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Entrepreneurs accuse UnitedHealth of not paying them for $1B business

Two former high-level executives with UnitedHealth Group Inc. are suing their old company, claiming they haven't been paid enough for a billion-dollar business line they helped start. UnitedHealth Group denies the allegations......»»

Category: topSource: bizjournalsJan 14th, 2022

SNEAKER RESELLING SIDE HUSTLE: Your guide to making thousands flipping hyped pairs of Dunks, Jordans, and Yeezys

As the market for valuable sneakers booms, entrepreneurs are making a killing by figuring out the best way to buy and sell sneakers. Gautam Malik is just one entrepreneur making thousands of dollars by reselling sneakers.kickzmalik/Instagram A Cowen & Co. analysis from July estimates that the sneaker resale industry is worth $2 billion in North America and could reach $30 billion globally by 2030. As the market for valuable sneakers booms, entrepreneurs are making a killing by figuring out the best ways to buy and resell sneakers.  Insider regularly interviews sneaker resellers and experts regarding the best practices for breaking into the industry and scaling a business. With the sneaker resale market continuing to thrive, Insider is covering all aspects of how to properly scale a business in the booming industry. From which sneakers to purchase to necessary technological investments, made in the form of bots that entrepreneurs entrust to nab pairs online, the following covers everything you need to know about how to break into the market that Cowen & Co. estimates could reach $30 billion globally by 2030.Getting startedSneaker reselling is based on a simple concept that guides many other businesses: buy low, sell high. You'll want to figure out how to track expenses and figure out net profit on each pair sold. One entrepreneur who made over $125,000 in sales since January 2019 showed us his spreadsheet that he uses for tracking profits. You'll also want to figure out your strategy. While some people might prefer to invest in a few pairs and wait for them to grow in value, others utilize a high-volume sneaker resale strategy to make money by moving product quickly at slimmer margins. Others focus on acquiring rarer pairs that can fetch thousands at auction. Some have even developed mathematical formulas to determine the best way to buy and sell. Lastly, it can be helpful to take a look at some up-and-coming sneaker resale websites to learn about new ways to make money in the industry.Read more: A 16-year-old who made $125,000 in sneaker sales reveals his pro tips for young resellers looking to break into the multi-billion dollar industry A sneakerhead who made nearly $7 million in sales last year reveals his secrets to tapping into the exploding multibillion-dollar resale marketThe top sneaker seller on eBay who made $1.5 million in sales in 2019 reveals how he grew business to dominate the platformWe got a look at exact spreadsheet a 16-year-old uses to make thousands of dollars in sales as a major sneaker supplier to stores and boutiques5 up-and-coming sneaker websites that resellers and collectors should use in 2020 to boost profit and nab hyped pairsA sneaker reseller whose store has made millions in sales since 2018 shares the mathematical formula he uses to determine which pairs will skyrocket in valueScaling your businessOnce you nail down the basics, here are some tools to guide you on the next steps of growing your business. While many sneaker resellers can start from humble beginnings, it can take just a few months to hit sustainable profit margins. Attending sneaker events like Sneaker Con is a great way to build connections and make fast sales. But as your business grows, it is important to keep track of all of your sales and expenses to ensure that you file your taxes correctly each year.Read more: Here are 5 steps that independent sneaker resellers live by to pay their taxes every seasonHow a formerly homeless sneakerhead with just $40 to his name built a multi-million dollar resale empire in 6 yearsA sneakerhead who has attended more than 20 Sneaker Cons reveals his top 6 secrets for making the most money at a resale event3 sneakerhead sisters could fetch over $1 million by selling thousands of their classic Nike, Adidas, and Reebok shoes through an exclusive eBay auctionSneaker bottingIn the sneaker resale world, a "bot" refers to a software application that expedites the online checkout process and helps resellers nab hyped pairs online — including limited-edition drops. Though a controversial aspect of the sneaker world, bots are often essential for purchasing the latest releases at retail prices. In many cases, these bots are built by former sneakerheads and self-taught developers who make a killing from their useful product. Bots, like sneakers, can resell for hundreds of dollars. There are even some bots that are meant to help users nab sneaker bots at retail. While sneaker-nabbing bots can give resellers a leg-up, they are often the cause of much distress on the side of footwear companies who are looking to mitigate the problem.Read more: A sneaker reseller who uses multiple 'bots' to nab mass quantities of expensive shoes the moment they drop explains why the controversial tech is worth itInside the controversial underworld of sneaker 'bots,' where coded scripts resell for thousands of dollars and Twitter monitors can make or break a releaseA 16-year-old's sneaker bot business charged $200,000 in fees since October. Here's how his 600-member group secures the coveted software before anyone else.How a self-taught developer with no formal training made $700,000 in sales this year from his sneaker bot, Splashforce, that nabs hyped pairs in just millisecondsAs sneaker bots explode, a veteran reseller and YouTuber with over 160,000 subscribers reveals 3 steps to profiting from the lucrative techIn the arms race between teenage sneaker bot users and footwear companies, one side is winning — and it's not the billion-dollar companiesCook groups and online services:While they normally charge hefty membership fees, cook groups are exclusive forums that supply information for anyone looking to break into the multi-billion dollar market. They usually offer members access to botting services in addition to exclusive details related to drops. We got a look inside a couple of these groups, including Polar Chefs, a thriving cook group with over 400 members that was started by a teenager who employs 23 people to help him run the group. Cook groups are often run on Discord, a messaging platform that has become a hotbed for sneakerhead activity. Read more: Exclusive sneaker resale groups make millions by paying insiders to leak information on valuable sneaker releases before they happen. Here's a look inside one of these members-only forums.Inside a teen's exclusive sneaker cook group that makes him 6-figures in sales, employs 23 people full-time, and nabs pairs of the hottest sneakers on the marketHow Discord went from gaming and alt-right hub to a sneaker cook group hotbed, where resellers charge fees to share their secrets for cracking the $2 billion resale marketA college dropout runs a multi-million dollar sneaker cook group, AMNotify, with thousands of members across the world. Here's how he launched one of the first exclusive sneaker forums from a hospital bed in 2017.Navigating the industry during the pandemicWhile slowdowns in shipping and supply chains caused some problems for the sneaker industry early on in the pandemic, the value of certain pairs, like the Air Force 1 and Air Jordan 1, has remained strong. Experts say that some pairs, like the Nike SB Dunk Low Travis Scotts or the Jordan 5 Retro High Off-Whites, will likely skyrocket in value after the pandemic. The CEOs of GOAT, Stadium Goods, and Bump all predicted that the sneaker resale market will continue to grow, and the proof is in the businesses. One teen entrepreneur that we spoke to said his business soared during the pandemic, bringing in close to $500,000 in sales during quarantine.Read more: The CEOs of GOAT, Stadium Goods, and BUMP outlined the best ways for sneaker resellers to navigate the multi-billion dollar market in the pandemicThe coronavirus outbreak is wrecking the sneaker resale industry, but investing in specific pairs can soften losses. Here's how to navigate the market in crisis, according to the head of China's Sneaker Con.These are the sneakers most likely to skyrocket in value when the coronavirus panic dies down, according to the founder of the largest sneaker event in the worldA 17-year-old entrepreneur made close to $500,000 in sales reselling sneakers during quarantine. Take a look inside his pandemic-proof business model.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderJan 3rd, 2022

4 Reasons to Bet On Mid-Cap Value Today

These mid-cap stocks are on sale. Mid-cap stocks are a relatively small group compared to large or small cap. And there’s a very good reason for this. For the most part, small-cap stocks display strong growth characteristics, but of course this comes at high risk. The small business owner doesn’t have the resources to get through economically challenging times or deal with stiff competition. Nor is he able to generate efficiencies from scale. His success depends primarily on the product and the relationships he is able to develop. So there’s a huge incentive to keep investing in the business until some sort of scale is achieved. There are as many small businesses as there are entrepreneurs. And these days, with relatively easy VC money, the small-cap segment is growing strongly.On the other hand, once a company grows into a large-cap stock, it generally has steady cash flows from a proven business model. This is a low-risk situation. However, the size normally leads to slower growth (we aren’t talking big tech here). This could be fine for more mature investors who don’t have that many working years left. Or it could be a good balancing act for a portfolio weighted toward high-risk high-growth names.Briefly between these two stages, a company passes through the mid-cap stage when you’re generating relatively strong growth at relatively lower risk. So with mid-caps, you have the best of both worlds.Second, if you’ve been trading for a while, you would have already discovered that its generally the large-caps, or really hot stocks that have a lot of analyst coverage. And often slipping through the cracks are the mid-caps, which while being good investments, don’t receive the deserved attention. Which means that there’s a good chance they haven’t been bid up. So there’s a better chance of finding value in the mid-cap category.Third, the Fed has turned hawkish of late (the Labor Department's CPI climbed by 6.8% in November, the fastest increase rate since June 1982), which means tapering, and therefore, imminent pressure on stocks as more money moves to higher-yielding bonds. So growth stocks that have been bid up too much, or stocks that are more risky depending on their specific circumstances, could see some pressure over the next year. While the right growth stocks are not to be shied away from, it’s important to load up on a bit of value as well. And the mid-cap segment may be just the place to find it.Fourth, labor shortage has affected different companies in different ways. But the JOLTS report for October indicates that mid-sized companies may be better off-Job openings are up across the board, but quitting has increased in small establishments with 1-9 employees and large establishments with 5,000 or more employees. Layoffs and discharging have also increased in these large establishments.On the other hand, in middle-level establishments with 1,000 to 4,999 employees, job openings may have increased but hiring has decreased. So these establishments are likely at a more optimum level of employment.  This is further confirmed by BLS wage data. And so, we see a significant increase in total wages in 2020, as employment reflected higher-paying jobs, because many of the lower-paying services type of jobs making up a smaller part of the total. With this segment returning in 2021, we see a decline in wage rates this year. So it’s the small establishments that are doing most of the hiring now while the large ones are still reducing workers to get to an optimum level. At the middle is where you see the best-balanced players.Given the above factors, here are a few stocks that you may want to consider-Asbury Automotive Group ABGAsbury Automotive is one of the largest automotive retailers offering new and used vehicle sales and related financing and insurance, vehicle maintenance and repair services, replacement parts and service contracts through their owned and franchised stores.Zacks #1 (Strong Buy) ranked Asbury has a Value Score A and belongs to the Automotive - Retail and Whole Sales industry (top 9% of Zacks-classified industries).Asbury’s revenue is expected to grow 12.0% in 2022 when its earnings are expected to grow 13.2%. Its 2022 estimates have been moving up consistently in the last 90 days. They are up $2.70 (10.3%) in the last 30 days.Asbury shares are undervalued. They currently trade at 5.96X F2 earnings, 0.42X sales and its PEG ratio is 0.36.Kohl's KSSKohl’s Corp. is a U.S. based department store chain offering moderately-priced apparel, footwear and accessories for men, women and children; as well as beauty and home articles. As of Oct, Kohl’s had more than 1,100 stores across 49 states. It also sells through its ecommerce site and the Kohl’s app.In the year ending Jan 2023, Kohl’s is expected to grow revenue and earnings by 2.2% and -5.6%, respectively. The analyst estimate for the year is expected to grow 88 cents (14.6%).Kohl’s shares carry a Zacks Rank #1. They have a Value Score of A and belong to the Retail - Regional Department Stores industry top 2%).However, they remain cheap at a valuation of 7.50X earnings, 0.38X sales and a 0.89 PEG.The Chemours Company CCThe Chemours Company is a leading provider of performance chemicals that are key ingredients in end-products and processes including plastics and coatings, refrigeration and air conditioning, mining and general industrial manufacturing and electronics.Chemours, with its Zacks #1 rank and Value Score of A belongs to the Chemical – Diversified industry (top 35%).Chemours is currently expected to grow its revenue by 6.4% and earnings by 8.2% in 2022. Estimates for the year are up 42 cents (10.6%) in the last 60 days.Chemours shares look pretty attractive right now, trading at 7.43X 2022 earnings, 0.88X sales and its PEG is 0.23.Berry Global Group BERYBerry Global manufactures and distributes nonwoven specialty materials, engineered materials and consumer packaging products for personal care, healthcare, beverage and food markets in South America, North America, Asia and Europe.#2 (Buy) ranked Berry Global has a Value Score of A and belongs to the Zacks-classified Containers - Paper and Packaging industry (top 42%).In the year ending Sep 2022, Berry Global is expected to grow its revenue and earnings by a respective 4.4% and 2.6%. The following year, revenue and earnings will grow 0.7% and 6.3%, respectively. The Zacks Consensus Estimate for the two years are up $1.12 (17.8%) and $1.02 (14.9%).The shares are trading cheaply at 9.15X earnings, 0.70X sales and its PEG ratio is 0.97.Arrow Electronics ARWArrow Electronics is one of the world’s largest distributors of electronic components and enterprise computing products. Arrow provides one of the broadest product ranges in the space, as well as a wide range of value-added services.Arrow has a Zacks Rank #2 and Value Score A. It is part of the Zacks-classified Electronics - Parts Distribution industry (top 9%).Arrow’s 2022 revenue and earnings are currently expected to grow 1.5% and 6.5%, respectively. Earnings estimates for the year are up $1.29 (9.0%).Arrow shares trade at 8.14X earnings, 0.26X sales and its PEG ratio is 0.32. So they are worth considering.3-Month Price PerformanceImage Source: Zacks Investment Research 5 Stocks Set to Double Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2021. Previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%. Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Kohl's Corporation (KSS): Free Stock Analysis Report Arrow Electronics, Inc. (ARW): Free Stock Analysis Report Asbury Automotive Group, Inc. (ABG): Free Stock Analysis Report Berry Global Group, Inc. (BERY): Free Stock Analysis Report The Chemours Company (CC): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksDec 15th, 2021

