Paradigm Shifts: Massive Investment Opportunities (that require patience & timing) The term “paradigm shift” was first coined by American philosopher Thomas Kuhn in his 1962 book The Structure of Scientific Revolutions. It describes fundamental change in the basic concepts of something and in the resulting practices of how that thing works or can be done. The box above, taken from good old Investopedia, sums up how paradigm shifts play out for investors. New ways of thinking or doing that totally revamp old orders erase some investments while sending others soaring. Streaming services annihilated CDs/music stores and necessitated huge changes for cable TV operators but made Spotify and others into huge successes. Online shopping took a huge bite out of the market for brick and mortar stores, while Amazon soared. Those are smaller paradigm shifts, which make for good simple examples. The green transition is not small. For better analogues of scale and timing/duration of impact, we need to look to past big paradigm shifts. The two I will lean on today are the rise of the internet and the rise of China. There are other examples, to be sure, such as the invention of the automobile, cryptocurrencies, antibiotics, and the […]
