Wikipedia defines alarmism as excessive or exaggerated alarm of a real or imagined threat. Alarmism connotes attempts to excite fears or give warning of great danger in a manner that is amplified, overemphasized or unwarranted. This is not new and has a number of possible causes, such as seeking recognition, funding and/or votes. Of course, social media has significantly expanded the opportunity compared to the historical depiction of an individual carrying a sign declaring “the end is near” through the public square.
Recent examples of potential “existential” threats might include nuclear war, climate, AI and UFOs. Without expressing an opinion with respect to any of the foregoing, it should be noted that so-called “existential” threats have existed throughout history.
Investors, and their advisor(s), will have to determine how real or extensive any of these, and other risks might be, when formulating portfolio decisions.
All comments and suggestions are welcome.
Walter J. Kirchberger, CFA