Transcript: Maureen Farrell

     The transcript from this week’s, MiB: Maureen Farrell on the Cult of We is below. You can stream and download our full conversation, including the podcast extras on iTunes, Spotify, Stitcher, Google, Bloomberg, and Acast. All of our earlier podcasts on your favorite pod hosts can be found here.   ~~~   RITHOLTZ: This… Read More The post Transcript: Maureen Farrell appeared first on The Big Picture.      The transcript from this week’s, MiB: Maureen Farrell on the Cult of We is below. You can stream and download our full conversation, including the podcast extras on iTunes, Spotify, Stitcher, Google, Bloomberg, and Acast. All of our earlier podcasts on your favorite pod hosts can be found here.   ~~~   RITHOLTZ: This week on the podcast, I have a special guest. Her name is Maureen Farrell, and she is the co-author of the book, “The Cult of We: WeWork, Adam Neumann, and the Great Startup Delusion.” I read this book a couple of weeks ago and just plowed through it. It’s a lot of fun. Everything you think about WeWork is actually even crazier, and more insane, and more delusional than you would’ve guessed. All the venture capitalists and — and big investors not really doing the appropriate due diligence, relying on each other, and nobody really looking at the numbers, which kind of revealed that this was a giant money-losing, fast-growing startup that really was a real estate play pretending to be a tech play. You know, tech gets one sort of multiple, real estate gets a much lower multiple, and Neumann was able to convince a lot of people that this was a tech startup and, therefore, worthy of, you know, $1 billion and then multibillion-dollar valuation. It’s fascinating the — it’s deeply, deeply reported. There is just an incredible series of vignettes, and stories, and reveals that they’re just shocking what Neumann and company were able to — to fob off on their investors. Everything from ridiculous self-dealing to crazy valuations, to lackluster due diligence, and then just the craziest most egregious golden parachute in the history of corporate America. I found the book to be just fascinating and as well as my conversation with Maureen. So, with no further ado, my conversation with Maureen Farrell, co-author of “The Cult of We.” VOICE-OVER: This is Masters in Business with Barry Ritholtz on Bloomberg Radio. RITHOLTZ: My special guest this week is Maureen Farrell. She is the co-author of a new book, “The Cult of We: WeWork, Adam Neumann, and the Great Startup Delusion.” The book has been nominated for a Financial Times/McKinsey Business Book of the Year Award. Previously, she worked at the Wall Street Journal since 2013. Currently, she is a reporter, investigative reporter for The New York Times. Maureen Farrell, welcome to Bloomberg. FARRELL: Thank you so much for having me. RITHOLTZ: So, let’s start a little bit with your background and history. You — you covered capital markets and IPOs at the Wall Street Journal. What led you and your co-author Eliot Brown to this story because this was really a venture capital and a startup story for most of the 2010s, right? FARRELL: Exactly. And for me, personally, I was covering the IPO market and — and capital markets the sort of explosion of private capital. So, I was looking at WeWork from both angles, basically, you know, in the small cohort of the most interesting companies that were going to go public, along with Uber, Airbnb, Lyft. And it was also part of this group that had raised more capital than anyone ever before. I was looking at SoftBank and its vision fund a lot. And then — I mean, take within this cohort, there were some pretty interesting companies, but I mean, just along the way kept on hearing, you know, Adam Neumann stood out. That’s like a little bit of a different entrepreneur that the — the stories you would just hear over time just became more and more interesting a little and vain. RITHOLTZ: So when did you decide, hey, this is more than just a recurring series of — of articles? When did you say this is a book? We have to write a book about this? FARRELL: So, we were — around August 2019, by then we were writing more and more about the company as it was clear that it was, you know, made it known that it was going to go public. Suddenly, it’s S-1, the — the regulatory documents you file publicly to go public were out there, and they were completely bonkers. They sort of captivated, I think, the imagination of the business reading public. But then over the next few weeks, WeWork was on its way to finally doing this IPO. And my co-author Eliot and I who had been cover — he had covering the company long before me. He’s a real estate. He had been covering them since 2013, then he was out in San Francisco covering venture capital. And it just became the most insane story either one of us had ever reported, like day by day there’s a playbook for IPOs. And they — you know, things are different, but they sort of follow a formula and nothing was making sense. And it just was getting more and more insane until this IPO was eventually called off. And Adam Neumann, the founder and CEO was pushed out of the company for all sorts of crazy things that were given to. RITHOLTZ: So, we’re going to — we’re going to spend a lot of time talking about that. But you hinted at something I — I have to mention. Your co-author covered real estate. Hey, I was told WeWork was a tech startup, and an A.I. company, and everything else but a real estate arbitrage play. How did they manage to convince so many people that they weren’t a Regis. The CEO of Regis very famously said, “How was what they do any different than what we do?” FARRELL: Well, they tried to convince Eliot Brown, my co-author, of the same thing. He — he had heard about Adam Neumann and his company. He started seeing the valuation. Back then I think it was $1 billion, $1.5 billion, and he was … RITHOLTZ: Right. When that became a unicorn, suddenly it was like, “Wait, this is just a real estate play.” FARRELL: Exactly. And he was covering other commercial real estate companies like Regis. And he had followed them and he was like, “Wait, they only have a couple of locations even still at that point.” So, he went in to meet Adam Neumann for the first time, and he’s got great stories. But as part of it, Adam was like really horrified. He was, you know, very nice, his charming self, but also saying, “Hey, you’re a real estate reporter … RITHOLTZ: Right. FARRELL: … for the Wall Street Journal. You’re the last person who should be covering this company. Do you have someone who covers like community companies?” RITHOLTZ: Right. FARRELL: And Eliot said, “No, and I’ll be following you from here on out.” RITHOLTZ: We’ll — we’ll talk about community-adjusted EBITDA a little later also. But — but let’s talk about the genesis of this because Neumann and his partner McKelvey had a — a legit business Greendesk, the — was the predecessor to WeWork. It was sold. I don’t know what the dollar amount was. Was that ever disclosed? FARRELL: Ah. RITHOLTZ: But — but it was not — nothing. It was real. And the two of them rolled that money plus a third partner who is also — Joel Schreiber is a real estate developer in New York, not coincidently. And in 2010, they launched WeWork with the first site in SoHo. So why is this real estate assign long-term leases and sell shorter-term leases at a significant markup? How is this not possibly a real estate concern? How? What was — what was the argument they were making to people that, “Hey, we’re a tech company and we deserve tech company valuations.” FARRELL: Sure. So exactly as you said, they have this Brooklyn business that was the genesis of WeWork. It was — it had a lot of that business, and it was what they took to make WeWork. It has a lot of innovation to it in terms of architecturally the aesthetic of it. I mean, we probably all have been to WeWork. They’re just — they’re beautiful buildings. RITHOLTZ: Funky, fun … FARRELL: Yeah. RITHOLTZ: … open … FARRELL: Light coming through … RITHOLTZ: … with a beer tap and lots of glass. FARRELL: … we had light streaming through the windows. You put — you pack people very close together. So, something they started in Brooklyn, it took off, but then their — the landlord there didn’t want to grow it, so they — they split up, they moved on. Adam and his — his co-founder Miguel McKelvey. And from the very beginning, the idea was something so much bigger. They say they created — they like sketched out something and it was like essentially WeWorld. It would be, you know, schools, and apartments, and this whole universe of we. But basically, as you said, I mean, throughout for the most part, it was this like arbitrage building, arbitrage company in terms of getting long-term leases and splitting it up. RITHOLTZ: All right. So, by 2014, they have a pretty substantial investor list, J.P. Morgan Chase, T. Rowe Price, Wellington, Goldman, Harvard Endowment, Benchmark Capital, Mort Zuckerman. Was this still a rational investment in 2014 or when did things kind of go off the rails? FARRELL: By then it still seemed like the valuation was really getting ahead of itself, and it was very much predicated on this idea that you said being a tech company. And I mean, at Adam Neumann’s genius was in marketing and fund raising. And what he had the ability to do really each step of the way and it’s — it’s masterful was sort of take — take the zeitgeist, like the big business idea of the moment that was captivating investors and put that on top of WeWork. So, he’s very into — a little bit before this like sort of acquainting it to Facebook. You know, Facebook was the social network. This is like a social network in person. RITHOLTZ: In real life, right. FARRELL: In — yeah, real life social network. And he didn’t manage to kind of convince people bit by bit. I mean, it’s interesting, Benchmark, you know, as you know, is like one of the top … RITHOLTZ: Legit — right, top shelf V.C., absolutely. FARRELL: Yeah, that’s been some — behind some of the biggest tech companies. RITHOLTZ: Bill Gurley, Uber, go down the list of just incredible … FARRELL: Snap. RITHOLTZ: … yeah, amazing. FARRELL: eBay. Yeah, they’ve had — through — for decades, they’ve been behind some of the biggest companies. So, they were willing to take a gamble on them, and then they saw red flags, but just decided to jump in anyway. But for Benchmark, I mean, we see and they ultimately — they get in at such a low valuation, it’s … RITHOLTZ: Doesn’t matter. FARRELL: … exactly like — you know, they want their homeruns. And I mean, it’s still — they still ultimately got out at a pretty good — really incredible return, but it’s … RITHOLTZ: Right, $600 million to $10 billion, something like that, something (inaudible). FARRELL: Yeah, something like that. RITHOLTZ: So — so just to clarify because I — I’m — I’m going to be trashing WeWork for the next hour, but this wasn’t a Theranos situation or a Bernie Madoff, this is not an issue of fraud or anything illegal or unlawful. Fees just were insane valuations. Somebody did a great job selling investors on the potential for WeWork, and it didn’t work out. FARRELL: I’m glad you brought that up because a lot of people do ask about the differences and the parallels between Elizabeth Holmes and Adam Neumann. And I — I mean, I almost think the story, in some ways, is more interesting. I mean, the Theranos story is, obviously, the craziest and — and horrifying in so many ways. But with Adam Neumann, on the margins, there are questions about, you know, some of them (inaudible). RITHOLTZ: They’re self-dealing and there’s some — a lot of avarice. And he just cashed out way, way early, so you could criticize his behavior. But, you know, you end up with the VCs and the outside investors either looking the other way or turning a blind eye. It’s not like the stuff wasn’t disclosed or anything, he was very out front. No, I need — I need a private jet because we’re opening up WeWorks in China and in 100 other countries, and I have to join around the world. FARRELL: Yeah, and maybe you (inaudible) thing. RITHOLTZ: Now, you need a $65 million (inaudible) is a different question. But, you know, there — they didn’t hide this. They were like proud of it. FARRELL: No, and I think it is every step of the way, you see. I mean, the investors and these were some of the most sophisticated investors in the world and some of the — you know, they are thought of as the smartest investors. They saw the numbers that WeWork was putting forth and they were real, real numbers. They also saw their projections and the projections were mythical, and they never quite reached them. But you could see, if you are going to invest in any round of WeWork, you could see what their prior projections were, how they failed to hit them. But instead, the thing that we saw time and time again to this point was, very often, Adam Neumann would meet the head of an investment company, whether it’s Benchmark or SoftBank or T. Rowe Price, like the — the main decision-maker totally captivate this person. You know, it’s usually a man. The man would become kind of smitten with Adam and all his ideas and what he was going to do, totally believing it. The underlings would look at the numbers, raise all these red flags, point them out. And then the decision-maker would say … RITHOLTZ: Do it anyway. FARRELL: … yeah, he’s amazing. (COMMERCIAL BREAK) RITHOLTZ: So I want to talk about the rapid rise of WeWork and their — their really fast growth path, but I have to ask, what sort of access did you have to the main characters in the book? Were people forthcoming? I have to imagine there were some people who had grudges and were happy to speak. What — what about the — some of the original founders, Adam and his wife Rebekah? Who — who did you have access to? FARRELL: Sure. So, you know, in the interest of privacy, I can’t get into specifics. But what I will say, the interesting thing was, I mean, when we really got access for hours and hours to the vast majority of players at every step of the way in this book. And the — one of the funny things was, I mean, the pandemic really started right as Eliot and I took book leave. We started a book leave in late February 2020. And we had both planned to sort of be and all around the world, meeting people in person. Eliot had moved to New York to meet a lot of the players in person. Obviously, the world shut down and, you know, was kind of nervous about what that would mean in terms of conversations. And the funny thing was I think people are home, bored, feeling pretty reflective. So, there are a number of people that said … RITHOLTZ: What the hell. FARRELL: … I didn’t know if I wanted to talk to you and … RITHOLTZ: But what the hell. FARRELL: … these — some of these people I probably had like 10 conversations … RITHOLTZ: Really? FARRELL: … for hours with. RITHOLTZ: And — and there are 40 something pages of endnotes. It’s — I’m not suggesting that this isn’t deeply researched because a lot of these conversations that you report on like you’re fly on the wall. Clearly, it can only be one of two or three people. So, it looks like you had a ton of access to a lot of senior people and I guess, we’ll just leave it at that. So — so let’s talk about that early rise in the beginning. They were really ramping up very rapidly. I mean, you could see how somebody interested in investing in a potential unicorn in 2012, ’13, ’14 coming out of the financial crisis. Hey, the idea of all these startups just leaving a little bit of space and not a long-term lease, it looks very attractive. It looks like, hey, you could put WeWorks wherever there’s a tech community, and they should do really well there. FARRELL: Yeah, there — and it was — the marketing was — it was very viral at that point. It was, you know, people would tell their friends about it, and they would fill up very rapidly. And they were building more and more. I mean — and this is one of the — you know, as part of the genius of Adam Neumann was, you know, he was telling people from day one they were really struggling to even secure the lease on the first building. And he was like, oh, we’re going to be global, we’re going to be international. He would set these goals of how many buildings they would open and people internally, and even investors, would say, “Oh, this is impossible.” RITHOLTZ: Right. FARRELL: And he would — and he would hit that. He kept on sort of defying gravity, defying disbelief or questions. So, the growth was incredible and they were filling them up. We could talk about, you know, the lack of the cost of doing so. RITHOLTZ: Right. They — they were paying double to — to real estate agents when everybody else was paying. They were going to competitors and saying, “We’re going to reach out to your tenants, and we’re going to offer them free rent for a year.” I mean, they were really sharp elbowed and very aggressive. FARRELL: Especially as time went on. We did find that there is one year we got all their financials. We — you know, we got our hands on a vast trove of documents, but there was one year — I think it was 2011 — that they, I think, made $2 million in profit. RITHOLTZ: Wow. FARRELL: We were — we were kind of shocked to see that. We don’t think they had ever made a profit. And then from there, they did not, and the billions and billions just added up in terms of losses. RITHOLTZ: So — so the rapid rise, we — we mentioned, they peaked in 2019 at more than $47 billion. Neumann recently did a interview with your fellow Times correspondent Adam (sic) Ross Sorkin, and he was somewhat contrite. He — he had admitted that all the venture money and all the high valuations had — went to his head, quote, “You lose focus on really the core of the business and why the business is meant to be that way. It had a corrosive effect on my thinking.” That’s kind of a surprising admission from him. FARRELL: It was. Yeah, I mean, his mea culpa is very interesting. And I mean, one of the things that people said along the way was, you know, the — the higher the valuation, the more out of touch she became. I mean, he — he had a narcissist. And I don’t know what you want to call it, but … RITHOLTZ: Socio-pathological narcissistic personality disorder? I’m just — I’m not a psychologist, I’m just guessing, or a really successful salesman/CEO. There’s like a thin line between the two sometimes, it seems. FARRELL: And some of it — I mean, it seems insane. It was like, oh, he thought of himself in this like same — like with along with world leaders, but world leaders were really sort of … RITHOLTZ: Tailing him. FARRELL: … really wanted to meet him. RITHOLTZ: Yeah. FARRELL: Yeah. And he was like — we have a scene in the book that he was debating whether or not he was going to cancel on Theresa May because he had promised his wife that he would teach a class on entrepreneurship to their new school, so it was like a few of their kids and a few of their kids’ friends were in the school. RITHOLTZ: Right. FARRELL: And they’re about five years old, five or six. And he had promised — and his wife … RITHOLTZ: Prime Minister, a five-year-old, that’s it. So, when you talk about losing touch with reality, some of the M&A that the startup did. Wavegarden or wave machine was a — like a surf wave machine, meetup.com, Conductor, they ended up dumping these for a fraction of what they paid for them. But what’s the thought process we’re going to become a technology conglomerate? I don’t — I don’t really follow the thinking other than will it be fun to have a wave machine at our buildings, like what’s the rationale there? FARRELL: OK. So, there were — there were two parts to that, and part of it was like it was the world was Adam Neumann’s playground, and he loves surfing, and he thought that — you know, that he found out this company has wave-making mission. They would make waves. So, him and his team went to Spain to surf on them and test them out, but he could basically convince his board, in general … RITHOLTZ: Right. FARRELL: … who had to approve these that anything made sense, whether it’s the jet, the wave pool company or friends of his. I mean, Laird Hamilton, the famous surfer … RITHOLTZ: Right. FARRELL: … was a friend of his. They invested like in his coffee creamer company. But then the second — so it was so many unseen investments that I really didn’t necessarily make any sense. But then on the other side, one of the things that we thought was interesting, he had this deal with Masa who — Masayoshi Son. He’s the CEO of SoftBank, became WeWork’s biggest investor, biggest enabler, you might say. RITHOLTZ: Yeah. FARRELL: And one of the — they were going to do this huge deal that would have actually kept WeWork private forever. It never came to pass, and that’s why it was sort of the beginning of the end when this deal fell apart. But as part of it, a lot of the deal is predicated on growing revenue. So, Adam also became obsessed with acquisitions like whatever they could possibly do to add more revenue to the company. I mean, he was talking about buying Sweet Cream, and he had like got pretty far along in the salad company … RITHOLTZ: Yeah, amazing. FARRELL: … in conversations with them. So, it was this idea of like let’s just throw in anything, we have money, and let’s just grow our top line. Who cares about anything else? RITHOLTZ: Let’s talk about Rebekah Neumann. She was Adam Neumann’s wife. What — what what’s her role in WeWork? How important was she? FARRELL: Her role is just so fascinating throughout. So, I mean, he — he met her right as he was starting Greendesk. And I think she just sort of opened his eyes. She’d grown up very wealthy. She’s Gwyneth Paltrow’s cousin. She had always ties to Hollywood. She gave him a loan early on, a high interest loan, I think even after they were married that we report about in the book. But as time went on, she — she really want a career in Hollywood, decides to — at one point, she — she was trying to be an actress and she tells someone that she’s done with Hollywood. She’s producing babies now. They’ve gone on to have six kids. But she sort of always kind of dabbled in the company, and they retroactively made her a co-founder. RITHOLTZ: Right, she wasn’t there from day one. It was only later she got pretty active. FARRELL: Yeah, she told people like giving tours early on that she help pick out the coffee in the — in the early WeWorks. But — so she became more active, but she was sort of jumped in and out. And it was by the — one of the things that she had a big focus on their kids were growing up, she didn’t really like their choices of private or public schools, so she decided to start — she helmed sort of the education initiative that’s something … RITHOLTZ: And she was deeply qualified for this because she — she was a certified yoga instructor, right? FARRELL: Yeah, she had been. RITHOLTZ: And — and I know she went to Cornell, which is certainly a good school. What bona fide does she bring to technology, real estate, education, like I’m trying to figure it out. And in the book, you don’t really go into any details that she’s qualified to do any of these things. FARRELL: I mean, especially with — with education, it’s like she didn’t — she want this — essentially she wanted a school for her children, and she wanted very specific things in that school. And once again, they decided that that would be the next like frontier for WeWork. They’re always adding different things. But no one really — then they let them do this. They started this school in New York in the headquarters, and they were going to teach the next-generation of entrepreneurs. And … RITHOLTZ: Right. FARRELL: … I mean, they — one of the things — I mean, it was the education arm more than — as much or more than other parts of it is just so tragic because they had a lot of money. She’s — she, like Adam, can just speak like — speak so — like eloquently and with this vision. So, she attracted all these very talented teachers. She sort of wooed them from the schools that they were in before and told them that they were going to start this, you know, new enterprise and change education forever. And it’s just really devolved so quickly. It became very like kind of petty. I mean, if you pull so they have PTSD from her like obsession with like the rugs like … RITHOLTZ: Right, just … FARRELL: … it was a Montessori-type school. And yeah, she obsessed over like the color of white of the rugs and made them like send back 20 rugs. RITHOLTZ: What was the most shocking thing you found out about him or her or both? FARRELL: So, one — one of these was — I mean, there is a lot of the — their personal lives, as we said, whether it was a school or other — other things where their kids are educated in, just the way in which the personal entanglements, you know, small and huge levels, but I’ll give two examples. I mean, one of the things that people said in the school, so within the WeWork headquarters was a whole … RITHOLTZ: Right. FARRELL: … floor and it’s beautiful if you see pictures of it, like it just this – like really incredible school. RITHOLTZ: Money was no object. FARRELL: Yeah. And they had Bjarke Ingels, this famous architect designed the school. And — but they basically, on Friday nights, would have dinners with their friends there. And according to many people would — the team would come in Monday morning … RITHOLTZ: It’d be a disaster. FARRELL: … it will be a complete … RITHOLTZ: Right. FARRELL: … disaster. So, it was like really on so many levels like everything was their personal … RITHOLTZ: So, entitled. FARRELL: Yeah. And the second thing that really shocked us was she was very — she had a lot of kind of like phobias around like health and wellness. And she says — I mean, she had a — a real tragedy in her family. Her brother died from cancer, and so she was always — she’s very focused on and she said it as much in podcasts and things. But she was very fixated on 5G. And she’s worried about vaccines for their kids. And — but the 5G of like what that could do for — you know, these signals. She wouldn’t let them have printers on the floor, like any printers on — wireless printers on the floor of the school. But there is a — they bought this … RITHOLTZ: Can you — can you even by 5G printers today? What — what was the … FARRELL: Oh, no, it’s a wireless. RITHOLTZ: … yeah, just Wi-Fi? FARRELL: Yeah, the wireless like freaked her out, so the teachers of that are like run up and downstairs to just print everything. It seems ridiculous. But the 5G towers, there was one, either being built or built right near there, across the Beam Park. RITHOLTZ: (Inaudible) City Park. FARRELL: Yeah, right nearby. So, she was so obsessed with it. She didn’t want to move in there. They had bought like six apartments in this building that she — the CFO — this is around the time they’re preparing for the IPO. I used to work at Time Warner Cable, who is the CFO of Time Warner Cable. So, she said, “Can you, Artie Minson, help us get rid of the 5G tower and have it moved?” And basically, he deputized another aide who used to work for Cuomo and worked for Governor Christie, the — both former governors. And they — like that was something they — they actually worked on. So, the — yeah, that interplay was just kind of insane. RITHOLTZ: Seems rational. There was a Vanity Fair article, “How Rebekah Neumann Put the Woo-Woo in WeWork,” and — and what you’re describing very much is — is along the lines of that. I’ve seen Neumann described as a visionary, as a crackpot, as — as a grifter, but he thinks he’s going to become the world’s first trillionaire, and — and WeWork the first $10 trillion company. Is — is any realistic scenario where that happens or is he just completely delusional? FARRELL: I mean, it seems insane and like he seems completely delusional, but he had a lot of people going along with him, including the man with one of the biggest checkbooks in the world who is Masayoshi Son, the CEO and Founder of SoftBank, who had just — I mean, the timing of the story, it’s like there’s so many things that happened at the first enrollment. RITHOLTZ: Saudi Arabia wanting to diversify, giving a ton of money. You — you call Son the enabler-in-chief. He — he put more than $10 billion of capital showered on — on to WeWork. How much do you blame Son for all of this mayhem at least in the last couple of years of WeWork’s run as a private company? FARRELL: It seems like he was the main — you know, the main person kind of pushing all of this. And when you talk to a lot of people around Adam, they just said they were just such a dicey match like that Adam was crazy to begin with. Everyone thought that. You know, it can go both ways, but … RITHOLTZ: Yeah, but people drank the Kool-Aid. It — it reminded me — you don’t mention Steve Jobs in the book, but very much the reality distortion field that Jobs was famous for, I very much got the sense Neumann was creating something like that. How did he get everybody to drink the Kool-Aid? Was he just that charismatic and that good of a salesman? FARRELL: I think so. And it was just he could talk about things and make you feel like the reality was there, this reality of distortion field. He was — he was masterful in that. Yet the thing that he did was he always found new pots of money … RITHOLTZ: Right. FARRELL: … all over the world. I mean, it was the time — it was the time when the private capital markets were getting deeper and deeper, the Fidelitys and the T. Rowe that like normally kind of sober mutual funds … RITHOLTZ: Right. FARRELL: … were jumping into startups. And they — they were — we call one of the