29
THE CHANGING WORLD ORDER
A LOOK AT ASSET RETURNS ACROSS THE GREAT POWERS
(Real Returns, 10-Year Window, Ann)
UNITED STATES
GREAT BRITAIN
JAPAN
GERMANY
Equity Bond Cash Equity Bond Cash Equity Bond Cash Equity Bond Cash
1900–10
9%
0%
1%
3%
2%
2%
4%
1%
4%
3%
2%
1910–20
-2%
-4%
-3%
-6%
-7%
-5%
1%
-5%
-4%
-14%
-10%
-14%
1920–30
16%
7%
5%
10%
8%
7%
-3%
12%
10%
-24%
-95%
-86%
1930–40
0%
7%
3%
1%
5%
1%
6%
4%
-1%
7%
11%
6%
1940–50
3%
-2%
-5%
3%
-1%
-4%
-28%
-34%
-33%
-4%
-16%
-19%
1950–60
16%
-1%
0%
13%
-1%
-1%
27%
-1%
5%
26%
5%
2%
1960–70
5%
-1%
2%
4%
0%
2%
8%
8%
2%
3%
5%
1%
1970–80
-2%
-1%
-1%
-4%
-3%
-3%
3% 
-2%
-1%
-7%
4%
0%
1980–90
13%
9%
4%
16%
8%
5%
19%
9%
4%
10%
6%
3%
1990–00
14%
6%
2%
12%
8%
5%
-7%
9%
2%
13%
7%
3%
2000–10
-3%
8%
0%
0%
4%
2%
-3%
4%
1%
-2%
6%
2%
2010–20
11%
4%
-1%
5%
5%
-1%
10%
2%
0%
7%
5%
-1%
A LOOK AT ASSET RETURNS ACROSS THE GREAT POWERS
(Real Returns, 10-Year Window, Ann)
FRANCE
NETHERLANDS
ITALY
Equity
Bond
Cash
Equity
Bond
Cash
Equity
Bond
Cash
1900–10
1%
3%
2%
5%
1%
1%
3%
4%
1910–20
-7%
-8%
-6%
1%
-6%
-3%
-9%
-8%
-6%
1920–30
-2%
-1%
-4%
1%
11%
6%
-6%
-5%
-1%
1930–40
-10%
2%
0%
2%
6%
3%
4%
5%
5%
1940–50
-20%
-22%
-23%
2%
-3%
-6%
-13%
-30%
-30%
1950–60
17%
0%
-2%
14%
0%
-2%
20%
2%
1%
1960–70
0%
2%
1%
2%
0%
0%
0%
2%
0%
1970–80
-2%
-3%
0%
-3%
2%
-2%
-13%
-8%
-1%
1980–90
16%
9%
5%
16%
7%
5%
15%
4%
6%
1990–00
13%
10%
5%
20%
7%
4%
9%
15%
6%
2000–10
-2%
5%
1%
-6%
5%
1%
-4%
5%
1%
2010–20
7%
6%
-1%
8%
5%
-1%
3%
8%
-1%

30
THE CHANGING WORLD ORDER
RUSSIA
CHINA
AUSTRIA-HUNGARY
Equity
Bond
Cash
Equity
Bond
Cash
Equity
Bond
Cash
1900–10
-2%
3%
4%
7%
6%
3%
4%
3%
2%
1910–20
-100%
-100%
-36%
3%
1%
4%
-9%
-10%
-8%
1920–30
9%
6%
1%
-6%
-44%
-44%
1930–40
2%
-7%
-6%
1940–50
-100%
-100%
-73%
1950–60
1960–70
1970–80
1980–90
1990–00
2000–10
15%
-2%
4%
1%
2010–20
7%
4%
1%
2%
2%
0%
4
SHARE OF PORTFOLIOS LOSING X% OVER 5 YEARS BY COUNTRY
(60/40 PORTFOLIO, REAL RETURNS)
-50% or worse
-90% or worse
-25% or worse
-10% or worse
0%
20%
40%
60%
80%
100%
1900
1920
1940
1960
1980
2000
2020
4 For China and Russia, bond data pre-1950 is modeled using hard currency bond returns held as though hedged back to local currency by a domestic 
investor; stocks and bonds modeled as full default at time of revolution. Annualized returns assume a full 10-year period even if markets closed during 
the decade.

