The International Monetary Fund cut its global growth forecast for 2026 to 3 percent this month, the second downgrade this year. Iran war escalation has kept energy prices elevated. Trade tensions simmered under volatile Middle East diplomacy attempts. In the same report, the Fund pointed to one bright spot: Artificial Intelligence stocks, whose valuations helped a handful of countries post better numbers than expected.
Rockets booming over the Gulf and technology share prices booming in the stock markets sat in the same paragraph of the same document, and nobody at the IMF thought this strange enough to comment on.
It is not a new arrangement. In 1348, the Black Death killed roughly a third of Europe’s population within four years. Villages emptied and grain rotted in fields with no one left to harvest it. And over decades, the merchant class members who survived became significantly wealthier than the merchant class that existed before the plague. Labor scarcity drove wages up for the peasants who remained alive.
Land ownership consolidated into fewer hands. Guilds, the trade associations that controlled who could work and at what price, became dominant. The same merchant families who buried their children commissioned the Danse Macabre frescoes that decorated churches across the continent within a generation or two. The frescoes personified Death as a skeleton leading chained bishops and kings toward the grave. They were painted with money made possible by the very death the paintings depicted.
Catastrophe made men rich in 1348.
The year 2026 has a modern version. The dying is not villages emptied by plague, but soldiers and civilians killed in the Gulf or in Ukraine. The wealth is not more land for merchant families but more profits for Nvidia shareholders, chip company executives, the people holding stock in the handful of firms that make the hardware everyone else needs and cannot make themselves. And we should not forget the oil traders now buying a new Rolls-Royce or Bugatti.
The IMF noted that Taiwan, South Korea, Thailand and Malaysia posted better economic numbers than expected because they sit inside the AI supply chain. China grew faster than forecasted partly on high-tech manufacturing. The rest of the world, the Fund said plainly, absorbed the damage and got nothing back.
The Philippines sits in that second group. The country has no meaningful AI hardware manufacturing base, no value-added chip fabrication capacity worth mentioning, and a stock exchange with almost no exposure to the companies driving the boom.
When global energy prices rise on Gulf tension, Filipino households pay the higher prices on everything. When AI valuations rise on the same set of global conditions, no Filipino portfolio captures the gain, because the PSEi was never built with export-oriented or technology listings in mind. The country absorbs the downside of a global arrangement it has no upside position in or any potential for improvement.
That is the predictable result of decades spent building an economy around domestic consumption and remittance inflows rather than the kind of production base that would put a Filipino company inside a semiconductor supply chain instead of downstream of one.
BSP policy can manage the currency and smooth the inflation numbers, but it cannot manufacture equity exposure. OFW remittances remain the country’s actual hedge against global disruption, arriving in dollars regardless of Nvidia’s stock price being up 75 percent in 18 months.
Remittances do their job. The failure sits elsewhere, in an industrial base the Philippines never built, the one that would let it participate in booms the way our Asean neighbors now do.
The frescoes in Europe’s churches were not subtle. They showed exactly who was profiting and who was dying. The IMF’s July report does the same thing in a table instead of a painting. Whoever is prepared and positioned or can adapt then captures the boom, and everyone else pays for the disruption that made the boom possible.
What assets made money for countries and individuals this year? Oil and petroleum products obviously. AI and tech names fueled big gains in Taiwan and South Korea. Precious metals turned in strong double-digit performance.
In 2026, the global ledger balances death and disruption against the staggering windfalls of technology and energy. For the Philippines, the lesson is merciless: a nation cannot forever rent out its resilience through remittances while producing nothing of its own. We pay the full price of chaos, yet collect none of the dividend. Until we build, we will only subsidize everyone else’s prosperity.
E-mail me at mangun@gmail.com. Follow me on Twitter @mangunonmarkets. PSE stock-market information and technical analysis provided by AAA Southeast Equities Inc.