chapters FOMO. It was like the … RITHOLTZ: Right. FARRELL: … fun FOMO. They were fearful of missing out on the next big thing. So that we’re sort of in this climate where there is an appetite to go after, to just take a chance for the chance of getting the next like maybe not trillion-dollar company, maybe no one but him and Masa believe that, the next big thing. RITHOLTZ: But the next 100X — right. And that’s really — you know, it’s always interesting when you see these stayed, old mutual fund companies that have literally no experience in venture capital or tech startups, but happy to plow into it because they — they — they want to be part of it. And maybe that’s how we end up with community-adjusted EBITDA. Can — can you explain to us what that phrase means? I don’t even know what else to call it. FARRELL: Sure. So WeWork was losing every — every step of the way. They were growing revenue more than doubling it. You know, they’re expanding all around the world. And with that, they were losing just as much, if not more every single year than they were taking in. So, they had this brilliant idea, really a lot stemming from the CFO and Adam Neumann love the CFO’s creation. His name is Artie Minson, the CFO. And it was this idea that you essentially strip out a lot of the costs of kind of creating all the — building out all the WeWorks and, you know, marketing and opening up new buildings. You strip it out, and then you’re suddenly a profitable company. It’s like the magic. RITHOLTZ: Wait, let me — let me make sure I understand this. So, if you eliminate the cost of generating that profit, you suddenly become profitable. How come nobody else thought of this sooner? It seems like a genius idea. FARRELL: Oh. RITHOLTZ: Just don’t — it’s profits, expenses. It’s fantastic. FARRELL: And the — the conviction with which certain people inside, especially on the finance team, believe this. I mean, they were saying throughout that like, oh, we will be a profitable company if we — the idea was if we just stop growing, we could be profitable right now. We take in more per building. (COMMERCIAL BREAK) FARRELL: Then we spend on it. But, you know, that never was the case. RITHOLTZ: So, let’s stick with the delusion concept. We talked about WeGrow, and we talked about WeLive a little bit, crazy stuff. What made this guy think he can help colonize Mars? Right, you’re laughing. You wrote it yourself, and it’s still funny. FARRELL: It is still … RITHOLTZ: By the way, I found a lot of the book very amusing, like very dry, like you guys didn’t try and crack jokes. But clearly, a lot of the stuff was just so insane. You read it, you start to laugh out loud. FARRELL: I’m — I’m glad to hear that because I think that we would joke that like every day. I mean, we’re in different places writing it. We are on calls constantly, and we would call each other. And it was often multiple times a day we would call each other and say, “You will never ever believe what I just heard.” And we would crack up, and we — we had a lot of fun writing it because it’s just — it was — the truth of the story was like more insane than … RITHOLTZ: Right. FARRELL: … anything we could have made up ever. RITHOLTZ: That’s the joke that, you know, the difference between truth and — and fiction is fiction has to make sense, and truth is under no such obligation. So, let’s talk about Neumann colonizing Mars. FARRELL: Yeah. RITHOLTZ: I mean, was that a serious thing or was he just, you know, on one of his insane (inaudible) and everybody comes along? FARRELL: There — there — speaking of fine lines, I mean, he just — I think he — he started to believe more and more of like these delusions. And so, I think he really did, and yeah, he got this — he secured a meeting with Elon Musk, and he – Elon Musk — he always — Adam was always late to every meeting, would make people wait for hours, like even like the bankers in the IPO would just sit around. There’ll be rooms of like dozens of people waiting for Adam, and he’d show up like two hours late. But Elon Musk made him wait for this meeting. They sat and sat and sat, and then he told Elon Musk that getting — that he thought — like building a community on Mars is what he would do and he would help him with. And he said, you know, “Getting — getting to Mars is the easy part. Building a community is the hard part.” RITHOLTZ: Right. Because, you know, it’s very hard to get those beer taps to work in a … FARRELL: Yeah. RITHOLTZ: … low-gravity, zero atmosphere environment. It’s a challenge, only WeWork could accomplish that. FARRELL: The – the fruit water. RITHOLTZ: Right. So — so I want to talk about the IPO, but before I get to that, I — I have to ask about the corporate offsites, the summer camp, which were described as three-day global summits of drinking and drug consumption. It was like a Woodstock event, not like a corporate retreat. How did these come about? FARRELL: So, Adam would say that he never — he grew up in Israel and he moved to the U.S. He lived for a little while the U.S., but move later in life. So, you said he never got to go to American summer camp, so he was going to recreate summer — American summer camp literally. They started at his wife’s family’s had a summer camp in upstate New York. That’s where they started. They just got bigger and bigger, eventually going to England and taking over this like huge like field — this huge estate there and bringing every single member of the company flying them from all over the world. RITHOLTZ: And there were thousands of employees? FARRELL: Thousands upon thousands, and the cost was unbelievable of every piece of it. I mean, every year, they just got bigger and bigger. I mean, the flew at the height of his fame not that he’s far off of it, but Lin-Manuel Miranda like, at the height of Hamilton, they flew him on a private jet. He — he performed on stage. The Roots came, and — and they would pay these people like … RITHOLTZ: Million dollars, right. FARRELL: … a million dollars, yeah. So, the money is no object. RITHOLTZ: That’s a good gig for an afternoon. FARRELL: Yeah, exactly. And they were — you know, especially at the beginning, it was like a younger group of people, in general. And — I mean, these — these were crazy. There’s tons of alcohol sanctioned by the company, handed out by the company. Drugs were in — you know, in supply not handed out by the company, but they were everywhere and … RITHOLTZ: And he talks about drugs. He says, “Well, we — it’s not really drugs, just, you know … FARRELL: He — so yeah, I think it — it got to a point and it was also mandatory to come to these events. So, I mean, the — they were … RITHOLTZ: And they were like meetings where there are shots, everybody has to do shots. FARRELL: Yeah. RITHOLTZ: This — this wasn’t just at these retreats, like hard partying was pretty common throughout the company or anywhere Neumann seemed to have touched. When — when he was there, everybody was expected to step-up and — and party hard. FARRELL: Including the investors. I mean, you’d walk into the office at 10 A.M., according to so many different people. And he’d insist on taking tequila shots with you in the morning in his office. And … RITHOLTZ: You didn’t have a shot before this? You — don’t you … FARRELL: Right. RITHOLTZ: … isn’t that — isn’t how every meeting begins? FARRELL: The breakfast … RITHOLTZ: Right? FARRELL: … of champions. RITHOLTZ: That’s — that’s right. So — so I got the sense from the book that they always seemed to be on the edge of running out of money, and they would always find another source, but it was all leading towards the IPO, but the S-1 one filing, the disclosures that go with an IPO filing, that seemed to be that they’re undoing the — the public just — investing public just torn apart. FARRELL: Exactly. I mean, the interesting piece of that, as you said, it was there’s always a new pool of capital like just when he thought that he was going to have to go public. And the board — and the board — I mean, one of the things we found time and time again was the board would say, you know, he’s really like crazy, things are getting out of hand. But like we won’t say no to him, but eventually he’s going to have to go public. This was back in like 2016-2017. RITHOLTZ: Right. FARRELL: We thought he was going to run out of money, the only place to go because they’re burning so much cash with the public markets. And the public markets will take care of it, which — that kind of floored us each step of the way. But yes, as you said, he — he — he knew how to captivate on — in one-on-one or bigger meetings to convince you of this future to tell you we always describe him kind of as a magician and think of him like this, like don’t look here, look here, like the sleight of hand. He could — then this S-1 came out. It was a regulatory document. You have to follow rules. RITHOLTZ: There’s no sleight of hand in S-1 filing. FARRELL: No, like you have to see. And people suddenly saw the — the broad public the revenue, the losses of a lot, not even all of these, you know, the questionable corporate governance, I mean, the — the … RITHOLTZ: The self-dealing. FARRELL: … the self-dealing, only pieces of that were even in it because the jet wasn’t in the S-1. They didn’t have to disclose it. The — and the interesting thing about this, I think there’s always like this distinction that people try to make between like, oh, the smart money and the dumb money. And it’s like the smart money is like the Fidelitys and the T. Rowes, and the SoftBanks. And then the dumb money, you know, it’s like — or the, you know, the average retail investor. And so, it’s just so interesting that like he — he captivated the — the quote-unquote, “smart money.” And then the minute this was all made public, everything was there, the world saw it and just said like what is — like this is insane. RITHOLTZ: I’m nursing a pet theory that it was Twitter that demolished him because people just had a — I remember the day of this filing, Twitter just blew up with — like a — a million people are taking an S-1 apart sentence by sentence and the most outrageous things bubbled up to the top of Twitter. And it was very clear that they were dead in the water. There was going to be no IPO, and the dreams of these crazy valuations seemed to crash and burn with the — the IPO filing, which — which kind of raises a question about, you know, how was all of this corporate governance so amiss. All the self-dealings that were allowed, so my — my favorite one was he personally trademarked the word We and then charged the company $6 million to use it. Again, he — he’s given these sort of crazy disclosure explanations. Hey, I’m only allowed to say this. But it seems he bought a bunch of buildings in order to flip them to WeWork at a profit. I don’t understand how the board — we mentioned Theranos — here’s the parallel. How did the board tolerate just the most egregious, avarice, lack of interest in the company and only enrichment of oneself? How does the board of directors tolerate that? FARRELL: I know that was — I think, if anything, from this whole story that just floored us was exactly that this board, I mean, it was a — it was a real like heavy-hitting board of directors. They’re not — and all financial people as opposed to Theranos, you know, it was like people who didn’t really know … RITHOLTZ: Politics and generals, and … FARRELL: Yeah. RITHOLTZ: … secretaries of states, right? It was a — and a lot of elderly men who were smitten with her. I mean, like men in — what was Kissinger on the board? He was 90 something. FARRELL: Yeah. RITHOLTZ: So — so with this though, the other thing that’s shocking is, you know, most founders of a successful company, they live a — a reasonably comfortable lifestyle, but the thought process is, hey, one day we’ll go public and my gravy train will come in, and I’ll have a — a high, you know, eight, nine, 10-figure net worth. Early in this time line, he was paying himself cashing out stock worth tens of millions, in some cases, hundreds of millions of dollars way, way early in — in — the company was five years old and he was worth a couple 100 million liquid, and god knows how much on paper. Again, how — how does the board allow that to take place? FARRELL: Yeah, that was — and a board, investors kind of signing off on this were jumping into it, I mean, seeing that he’s going to sell a lot of stock each round. I mean, now there does seem to be a shift and it’s kind of a scary one that this is like more private companies, the founders are selling more and more. But back then, you didn’t really see this very much. And one of the things I find very interesting is he was very much following the Travis Kalanick that — for Uber CEO’s playbook, and literally like following it that like going after the same investors, going around the world. Travis had raised more money than anyone before. Travis, every step of the way, made a huge point of, “I’m all-in. I’m never selling any stock” … RITHOLTZ: Right. FARRELL: … until he was kicked out of the company basically. So, Adam followed his playbook, but each step of the way was — said he took money out and was like prepare about it. RITHOLTZ: I mean, he was very wealthy for a — a scrappy startup founder, 14, 15, 16. You would think, hey, he’s — maybe he’s making a decent living, but not hundreds of millions of dollars, it’s kind of amazing. FARRELL: Or like having many, many, many houses. RITHOLTZ: Right. FARRELL: And they were like he didn’t hide the way in which he was living, having houses all over the world, jet setting all over the world. You know, and, in fact, he almost like, you know, wanted everyone to know that was part of his like a lure. RITHOLTZ: So, when the IPO filing in 2019, when — when that blows up, it seems to have a real impact on Silicon Valley for a while. Suddenly, high-spending, fast-growing, profitless companies looked bad, and now we’re back to we want profit growth and revenue, but that really didn’t last all that long, did it? FARRELL: No, it was unbelievable. I mean, we also — Eliot and I joked that we rewrote the epilogue like five times because, at first, we wrote it saying like this is the fallout. RITHOLTZ: Oh, look at the impact, right. FARRELL: Yeah, and it was — I mean, Masayoshi Son had his own mea culpa like, you know, I believe in Adam, I shouldn’t have, I made mistakes. But also, I want my companies to be profitable now … RITHOLTZ: Right. FARRELL: … like I’m going to invest in these companies or the companies have invested already, they should be profitable. IPO investors, public market investors were totally spooled by money-losing companies. Then — you know, then came the pandemic, then came the Fed pumping money into the system. And then, you know, now, in some ways, it’s like, wow, WeWork always like made — generated revenue and losses. It’s like now today we have Rivian … RITHOLTZ: Right, Rivian and … FARRELL: … pre-revenue … RITHOLTZ: … Lucid and, you know, it’s all potential. Maybe it works out, maybe Amazon buys 100,000 trucks from them, but that’s kind of — that’s a possibility. And, you know, more — more than just the Fed, you had the CARES Act, you had a ton of money flow into the system, but it doesn’t necessarily flow to venture-funded outfits, it’s just a lot of cash sloshing around. Is that — is that a fair statement? FARRELL: Oh, completely. RITHOLTZ: So how quickly were the lessons of WeWork forgotten? FARRELL: Incredibly quickly. I mean, it felt like it had — it like it changed everything for a few months. I mean, the other part of it was Masayoshi Son had — had raised a $100 billion fund, biggest fund ever to invest in tech companies. He was literally about to close his second fund. It was … RITHOLTZ: $108 billion, right? FARRELL: Yeah, another $100 billion fund to just go and like pour into companies. RITHOLTZ: More, right. FARRELL: And then I mean, we’ve heard from all these people who are out meeting sovereign wealth funds, Saudi Arabia, and they were just like every meeting, it was like what about WeWork. And, you know, one of the things we’ve heard was he was pushing for it to just go public, you know, or to — or not to — to not go public because he didn’t want to take the mark. He didn’t want to make … RITHOLTZ: Right. FARRELL: … all of this public. And we have a scene in the book about this that Masa tries to tell him to call off the IPO and tried to force his hand, and Adam is kind of like … RITHOLTZ: Confuses. FARRELL: Yeah. RITHOLTZ: Right. It’s — it’s — it’s really quite — it’s really quite astounding that we end up with — what did he burn through, $20 billion, $30 billion? FARRELL: More than $10 billion, I think. RITHOLTZ: Wow. FARRELL: Yeah. RITHOLTZ: That — that’s a lot of cash. FARRELL: Towards him essentially. RITHOLTZ: So — so here’s the curveball question to ask you. So, you’re now a business reporter at the Times. WeWork obviously isn’t the only company led by an eccentric leader. What are you reporting on now? What’s the next potential WeWork out there? FARRELL: You know, I’m — I’m just getting started. This is just a couple of weeks in, but — so it’s — I don’t quite know what the next WeWork is. I almost feel like there’s a lot of mini WeWorks out there, whether it’s — you know, the company is in the SPAC market. Some of these unicorns, I mean, there’s so many — so many red flags around these companies like I was saying before like if founders taking money out very early and, you know, investors are not really caring and just wanting to get into them, getting these massive packages — pay packages, compensation. So, I think there’s — there’s so many different places to look. I don’t get the sense that there’s one company now that’s sort of — of size of Adam Neumann. I think there are just a lot of many ones. I mean, he was a pretty like captivating and just insane in so many — larger than life in so many ways. But I have no doubt we’re going to find one of them fairly soon. There’ll be more. RITHOLTZ: And — and what do you think the future holds for Adam Neumann himself? He — we — we have to talk about the golden parachute, so not only does SoftBank refinance a couple hundred million dollars in loans that he has outstanding, they give him $183 million package and essentially purchased $1 billion of his stock, so he leaves WeWork as a billionaire. FARRELL: Yeah, it was — I mean, it was just an incredible thing. And I mean, then he got this pay package that they agreed to as part of the bailout. I mean, WeWork, once the IPO was called off, was on the verge of bankruptcy. They were going to run out of money in a couple of months so they had to do this very quickly. They were laid off thousands upon thousands of people. But basically, as part of the negotiations to get Adam Neumann to give up his super voting shares, these potent shares that would have let him continue to keep control of the company to do that, they struck this pay package. And I mean, it’s kind of interesting when we talk about the power founders right now that it wasn’t a wakeup call for Silicon Valley to be more wary of giving this power to founders, like when you saw the price tag that Adam Neumann extracted the cost of pushing out a founder who’s kind of a disastrous founder at some point. RITHOLTZ: Yeah. I — I remember reading that and thinking Son played it terribly. He could’ve said, “Hey, listen, I got $100 billion worth of other investments. If I take a $10 billion write-down, it’ll hurt, but I still have plenty of other money. If this goes belly up, you’re broke, you’re a disaster except I’ll give you $50 million or else you’re just impoverished. Good luck finding the lawsuits for the rest of your life.” That would have been the play, but he didn’t — I guess, it was the other second fund he didn’t want to put at risk. Why — why didn’t he hardball Neumann because I thought Son had all the leverage in that negotiation? FARRELL: That was one of the — like the enduring mysteries, I think, of this whole story because all the things you said are right, plus Adam had taken out so much money in terms. He had so much lent against his stock at $47 billion. I mean … RITHOLTZ: Right. FARRELL: … J.P. Morgan, UBS, Credit Suisse, they have lent him hundreds of millions of dollars, and he would have gotten to default. He like didn’t necessarily have the liquidity to pay back everything … RITHOLTZ: Right. FARRELL: … he had borrowed. So, it was — I mean, it’s kind of amazing in terms of his negotiating skills that Masa and SoftBank. It was led by Marcelo Claure who’s now the WeWork Executive Chairman. They blinked first. RITHOLTZ: Right. FARRELL: They gave Adam a lot. And I totally agree with you, one of the things I’ve heard it was just like the interest of time. They just wanted it done $10 billion or whatever. It doesn’t mean that much. They want to just keep on moving, keep on … RITHOLTZ: Right. FARRELL: … spending, not distract too much and just get this done, but it’s crazy. I mean, the … RITHOLTZ: So … FARRELL: … the time value of money … RITHOLTZ: … could be the greatest golden parachute in the history of corporate America. I mean, I — I’m hard pressed to think of anybody who, on the way out of a — a failing company, and it was a failing company at that moment, squeeze more money out of — out of their board. FARRELL: And just to say, I mean, Andrew Ross Sorkin at — in this first big interview with Adam that he gave was — I mean, Adam defended it in different ways. I mean, Andrew very much pushed him on like why that was okay and … RITHOLTZ: Very aggressively. FARRELL: Yeah. RITHOLTZ: That was early November. And he was sort of contrite and, you know, a little shifty, but for the most part surprisingly transparent. I was — when I was prepping for this, I watched this and, you know, you could see how he constructs that, you know, reality distortion field. But there was definitely more humility than we have seen previously. I don’t want to say humble, but just closer on that spectrum. Clearly, he wants to have a future in — in business, and he needs to offer a few mea culpas of his own. FARRELL: It does feel like this is the first step on the come back toward … RITHOLTZ: Yeah. FARRELL: … Adam Neumann. RITHOLTZ: I think that’s going to be a pretty big uphill battle. That’s going to be quite the Kilimanjaro to — to — to mount given what a debacle … FARRELL: The interesting thing just so in terms of his next step is I — I agree with you, there’s an uphill battle in terms of maybe getting people to — to give him money, but he now has a lot of money and from … RITHOLTZ: Family office, yeah. FARRELL: Exactly. Anecdotally, it sounds like a lot of people are very happy to take his money. So, to begin, that’s, you know, he’s seeding a lot of things that you — who knows where they’re going to go. RITHOLTZ: Interesting. So, I only have you for a limited amount of time. Let me jump to our favorite questions we ask all of our guests starting with, you spend a lot of time researching and writing during the lockdown. Did you have any time to stream anything on Netflix or Amazon Prime? FARRELL: There — I mean, there’s still a lot of like downtime. I — I probably watched not much. You know, there — there was downtime, and I did have a few shows that were … RITHOLTZ: Give us one or two favorites. FARRELL: … Little Fires Everywhere. I really liked Never Have I Ever. RITHOLTZ: I just started watching the last week, it’s quite charming. FARRELL: Yeah, it’s really good. RITHOLTZ: Anything Mindy Kaling does is quite amusing. FARRELL: She is amazing. Schitt’s Creek, we got through the whole — that was with my favorite pandemic. RITHOLTZ: So, the — the funny thing about that is the first episode, too, were like – it’s like — it’s like succession. You don’t like any of these people. The difference being in Schitt’s Creek, you quickly start to warm up to them and they start to reveal their own path to rehabilitation of — of themselves. FARRELL: It just gets better like ever — and then it’s so devastating at the end. RITHOLTZ: So, it was really great, right? That – that was one of my favorites. Let’s talk about your mentors, who helped shape your career as a business journalist. FARRELL: I guess, my earliest mentor as a journalist, in general, was in college, I’d always thought about journalism, and I got an internship with then, I think, a septuagenarian journalist. He — his name was Gabe Pressman. I grew up in New York. He was an NBC … RITHOLTZ: Sure. FARRELL: … journalist. This is sort of the political head honcho of local journalism. I worked for him for a summer. He was in his, I think, late 70s. And he was just the most energetic, passionate journalist I’ve ever met. He was still like chasing after mayors, grilling them. It was — with the Senate race it was Hillary in the Senate race. And it was like the most fun summer I’ve ever had and seeing his energy. And — and he — he passed away a few years ago, but literally, he started blogging into his 90s. And he would joke. He would say, “You know, my wife really wants me to like take a step back and work and teach at Columbia Journalism School,” where he had gone. And he was like, “I’m just not ready like, at some point, like scale back, and he never really did. So, he — I would say he was my first mentor. Just seeing like that, it is the most fun job in the world. He just was seeing that day in and day out. RITHOLTZ: Let’s talk about books. What are some of your favorites and — and what are you reading right now? FARRELL: Sure. I’ll start, you know, I always wish I read more fiction, but it’s like I always get pulled in, especially the business, genre. RITHOLTZ: Sure. FARRELL: So right at this minute, I’m reading “Trillions” by Robbin Wigglesworth. It’s really good. It’s about like index funds, sort of I’m learning a lot from it, the rise of Vanguard. RITHOLTZ: He was my guest last week just so you know … FARRELL: Oh, awesome. RITHOLTZ: … or two weeks ago. FARRELL: I’m midway through, but I’m, yeah, learning … RITHOLTZ: Really interesting. FARRELL: … a ton from it. I just read Anderson Cooper’s book about the Vanderbilts. It’s — I thought it was really great and it’s so interesting. You know, he talks — it starts like the Gilded Age. And you just see so many like eerie and kind of parallels between our age right now and just like the level of like wealth creation and what it leads to. So, I really enjoyed that. I read — this is a little bit dated, but “Say Nothing” by Patrick Radden Keefe. It’s about the troubles in Northern Ireland. It is — I mean, it’s — it’s very sad, but I — and it’s pretty long, and I just could not put it down. It’s … RITHOLTZ: Really? FARRELL: … so great. Yeah, I can’t recommend that one highly enough. RITHOLTZ: Quite, quite interesting. What sort of advice would you give to a recent college grad who was interested in a career in either journalism or — or business? FARRELL: In terms of journalism, I would just say jump in. I mean, it’s such a — as opposed to business, I felt like when I graduated from college, you know, so many people had jobs that they were going to make, you know, a decent amount of money. And with the journalism, you just have to find your way in and a lot of its internships. And it just — the path is hard. There’s no straight line. So, I would just say for journalism, it really helps to just jump into the first job you can get. Work really hard in it. And you just always have to keep — there’s no straight line, but jump and learn from it, meet people, find your mentors everywhere you go, and just keep going. You learn so much on the job. I went to Journalism School at Columbia. It was a super fun year, but it’s like within two days of working as a journalist, you just learn so much you can never learn in school. RITHOLTZ: And our final question, what do you know about the world of IPOs, capital market, business journalism today that you didn’t know 15, 20 years ago when you were first starting out? FARRELL: Okay. What I think have learned and probably the most in writing this book is you think people are rational players, and you think that titans of business are supposed to behave in sort of a rational way, and that these, you know, these checkmarks, these — like a T. Rowe Price or something or Fidelity that they’re going to do a certain amount of work looking at things. And I think the level of irrationality in business of just relationships of people, sort of not necessarily making rational decisions and just going with their gut and going with the people they like, I think, are cool like that that overrides a lot of things. I think it’s just so much less rational than you think it would be. And sometimes the things that are on their face seem really crazy and insane, maybe are. RITHOLTZ: Quite, quite fascinating. We have been speaking with Maureen Farrell. She is the co-author of “The Cult of We: WeWork, Adam Neumann, and the Great Startup Delusion.” If you enjoyed this conversation, well, be sure to check out any of our previous 400 interviews. You can find those at iTunes, Spotify, wherever your podcasts from. We love your comments, feedback, and suggestions. Write to us at mibpodcast@bloomberg.net. Follow me on Twitter @ritholtz. You can sign up for my daily reads at ritholtz.com. I would be remiss if I did not thank the team that helps put together these conversations each week. Charlie Vollmer is my Audio Engineer. Atika Valbrun is our Project Manager. Michael Batnick is my Director of Research. Paris Wald is my Producer. I’m Barry Ritholtz. You’ve been listening to Masters in Business on Bloomberg Radio.   ~~~   The post Transcript: Maureen Farrell appeared first on The Big Picture......»»

