The X Factor

This was an Inter-generation Election. Boomers and Millennials just lost to Gen X and Gen Z....

This was not about Left versus Right, it was about a generational shift, from the Boomers to Gen X. This will then also move the children of the Boomers - the Millennials - down in favour of the next generation, the Zoomers of Gen Z. The economy and the markets will now shift in line with their traits and behaviours.

In their 1997 book the Fourth Turning, authors William Strauss and Neil Howe made famous the concept of the (Baby) Boomers and the Millennials and in particular the notion that the behaviour of each generation tends to be a reflection/reaction to that of the previous generation, perhaps best summed up in the subsequent meme/aphorism:

“Hard times create strong men, strong men create good times, good times create weak men, and weak men create hard times.”

G Michael Hopf

What has tended to be somewhat overlooked has been that the generation following the Boomers are not the Millennials, but rather Gen X - those born approximately 1965 to 1985. Strauss and Howe originally called them the 13th generation (of the US) and the reality is that they have been steadily pushing their way back into the public space and that rather than the Boomers handing over to their own offspring - essentially the Millennials - Gen X are taking over, with the support of their offspring, the ‘Zoomers’ of Gen Z.

This Election has made this point very sharply and while in any ‘normal’ election we would not be surprised at the incumbents losing on the back of Covid, inflation and poor economics on the ground, the extent of the Trump victory points to something more than ‘the economy stupid’.

This has not been a simple ‘Succession’ from Boomers to Millennials, Gen X has forced its way in.

The Biden administration, like the ones that proceeded it, was a bar bell of Millennials and Boomers, of Culture War and actual war. The traditional left right paradigm didn’t really apply, as exemplified by the fact that former Dems like RFK jnr and Tulsi Gabbard moved to team Trump (Team X) while the Cheney’s moved to the Democrats.

This is a Gen X administration

Trump and RFK Jr are boomers, but J D Vance, Tulsi Gabbard, Bill Ackman, Elon Musk and fellow tech billionaires Mark Andreeson, Ben Horowitz and David Sacks are all very much Gen X. Meanwhile Elon’s fellow member of the new Department of Government Efficiency, Vivek Ramaswamy and RFK’s VP pick and co founder of Google Nicole Shanahan, while at the very end of the Gen X cohort, are cut from the same cloth - practical and pragmatic, born into a generation where the needs of the parents tended to (still) dominate those of their children (I had to stand up on the bus for an adult to sit down, now I am expected to stand up for somebody’s child).

Starry eyed Millennial dreamers and steely eyed Boomer opportunists are being challenged by practical and pragmatic Gen X’ers, who have a strong work ethic, are independently minded and sceptical, often entrepreneurial, resilient and tech savvy.

Bill Gates and Mark Zuckerburg are being pushed aside by Elon Musk and Joe Rogan.

Generational Shift

We would thus suggest that the consequences of this Presidential Election will extend beyond the normal fashion of a swing between centre left and centre right and the first casualty will be the Globalist institutions wherein the Boomers had tried to organise the world and engaged the Millennials to execute their plans. The most obvious (and early) example of this is the latest COP 29 meeting in Baku. After last year’s (likely peak) attendance of over 83,000 people in Dubai, numbers are down - and with no Presidential level attendance from the US, China, Russia, France, Germany, Brazil or the EU - the project looks to be being quietly ‘de-emphasised’.

The irony that November saw zero sun in many parts of the UK, along with zero wind, just as Donald Trump was elected with an anti renewables agenda is not lost on Gen X - or Gen Z.

The UK’s Kier Starmer is there of course, weirdly claiming that spending hundreds of billions on renewables in a system that sets UK electricity prices at 5 times that of the US will somehow ‘create jobs and lower energy prices’. It remains to be seen how much longer he, Ed Milliband and the unelected Climate Change Committee can continue to suspend reality now that the zeitgeist is shifting. This is not requiring ‘Climate Denial’ just practical and realistic actions rather than grand ‘aspirations’ and coercion.

“What makes you think you are going to take over?”

Ironically, the latest (highly unpopular) UK Budget could actually be seen through the same lens; sadly not entrepreneurs and practical tech minded business people taking charge, but rather Gen X politicians taking the pension wealth of the Boomers and denying the inheritance from the Millennials in inheritance taxes. Same story, less helpful outcomes. Less Golden Age for the UK and more Bronze Age.

The Election also highlighted the shift from a media world of Boomer Network TV structured around 8 minute segments in between adverts, to long-form Gen X and Gen Z podcasts like Joe Rogan. Whatever happens, the next Democratic Party candidate is going to have to be able to talk for three hours in an open format like Trump (and Vance) can. YouTube and Spotify are now better/more trusted sources of content than the traditional channels. As of course is (the entirely appropriately named) X.

The winner in the media wars is the appropriately named X

Elsewhere, there is the prospect that the power of DEI may also be waning - shifting back to equality of opportunity rather than Equity of Outcomes - look for companies starting to reward the attributes of Gen X rather than the aspirations of the Millennials. The entitled Millennial offspring of Logan Roy got a somewhat similar wake up call in the fourth and final season of succession. Predictive programming perhaps?

Where the US leads, others will follow. Much attention is being paid to Trump and his likely tariffs on foreign imports, but reading between the lines (and listening to Joe Rogan) he appears to want to use tariffs to generate FDI into the US. No more offering carrots in the form of tax incentives to companies to come to the US, rather a stick in the form of pricing them out of the market unless they build locally and employ US workers.

This is more of a European approach and we would expect the US to extend similar tariffs to its ‘allies’ in Europe looking to export to the US. At the same time we look for pressure on Europe to import more US LNG and pay more for NATO ‘protection’, even, or particularly, post war. Good for US energy and Defence, less good for European exporters. Also not good for the multi national incumbents, who far from being protected by tariffs will now see their carefully crafted monopolies challenged. The role of RFK jnr in challenging big Pharma (and big Farmer in the role of Big Agriculture) is going to be a very interesting watch.

Here we are also looking for an emerging split between the Boomer EU and associated Globalist entities like the WEF ad the WHO and the newly arriving Gen X state governments to emerge. Interesting to note that since the start of the Ukraine conflict we have seen the leadership change in US, UK, France and now Germany (the coalition collapsed the day after the US election). Those replacing them are increasingly going to be Gen X.

Peak COP and now Peak Davos?

I think the X men are waiting for us Ursula…..

It’s a Paradigm shift…