Things to Watch in 2026
The Forces Beneath the Headlines
Every January brings the same temptation. A clean calendar. A fresh stack of forecasts. The hope that if we read enough outlooks and run enough scenarios, the year might finally start to make sense.
That instinct is understandable. It is also incomplete.
What stands out about the start of 2026 is not a lack of information, but the way it resists forming a tidy story. Markets offer mixed signals. Politics feels loud but brittle. Technology continues to move faster than our ability to absorb its consequences. Institutions that once felt durable now feel conditional, effective until they are tested.
These pressures did not arrive all at once. They have been building quietly for years, surfacing in different places at different times, often dismissed as temporary or cyclical. Over time, accumulation changes how things feel. You stop looking for clean forecasts and start paying closer attention to how decisions are actually being made, where assumptions are holding, and where they are starting to strain.
I have been circling these ideas for a while. Last year, I wrote about what I described as a crisis era, not as a prediction, but as a way of naming the kind of environment we appear to be operating in. A period where pressure forces choices, where systems are tested in ordinary, day-to-day ways, and where clarity comes less from certainty and more from attention.
That framing has stayed with me. And as 2026 gets underway, it feels less abstract and more practical.
What follows is not a set of predictions for the year ahead. It is an attempt to take stock of the forces at work and to think clearly about what kind of year this is likely to be, not in headlines, but in how it will actually be lived and led through.
Geopolitics Has Become a Practical Business Variable
The year began with something that would have felt unthinkable not long ago: the daring capture of Venezuelan leader Nicolás Maduro by U.S. forces.
This was not a quiet diplomatic maneuver or a symbolic escalation. It was a direct, physical operation against a sitting head of state. Whatever one thinks of Maduro, the significance lies in the precedent. Moves like this tend to happen only when the rules have already shifted and when power is being exercised more openly.
Not long after, the U.S. seized a Russian-flagged tanker carrying sanctioned Venezuelan crude following a prolonged pursuit. Taken together, these actions reflect a broader pattern. Economic tools are being used more aggressively, enforcement is more explicit, and the lines between diplomacy, pressure, and confrontation are thinner than they used to be.
For businesses, this is no longer an abstract geopolitical story. It shows up in energy volatility, shipping risk, and supply chains that are increasingly designed for resilience rather than efficiency. Risk premiums are shaped as much by political decisions as by operational performance.
The implication is straightforward. Geopolitical risk now belongs in capital allocation discussions, growth planning, and credit analysis, even for companies that operate entirely within domestic markets.
Monetary Policy Is Losing Its Clean Edges
The Federal Reserve ended last year with rate cuts into the mid-3 percent range, and markets broadly expect further easing in 2026. On the surface, that looks like a conventional response to cooling inflation and uneven growth.
What complicates the picture is the surrounding political environment.
Monetary policy is now part of everyday political discourse in a way that would have felt unusual not that long ago. As pressure builds to stimulate growth and manage debt service costs, markets are forced to think about institutional credibility alongside traditional economic indicators.
At the same time, federal deficits remain large and debt levels continue to rise. These realities do not create immediate crisis, but they do narrow the margin for error. A modest weakening of the dollar would not be surprising, nor would increased interest in alternatives at the edges of the global system.
This is often how strain shows up in mature systems. Not through sudden failure, but through gradual shifts in confidence and expectations that accumulate over time.
The Everything Bubble Reflects Yesterday’s Conditions
The idea of an “everything bubble” gets tossed around casually, but it points to a real imbalance that has been years in the making.
Low rates, abundant liquidity, and repeated intervention lifted asset prices across equities, real estate, private credit, and parts of technology. That environment rewarded risk-taking and blurred the line between durable value and favorable conditions.
Markets closed 2025 near all-time highs, and earnings expectations remain constructive. At the same time, valuations assume a degree of stability across policy, geopolitics, and consumer confidence that feels increasingly fragile.
If asset prices adjust, it does not mean innovation failed or growth vanished. It means price and value are moving back toward a more sustainable relationship. The real risk for leaders is confusing elevated prices with permanent value and building strategies that only work in unusually supportive environments.
Cultural Division Is Giving Way to Fatigue
Political polarization remains intense, but fatigue is becoming just as important a force.
As the country moves toward another midterm cycle, rhetoric will intensify. Beneath that noise is a broad sense of pessimism about institutions, affordability, and long-term direction. Trust is thin and confidence is uneven at best.