Category: blogSource: TheBigPictureDec 15th, 2021

Elizabeth Warren Is So Very Wrong About Inflation

Elizabeth Warren Is So Very Wrong About Inflation Authored by William Anderson via The Mises Institute, Almost anyone who follows social media is familiar with the latest tweets by Senator Elizabeth Warren, who has pronounced her verdict on higher food and gasoline prices: they are nothing less than the result of corporate greed. In fact, according to Warren, there is no inflation, only corporations arbitrarily raising prices in their relentless pursuit of … profits. In a November 21 interview with MSNBC’s Joy Reid, Warren declared (later placed on Twitter): Prices have gone up. Why? Because giant oil companies like Chevon and ExxonMobil enjoy doubling their profits. This isn’t about inflation. This is about price gouging for these guys and we need to call them out. Three days later, she outdid herself, declaring: Wondering why your Thanksgiving groceries cost more this year? It’s because greedy corporations are charging Americans extra just to keep their stock prices high. This is outrageous. To those familiar with Warren and her previous economic pronouncements, none of this is surprising. A decade ago, she declared that entrepreneurial successes are due to the government, not any decisions that entrepreneurs might have made, and her record in the US Senate speaks volumes to her economic illiteracy. That she should claim that all businesses have to do to increase profits is to raise prices is proof to her intellectual bankruptcy. Despite the title, however, this article is not about Elizabeth Warren’s economic viewpoints. However, in her declaration that no doubt plays well with progressives, she makes a specific claim: firms that wish to increase their profits and stock values simply need to raise the prices of whatever they sell. Warren’s claim raises an obvious question: If higher prices always lead to greater profits, why would any business owner pass up the chance for greater profitability? In fact, if high profits are tied directly to higher prices, then one would expect a cottage industry to spring up of class action law firms suing corporations for lowering their prices, since any firm is free to increase its profits at will. Doing anything less is dereliction of duty to shareholders. Not that I regularly follow Warren’s Twitter decrees, but I doubt seriously that she ever has praised any businesses when they lower their prices (oil companies often lower prices, not to mention technology firms). Since lower prices do not fit into Warren’s progressive narratives, it is doubtful that she even notices when that happens, and if we are to take her latest statements seriously, then we would have to believe that such an event could not happen because no profit-maximizing firm ever would impose losses upon itself when they are fully aware of a profitable alternative strategy. There are a number of fallacies in Warren’s antimarket missives, and I shall examine them from the Austrian viewpoint, specifically using Murray Rothbard’s Man, Economy, and State as the standard. I first look at her view of profits themselves. Like many American progressives, Warren seems to interpret business profits as an extraction of wealth from the community at large. Rothbard wrote about what he called the “altruists” as condemning profits: It is also peculiar that critics generally concentrate their fire on profits (“the profit motive”), and not on other market incomes such as wages. It is difficult to see any sense whatever in moral distinctions between these incomes. Indeed, progressives like Warren see markets in a starkly different way than do Austrians such as Rothbard. To Warren, markets are violent, predatory entities with no more moral standing than the Roman arenas. Rothbard, not surprisingly, differs: [C]ritics overlook the fact that the operation of the free market is vastly different from governmental action. When a government acts, individual critics are powerless to change the result. They can do so only if they can finally convince the rulers that their decision should be changed; this may take a long time or be totally impossible. On the free market, however, there is no final decision imposed by force; everyone is free to shape his own decisions and thereby significantly change the results of “the market.” In short, whoever feels that the market has been too cruel to certain entrepreneurs or to any other income receivers is perfectly free to set up an aid fund for him for depriving his fellowman of needed benefits. For the consistent altruist must face the fact that monetary income on the market reflects services to others, whereas psychic income is a purely personal, or “selfish,” gain. Entrepreneurial profits, Rothbard notes, do not come about because of nefarious behavior on part of the producers, but rather the good judgment successful entrepreneurs make regarding the present price of key factors of production and the predicted value of final products these factors help create. Writes Rothbard: What gave rise to this realized profit, this ex post profit fulfilling the producer’s ex ante expectations? The fact that the factors of production in this process were underpriced and undercapitalized—underpriced in so far as their unit services were bought, undercapitalized in so far as the factors were bought as wholes. One can imagine Warren and other progressives replying: “Maybe that is true in a theoretically competitive market, but oil companies and big food companies are not entrepreneurs, but rather are monopolies that regularly manipulate the market to their advantage. Their markets are not competitive, so they are free to set whatever prices they want and name their own profits.” While accusations of “market manipulation” by rapacious monopolies are common among progressives, identifying such actions of “manipulation” is difficult. The standard accusation is that these companies manage to keep supplies off the market, thus forcing up the prices of goods. The problem, of course, is identifying specific instances and also properly identifying scenarios in which such “manipulation” actually is possible. Take fuel prices, for example. If oil and gas companies were to hold back supplies in order to gain temporary price increases, they quickly would have to release those confiscated supplies back into the market (forcing down prices), as there are no secret storage areas that these companies possess that would enable them to set aside the massive quantities of fuel needed to accomplish what Warren and other progressives accuse oil and gas firms of doing. The only way fuel companies can make the kinds of windfall profits that Warren claims they are making is for them to experience either unanticipated surges in demand that overwhelm current supplies or for there to be external events that threaten future supplies and quickly increase the value of those present supplies. As I recently pointed out, the Joe Biden administration is attempting to cripple the oil and gas industries in the future in pursuit of its ill-advised green agenda, and one of the obvious effects of throwing down regulatory roadblocks and dangling criminal charges against fuel company executives for allegedly warming the earth is to ensure that future fuel supplies will be diminished. The upshot of such actions will be to force up the current prices of fuels. As I wrote in that article: While some have called this “regulatory overreach,” there is nothing surprising or shocking about this. The Biden administration response to anything it can tie to “climate change” is going to be heavy-handed and expansive, especially since regulators now believe they have been near-divinely appointed to bring better weather to planet Earth. The Biden administration’s actions have the effect of forcing up present prices because buyers know that the government’s attempts to cripple these industries will mean severely diminished supplies in the future. Such actions cause the value of current inventories to increase, which in the short term will boost industry profits. Since Warren openly supports the Green New Deal and other such measures, she is partly to blame for higher fuel prices even if she refused to admit she is part of the problem. To further emphasize this point, I use Rothbard’s examples to compare the government’s attempts to reduce production of oil and gas with the actions of coffee firms in Latin America to burn part of the year’s harvest to enjoy higher present prices. He writes: But is not monopolizing action a restriction of production, and is not this restriction a demonstrably antisocial act? Let us first take what would seem to be the worst possible case of such action: the actual destruction of part of a product by a cartel. This is done to take advantage of an inelastic demand curve and to raise the price to gain a greater monetary income for the whole group. We can visualize, for example, the case of a coffee cartel burning great quantities of coffee. In the first place, such actions will surely occur very seldom. Actual destruction of its product is clearly a highly wasteful act, even for the cartel; it is obvious that the factors of production which the growers had expended in producing the coffee have been spent in vain. Clearly, the production of the total quantity of coffee itself has proved to be an error, and the burning of coffee is only the aftermath and reflection of the error. Yet, because of the uncertainty of the future, errors are often made. Man could labor and invest for years in the production of a good which, it may turn out, consumers hardly want at all. If, for example, consumers’ tastes had changed so that coffee would not be demanded by anyone, regardless of price, it would again have to be destroyed, with or without a cartel. In the case of fuels, the oil and gas companies are not destroying present supplies or even hiding them in imaginary vaults. Instead, we have a government that does what it can to ensure that future supplies of these fuels will be less available and that firms are on notice that this particular president believes those companies should not even exist. And yet Warren and her colleagues are shocked, SHOCKED, that government-directed reduction of oil and gas supplies means higher present prices for consumers. Furthermore, contra Warren, we should expect fuel and commodity prices to rise substantially during periods of deliberate government monetary debasement (better known as inflation), as commodities historically have had wider price swings during periods of inflation and deflation and are very sensitive to changes in the value of the dollar. The markets for commodities like oil and crops are some of the most competitive markets to be found anywhere. Unfortunately, those that are most responsible for this current upswing in fuel and food prices are the same ones pointing blame elsewhere. Jacob Hornberger in his blog has noted that the Biden administration is taking a page from the Jimmy Carter administration more than forty years ago, which blamed higher prices on private enterprise. Hornberger writes: According to an article in the Washington Post, Biden is “considering whether to escalate an attack on parts of corporate America over rising prices…. The administration would amplify criticisms of large firms in heavily concentrated industries for passing higher prices on to consumers as they benefit from high profits” According to the article, “The White House took a step in this direction earlier this week, with Biden urging the Federal Trade Commission to escalate its investigation of anti-competitive behavior in the oil and gas industry, which the president alleged was leading to higher prices for drivers at the pump.” Readers like me who were adults during that time might remember that many in Congress and the media were calling for full nationalization of the oil industry, and that progressives of that era claimed (as they do now) that oil markets were not subject to ordinary laws of economics. That we have seen these things disproven over the past four decades means little to political, media, and academic elites who spew the same economic nonsense as they did in the 1970s. The explanations given by Austrians at that time, such as Murray Rothbard, still hold true today. We are seeing the natural results of massive monetary manipulation that dwarfs anything the Federal Reserve System and its government allies saw in the late 1970s and a new generation of progressives such as Elizabeth Warren are dusting off the old playbook and, with the help of elites of the mainstream media and academe, are spreading the old economic nonsense all the while destroying the fundamentals of a market economy. One likens them to the Bourbons of early nineteenth-century France after they were restored to power after the turmoil of the French Revolution and the Napoleon years. The French statesman Charles-Maurice de Talleyrand wrote of them, “Ils n'ont rien appris, ni rien oublié.” They have learnt nothing, and forgotten nothing. Tyler Durden Fri, 12/03/2021 - 19:00.....»»

Category: blogSource: zerohedgeDec 4th, 2021

Everything we know about the persistent but unproven rumors that Rep. Ilhan Omar married her brother

No hard evidence has ever surfaced to prove that Omar's ex-husband Ahmed Nur Said Elmi is her brother or that any immigration fraud was committed. Congresswoman Ilhan Omar, D-Minn., speaks Tuesday, April 20, 2021, in Brooklyn Center, Minn., during a news conference at the site of the fatal shooting of Daunte Wright by a police officer during a traffic stopAP Photo/Morry Gash Rep. Lauren Boebert revived unproven rumors sthat Rep. Ilhan Omar married her brother to commit immigration fraud.  Conservative websites have claimed for years that Omar's second husband was really her brother.  No evidence — like a birth certificate or other legal document — has surfaced to prove the theory. Prominent progressive Rep. Ilhan Omar of Minnesota has for years found herself on the receiving end of a slew of incendiary attacks from former President Donald Trump and other Republicans — including persistent but baseless rumors that she married her brother. GOP Rep. Lauren Boebert of Colorado is the latest high-profile conservative to revive the unverified claim amid other Islamophobic attacks and insults against Omar. In a November 17 speech on the House floor, Boebert called Omar a member of the "Jihad Squad" and referred to Omar's "brother-husband." Trump poured more fuel on the fire in a Tuesday statement, accusing Omar, who came to the US as a young girl, of "abandoning her country" and saying "she should apologize for marrying her brother."Omar, who was born in Somalia in 1982, came to America as a refugee with her father and siblings in 1995 by way of a Kenyan refugee camp and resettled in Minneapolis, where she became a US citizen. Omar was elected to the Minnesota House of Representatives in 2016 and to Congress in 2018, one of the first two Muslim women to serve in Congress.At an October 2019 rally in Omar's district in Minneapolis, Trump praised the work of conservative blogger Scott Johnson, who authors the Power Line blog."Everything about Omar is a fraud, including her name," Trump said at the rally. "Scott reports that his sources told him, that Omar's legal husband was Omar's brother, and that she married him for fraudulent purposes, you mean like, coming into the United States maybe?" The unverified rumors that Omar married her brother originated from an anonymous user on a Somali-American internet forum in 2016, and have circulated around the internet ever since.Conservative bloggers have claimed that Omar's second husband, a British citizen named Ahmed Nur Said Elmi, is her brother and that she married him to help him fraudulently gain a US green card.President Donald Trump addresses a campaign rally Thursday, Oct. 10, 2019, in Minneapolis.AP Photo/Jim MonePublic documents contradict some of Omar's story about her marriage historyNo hard evidence — like a birth certificate or other legal documents — has surfaced to prove that Elmi is Omar's brother or that any fraud was committed. Yet Omar has still not explained some discrepancies and inconsistencies in her marriage history.Omar released a lengthy statement when she first ran for office in 2016 to address the persistent rumors that she married her brother, which she called "absurd and offensive," and gave a timeline of her marriage and relationship history.Omar married her first husband, Ahmed Hirsi, in an Islamic faith ceremony in 2002 when she was 19, but the couple did not obtain a legal marriage certificate. The couple had two children together from 2002 to 2008.Omar and Hirsi split in 2008, also in a faith-based, not legal, proceeding.Omar legally married her second husband, Elmi, in 2009.Elmi and Omar separated just two years later, in 2011, but did not get a legal divorce. Elmi moved back to London.Omar and Hirsi got back together in 2012 and had their third child while Omar was separated from but still legally married to Elmi.Omar officially divorced Elmi in 2017 and legally married Hirsi in 2018.Omar filed to legally divorce Hirsi in October 2019, citing an "irretrievable breakdown of the marriage relationship" in her divorce filings. Their divorce was finalized in November 2019, and Hirsi married another woman a little over a month later in December. Omar also remarried, tying the knot with political consultant Tim Mynett in March 2020. Numerous public documents obtained and reported by news outlets including the Minneapolis Star Tribune and the Washington Examiner, however, cast doubt on Omar's official timeline of her marriage and relationship history.As the Star Tribune reported in June 2019, Omar filed joint tax returns with Hirsi in 2014 and 2015 while she was still legally married to Elmi.  She was fined by Minnesota's campaign-finance watchdog for paying a lawyer with campaign funds to fix the mistake, as federal law prohibits people from filing joint returns with a person who is not their spouse.At about the same time, the Examiner published a story reporting that in dozens of publicly available traffic violation and court records, Hirsi "listed his address at a single Cedar Riverside address consistently in 2006, 2008, 2009, 2010, and 2011," the same address Omar listed in separate traffic-violation cases, including during the time she was split from Hirsi.The Examiner further discovered a 2013 local news article which said that Omar and Hirsi "moved to North Dakota so that Omar could finish her bachelor's degree in political science" from 2009 to 2011, the exact time frame during which she was legally married to Elmi, who also attended North Dakota State.Complicating matters further, both the Star Tribune and the Examiner reported that the address in the Minneapolis suburb of Columbia Heights that Omar and Elmi listed on their 2009 marriage-license application was the same location Hirsi listed as his home address when applying for a business license with the state government that same year.Rep. Ilhan Omar speaks to reporters in Statuary Hall on Capital Hill on Tuesday, Jan. 12, 2021.Kent Nishimura / Los Angeles Times via Getty ImagesBut there's still no evidence to support the theory that her second husband was her brother. Omar has not yet given a clear explanation as to why so many public documents point to her and Hirsi living together and being romantically involved while she was legally married to another man, but there is no solid evidence to support the theory that Elmi is Omar's brother.Being a refugee, Omar does not have an original birth certificate. She released the first names of her six siblings in 2016 and provided a Star Tribune reporter with photographs of her and her siblings' original refugee resettlement documents and identification cards — none of which listed Elmi as one of her brothers. The Star Tribune reported that Omar was the youngest of seven siblings, and Elmi is three years younger than she."For someone like me, who left a war-torn country at the age of 8, who got refugee status to come to America, where in the world am I finding a sibling 15 years, 20 years later to seek to do what people accuse me of?" she told the Star Tribune.Some outlets and blogs have pointed to social media posts from accounts supposedly linked to Elmi in which he posted photos of Omar during the period of time she said in her divorce papers that she wasn't in contact with him, where he seemingly referred to her third child as a "niece."The accounts have since been deleted, however. No news outlets have been able to independently verify their authenticity or make contact with Elmi or any of Omar's family members who could confirm that he and Omar are not related.Furthermore, the site Snopes pointed out some significant logical holes in the theory that Elmi is Omar's brother and that she married him to help him gain citizenship.Not only did all of Omar's six siblings also gain refugee status in the US, but siblings can sponsor one another for residency status and a green card under US immigration law — negating the need for Omar and Elmi to commit fraud by getting married if he really were her brother.One Minnesota-based immigration lawyer told the Star Tribune that cases of siblings marrying each other to commit immigration fraud were practically nonexistent, saying, "It is so rare that you would think that it would be more easily uncovered."And more important, if Elmi's intention was to enter into a fraudulent marriage with Omar to gain a green card and settle permanently in the United States, it doesn't explain why he left the US and moved back overseas to London just two years after getting married. If Elmi went to such lengths to commit marriage fraud to stay in the United States, it also doesn't make sense why he did not respond to Omar's multiple attempts to serve him with divorce papers — given that she would have presumably been his sponsor for a green card."Since before she was elected to office, Ilhan has been the subject of conspiracy theories and false accusations about her personal life," a spokesman, Jeremy Slevin, told the Star Tribune in 2019. "Ilhan has shared more than most public officials ever do about the details of her personal life — even when it is personally painful."He added: "Whether by colluding with right-wing outlets to go after Muslim elected officials or hounding family members, legitimate media outlets have a responsibility not to fan the flames of hate."Read the original article on Business Insider.....»»

