Davos 2026 and the New Rules for the Global Economy
The 2026 meeting of the World Economic Forum in Davos has made one thing clear: the global economy is no longer operating on steady averages. Instead, we have entered a period of extremes where record-breaking stock markets are clashing with deep geopolitical instability.
From sudden trade disputes over Greenland to the rapid rise of artificial intelligence, the events discussed suggest that the financial rules we have relied on for decades are being rewritten. For the average person, this means a world that is harder to predict but full of new opportunities for those who know where to look.
One of the most significant warnings concerned the future of work. The International Monetary Fund described an incoming labor market tsunami driven by artificial intelligence. Experts estimate that AI will affect roughly 60 percent of jobs in advanced nations, with entry-level roles being the most vulnerable. While this promises massive productivity gains and cheaper goods in the long run, the immediate impact is a sense of job insecurity. This is forcing workers toward specialized roles that require a high degree of human negotiation and leadership—skills that machines cannot easily replicate.
The impact on your wallet is also changing due to a new reality in the housing and credit markets. In the United States, mortgage rates have settled into a new normal in the low 6 percent range, which is helping to thaw the housing market. Homeowners who were previously locked into low rates are finally starting to sell, leading to a 20 percent surge in housing inventory. This shift gives buyers more leverage to negotiate prices even if borrowing costs remain higher than in the past. At the same time, a proposed federal cap on credit card interest rates at 10 percent is creating a stir. While intended to provide relief, major banks warn it could lead to a credit freeze for millions of people with lower credit scores as lenders tighten their standards.
Finally, the global energy and asset landscape has reached a tipping point. For the first time, wind and solar power have overtaken fossil fuels for electricity generation in the European Union. Meanwhile, investors are moving toward hard assets like gold and bitcoin as a hedge against the instability of traditional currencies.
MinMax Take
As the world splits into different economic zones—with high inflation persisting in the West and prices falling in the East—the most successful strategy for the rest of 2026 involves ignoring the political noise and focusing on the underlying signals of price and supply. Success this year requires moving quickly when specific windows of opportunity, like the dip in mortgage rates, open up.