Rupture and Resilience

PIMCO

Daniel Ivascyn

Research

12 Pages

PIMCO examines how geopolitical fragmentation, fiscal pressures, and AI driven investment could reshape markets over the next five years. The paper argues that a potential $14 trillion capital spending wave may create opportunities, while elevated uncertainty increases the importance of portfolio resilience.

Key Takeaways

Capital Spending Wave: AI infrastructure, energy networks, defense investment, and supply chain reshoring could contribute roughly $14 trillion in global capital expenditures between 2026 and 2030.
Income Looks Attractive: PIMCO estimates diversified high quality fixed income portfolios currently offer yields between 5% and 7%, creating a compelling starting point for investors.
Recessions Remain Common: U.S. recessions occurred during 69% of rolling five year periods since World War II, highlighting the continued importance of portfolio diversification.
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