Category: topSource: businessinsiderNov 30th, 2021

6 things I wish I knew before quitting my job without a backup plan

"I was stubborn and didn't seek out a mentor ... this caused me to lose several years of growth and income," says Lindsay Yaw Rogers. Lindsay Yaw Rogers.Lindsay Yaw Rogers. Lindsay Yaw Rogers is an entrepreneur and brand story coach based in Aspen, Colorado. After quitting her job in tech, she says becoming an entrepreneur was a journey of trial and error. Rogers says it's important to have a solid business foundation to enable steady, long-term growth. See more stories on Insider's business page. I'm a risk-taker. But leaving my high-paying job at a tech startup in 2012 with a one-week old baby — with no plan —  meant my family's income went from comfortable to zero overnight.My husband was developing a wind farm in Chile and not getting paid. But I knew I needed to leave the toxic workplace I'd been in for two years.Nine years into running my business, a brand story and content strategy firm, I've had time to look back on the mistakes I made, the stints of success, and the six things I wish I'd known before going out on my own. 1. Nobody is their strongest aloneEarly on, a phone call to my old boss landed me multiple massive content projects for several large companies. So in the first few years, I didn't have to work hard to get clients — which meant I also became overly confident. Eventually I had nothing in place to help me get more work, but I was stubborn, wouldn't admit that I was frustrated, and didn't seek out a mentor because I thought I knew everything or could figure it out on my own. This caused me to lose several years of growth and income.In the past few years, I've joined a mastermind group, read and listened to countless business books and podcasts, and have taken close to a dozen online courses — all part of my quest for mentorship.2. Normalcy isn't the goalFitting in is the best way to be forgotten. After a client chose not to renew my contract because I "wasn't 100% necessary" for their growth, I took a business course online. It made me realize everything I was not doing — like differentiating myself .My first task was to define my "Dream 100" — the list of people I really wanted on my client list. Easy. Then I had to define what my secret sauce was that would make me different. It took me six months to nail down the process I'd used with past clients and put it into a legible framework I could sell to a higher number of different clients. 3. Fail quickly, fail oftenMy dad used to say, "you never learn less" after anything disappointing happened to me, and it would drive me insane.But after getting humbled several times as an entrepreneur (ie. losing a job bid), I realized he meant that experimenting is how you find your edge, even when some of those experiments completely bomb. Once I accepted that failure was inevitable, I felt less trapped by perfectionism and more free to try new things, create new programs, and go after my "Dream 100." 4. Be more interested than interestingYears into my business, I started listening aggressively to my ideal clients, and moved from trying to be interesting myself to being wholly interested in what they needed. This moved my client roster from start-and-stop to a steady stream, and thus recurring revenue.5. Be prolificA few years back, I went back to my roots and started writing again — this time with a strategy.  I began penning blog and guest posts for brands and entrepreneurial magazines, sending weekly emails, and answering HARO requests. This has allowed others to see how I work and think, what frameworks I use, and how I impact others, which has led to even more opportunities. Just recently, an article I wrote got selected to be in a book being published by Thrive Global.6. The back of the statue matters When I first started working solo, I hated all the unsexy stuff that needed to happen on the back end of my business. But when I started to have a referral drought, I admitted that having no system (the back of the statue) was impacting my reputation and  positioning (the front of the statue that people could see). It took months of toil, late nights, and a full-time virtual assistant to get my systems dialed, but now I communicate my process with clarity.Lindsay Yaw Rogers coaches high-achieving entrepreneurs and athletes on how to create powerful brand stories to  to stand out, create partnerships, and position themselves as a leader.This article originally published July 8, 2021.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderNov 26th, 2021

Tech billionaire whose ex-staff allege he kept a "harem" of women and schemed to kill his critics accuses the New York Post of defamation

Former Sequoia Capital partner Michael Goguen has been accused of sexual misconduct and a murder plot. Goguen says the claims are "ridiculous and defamatory." Musician Won-G, Mike Goguen, and Andrew South arrive at The Grossman Burn Foundation's "Art Of Humanity" Gala at SLS Hotel on October 8, 2010 in Beverly Hills, California.Michael Kovac/FilmMagic Michael Goguen is accusing the New York Post of defamation after the tabloid reported on a lawsuit filed against him. The tech billionaire was a former partner at venture capital firm Sequoia Capital. Goguen says allegations that he recruited women for sex and threatened to have those who would expose him killed are "ridiculous and defamatory." Tech billionaire Michael Goguen is accusing the New York Post of defamation after the newspaper ran a story about a lawsuit that alleges Goguen used his fortune to run an illegal enterprise that recruits, transports, and pays off women for sex. Insider has viewed a copy of a letter that a representative for Goguen sent to the Post, which reported on the lawsuit Saturday in an article by staffer Isabel Vincent."Ms. Vincent and the Post either knew the statements in the article were false, or acted with a reckless disregard as to their truth," reads the letter from Bruce E. Van Dalsem, an attorney representing Goguen.Goguen's attorneys sought to dismiss the lawsuit, which was first filed in February, in June, claiming the plaintiffs didn't have standing to bring the lawsuit and failed to describe a pattern of illegal activity.Four ex-employees of Goguen's — Matthew Marshall, John Maguire, Keegan Bonnet, and Anthony Aguilar — filed a significantly amended version of the lawsuit in September. In it, they allege that the 57-year-old billionaire used his wealth and influence to run a sex trafficking operation in Whitefish, Montana, a town of just over 7,700 nestled in the Rocky Mountains.According to the amended complaint, Goguen had an "extramarital sex life involving tens of women at any given time, which Goguen referred to as 'the harem,'" and made Marshall his fixer. Goguen frequently sent Marshall graphic photos and descriptions of his sexual encounters, and showed him a spreadsheet of around 5,000 women he had sex with, the lawsuit alleges.The billionaire paid women to "have sex with him, to perform other deviant sexual acts with him," and had sex with one acquaintance's wife and 16-year-old babysitter, the lawsuit alleges. When people who learned of Goguen's lifestyle threatened to expose it, the lawsuit alleges he tried to have them killed.But Goguen alleges Marshall may have an ulterior motive for throwing accusations his way. According to a November 5 article from the Flathead Beacon, Marshall struck a deal to plead guilty to federal charges of tax evasion and defrauding Goguen. Marshall is scheduled to be sentenced in March 2022.In a statement to Insider, a spokesperson for Goguen accused Marshall of filing the lawsuit in the hope that it would help him with his criminal case, prior to his plea deal. Goguen's attorneys said in the letter sent to the Post that the other plaintiffs are Marshall's former partner, a cousin, and a man who participated in an alleged money laundering scheme with Marshall. In a separate statement to the Post, Goguen called the claims "ridiculous and defamatory," noting that Marshall was a "recently convicted felon" seeking "to cause my family and I as much damage as possible before his upcoming sentencing.""It's hard to believe that we're at a time in society when disgusting nonsense like this — crafted from the evil and twisted imaginations of a convicted felon to openly and publicly retaliate against his victim — is given the same weight by the media as the fact and evidence-based conclusions reached by the FBI and the criminal justice system," Goguen said.An attorney for the Post didn't respond to Insider's request for comment on Monday.Goguen tasked his head of security with paying off women, the lawsuit alleges Marshall, an alumnus of the State Department, began working for Goguen in 2013 to oversee private security operations.Over time, the lawsuit claims, Goguen made Marshall his right-hand man by installing him as vice president or a trustee of various legal entities.Goguen also tasked Marshall with paying off women and property expenses so that his then-wife wouldn't find out about his affairs, the lawsuit alleges."At Goguen's direction, Marshall was being asked to purchase, out of his personal accounts, vehicles, jewelry, earnest money deposits on properties, and to provide cash or other items for Goguen's mistresses, or as hush-money payoffs," the lawsuit alleges.Goguen also asked Marshall to take care of the women in his "harem" in other ways, according to the amended complaint.On one occasion, Goguen asked Marshall to fly to Africa to help out two Playboy Playmates on a safari who said they lost their passports, the lawsuit alleges. Marshall declined to fly there, the complaint continues, but used local contacts to help the women out.Paying and transporting the women to and from Goguen's properties in the Whitefish area amounted to sex-trafficking, the lawsuit alleges. "Goguen would traffic and pay for his harem of women to have sex with him, or to birth illegitimate children with him, often by purchasing for them through means of interstate commerce, cars, houses, and by giving cash or other items of value for these women to be a part of the Goguen Sexual Scheme," the lawsuit says.Goguen is also accused of asking his security chief to kill people who confronted himOn several occasions, Goguen suggested or instructed that Marshall kill people who confronted him or otherwise threatened to expose his lifestyle, the lawsuit alleges.The first time, according to the complaint, was after Goguen slept with a friend's wife and 16-year-old babysitter. Goguen paid for the friend's wife's legal expenses, which the lawsuit claims made the ensuing divorce "longer and more expensive than it would have been otherwise."He also paid for a security team to track the friend's whereabouts and harass him and his children, the lawsuit alleges.Goguen is accused of amassing land and power in Whitefish, Montana.George Rose/Getty ImagesThe lawsuit alleges that on September 19, 2014, Goguen sent Marshall a message through the encrypted messaging app Wickr, under the alias batman234, where he complains Marshall's efforts hadn't gone far enough."[REDACTED] has pushed me too far and his occasional reminders he might help blow the lid off my personal life requires an extreme response," the message quoted in the lawsuit says. "The cyber route isn't having the impact on him that I was hoping to achieve. Buddy, he's [REDACTED] with my life, career, etc. and the potential for me being destroyed if he gets traction with the authorities or press is significant. This requires an extreme response."Goguen then suggested killing the friend, the lawsuit alleges."He will [REDACTED] destroy the 'bigger picture' for us if he's not stopped. He needs to be killed," the message included in the lawsuit says. "I know that's a VERY big ask but we are in defcon 5. We can discuss details in person but we do NOT have conversations about this on our cell phones. Wickr only…"Goguen then sent Marshall three of the friend's addresses and told him "that last one is up in Lake Tahoe, which is a lot less populated than his other loc," the lawsuit alleges. He also wanted Marshall to target the friend's phones "for cyber crimes," according to the complaint."Marshall did not follow through on Goguen's solicitation to have [the friend] hacked or murdered at 'a lot less populated' location," according to the complaint. "Marshall explained to Goguen that it 'doesn't work this way' and sought to dissuade Goguen from going to extreme measures against his enemies."The lawsuit further alleges that, on one occasion in 2015, Goguen asked Marshall to execute a man whose girlfriend Goguen slept with and who threatened to reveal aspects of the billionaire's lifestyle to his then-wife. And on another occasion later that year, after a hacker Goguen hired refused to surveil and harass his enemies and threatened to call law enforcement, Goguen directed Marshall to "gun him down," according to the complaint.The lawsuit alleges that Goguen used his Silicon Valley fortune to traffic women in WhitefishGoguen is worth around $5 billion, according to The New York Post. The billionaire seemingly accrued his fortune working at Sequoia Capital, a top technology-focused venture capital firm based in Menlo Park, California. In 2012, Goguen told the Flathead Beacon that he'd been part of the Sequoia Capital team that decided to make early investments in tech giants like Google, Yahoo, and YouTube. A 2014 profile from Forbes lists Goguen as one of the top partners at Sequoia. He began using some of that money to make a splash in Whitefish and the surrounding region. The Flathead Beacon reported that Goguen had spent "$10 million in personal funds" to help the region establish a "state trust land plan" resulting in the Whitefish Trail; furnished law enforcement with "state-of-the-art helicopters;" and poured money into local philanthropic causes. Goguen said he was just giving back to the community."I view coming up here as a relief valve," he told the Flathead Beacon. "It's a wonderful counterbalance to my day job."Representatives for the city of Whitefish didn't respond to Insider's request for comment on Monday. According to the lawsuit, Goguen's vast 3,200-acre estate outside Whitefish includes a 75,000 square-foot house; another 10,000 square-foot lake house; other houses for family members and staff; and a 25,000 square-foot underground bunker designed to withstand nuclear blasts. The lawsuit also alleges Goguen owned "safe houses" in the area where he conducted extramarital affairs with women, including ones he trafficked.In the lawsuit, Marshall alleges that Goguen poached him from his job at the US State Department, and that the two men founded the Amyntor Group, a private security business. Marshall's co-plaintiffs, Aguilar, Bonnet, and Maguire, were recruited to work for Amyntor. The lawsuit alleges that when their work relationship soured, Goguen conspired to "falsely accuse Marshall of wire fraud, money laundering, and tax evasion to the FBI and IRS." This isn't the first time that Goguen's sex life and financial dealings have come under scrutiny. In 2016, the billionaire's former mistress, Amber Laurel Baptiste, accused Goguen in a lawsuit of sexual, physical, and emotional abuse, as well as human trafficking. According to the recent lawsuit against Goguen, the billionaire had at one point suggested Marshall kill Baptiste as well.Baptiste ultimately lost her lawsuit and was ordered to pay more than $10 million to Goguen, as well as abide by a restraining order. A spokesperson for Goguen said in a statement to Insider that Baptiste is the only person to accuse Goguen of misconduct.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderNov 23rd, 2021

Afghans say the Taliban is too busy policing women to prevent a humanitarian disaster that could leave half of Afghanistan hungry this winter

Three months into Taliban rule, half of the population of Afghanistan faces acute food insecurity between now and March, the UN says. Afghan children play in the Saray Shamali encampment in Kabul on Nov. 2, 2021.HECTOR RETAMAL/AFP via Getty Images Three months into Taliban rule, 22.8 million Afghans could face acute hunger this winter, the UN says. The Taliban has been cut off from $9.5 billion in assets and loans. Unemployment is widespread.  The Taliban "obsesses" over women's daily activities while failing to manage basic needs, Afghan women said in a recent viral video. Last month, Zahra Mohammadi, a doctor in Kabul, called on a small cadre of fellow professional women to gather up their spare coats and winter clothes, and rented a minibus.The plan was to drive to the makeshift encampment on the northern edge of Afghanistan's capital that's become home to scores of displaced Afghans and distribute the warm clothing. "We knew we didn't have much ourselves, but we had to do something," Mohammadi said from her job at a busy clinic. (The Taliban has forced some women to abandon their jobs, but female doctors have continue to work.) "Some people felt bad giving clothes they had worn once or twice, but we told them, 'It's okay, these people have nothing.'"But when they arrived at the encampment, crowds of people rushed toward their minibus. It quickly became obvious that they had miscalculated not only the scale of need, but also how complex it would be to distribute the donations. "Some families did have tents, but so many others had gathered whatever fabric they could find to hang over their heads as shelter," Mohammadi said.Mohammadi and the others tried to maintain calm as they handed things out, but people were running towards the car as fast as they could, reaching for anything within their grasp and begging for help.  A women holds a child in the encampment that displaced Afghans have set up in Kabul's Saray Shamali neighborhood on Nov. 2, 2021.HECTOR RETAMAL/AFP via Getty ImagesSensing that the situation was getting out of hand, Mohammadi told the driver to go. "Even then, we just saw these boys and men chasing after our car. Some were hanging onto the sides. I don't know what they were hoping to achieve," she said.Outraged by what she had seen, Mohammadi and her colleagues shot a video accusing the Taliban of being too "obsessed" with criminalizing women's daily activities to manage the basic needs of the country. The video soon circulated widely among Afghans.  "They've made it their mission to go after women. We're all they talk about. Our clothes, our shoes, our scent, our work, our school, they spend so much time dictating our lives," Mohammadi said during a phone interview the next day. "They spend so much of their time worrying about us women when they could be helping the millions in need."She had to pause the interview a few times, as she juggled her formal and informal roles. One minute, she was asking a nurse about a patient's discharge papers. The next, she could be heard greeting female visitors who had come to talk about another plan to assist Afghans in need. In the three months since the Taliban took control of Afghanistan, the economy has been crippled. Almost countless numbers of people lost their jobs overnight and even more haven't received their salaries. To prevent a run on banks, where lines on most days run hundreds of people deep, financial institutions have limited withdrawals to $400. The United Nations warns that 22.8 million Afghans – over half of the population – face acute hunger between now and March. "A humanitarian catastrophe looms"Before the Taliban took Kabul on Aug. 15, completing its sweep of the country as US troops prepared to end their 20-year war, Afghanistan's Western-backed governments were buoyed by two decades of foreign aid. A line at a World Food Program food distribution site in Kabul on Nov. 6, 2021.HECTOR RETAMAL/AFP via Getty ImagesJust two weeks after the Taliban takeover, United Nations Secretary-General António Guterres said "a humanitarian catastrophe looms" in the country.Since then, those warnings have only grown more dire. The World Food Programme says that Afghanistan is becoming the world's largest humanitarian crisis, with 8.7 million people facing  emergency levels of hunger this winter. The World Health Organization said 3.2 million children are expected to suffer from acute malnutrition in Afghanistan by the end of this year. In the three months since President Ashraf Ghani fled the country and the Taliban's all-male administration took over, the US and international organizations have cut off Afghanistan's access to $9.5 billion in assets and loans. Even Afghans with means are facing pressure, as regulations on banking withdrawals and the falling value of the Afghani, Afghanistan's currency, has led to a severe cash crunch across the country.Taliban spokesman Suhail Shaheen has said Western countries should make good on their promised aid immediately. "The winter is around the corner, so there is an immediate need for the international community to urgently disburse the recently announced nearly one-billion-euro aid package pledged … to all poor, vulnerable and displaced people," Shaheen told the media last month.Afghan men wait outside a bank in Kabul on Sept. 22 2021.Oliver Weiken/picture alliance via Getty ImagesMeanwhile, the Taliban launched a work-for-wheat scheme, but grim jokes began to spread on social media and messaging apps saying that "wheat" has replaced the Afghani as Afghanistan's natural currency. 'I don't know how much longer I can keep things going'The crisis stretches well beyond the capital.Near the Tajik-Afghan border in Badakhshan province, one of Afghanistan's coldest areas, people are struggling to buy wood and coal to heat their homes. Prices for these things traditionally go up every year as the temperature drops, which people manage by taking out loans. But this year, they, like millions of other Afghans, are left to wonder how they will make due during the cold months.Farhan Hotak, a vlogger was recently traveled to the area, said Badakshis in the border regions are now "living off limited resources." In the past, people were able to secure loans from relatives and neighbors to survive, but Hotak said that has largely come to an end, as people are struggling to provide for their own families."No one can afford to lend money anymore," Hotak said from Tajikistan.The region is heavily reliant on crossborder trade, which has been disrupted by a diplomatic spat since Tajikistan has refuses to acknowledge the Islamic Emirate as Afghanistan's legitimate government and the Taliban accuse Tajikistan of harboring resistance forces in the Northern province of Panjshir."People used to trade buy and sell among each other, but that came to an end after the Taliban takeover," Hotak said.Afghan men work at a coal market in Kabul on Oct. 17, 2021.Saifurahman Safi/Xinhua via Getty ImagesHotak says that businessmen in the provincial capital, Faizabad, are also struggling. He said he met dozens of entrepreneurs who had left the city and were heading to Tajikistan in hopes of making some money.In Kabul, hundreds of offices and businesses have shuttered. Nawab Niazi, the owner of a textile factory, says that in years past he employed 70 to 80 people, but now he can only afford to pay 10 or 12 people at reduced wages.  "I don't know how much longer I can keep things going. When we run out of cash, we'll have no choice but to shut," he said in an interview. Niazi is wont to have his staff join the list of his family and friends who have spent the last three months in unemployment. He estimates that 90 to 95 percent of the people he knows in the capital are now jobless.Niazi says Afghan business owners are facing enormous pressure to stay open. But without easy access to their bank accounts, they're struggling to pay their workers and their suppliers."We're burning through our reserves. Once that's gone, I won't be able to pay anyone at all," Niazi said. Afghans with government jobs haven't fared much better.The public sector has for years been one of Afghanistan's biggest employers. But without foreign aid, many government workers have not been paid in months. The Security Forces and several ministries are operating at a minimum capacity, if at all. Hundreds of people who worked as bodyguards, drivers and cleaners to the former government are now unemployed as well.Afghan boys play at Chaman-e-Hozori park in Kabul on Nov. 12, 2021.HECTOR RETAMAL/AFP via Getty ImagesWhile unemployment is a problem across Afghanistan, it used to be that women could work and contribute to the family income. The fact that so many women now stay at home has only exacerbated the nation's financial woes, Mohammadi said. One of the Taliban's first acts was to convert the Ministry of Women's Affairs back into the Ministry for the Propagation of Virtue and Prevention of Vice, which watchdog groups like Human Rights Watch had once denounced as "a notorious symbol of arbitrary abuses, particularly against women and girls."But another casualty of the shift was that the old ministry had employed hundreds of women, many of whom were the sole breadwinners of their families. Similarly, female judges, teachers, journalists, and office workers found themselves unemployed overnight. "Those women are now at home wondering how to feed their families," Mohammadi said.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderNov 15th, 2021

Business coaching is red hot thanks to TikTok and Instagram, but remains unregulated. Here are 7 steps to find the right coach.