31
THE CHANGING WORLD ORDER
WORST INVESTOR EXPERIENCES (ACROSS MAJOR COUNTRIES)
Major Cases of 60/40 Real Returns Below -40% over a 20-Year Window
Country
20yr Window
Worst 20yr 
Return 
(Real, Cumul)
Detail
Russia
1900–1918
-100%
The Russian Civil War ended with communist rule, 
debt repudiation, and the destruction of financial 
markets.
China
1930–1950
-100%
Asset markets closed during WWII and were de-
stroyed when communist rule took hold in the late 
1940s. 
Germany
1903–1923
-100%
Weimar Republic hyperinflation led to a collapse in 
assets following WWI.
Japan
1928–1948
-96%
Japanese markets and currency collapsed as 
markets reopened post-WWII and inflation soared. 
Austria
1903–1923
-95%
Similar to Weimar Germany (though less infamous); 
hyperinflation led to poor asset returns post-WWI.
France
1930–1950
-93%
The Great Depression, followed by WWII and 
German occupation, led to poor returns and high 
inflation.
Italy
1928–1948
-87%
Similar to those of other Axis powers, Italian markets 
collapsed as WWII concluded.
Italy
1907–1927
-84%
Post-WWI, Italy suffered from economic depression 
and high inflation, helping lead to Mussolini’s rise.
France 
1906–1926
-75%
The early 20th century saw WWI, followed by France’s 
inflationary currency crisis in the early 1920s.
Italy
1960–1980
-72%
Italy endured a series of recessions, high 
unemployment rate and inflation, and currency 
declines in the 1960–70s.
India
1955–1975
-66%
Post-independence, a series of major droughts 
caused weak Indian economic growth and 
high inflation. 
Spain
1962–1982
-59%
The post-Franco transition to democracy coupled 
with the inflationary 1970s strained Spain’s economy.
Germany
1929–1949
-50%
The Great Depression followed by the devastation of 
WWII led to a terrible period for German assets. 
France
1961–1981
-48%
Like other European nations, the 1960–70s saw weak-
er growth, currency declines, and high inflation.
UK
1901–1921
-46%
The early 20th century saw World War I, followed by 
the depression of 1920–21.
5
5 Cases of poor asset returns in smaller countries such as Belgium, Greece, New Zealand, Norway, Sweden, Switzerland, and across the emerg-
ing world are excluded from this table. Note that for conciseness the worst 20-year window is shown for each country/time period (i.e., including 
Germany in 1903–23 precludes including Germany from 1915–35). For our 60/40 portfolios, we assumed monthly rebalancing across the 20-year 
window.

32
THE CHANGING WORLD ORDER
PERIODS OF WEALTH CONFISCATION
1900
1920
1940
1960
1980
2000
UK
USA
Yes
Yes
China
Yes
Yes
Germany
Yes
France
Russia
Yes
Yes
Yes
Austria-Hungary
Italy
Yes
Netherlands
Japan
Yes
6
PERIODS OF STRICT/RISING CAPITAL CONTROLS
1900
1920
1940
1960
1980
2000
UK
Yes
Yes
Yes
Yes
USA
Yes
Yes
China
Yes
Yes
Yes
Germany
Yes
Yes
Yes
Yes
France
Yes
Yes
Russia
Yes
Yes
Yes
Yes
Yes
Yes
Austria-Hungary
Yes
Italy
Yes
Netherlands
Yes
Japan
Yes
Yes
6 While this diagram is not exhaustive, I include instances where I could find clear evidence of each occurring in the 20-year period. For this analysis, wealth 
confiscation was defined as extensive seizure of private assets, including large-scale forced, non-economic sales by a government (or revolutionaries in the 
case of revolution). Relevant capital controls were defined as meaningful restrictions on investors moving their money to and from other countries and assets 
(although this does not include targeted measures directed only at single countries, such as sanctions).