escapism playing in the background. Reportedly forty-two percent of asset managers now dance to a new rap of ESG, impact investing, and the like, all hinging on an oxymoronic supposition of sustainability. Their investments now validated by a rating-system of peers desperately appealing to what society wants rather than needs. You can wait for the shoes of mindless populism to drop.
Despite the slippery slope of asset management aging past, a bright future lies ahead. A future in which asset management can and must play a pivotal role in the expansion of human evolution, guided by the latest evolutionary principles. Asset management must change from a financial instrument working in a suffocating vacuum to a financial instrument promulgating the excellence of humanity.
You see, the only renewable alpha a fund can generate is the alpha correlated to the fractal of human expansion. Indeed, asset management must be infused with evolutionary principles to become as renewable as a 4.5 billion year evolution of nature – nature which uses the principles of renewal, at its cause, to enable the prolonging of sustainability as its consequence.
The rules to secure renewal differ substantially from the pretense of sustainability. Not in the least because renewal relies on plurality, not on the flawed presumption of absolutism. Nothing in our universe is sustainable, and to tie asset management to sustainability is bound to become another sinking ship soon.
Our discoveries from the workings of nature reveal its evolution is based on dynamic relativity, with an innate plurality of values, continually strengthening renewal enabling the mobility of our meaningful differences, thereby securing ever-evolving new equilibriums.
Substantially different from how our current asset management systems work, stuck in stale monisms of absolutism. To breathe new life in asset management, we must build systems of asset management employing natural principles. Only then can a financial instrument successfully trace the expansion of human ingenuity and capacity, truthfully and organically.
A new world order
While nature’s principles appear very complicated, our analysis discovered our evolutionary first-principles are merely derived from a single causal theory. A theory, in the words of Einstein, that determines what can be discovered. Implementing said causal theory, complete with its hierarchical dependencies deploys nature’s principles in one fell swoop.
Asset management has a tremendous opportunity to morph from a passive leech of regurgitated human capacity, steeped in hindsight, to an active stimulus of a world we all want to see, derived from foresight. It can do so by merely deploying a theory of evolutionary values, and without the need for regulatory or public consensus, allocate funds directly to what it deems appropriate — the perfect anarchy to combat political gridlock.
A brave new world
All it takes is a new theory deploying new first-principles that determine what can be discovered. A theory of evolution applied to asset management we have locked and loaded.