Newsletter – October, 2022

Capitalism has been the most productive economic system over the last century. This is mainly due to the efficient allocation of resources (Labour, Capital) as they move from unprofitable/less profitable industries to the more profitable ones. This leads to a spurt of competition in industries offering long-term growth potential and high return profile. While competition leads to innovation and affordable prices, it also disrupts the environment for the incumbents in the near-term. However, it is important to avoid painting every scenario with the same brush as higher competition can also have a positive impact on the incumbents in the long-term.