Social media plays an important role in how coaches build their reputations, but it can be difficult to tell who's legit. Young entrepreneurs are turning to influencer coaches offering their services through social media. Inside Creative House/Getty Images A growing industry of young, female coaches are helping entrepreneurs launch online businesses. Coaches use social media to build their reputations, but it can be difficult to tell who's legit. Here are seven steps to take and four red flags to look out for before hiring a business coach. When influencer Brittany Jack started her Instagram marketing business in January, she had 10,000 followers on the platform. A month later, she signed up for business-coaching sessions with Maya Elious, a brand strategist who helped her double her follower count and reach 200 clients by October. She wouldn't have been able to do it without Elious' help, Jack said."Having a business coach to navigate a lot of growth has been integral to my journey," Jack, 29, added. Influencer and creative director Brittany Jack started her business on Instagram in January. Mecca Gamble Photography Both Jack and Elious are part of a growing industry of young, female coaches helping entrepreneurs launch and scale their online businesses through upbeat Instagram reels, inspirational quotes, and online courses. In 2019, business coaching was a $15 billion industry, and it's expected to grow 5.8% in 2021.But not everyone's experiences with coaching programs are as rosy as Jack's. Social media plays an important role in how coaches build their reputations, but it can be difficult to tell who's legit. Last year, after starting her credit-card-points podcast, "Geobreeze Travel," Julia Menez saw an ad on Instagram for a website called The Bundle Co., which sells a package of online courses for $99.50. She signed up but was disappointed to find that the courses only covered surface-level topics, such as journaling and YouTube basics, not the business and marketing tips she'd hoped for."With business coaching, oftentimes you do get what you pay for," Menez, 31, said.Here's how to find the right business coach and avoid getting scammed, plus red flags to watch for, according to seasoned coaches and entrepreneurs who've worked with them. How to find the right business coach1. Follow before you investJessica Caver Lindholm, 36, has been an online-business coach for eight years and has hit $814,000 in gross income this year, documents reviewed by Insider showed. She advised entrepreneurs not to rush into anything just because it sounds exciting. "When something is marketed really well, it can make us feel like we have to have it now or else," Lindholm said. Instead, take your time to research, read testimonials, and call up a couple of former clients. Gauge a coach's values by paying attention to what she says on social media. "You have to get an idea of who they are and how they operate," said Debbie Rebar, who has been a virtual assistant for 19 years to authors, speakers, and business coaches.For example, Rebar said some people have complained that her client Amanda Frances swears in her courses - something they would have known had they followed Frances and paid attention to her posts. 2. Get free content firstCheck out free content, which many coaches offer, such as guides and templates to help you test whether their methods work for you, Lindholm said.Rebar suggested signing up for a coach's email list to assess their level of expertise. "See if that's closely related to what you need help with," she said. 3. If the coach is new, look for a focus Just because someone is new to coaching doesn't mean they can't be helpful. But Lindholm suggested ensuring that fresh talent had specified skills, such as marketing on Instagram reels or TikTok. If you're looking for a breadth of business knowledge, stick with more experienced coaches."So that you know that they really have had the time to practice and live what they preach, and that it's not just one well-written post," she said. Jessica Caver Lindholm has been an online-business coach for eight years. Amalie Orrange 4. Have an introductory meetingNot all coaches offer introductory meetings, but if you find a coach who does, take it. "Be clear about what you need help with and ask that coach directly if that's something they can help you with," Rebar said.5. More expensive does not always mean betterRebar said a common misconception in the industry is tying value with price. But she's seen coaches with less experience price high and more experienced coaches price low. "We've conditioned ourselves as a society to think that the more expensive one is better, and that is not always the case," she said. At the same time, Menez cautioned entrepreneurs to be skeptical of extremely low prices. "When entrepreneurs are starting out, it is always about cutting costs," she said. "Invest in yourself a little bit more. You will get higher quality as long as you do proper research."6. Get your purchase in writingOnce you're ready to sign up for a coaching session, make sure there's a written agreement that covers everything you're getting out of it. "It helps it feel more like an agreement was made rather than you're not even sure why you signed up," Lindholm said. 7. Red flags to look forNow that we've covered what you should do before hiring a business coach, here are some red flags that might indicate a coach isn't the right fit. If a business coach pressures you to sign up quickly to secure your spot, it may mean they're desperate. If a coach markets themselves as a business coach but only has testimonials from other coaches, it could indicate that she's going to teach you how to become a coach, not run your business. If a coach gets a lot of negative comments on their posts, it might be worth reaching out to those people to get their perspective before signing up for her services.Courses and programs tout a community, such as a Facebook group, but members aren't active, or posts only market the program rather than generate discussion.Have you used a business coach you found on Instagram, TikTok, or Clubhouse? Contact this reporter at jortakales@insider.com to share your story.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderNov 15th, 2021

Fewer than 200 Black female founders have ever received $1 million in VC funding. 7 women who did it share their best fundraising advice.

Insider spoke with some Black female founders who've raised over $1 million to fund their businesses. Here's the playbook they followed. Britney Winters, Joanna Smith, and Tanya van Court. Courtesy of Britney Winters, Mamadi Doumbouya, and Tanya van Court; Skye Gould/Insider The venture-capital space isn't the most welcoming environment for Black women. As of 2020, only 93 Black women had raised $1 million or more in venture funds. Black women who have achieved this feat gave advice for others looking to do the same. Tanya van Court noticed immediately that white male investors weren't backing her business.Van Court, who is Black, launched the app Goalsetter in 2016 to teach children how to invest and save money. After raising her first $1 million in venture capital in 2018, she noticed almost 90% of her investors were from marginalized communities. Today, Goalsetter, which uses gamification to teach children healthy financial habits, has 367,000 users and received a $1 million investment from Nike in February.She recalled white investors telling her Goalsetter was "uninvestable" and kids' fintech "wasn't a thing."Then, she'd see those same investors fund a similar startup created by a white founder, she said.This cycle continued until the murder of George Floyd. Then, people started paying attention to Black-owned businesses, she said. In January, her company closed a $3.9 million seed round that included the basketball stars Chris Paul and Kevin Durant as investors, and to date, her company has raised $6 million in venture capital.The number of Black women like van Court who are raising $1 million or more in venture capital is increasing but still small - 93 as of December, up from 34 in 2018, according to the demographic study ProjectDiane. One founder said investors tended to fund people who look like them, and 70% of venture capitalists are white - according to 2019 data from Richard Kerby, a cofounder of the venture fund Equal Ventures, only 2% of venture capitalists identified as Black men in 2018 and 1% as Black women.Recall the question of who gets to be an entrepreneur in the first place. Research has found it's those born into wealth. Van Court said it would take decades to see whether venture capitalists kept their promise to invest in Black businesses. Tanya van Court To be a Black female founder is to be doubly minoritized in a highly homogenous space. And - like in corporate America - these Black women must navigate structural barriers, closed networks of contacts, code-switching, racialized expectations, and the norms of the majority group to succeed and receive investment.Insider spoke with van Court and six other Black female founders who've raised more than $1 million in venture capital to find out how that feat could be accomplished. The resulting guide contains their insight on choosing the right investors, pitching prospective funders, and building positive relationships with other entrepreneurs.As the responsibility for change doesn't lie solely on the shoulders of the marginalized, the women also shared their thoughts on what venture-capital firms could do to bring more equity to the world of venture.Here are the best practices, according to them.Come ready with numbersAs of 2020, according to ProjectDiane data, the median seed round for Black female entrepreneurs was $125,000, compared with the national median of $2.5 million. And alongside Latina female founders, the two groups received just 0.43% - or $715 million - of the $166 billion in venture-capital funding raised in 2020, ProjectDiane found. !function(){"use strict";window.addEventListener("message",(function(e){if(void 0!==e.data["datawrapper-height"]){var t=document.querySelectorAll("iframe");for(var a in e.data["datawrapper-height"])for(var r=0;r.....»»

Category: dealsSource: nytNov 7th, 2021

Argosy Investors 3Q21 Commentary: DFH, GO, RRTS Stock Declines

Argosy Investors commentary for the third quarter ended September 2021, disucssing the decline in stock price of Dream Finders Homes, Grocery Outlet Holdings and Roadrunner Transportation Systems. Q3 2021 hedge fund letters, conferences and more Dear Investors, Year-to-date 2021 performance was 17.1% in select accounts. The S&P 500 by comparison returned 15.9%. This quarter our […] Argosy Investors commentary for the third quarter ended September 2021, disucssing the decline in stock price of Dream Finders Homes, Grocery Outlet Holdings and Roadrunner Transportation Systems. .first{clear:both;margin-left:0}.one-third{width:31.034482758621%;float:left;margin-left:3.448275862069%}.two-thirds{width:65.51724137931%;float:left}form.ebook-styles .af-element input{border:0;border-radius:0;padding:8px}form.ebook-styles .af-element{width:220px;float:left}form.ebook-styles .af-element.buttonContainer{width:115px;float:left;margin-left: 6px;}form.ebook-styles .af-element.buttonContainer input.submit{width:115px;padding:10px 6px 8px;text-transform:uppercase;border-radius:0;border:0;font-size:15px}form.ebook-styles .af-body.af-standards input.submit{width:115px}form.ebook-styles .af-element.privacyPolicy{width:100%;font-size:12px;margin:10px auto 0}form.ebook-styles .af-element.privacyPolicy p{font-size:11px;margin-bottom:0}form.ebook-styles .af-body input.text{height:40px;padding:2px 10px !important} form.ebook-styles .error, form.ebook-styles #error { color:#d00; } form.ebook-styles .formfields h1, form.ebook-styles .formfields #mg-logo, form.ebook-styles .formfields #mg-footer { display: none; } form.ebook-styles .formfields { font-size: 12px; } form.ebook-styles .formfields p { margin: 4px 0; } Get The Full Ray Dalio Series in PDF Get the entire 10-part series on Ray Dalio in PDF. Save it to your desktop, read it on your tablet, or email to your colleagues (function($) {window.fnames = new Array(); window.ftypes = new Array();fnames[0]='EMAIL';ftypes[0]='email';}(jQuery));var $mcj = jQuery.noConflict(true); Q3 2021 hedge fund letters, conferences and more Dear Investors, Year-to-date 2021 performance was 17.1% in select accounts. The S&P 500 by comparison returned 15.9%. This quarter our holdings experienced mixed performance. Some of the portfolio companies I have invested in most recently have done the worst of late (more on that later). We are sharpening our pencils on depressed names in and out of our portfolio, trimming more richly valued names, and slowly consolidating the portfolio into our best ideas. We feel a portfolio of ~30 businesses, with the top 10-15 representing a significant majority of our equity exposure is a prudent way to grow our wealth without being too concentrated. This chart shows that as a portfolio increasingly diversifies beyond 20 stocks (they must not be significantly correlated to one another), the benefits of additional diversification diminish substantially. We think that this is the correct way to think about long-term investment. As Omaha’s most famous investor, Warren Buffett, would remind us, if we owned 5 or 6 well-positioned businesses in the town or city in which we live, no one would accuse us of being too concentrated. The above passage is a bit aspirational, if I’m being honest. I greatly respect the trust put in me by the people whose money I manage, and if I were to put 25% of their money into an investment that went horribly, I would feel terribly. Having a bit more diversified portfolio than the above chart would suggest is optimal is a bit of insurance against my own ignorance. Existing Portfolio Activity: ESI, TAP, EPAM, DAVA, GDYN, WFC, GXO, JD This section will sound repetitive to last quarter’s section on existing positions. I trimmed or eliminated our stakes in Element Solutions Inc (NYSE:ESI), Molson Coors Beverage Co (NYSE:TAP), EPAM Systems Inc (NYSE:EPAM), Endava PLC (NYSE:DAVA), Grid Dynamics Holdings Inc (NASDAQ:GDYN), GXO Logistics Inc (NYSE:GXO), JD.Com Inc (NASDAQ:JD), and Wells Fargo & Co (NYSE:WFC) during the quarter. Each of these had appreciated significantly since purchasing and I considered none of them except DAVA, GDYN, and EPAM a core position at this time. DAVA, GDYN, and EPAM continue to discount multiple years of 20%+ growth and even still would be valued at >30x 2024 earnings. We are slowly trimming here despite the strong growth of the businesses. GXO was a spin-off of XPO, and we elected to keep the XPO business because we do not perceive GXO's contract logistics business as inherently attractive. We sold JD as a result of the furor over Chinese stocks during the quarter. We had been concerned about China’s lack of respect for investor rights for some time, and Beijing has become significantly more aggressive in asserting itself of late. In addition, the legal structure Chinese companies use to come public in the U.S., a Cayman Islands shell corporation leaves American investors with an unsure path to recovering value should these companies cease to trade on U.S. exchanges. Because of the uncertainty, we exited our position in JD completely. We still love JD's long-term prospects, but we cannot estimate the legal/regulatory risk associated with these companies anymore. More broadly, we are freeing up cash for some other positions we already own which have declined in this market, and after additional review, remain attractive. Dream Finders Homes Dream Finders Homes Inc (NASDAQ:DFH), like Grocery Outlet below, was down over 30% since our first purchases during the first quarter of this year. Their stock price declined significantly due to a large shareholder, Boston Omaha, offloading almost 10% of the publicly-traded shares of DFH in a short period of time. This was unexpected because Boston Omaha presents itself to public markets as a patient long-term investor, like Warren Buffett. In fact, one of the two principals of Boston Omaha is directly related to the Oracle of Omaha. The timing was curious as well because DFH announced a fairly large acquisition around the time that Boston Omaha’s share sales began. Some could interpret this pattern as a lack of confidence in the acquisition, but it is equally plausible that Boston Omaha sold DFH shares to generate cash to fund its other investments, particularly funding their recently-announced SPAC deal, leaving us an opportunity to acquire shares at an attractive price. Importantly, so far the founder and CEO of DFH has elected not to sell any of his shares, even though he is now allowed to. The acquisition of McGuyer Homes, doing business as Coventry Homes in Texas, for $475 million is a big deal for DFH. It was funded with cash on hand and $150 million of preferred stock paying dividends at a 9% rate. DFH agreed to pay additional money to McGuyer if they achieve certain thresholds, which gives us insight into DFH’s expectations for the business, as well as earnings levels the sellers of McGuyer believe are reasonable to hit. For 2022, the earn-out threshold is $66 million. Below that amount, DFH owes the sellers nothing. If McGuyer is able to hit this threshold, then DFH is paying 7x pre-tax income for these assets in the fast-growing Austin, TX market. The other important element to this deal is that DFH structured the transaction so that they remain an asset-light homebuilder. McGuyer’s sellers will retain $100 million in real estate inventory, and DFH has the option to purchase that inventory over the next 2 years. I have to believe that many homebuilders would be reticent to agree to such terms, so while some in the market may view this deal negatively, I believe DFH is being disciplined in pursuing this deal. We will just have to see as the future unfolds. Given the additional earnings from the McGuyer assets, I believe that DFH is now capable of producing >$2 in earnings in 2022. Obviously, interest rates, raw material prices, labor availability, and other factors could impact their ability to deliver this result, but I think that DFH could be worth ~$30 based on 2022 earnings, nearly 100% higher than recent prices. Future growth could justify prices above $50 over the next several years. Grocery Outlet Holdings Grocery Outlet Holding Corp (NASDAQ:GO) stock has declined significantly, over 30%, since our initial purchase. I don’t especially enjoy sharing our failures, even short-term ones, with you. I hope by being transparent with you about both the good and the bad that I will earn your trust over time. GO’s decline was particularly surprising to me because they are a chain of grocery stores with a long runway for growth nationwide. It seems like GO’s extremely predictable drop in sales from a pandemic-driven spike in 2020 has spooked some investors, temporarily. I am often surprised by how short-term Wall Street can be, and I believe GO’s decline represents an attractive opportunity to add to our position, which I did during the 3rd quarter. We believe the long-term returns in the mid-teens are still intact, and we think the recent decline could allow our returns to be closer to 20%+ in the short-term if our thesis for the business turns out to be correct. Roadrunner Transportation Systems Roadrunner Transportation Systems Inc (OTCMKTS:RRTS) stock “declined” almost 100% during the quarter. I write “declined” in quotation marks because I don’t actually believe the value of this position declined at all. There was an SEC rule change implemented during the quarter designed to protect small investors. The rule change required companies to prepare publicly available financial information in order for brokers to quote their prices. Since RRTS is owned 90% by Elliott, a prominent hedge fund, they made the decision months ago to save money by ceasing many financial reporting requirements during their turnaround. As a result, the brokers where your accounts reside will not quote a price for our shares. We believe RRTS will emerge back onto the public markets in due course, but for now they are essentially a private company. We will have to wait an indefinite period of time to learn what happens to our investment. My initial thesis still remains valid that RRTS is turning around its LTL business to become a profitable competitor alongside XPO and ODFL. With that said, Elliot has a reputation for having “sharp elbows” and it is within the realm of possibility that our very small investment into RRTS could become worthless at some point. I will update you when there is progress on this company. New Portfolio Activity We didn’t add any new positions this quarter, as we have been researching a number of positions. We currently see many opportunities to increase concentration in our existing portfolio, but that is not to say that we won’t invest in new opportunities when it makes sense. We are, however, trying to consciously focus more of our portfolio on our best ideas. Conclusion Thank you for your confidence in me. It is humbling that some of the people I care most about in this world have trusted me to grow their hard-earned wealth. Investing entails risks, sometimes difficult to foresee before they occur, and I heavily weigh the many hours of work that went into creating the wealth in the first place against the risks I assume in making any given investment. While it can seem tempting to act when things are not going our way, and there will be times when things are really not going our way, patience and emotional stability are probably the two most important investment attributes. Without these, the best analytical prowess is wasted on the next new shiny thing, and in the worst of times, the highly analytical investor without the emotional stability to withstand adversity will not see things through. In fairness, my own direct experiences in the investment world are limited to the years after the Great Financial Crisis. My only experiences with market adversity have been relatively brief, and the market has always climbed back relatively quickly. Please prepare yourself now for those inevitable times in any person’s investing life when the unthinkable occurs and it has profound financial consequences on all of us. That time will happen at some point, and the more we prepare ourselves emotionally now, the better we will be able to endure the disappointment of losses in our portfolio and continue to invest. We face an opposite challenge today: the market is making a lot of us who invest look pretty smart. I try to continue pushing the portfolio forward during these times but with a deep (if vicarious) appreciation for the potential to sustain abrupt  and significant losses. We will be tested, and I look forward to doing my best to help you navigate those times with patience and equanimity. Until January, Argosy Investors Updated on Oct 26, 2021, 11:18 am (function() { var sc = document.createElement("script"); sc.type = "text/javascript"; sc.async = true;sc.src = "//mixi.media/data/js/95481.js"; sc.charset = "utf-8";var s = document.getElementsByTagName("script")[0]; s.parentNode.insertBefore(sc, s); }()); window._F20 = window._F20 || []; _F20.push({container: 'F20WidgetContainer', placement: '', count: 3}); _F20.push({finish: true});.....»»