The wealth gap increasingly shapes lived experience. High-cost regions feel disconnected, while migration toward more affordable areas reflects both opportunity and constraint. These pressures influence hiring decisions, consumer behavior, and business investment in subtle but persistent ways.
Leadership in this environment has less to do with bold declarations and more to do with steadiness. People respond to clarity, competence, and follow-through when everything else feels unsettled.
AI Is Changing Work Faster Than Organizations Expect
Artificial intelligence is no longer a distant concern. Its effects are already visible across labor markets, job design, and organizational structure.
Wage pressure is emerging in roles that are highly exposed to automation. Entry-level white-collar positions, analytical support functions, and certain creative services are being redefined. Productivity gains are real, but uneven, and they arrive alongside uncertainty.
There is also a human dimension that deserves attention. As AI becomes embedded in daily work and personal interaction, it challenges how people think about contribution and purpose. Efficiency improves, but displacement creates friction.
Organizations that treat AI purely as a cost-reduction tool may see short-term gains at the expense of trust and cohesion. Those that use it to strengthen human judgment and capability are better positioned to adapt as expectations shift.
What This Means for the Economy
Taken together, these forces point toward an environment defined more by adjustment than collapse.
Geopolitical friction introduces energy and supply chain risk. Monetary and fiscal pressures complicate inflation management. Asset prices may reset as conditions evolve. Consumer confidence remains sensitive to political and cultural signals.
Growth may slow at times without breaking down. Inflation may linger longer than models suggest. Policy responses may feel less predictable than markets have grown accustomed to.
This is not meant to be a case for pessimism. It’s just the most realistic outlook at this point in time. Periods like this tend to reward preparation over prediction and discipline over reaction.
What This Means for Small Business Lending and B:Side
For small business lenders, 2026 is likely to test assumptions more than appetite.
Borrowing costs will move, credit conditions may tighten at the margins, and some sectors will feel pressure sooner than others as the economy continues to adjust. Asset valuations may look different by the end of the year than they do today. None of that is especially surprising in an environment like this.
What is easy to forget is that small businesses do not stop building in periods of uncertainty. They adapt. They adjust plans. They look for opportunity where others see friction. Migration toward more affordable regions continues to create demand, and businesses that respond to changing customer behavior and new technologies will still need access to capital to grow.
That is where strong lending partnerships matter most.
At B:Side, our role does not change just because conditions do. We stay focused on fundamentals. We apply sound credit judgment. We pay attention to real signals rather than headlines, and we execute calmly and consistently, even when the environment feels uneven.
AI adoption among small firms will be uneven, as it always is with new tools. Some businesses will use it to strengthen operations and decision-making. Others will struggle to integrate it effectively. Increasingly, lending decisions will hinge on that distinction, on whether technology is reinforcing the underlying business or simply masking weakness.
We enter this year clear-eyed and well positioned, ready to support our lending partners and their clients as they navigate whatever comes next. In periods like this, steadiness, judgment, and trust tend to matter more than speed or certainty, and that is where we intend to stay focused.
What This Means for Banks
Banks face similar pressures from a different angle.
Net interest margins are sensitive to policy uncertainty. Credit quality depends on realistic assessments of collateral value. Technology is reshaping operations and talent needs at the same time.
Further consolidation is likely, but there remains room for institutions that understand their markets deeply, choose their battles carefully, and execute with clarity. In environments like this, purpose and positioning matter more than size alone.
Where This Leaves Us
If there is a common thread running through all of this, it is pressure, not as a dramatic force, but as a persistent one.
Pressure has a way of clarifying things. It exposes weak assumptions and accelerates changes that were already underway. It narrows choices and makes trade-offs harder to ignore, which is uncomfortable, but also useful.
I have been thinking about this environment for a long time, and 2026 feels less like a sharp turning point and more like another step along a longer path. The systems we rely on are being tested in ordinary, day-to-day ways rather than through a single defining event. Some will bend. Some will fall away. Others will adjust and keep going.
Leadership in moments like this is rarely about having the right forecast or the loudest conviction. It is about paying attention, staying grounded, and making reasonable decisions with imperfect information, even when the path forward is not especially clear.
That kind of leadership tends to look quiet in the moment, but over time it is usually what carries people and institutions through periods like this.