The #1 Risk to Your Investments: Explained

Over the next couple of weeks, I’m going to share with you, what I believe is the key risk to your investment future.

No it’s not the budget.

It’s not the abandoning of the 50% capital gains tax discount or the lofty house prices in Australia.

It’s much bigger than all of that.

Virtually all global economic tremors, today, can be rooted back to this one core issue.

So, over the coming weeks, I’ll be offering you an investment framework that aims to protect wealth, and potentially grow it against this major risk.

For many though, we could be embarking on something that’s totally un-investable. The coming years promises to be turbulent.

So, what am I talking about?

No doubt, you’ve experienced the benefits of a globalised economy… Easy travel, cheap stuff!

For multinational corporations, it’s the goose that’s laid the golden egg.

Globalisation has dramatically lowered manufacturing costs, thanks to cheap labour across Asia.

But there have been other, less visible benefits to this titanic economic trend.

You see, trade is the bond that connects nations and incentivises peaceful communication.

In other words, globalisation is a powerful diplomatic tool that prevents war.

From Argentina’s lithium-rich Salar brines, pumped, concentrated and shipped to giant processing facilities in Asia.

Durum wheat from South Australia’s Yorke Peninsula that gets sent to Italy and made into bucatini pasta.

Or natural gas from the Persian Gulf that’s shipped to China, fuelling its gigantic manufacturing machine.

We all lean on each other in this globalised world.

Which is why a shift AWAY from this economic paradigm could be catastrophic!

Steering towards a dangerous path

Economists and other think tanks have flirted with the idea of a breakdown in globalisation.

No doubt, five years ago, the pandemic prompted many to ask: What would permanent ‘deglobalisation’ do to the modern economy?

It’s fair to say that some regions will fare much worse than others…

Take China: The country requires massive energy imports to sustain its position as a manufacturing behemoth. And that dependence grows each year.

According to the US Energy Information Administration, China’s crude oil imports averaged approximately 11.55 million barrels per day (bpd) in 2025.

A 4.4% increase from 2024 and a new record high.

As I’ve been banging on for years now, energy dependence also presents a major dilemma for Europe.

Given that energy sits at the heart of our modern economy, China and Europe stand to lose the most in a deglobalised economy.

No doubt, oil sits at the heart of this pivotal shift, and again, that’s something I’ve been steering you towards well before the war kicked off in Iran.

Then there’s the USA

A country well known for its dominance across tech, banking and finance. It’s also the world’s largest oil and gas producer.

Yet, few realise the important role America plays in feeding the planet.

The United States is the world’s largest food exporter by total value, shipping over $170.5 billion in agricultural products annually as of 2025–2026.

It leads globally in the export of staples such as soybeans, corn, dairy products, cattle, and wheat.

Yet this giant food basket of a country can only feed a hungry planet through massive volumes of fertiliser imports.

As the world’s largest food exporter, America is inevitably a major exporter of potash, potassium and nitrogen, the key elements for plant growth.

And who happens to be the world’s most important supplier?

Russia: The King of Fertiliser

Despite the West’s diplomatic and economic freeze against the Russian Federation, fertiliser imports have continued to flow into America and other Western countries.

Underscoring how important this is: In July 2022, the US Department of the Treasury issued a fact sheet declaring the sale or transport of Russian fertiliser to the United States EXEMPT from trade embargoes.

Sanctions be damned when something’s too important!

In fact, US imports of Russian fertilisers haven’t just continued since the war in Ukraine, they’ve surged!

Nitrogenous fertilisers alone accounted for almost half of America’s total imports from Russia, growing 87% year-on-year.

Russia has also become the largest urea supplier to the US.

It begs the question…

In a deglobalised world, can the world’s largest food exporter continue to rely on Russian fertiliser imports to sustain critically important food production?

Let’s see, but it’s a risk that few were watching before the Strait of Hormuz was closed. That chokepoint has suddenly thrust fertiliser back into the spotlight, given that it is a major transport route for urea and sulphur.

But Russia remains the big question here…

How long will this critical supply chain stay intact? Right now, it walks a fine line.

The playbook is clear: in a globalised world, systems break down rapidly when vital trade routes close.

The pandemic showed it in 2020.

Russia and Ukraine showed that in 2022.

And now Hormuz is spotlighting the vulnerable state of global trade.

But it’s important to highlight that each crisis is NOT an isolated event. They’re all symptoms of the gradual erosion of our globalised economy.

As an investor, you should be anticipating more of this in the years to come, not less.

Stay tuned for Part II of this special series as we explore ways to invest in an increasingly DEGLOBALISED world.