Category: blogSource: valuewalkOct 26th, 2021

“Main Street Against Big Tech” Campaign Launches

Main Street Alliance members add their voices to Accountable Tech’s “Main Street Against Big Tech” Campaign, to reveal realities of tech monopolies‘ impact on small businesses Q3 2021 hedge fund letters, conferences and more Six-Figure National Campaign Shares the Experiences of Over a Dozen Small Business Owners Across the Country Accountable Tech Launches Main Street […] Main Street Alliance members add their voices to Accountable Tech’s “Main Street Against Big Tech” Campaign, to reveal realities of tech monopolies‘ impact on small businesses if (typeof jQuery == 'undefined') { document.write(''); } .first{clear:both;margin-left:0}.one-third{width:31.034482758621%;float:left;margin-left:3.448275862069%}.two-thirds{width:65.51724137931%;float:left}form.ebook-styles .af-element input{border:0;border-radius:0;padding:8px}form.ebook-styles .af-element{width:220px;float:left}form.ebook-styles .af-element.buttonContainer{width:115px;float:left;margin-left: 6px;}form.ebook-styles .af-element.buttonContainer input.submit{width:115px;padding:10px 6px 8px;text-transform:uppercase;border-radius:0;border:0;font-size:15px}form.ebook-styles .af-body.af-standards input.submit{width:115px}form.ebook-styles .af-element.privacyPolicy{width:100%;font-size:12px;margin:10px auto 0}form.ebook-styles .af-element.privacyPolicy p{font-size:11px;margin-bottom:0}form.ebook-styles .af-body input.text{height:40px;padding:2px 10px !important} form.ebook-styles .error, form.ebook-styles #error { color:#d00; } form.ebook-styles .formfields h1, form.ebook-styles .formfields #mg-logo, form.ebook-styles .formfields #mg-footer { display: none; } form.ebook-styles .formfields { font-size: 12px; } form.ebook-styles .formfields p { margin: 4px 0; } Get Our Activist Investing Case Study! Get the entire 10-part series on our in-depth study on activist investing in PDF. Save it to your desktop, read it on your tablet, or print it out to read anywhere! Sign up below! (function($) {window.fnames = new Array(); window.ftypes = new Array();fnames[0]='EMAIL';ftypes[0]='email';}(jQuery));var $mcj = jQuery.noConflict(true); Q3 2021 hedge fund letters, conferences and more Six-Figure National Campaign Shares the Experiences of Over a Dozen Small Business Owners Across the Country Accountable Tech Launches Main Street Against Big Tech On Friday – Ahead of next week’s Q3 earnings reports from Facebook, Google, and Amazon – Accountable Tech, including stories from Main Street Alliance members, launched “Main Street Against Big Tech,” a six-figure national campaign and storytelling effort to demonstrate the variety of ways in which Big Tech squeeze and exploit small businesses across the country. For too long, Big Tech corporations have used small business owners as a shield to protect them from real reform and accountability, cynically casting themselves as saviors of mom-and-pop shops and lifelines for entrepreneurs. But the truth is that Big Tech exploits small businesses at every step of the way by providing misleading and unreliable data, imposing hidden costs, designing confusing interfaces, making abrupt changes in their rules and algorithms, and having inadequate customer service. “In an effort to avoid regulatory scrutiny, monopolists like Facebook, Google, and Amazon have spent millions of dollars persuading lawmakers and the public that their business products are a lifeline for small businesses when in fact the opposite is true,” said Nicole Gill, Co-Founder and Executive Director of Accountable Tech. “These corporate giants abuse their power to exploit small business owners, extracting monopoly fees for access to the digital economy and draining them of resources that would otherwise be reinvested in their communities. But now small business owners are fighting back by sharing their lived experience to expose the real relationship between Big Tech and Main Street.” “Guardrails on Big Tech are incredibly important to small businesses competing on and with these giant platforms that also determine and control the avenues to reaching customers,” said Didier Trinh, Director of Policy and Political Impact at Main Street Alliance. ”As stories from our members show, this has been an ongoing issue that is directly impacting small business bottom lines and competitiveness. Antitrust regulation and enforcement is one place where we can look to build a more resilient and fair economy coming out of the pandemic.” This new campaign – launched by Accountable Tech with support from Main Street Alliance, Small Business Rising, the Institute for Local Self-Reliance, and the American Economic Liberties Project – will continue to highlight stories of small business owners across industries who have experienced first-hand the ways in which Big Tech abuses its monopoly power to pad profits at their expense. Through compelling video testimonials, as well as a storybook, paid ads, and earned media, Main Street Against Big Tech will cut through the false narratives long spun up by Silicon Valley giants and reveal the truth. Watch the Teaser Video for the Campaign Visit the Website to Watch Videos of the Small Business Owners View the Storybook of Small Business Owners Guadalupe (Lupe) Ramirez Owner of AlterNatives Boutique, MSA Member Richmond, VA Lupe is the owner of AlterNatives boutique store in Richmond, Virginia. She created AlterNatives with the idea that the marketplace is a sacred space in which everyone should receive access to equal opportunity. She works directly with local and international artisans to sell their fair trade products. Anita Thomas Executive Director of Carolyn Dorfman Dance, MSA Member Union, NJ Anita is the Executive Director of Carolyn Dorfman Dance. She manages the dance company’s roughly million dollar annual budget and oversees a digital team that works on digital marketing and social media. Aaron Seyedian Founder of Well-Paid Maids, MSA Member Takoma Park, MD Aaron is the CEO and Founder of Well-Paid Maids. He created Well-Paid Maids to help prove that living-wage businesses can be successful in traditionally low-paying industries. Douglas Reynolds Owner of The Charleston Gazette-Mail, MSA Member Charleston, WV Doug is the owner of HD Media, which owns several newspapers in West Virginia including The Charleston Gazette-Mail. In 2021, he sued Facebook and Google for their duopoly on digital ads that undermines local news media including his newspaper business. Gina Schaefer CEO of 13 ACE Hardware Stores, Small Business Rising Member Washington, DC Gina is the owner of 13 ACE Hardware Stores across the Virginia, Maryland, and D.C. area. She operates these stores as co-ops with ownership now shared for some stores between her and her 200+ employees, who she calls teammates. David Guernsey CEO of Guernsey Office Products, Small Business Rising Member Sterling, VA David is the CEO and Founder of Guernsey Incorporated, one of the largest independent business products dealers in the United States. They provide supply chain and procurement management services for office supplies for small and medium-sized businesses across the country. About Main Street Alliance Main Street Alliance is a national network of small business coalitions working to build a new voice for small businesses on important public policy issues. Alliance small business owners share a vision of public policies that work for business owners, our employees, and the communities we serve. Updated on Oct 22, 2021, 12:41 pm (function() { var sc = document.createElement("script"); sc.type = "text/javascript"; sc.async = true;sc.src = "//mixi.media/data/js/95481.js"; sc.charset = "utf-8";var s = document.getElementsByTagName("script")[0]; s.parentNode.insertBefore(sc, s); }()); window._F20 = window._F20 || []; _F20.push({container: 'F20WidgetContainer', placement: '', count: 3}); _F20.push({finish: true});.....»»

Category: blogSource: valuewalkOct 22nd, 2021

Jeff Bezos “May Have Lied” To Congress About Amazon Practices

Lawmakers wrote to Andy Jassy, CEO of Amazon.com, Inc. (NASDAQ:AMZN), to accuse the company’s top executives, including founder Jeff Bezos, of lying or misleading the House judicial committee about business practices of the e-commerce giant. Q3 2021 hedge fund letters, conferences and more Accusations The letter points to a recent Reuters investigation, which claimed that […] Lawmakers wrote to Andy Jassy, CEO of Amazon.com, Inc. (NASDAQ:AMZN), to accuse the company’s top executives, including founder Jeff Bezos, of lying or misleading the House judicial committee about business practices of the e-commerce giant. if (typeof jQuery == 'undefined') { document.write(''); } .first{clear:both;margin-left:0}.one-third{width:31.034482758621%;float:left;margin-left:3.448275862069%}.two-thirds{width:65.51724137931%;float:left}form.ebook-styles .af-element input{border:0;border-radius:0;padding:8px}form.ebook-styles .af-element{width:220px;float:left}form.ebook-styles .af-element.buttonContainer{width:115px;float:left;margin-left: 6px;}form.ebook-styles .af-element.buttonContainer input.submit{width:115px;padding:10px 6px 8px;text-transform:uppercase;border-radius:0;border:0;font-size:15px}form.ebook-styles .af-body.af-standards input.submit{width:115px}form.ebook-styles .af-element.privacyPolicy{width:100%;font-size:12px;margin:10px auto 0}form.ebook-styles .af-element.privacyPolicy p{font-size:11px;margin-bottom:0}form.ebook-styles .af-body input.text{height:40px;padding:2px 10px !important} form.ebook-styles .error, form.ebook-styles #error { color:#d00; } form.ebook-styles .formfields h1, form.ebook-styles .formfields #mg-logo, form.ebook-styles .formfields #mg-footer { display: none; } form.ebook-styles .formfields { font-size: 12px; } form.ebook-styles .formfields p { margin: 4px 0; } Get The Full Henry Singleton Series in PDF Get the entire 4-part series on Henry Singleton in PDF. Save it to your desktop, read it on your tablet, or email to your colleagues (function($) {window.fnames = new Array(); window.ftypes = new Array();fnames[0]='EMAIL';ftypes[0]='email';}(jQuery));var $mcj = jQuery.noConflict(true); Q3 2021 hedge fund letters, conferences and more Accusations The letter points to a recent Reuters investigation, which claimed that Amazon had copied products and manipulated search results in India to further the sale of its own brands. In the letter, five congressmen tell the company’s CEO that they are considering filing a criminal complaint to the U.S. Justice Department. Amazon has denied the ground of these accusations. The document asserts that journalistic investigation by Reuters and other media outlets contradict what was said in testimony to the House judicial committee by senior Amazon executives, including former CEO Jeff Bezos. “We strongly encourage you to make use of this opportunity to correct the record... as we consider whether a referral of this matter to the Department of Justice for criminal investigation is appropriate,” the letter states. An spokesperson quoted by BBC said: “Amazon and its executives did not mislead the committee, and we have denied and sought to correct the record on the inaccurate media articles in question.” The company also denied the claims via a statement sent to The Independent: “Amazon and its executives did not mislead the committee, and we have denied and attempted to correct the record on the inaccurate media articles in question.” "We Have To End It" According to Democratic Sen. Elizabeth Warren, the cited Reuters report brings to the surface how the company used its power in the tech sector to its own advantage, as she called for the giant company to be terminated. “These documents demonstrate what we feared about Amazon's monopoly power: that the company is willing and able to rig its platform to benefit its bottom line while scamming small businesses and entrepreneurs. This is one of the many reasons we have to end it,” she wrote. As reported by The independent, Reuters found that the Amazon India team would have used “sales data and customer reviews” from brands sold on its platform and then “replicate and sell” similar items. The investigation is backed by internal documents, including one called the “India Private Label Program.” Amazon is part of the Entrepreneur Index, which tracks 60 of the largest publicly traded companies managed by their founders or their founders’ families. Updated on Oct 19, 2021, 10:41 am (function() { var sc = document.createElement("script"); sc.type = "text/javascript"; sc.async = true;sc.src = "//mixi.media/data/js/95481.js"; sc.charset = "utf-8";var s = document.getElementsByTagName("script")[0]; s.parentNode.insertBefore(sc, s); }()); window._F20 = window._F20 || []; _F20.push({container: 'F20WidgetContainer', placement: '', count: 3}); _F20.push({finish: true});.....»»

Category: blogSource: valuewalkOct 19th, 2021

Watch These Next-Gen Cloud Computing Stocks

Adapt or die. Q3 2021 hedge fund letters, conferences and more That was the tough choice facing many small businesses when COVID-19 hit. It was truly survival of the fittest. The good news is millions of American entrepreneurs rose to the occasion. According to CNBC, a record 4.3 million new business applications were processed last […] Adapt or die. if (typeof jQuery == 'undefined') { document.write(''); } .first{clear:both;margin-left:0}.one-third{width:31.034482758621%;float:left;margin-left:3.448275862069%}.two-thirds{width:65.51724137931%;float:left}form.ebook-styles .af-element input{border:0;border-radius:0;padding:8px}form.ebook-styles .af-element{width:220px;float:left}form.ebook-styles .af-element.buttonContainer{width:115px;float:left;margin-left: 6px;}form.ebook-styles .af-element.buttonContainer input.submit{width:115px;padding:10px 6px 8px;text-transform:uppercase;border-radius:0;border:0;font-size:15px}form.ebook-styles .af-body.af-standards input.submit{width:115px}form.ebook-styles .af-element.privacyPolicy{width:100%;font-size:12px;margin:10px auto 0}form.ebook-styles .af-element.privacyPolicy p{font-size:11px;margin-bottom:0}form.ebook-styles .af-body input.text{height:40px;padding:2px 10px !important} form.ebook-styles .error, form.ebook-styles #error { color:#d00; } form.ebook-styles .formfields h1, form.ebook-styles .formfields #mg-logo, form.ebook-styles .formfields #mg-footer { display: none; } form.ebook-styles .formfields { font-size: 12px; } form.ebook-styles .formfields p { margin: 4px 0; } Get The Full Series in PDF Get the entire 10-part series on Charlie Munger in PDF. Save it to your desktop, read it on your tablet, or email to your colleagues. (function($) {window.fnames = new Array(); window.ftypes = new Array();fnames[0]='EMAIL';ftypes[0]='email';}(jQuery));var $mcj = jQuery.noConflict(true); Q3 2021 hedge fund letters, conferences and more That was the tough choice facing many small businesses when COVID-19 hit. It was truly survival of the fittest. The good news is millions of American entrepreneurs rose to the occasion. According to CNBC, a record 4.3 million new business applications were processed last year. And 77% of those were online businesses! Meanwhile, millions of existing mom-and-pop shops rapidly retooled to do business on the internet. As regular RiskHedge readers know, “entrepreneur stocks” made this possible. Entrepreneur stocks help small companies set up and grow online. They’ve been lucrative investments since the pandemic struck. Next-Gen Cloud Computing Stocks: Shopify Shopify Inc (NYSE:SHOP) helps businesses set up and run online stores. It has rallied 226% since April 2020. Square Square Inc (NYSE:SQ) helps small businesses accept payments online. It has surged 355% over the same period. Etsy Etsy Inc (NASDAQ:ETSY) gives artists and creators a marketplace to sell custom crafts. It has soared 243% since the March 2020 COVID crash. But the biggest game-changer for small businesses has been the rise of “cloud computing for the little guy”… In a nutshell, cloud computing lets companies access powerful software over the internet without paying a fortune. Cloud computing stocks aren’t new. But most well-known cloud computing platforms, like Amazon Web Services and Microsoft’s Azure, are geared toward large enterprises. I’m more interested in cloud computing companies that help little companies… simply because the untapped potential is huge. Small- and medium-sized businesses employ 60 million people in the US. They also make up 99.9% of all registered companies. But until COVID, almost none of them were online. A recent Bloomberg study found only half of small businesses have websites. Even fewer have ever sold anything online! Meanwhile, the huge benefits of moving to the cloud make it a no-brainer for most companies... Deloitte found that small businesses that use the cloud grow 26% faster than ones that don’t. That same study found 69% of companies plan to increase spending on cloud computing in the next three years. Despite all this, most small companies haven’t moved to the cloud yet. A study by McKinsey confirms most companies only have about 20% of their workflows happening on the cloud. In other words, there’s hypergrowth potential for cloud computing companies that focus on small businesses... Intuit Consider Intuit Inc. (NASDAQ:INTU)… Intuit isn’t exactly a household name. But many small businesses couldn’t live without this company. It owns the credit score–tracking company Credit Karma and budget-tracking company Mint. It also owns the tax-preparation company TurboTax and accounting software QuickBooks. And it recently acquired MailChimp to help small businesses with email marketing. If there were a stock market Hall of Fame, Intuit would be a shoo-in. It’s returned over 20,300% since it IPO’d in March 1993. That’s enough to turn every $1,000 into $203,300. HubSpot Then there’s HubSpot Inc (NYSE:HUBS). Like cloud computing pioneer Salesforce (CRM), HubSpot helps businesses find, engage, and convert customers. Unlike Salesforce, HubSpot focuses on helping smaller companies. HubSpot has rallied 77% this year and 2,500% since it went public. I’m expecting even bigger returns out of stocks like these in the years to come. Bill.com This is why I recently recommended Bill.com Holdings Inc (NYSE:BILL)… Bill.com helps small businesses simplify payments with a solution that is automated, digital, and cloud-based. Bill has surged 1,070% since it went public on December 12, 2019, and 66% since I encouraged my subscribers to buy it in June. Bill continues to look like a market leader. However, there’s a strong possibility it will trade a little choppy until the broad market gets back on track. So, I’d like to see more confirmation of strength before I recommend buying more shares. But companies like Bill.com will continue to thrive… because it’s never been more important for small businesses to operate on the cloud. Keep your eyes on the cloud software stocks helping the little guys—that’s where the biggest profits will be found. The Great Disruptors: 3 Breakthrough Stocks Set to Double Your Money" Get our latest report where we reveal our three favorite stocks that will hand you 100% gains as they disrupt whole industries. Get your free copy here. Article By Justin Spittler, Mauldin Economics Updated on Oct 14, 2021, 2:27 pm (function() { var sc = document.createElement("script"); sc.type = "text/javascript"; sc.async = true;sc.src = "//mixi.media/data/js/95481.js"; sc.charset = "utf-8";var s = document.getElementsByTagName("script")[0]; s.parentNode.insertBefore(sc, s); }()); window._F20 = window._F20 || []; _F20.push({container: 'F20WidgetContainer', placement: '', count: 3}); _F20.push({finish: true});.....»»

