Insights Now Alternative Realities: The 2026 Long Term Capital Market Assumptions: Challenges and opportunities
Dec 12, 2025
David Lebovitz, a Global Strategist at J.P. Morgan Asset Management, shares insights on capital market assumptions shaping investments. He discusses the impact of economic nationalism, fiscal activism, and technology over the next decade. The outlook for stable U.S. equities and improved bond yields is explored, along with the rising demand for core real estate and infrastructure tied to AI. Lebovitz also examines challenges in direct lending and the intriguing dynamics driving gold and commodities, highlighting the complexities of private market premiums.
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Purpose And Rigor Of The LTCMAs
- The LTCMAs present 10–15 year forecasts tied to a full business cycle rather than short-term cycle timing.
- J.P. Morgan spends ~9,000 hours and 100+ people to produce assumptions used across ~$1 trillion in portfolios.
Three Forces Shaping The Next Decade
- The next decade will be shaped by economic nationalism, fiscal activism, and technology adoption (notably AI).
- AI-driven productivity gains could offset weaker labor supply and inflationary pressures.
Growth Cuts Don’t Always Cut Equity Returns
- Public economics and capital markets can diverge: slower GDP growth doesn't necessarily mean lower equity returns.
- U.S. large-cap returns stayed at 6.7% because earnings and margins are forecasted to be stronger despite downgraded GDP.