Hi. I'm Carl Tannenbaum, Chief Economist for Northern Trust. In the era before video games, and, yes, there was an era before video games, children often amused themselves by playing with magnets. We could pick up our toy cars, which were made from steel back then, and pretend that they were flying through the air. And when our parents weren't looking, we'd take the magnet into the kitchen and harvest the contents of the utensil drawer.

It was low tech, but it was a lot of fun. Magnets can attract, but they can also repel. And it is in this latter sense that the world has become more polar. This creates risk for the world's economies.

Globalization enjoyed a Renaissance beginning in the early 1980s thanks to advances in supply chains and collaboration between businesses and governments. New trade arrangements, such as the North American Free Trade Agreement and the entry of China into the World Trade Organization, added to the momentum.

The volume of exchanges between countries rose steadily raising standards of living for all participants. And the expansion of commercial ties led to deepening diplomatic ties that produced three decades of relative peace. But the 2008 financial crisis illustrated the downside of international linkages. Losses radiated far from their origins leading to widespread recession. The recovery from those downturns was frustratingly slow leading to questions about whether the global order was working as intended.

In the 15 years since that episode, many nations have turned inward. There has been a substantial increase in trade restrictions and frictions. International organizations have been weakened, and the appetite for engaging in global affairs has been reduced. Trade's share of the world's output is on the decline and global tensions are on the rise. Further, friction between and within political parties in a number of countries is also rising.

Achieving domestic consensus has become increasingly difficult leaving important business undone and adding to international uncertainty. Elections covering more than 40% of the world's population and GDP will be held in 2024, offering the potential for additional volatility. The result of all of this is an environment that is more vulnerable to tail risks.

As we record this, we have two significant wars underway and measures of geopolitical uncertainty are spiking. Neither of these is favorable for progress. Restoring the attraction of economic and diplomatic cooperation may take some time. Until then, polarizing forces will push peace and prosperity further away. And that's the view from here.