Category: blogSource: valuewalkOct 14th, 2021

Rowan Street 3Q21 Commentary: Sells Alibaba And Tencent

Rowan Street commentary for the third quarter ended September 2021. Q3 2021 hedge fund letters, conferences and more Dear Partners and Friends, Rowan Street Performance Update Rowan Street was down -13% in Q3, causing our fund to decline -9.2% (net) year-to-date as of September 30. This decline is normal and is to be expected, especially […] Rowan Street commentary for the third quarter ended September 2021. if (typeof jQuery == 'undefined') { document.write(''); } .first{clear:both;margin-left:0}.one-third{width:31.034482758621%;float:left;margin-left:3.448275862069%}.two-thirds{width:65.51724137931%;float:left}form.ebook-styles .af-element input{border:0;border-radius:0;padding:8px}form.ebook-styles .af-element{width:220px;float:left}form.ebook-styles .af-element.buttonContainer{width:115px;float:left;margin-left: 6px;}form.ebook-styles .af-element.buttonContainer input.submit{width:115px;padding:10px 6px 8px;text-transform:uppercase;border-radius:0;border:0;font-size:15px}form.ebook-styles .af-body.af-standards input.submit{width:115px}form.ebook-styles .af-element.privacyPolicy{width:100%;font-size:12px;margin:10px auto 0}form.ebook-styles .af-element.privacyPolicy p{font-size:11px;margin-bottom:0}form.ebook-styles .af-body input.text{height:40px;padding:2px 10px !important} form.ebook-styles .error, form.ebook-styles #error { color:#d00; } form.ebook-styles .formfields h1, form.ebook-styles .formfields #mg-logo, form.ebook-styles .formfields #mg-footer { display: none; } form.ebook-styles .formfields { font-size: 12px; } form.ebook-styles .formfields p { margin: 4px 0; } Get The Full Series in PDF Get the entire 10-part series on Charlie Munger in PDF. Save it to your desktop, read it on your tablet, or email to your colleagues. (function($) {window.fnames = new Array(); window.ftypes = new Array();fnames[0]='EMAIL';ftypes[0]='email';}(jQuery));var $mcj = jQuery.noConflict(true); Q3 2021 hedge fund letters, conferences and more Dear Partners and Friends, Rowan Street Performance Update Rowan Street was down -13% in Q3, causing our fund to decline -9.2% (net) year-to-date as of September 30. This decline is normal and is to be expected, especially after a solid performance year we had in 2020, where our fund outperformed the market by 30% net of fees. We would like to remind all our partners, especially the ones who have recently joined our partnership, that the sole focus of the fund is to compound our partners’ capital at double-digit rates of return over a long-term holding period. Since December 2017 (start of our fully invested period), the fund has delivered 68.8% return (net of fees) or 15% per annum. Although 3 ¾ years is still a relatively short period of time to judge whether we are successful in achieving our long-term double digit return goal (anything longer than 5 years would be a more desirable barometer), thus far we have been on target. Looking at a longer time period of 6 ½ years since we founded Rowan Street, which includes the initial period of 2 ¾ years when we held 75% of our portfolio in cash while we carefully developed and tested our investment strategy and internal processes and invested only our personal capital as well as friends and family, we have delivered 93.4% cumulative net return or 11% per annum. When we report our 7, 8, 9 & 10 year performance numbers, the benchmark of our success will always be — are we compounding our investors’ capital at double-digit returns over the long run? If the answer is yes, then we are doing our job and that is the only thing that truly matters. In contrast to the majority of Wall Street funds out there, our focus will NEVER be on beating or keeping up with the market in any given quarter or a year, or on minimizing short-term volatility in the fund. We believe volatility is not the real risk. Volatility is part of the course of investing. In fact, there is NO wealth creation without volatility! It is simply the “price of admission” that the market demands us to pay, yet there is so much effort on Wall Street that is dedicated towards minimizing volatility. These efforts are catered towards nurturing clients’ emotional well-being while creating an illusion of safety, but almost always come at a huge cost of reducing clients’ long-term returns. We are very fortunate to have limited partners in the fund that allow us to focus on the long-term compounding of their family’s capital instead of being distracted from our main goal in order to nurture their emotional well-being. This is a huge advantage for us! At Rowan Street, the #1 fundamental principle of everything we do is we have a mindset of a business owner — this is how we approach all our investments. When you start looking at the world through the lens of a business owner, you start paying less and less attention to the stock tickers that bounce up and down every day and realize that most of the time these daily stock price gyrations have very little to do with the long term intrinsic value of the business. Over the long run, however, stock prices accurately reflect the fundamentals of businesses. For example, when you purchase a house or a commercial property or buy into a small business, you do not get a quote on it every single moment or every single day. You are in it for the long run, and you make your investment decision based on the earnings that your property or business can generate over the next 5-10 years in relation to the capital that you have to put up up-front. This is exactly how we structure the portfolio of our fund and how we judge the performance of our businesses, in which we are minority owners. Spotify Let’s look at one of our investments, Spotify Technology SA (NYSE:SPOT), as an example. We encourage you to review our investment thesis on Spotify that we published in our Q2 2020 Letter and in H1 2021 Letter. The company went public in April of 2018 and since the stock has delivered the following calendar year returns: 2018: -24% (since IPO date) 2019: +32% 2020: +110% 2021: -26% (as of this writing) As you can see, performance of an individual stock can be very lumpy from year to year. Spotify was the biggest contributor to our funds’ performance in 2020 and it's the second biggest detractor thus far in 2021. Do these short-term stock price gyrations matter to us? Absolutely not! Focusing on this and judging our investment based on how it performs in any given year would be akin to attempting to win a football game while keeping our eyes on the scoreboard. This is why at Rowan Street, our eyes will always be focused on the “playing field”. If we continue to do that, the score will take care of itself over time! What does it look like on the “playing field” for Spotify? As you can see from the tables below, Spotify’s intrinsic value has increased quite a bit since its IPO date. Revenues have increased by 75% (or ~20% p.a.), gross profits have increased 64% (~18% p.a.). We believe that management has done a terrific job thus far in reinvesting these gross profits into building the world’s leading audio platform and constantly innovating ( and out-innovating its competitors) to deliver for both artists and fans. The result of their investments could be seen in the growth of Monthly Active Users (MAU) as well as their Premium Subscribers. The former has grown at 2.3x and the latter at 2.1x over the past 3 years, and we estimate that it’s feasible for Spotify to grow to ~1 billion users over the next 5 years. If the management continues executing the way they have been in the past, we have a pretty good chance of attaining our double-digit return from owning Spotify’s stock over the next 5 years. Exit From Our Chinese Positions As you know, we have owned stock in Alibaba Group Holding Ltd (NYSE:BABA) and Tencent Holdings ADR (OTCMKTS:TCEHY) since 2018. We know both companies very well and have spent countless hours studying their operations over the past 3 years. We have published our detailed write-up on Alibaba in our Q3 letter last year. At one point, in the first half of 2020, we were sitting on substantial gains in both positions (2x on Tencent), and our China exposure had grown to around 25% at the time. We started actively trimming these in Q1 and completely exited both positions in Q2 (please see our rationale below). All-in-all, we ended up netting a small gain in dollar terms. However, both Alibaba and Tencent detracted ~5% from our performance in 2021. We believe the number one mistake that we as investors can make is to be unwilling to admit that we are wrong. Sometimes being willing to change our mind in the face of new evidence, selling when necessary, is one of the most important skills that we as investors can have. So what new evidence changed our mind? As you know, capital allocation and reinvestment of capital is one of the most important foundational pillars that we spend a lot of time on and watch very closely. Recent Chinese government crackdown and CCP’s ”common prosperity“ policies, which you are all well aware of as they have been widely covered this year, have a direct impact on the future capital allocation policies of both Alibaba and Tencent. When management of the companies that we are owners of do NOT have full control of the capital allocation, that goes against all our foundational principles as investors and stewards of your capital. At that point, we place a lot less importance on the size of revenues and cash flows that the company generates and how attractive their valuations may be (it's very apparent to just about everyone how statistically cheap the stock of Alibaba and Tencent currently are). The only logical decision here, once one of our foundational principles is violated, is to sell and to reinvest the proceeds into our high conviction ideas that fit our investment criteria and that have a high probability of compounding our fund’s capital at double-digits (p.a.) in the next 5-10 years, which is exactly what we have done over the past several months. General Thoughts on China Fred Liu, a fellow fund manager, recently gave a very good overview of China's latest crack-down and provided a basic framework through which to analyze the latest developments: “The difference in Chinese policies vs. many western governments, is that China prioritizes the labor and tech components of the equation more so than capital… While labor is made up of the domestic population itself and technology is used to amplify this output, capital is face-less (or at least belonging most to those who have benefited from the country’s rise and accumulated the capital in the process, and thus have a “national duty” to help & repay their fellow citizens / country who helped them achieve success).” “Capital is meant as a tool to enhance & accelerate society’s goals, not as an end-goal itself. Versus many Western markets, where it seems that the betterment of shareholders (and putting more money into their pockets) is often then the end goal itself. If the well-being of capital must be sacrificed to ensure a better long-term direction of society then in the Chinese government’s eyes, it's a worthy trade-off.” “In this case, the Capital wasn’t being productive anyways, so there’s no loss if the government impairs it (and sends a message to discourage future investment in these fields). Capital (and investors) will be rewarded when capital is needed to fuel to achieve the broader goals of societal and economic advancement in a harmonious and equitable manner. But when capital investment in certain sectors is at odds with these goals, don’t be surprised when it's impaired.” Fred makes some very good points and we would completely agree with this view. However, the entire ideology of a command economy with its 5-year plans is at odds with our own ideology in the Western world where free markets (or Adam Smith’s invisible hand) determines whether Capital is productive or not and how it should be allocated. In his very famous book The Wealth of Nations, Adam Smith wrote: “But the annual revenue of every society is always precisely equal to the exchangeable value of the whole annual produce of its industry, or rather is precisely the same thing with that exchangeable value. As every individual, therefore, endeavors as much as he can both to employ his capital in the support of domestic industry, and so to direct that industry that its produce may be of the greatest value, every individual necessarily labours to render the annual revenue of the society as great as he can. He generally, indeed, neither intends to promote the public interest, nor knows how much he is promoting it. By preferring the support of domestic to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. Nor is it always the worse for the society that it was not part of it. By pursuing his own interest he frequently promotes that of the society more effectively than when he really intends to promote it. I have never known much good done by those who were affected to trade for the public good. It is an affectation, indeed, not very common among merchants, and very few words need be employed in dissuading them from it.” Using the invisible hand metaphor, Smith was trying to present how an individual exchanging money in his own self-interest unintentionally impacts the economy as a whole. In other words, there is something that binds self-interest, along with public interest, so that individuals who pursue their own interests will inevitably benefit society as a whole. This very ideology is the foundation of our capitalistic system that has worked so incredibly well for America over the past 245 years. Fishing In Our Own Pond The real question to ask ourselves as investors: Is this our game to play? We would not invest in an individual company whose set of values, principles and ideologies is at odds with our own. The company‘s future prospects may prove to be very bright (as Alibaba’s and Tencent’s are very likely to be), but it would be extremely difficult-to-impossible for us to maintain a strong conviction in companies (and sleep well at night) that operate on a soil of a system, which at the very core, is contradictory to our own values. Simply put, we came to the conclusion that this is NOT our game to play! Continuing to invest in Chinese companies that are “outside of our circle of competence” makes little sense for Rowan Street considering we have an amazing “pond to fish” here in the United States. Some of the best innovators, entrepreneurs and some of the best companies in the world are still being founded and built here. When it comes to breaking down the top 100 companies of the world, according to this interesting chart below by Visual Capitalist, the United States still commands the largest slice of the pie. And even though China has the second largest and rapidly growing slice of the pie, at the risk of sounding redundant, we have concluded that we have ZERO edge in that part of the world no matter how attractive their future may appear with their high GDP growth, huge size of the population, rise of the middle class and incredible pace of innovation (arguably even higher than in the USA). We believe that domestically we have much better odds of winning, and that’s where we will focus on from now on. We want to thank you for your partnership. Joe and I have our entire net worths invested alongside you — we strongly believe in eating our own cooking. We look forward to reporting to you again at the end of 2021. Best regards, Alex and Joe Updated on Oct 13, 2021, 4:58 pm (function() { var sc = document.createElement("script"); sc.type = "text/javascript"; sc.async = true;sc.src = "//mixi.media/data/js/95481.js"; sc.charset = "utf-8";var s = document.getElementsByTagName("script")[0]; s.parentNode.insertBefore(sc, s); }()); window._F20 = window._F20 || []; _F20.push({container: 'F20WidgetContainer', placement: '', count: 3}); _F20.push({finish: true});.....»»

Category: blogSource: valuewalkOct 14th, 2021

Transcript: Chamath Palihapitiya

     The transcript from this week’s, MiB: Chamath Palihapitiya on Venture Investing, is below. You can stream and download our full conversation, including the podcast extras on iTunes, Spotify, Google, Bloomberg, and Acast. All of our earlier podcasts on your favorite pod hosts can be found here. ~~~ RITHOLTZ: This week on the… Read More The post Transcript: Chamath Palihapitiya appeared first on The Big Picture.      The transcript from this week’s, MiB: Chamath Palihapitiya on Venture Investing, is below. You can stream and download our full conversation, including the podcast extras on iTunes, Spotify, Google, Bloomberg, and Acast. All of our earlier podcasts on your favorite pod hosts can be found here. ~~~ RITHOLTZ: This week on the podcast, man, strap yourself in. This is really one of the old-time greats. Chamath Palihapitiya, Founder of Social Capital, very successful venture capitalist, part-owner of the Golden State Warriors, and all-around insightful investor social critic, and tech wonk. If you’re interested in anything from technology to social media, to venture investing, startups, entrepreneurship, I don’t know what else to say other than strap yourself in. This is a great one. With no further ado, my conversation with Chamath Palihapitiya. VOICE-OVER: This is Masters in Business with Barry Ritholtz on Bloomberg Radio. RITHOLTZ: I’m Barry Ritholtz. You’re listening to Masters in Business on Bloomberg Radio. My extra special guest this week is Chamath Palihapitiya. He is the Founder of Social Capital, one of the more interesting and successful venture capitalist out in Palo Alto. He is also an Engineer and Team Leader working at places like AOL, Facebook, and Slack. He has been known as the SPAC King for his numerous successful deals in that space. And he is also a 10 percent owner of the Golden State Warriors. Chamath Palihapitiya, welcome to Bloomberg. PALIHAPITIYA: Barry, thanks. RITHOLTZ: I’ve been looking forward to having this conversation for a while. Let’s — normally, I start with people’s backgrounds and we go chronologically, but you have some quotes that I love, and I want to ask you about them and let you run wild with them, “Starting with venture capital properly deployed can solve the biggest problems filling the void left by the shrinking scientific ambitions of governments, foundations, and international organizations. Explain. PALIHAPITIYA: Well, if you look at what’s happening in California or what’s happening at the federal level of the United States currently, there’s a really interesting thing that’s happened, which is we have effectively single-party rule. You have a, you know, elected leader that’s of one party. You have a Senate that’s of that same party, a House and then, you know, in the case of California, mayors as well, all democratic in this case. And what’s interesting is it also happens to be a moment in time where the societal problems that we’ve been facing are the worst they’ve ever been. Climate change is worse than it’s ever been. We have a water crisis. We have an impending food crisis, homelessness, crime. And you have to ask yourself, well, if a single party like — you know, when you have a typical normal, you know, political set-up, you have these two opposing forces and you have to find common ground. And each party says the exact thing, which is, well, if we had complete control, this would all be fixed. And it turns out that two examples where you have complete control, in fact, nothing gets fixed, even less gets fixed than what got fixed before. So why is that? It’s that the toolkit of policy and the toolkit of societies has changed. It’s no longer as much about laws necessarily, but it’s about technology. It’s about code. It’s about very specific inventions of science. And the problem with that then, well, then you would say, “Well, great. Well, that’s the solution to all of our problems. If we go in and figure out how to actually, you know, just have more of all of that stuff, everything will be solved.” OK, well, then — then you go in and you decompose that problem to first principles. And what you find is, for example, in places like core scientific research, people care more about citations, and papers, and research, and it’s also highly politicized and infested with all kinds of infighting. And so, foundations can’t fund the work that they used to. Universities aren’t nearly as good and actually promoting massive breakthroughs. So more and more of this responsibility gets put on for-profit enterprises, but to be very specific, they have to be for profit and they have to be technical. And when you see it that way, the venture capitalist all of a sudden has this critical role in society that they didn’t have before because they are a translator. They are, you know, in a technical meeting the smartest business person, but in a business meeting the smartest technical person. And they’re able to put these things together to solve problems. And so, that’s what I was trying to get across, which is we need more people building for-profit technical businesses, organizing resources against problems. RITHOLTZ: So — so let’s stay with the concept of — of venture capital being organized to solve problem and talk a little bit about Social Capital. Tell us about your first couple of venture investments and who were your first limited partners. PALIHAPITIYA: So, I was a Facebook at the time, and I had been doing a bunch of angel investing. And this is maybe 2008 or ’09, but I was the first solo G.P., I think, in many ways. I was putting some money to work of my own money, small checks, Barry, $10,000, $15,000. RITHOLTZ: Early seed round, right? PALIHAPITIYA: Early seed rounds in, you know, 2007 and ’08, basically all the money that I had. And I had to win. I met a guy named Rick Thompson, an amazing entrepreneur, who started a gaming company. And I jumped in with two feet. I invested my money. I spent a little bit of time there helping him, you know, sort of — I mean, as a — as a part-timer, obviously, because I was working at Facebook at the time. And the company gets bought by Disney for like 750 million bucks and I made a few million bucks. And I thought, “This is it.” I have my — I have my escape velocity. And at the time at Facebook, they were all these people that were trying to invest in the company. And Zuck basically said to me, “Hey, can you help sort out whose money we should take?” I mean, I was running Facebook platform, I was building Facebook Mobile, I was doing all of these products so — but I was like, “Yeah, sure, I guess.” And I met the guys at Tiger Global, Chase Coleman specifically, and we built a relationship and then, you know, Tiger ended up investing in the business. And along the way, you know, I said, “Hey, I’m thinking of, you know, investing a little bit of capital on the side.” And he goes, “Well, if you organize a little LLC, you know, I’m happy to kick in a, you know, a few shovels.” And so, all of a sudden, I had this little group of me and my friends, and I just organized about 11 million bucks, you know, and I was like three or four of it and like, you know, other couple of folks jumped in for 50K there, 500K there, a million there, whatever. And so, while I was a full-time employee at Facebook, I was a part-time investor. And that’s how I started and so those are my first LPs, wonderful guys, Reid Hoffman, you know, a whole list of kind of like … RITHOLTZ: Who — who’s the rest of that list because already I am loving this group? PALIHAPITIYA: The list was pretty impressive. I want to say it was like Peter Thiel, Reid Hoffman, Chase Coleman. I’d have to look at the slides, I can’t … RITHOLTZ: But it’s a murderous row pretty much. PALIHAPITIYA: Yeah, Dave Goldberg, you know, Zander Lurie who is the CEO of Momentum A.I., so a bunch of really great entrepreneurs, and CEOs, and investors. Anyways, I put the money to work and, you know, it was non-obvious that that fund was good. I was learning. And most of the investments I made were way too ambitious, and I was deeply undercapitalized, right? So, you — in 2008 and ’09, in hindsight, it was really dumb to make a bunch of deep tech investments. Now, some of them have come home to roost, and that fund has now (inaudible), but we got very lucky and it did very well, but it took an enormously long period of time. So, I put the money to work and I learned. I learned, hey, portfolio construction is important. I didn’t get that right. I was way undercapitalized, like, hey, wait a minute, like I needed way more reserves to defend these companies. And I had to think about duration, meaning I can’t solve 20 of your problems in a 10-year fund. I need to solve five of your problems in a 10-year fund if I want to be in the fund business. And, you know, that obviously changed in 2016 and ’17 when I just basically consolidated with my own money. But so – then I left Facebook in 2011 and I went back to these same folks. And I said, “Guys, let’s go much bigger. I think I know what I’m doing.” And we created — my first fund was 250 or 60 million bucks. I put up 60, and then it was really like, you know, John Doerr, Peter Thiel, Reid Hoffman, Li Ka-shing, you know, just — I ran the table of Jorge Paulo Lemann like incredible people. And a handful of really great institutions, Mayo Clinic, you know, folks that I was really proud to make money for. And I said, “This is like a great intersection of entrepreneurs and, you know, investors, and philanthropists, and foundations.” And, you know, I’m going to go and try to find great businesses, and that’s how it started. RITHOLTZ: So, from there, what was the subsequent funds that came out of that because that, you know, funds that run a seven or a 10-year lifespan. And some companies, some VCs will just do Fund 2, Fund 3, Fund 4, you didn’t exactly go in that direction. PALIHAPITIYA: You know, I can tell you — so like the returns as of this last quarter because I just — I had a — I had a little advisory board meeting, you know, I put about a billion one in the ground. That is worth today just a little under $5 billion. RITHOLTZ: And this was the 2016? PALIHAPITIYA: No. So, yeah, this was … RITHOLTZ: Or 2011? PALIHAPITIYA: I — I raised about $1 billion over four funds — over five funds, sorry, in the first five years basically, so a $260 million fund, another $260 million, a $500 million, and then I had a small $100 million fund and then a $30 million opportunities fund kind of — so about $1.1 billion. And, you know, so far, we’ve returned a little — almost a little under 2X of capital, so cash-on-cash, we’ve returned about two some odd billion. The curing value is a little under $5 billion. And I think that, you know, when I look in the next — in the next few years that will turn one more time. So basically, you know, one billion will turn into $10 billion and the returns are, you know, probably — well, right now they’re in the high 20’s nets. RITHOLTZ: That’s great. PALIHAPITIYA: And it’ll be in the — probably the low 30’s. That’s when it’s all … RITHOLTZ: So, as all that comes up, are you just going to roll that over into another fund or … PALIHAPITIYA: So … RITHOLTZ: … are you looking to spread this into different spaces because I am aware you are a man of many interests. You’re not just — I — I find the world … PALIHAPITIYA: Right. RITHOLTZ: … really fascinating and curious. And — and looking at what you invest in, I can tell you approach the universe the same way. PALIHAPITIYA: Right. So, along the way, I think in 2016 what I realized was running funds doesn’t accomplish my goal. And it took me some number of years to figure that out. I loved working inside of these companies. I loved trying to make some of these businesses work. I loved taking really big moon shots on technical problems that I wanted to solve. I didn’t like the constraints of a fund. I didn’t like managing L.P. relations because by that point, you know, as you know, Barry, when you’re in the fund to business, then it’s all about quantity of LPs. And so, the LPs had grown beyond my cohort of people, right, because it’s not as if their money is infinite either. RITHOLTZ: Right. PALIHAPITIYA: Right? And so, then we have fund of funds and other organizations who are in the business of, you know, being investors in these organizations. And it became very administrative. And a lot of my time was spent fundraising and managing those relationships as opposed to investing or starting companies. And so, that was one big error of judgment that I felt I needed to fix. The other one was I was looking at myself thinking like, well, am I going to be able to defend the ownership of these best companies? And think about what happens in a fund. If you make an investment and it’s working, you have all this pressure to double down. But when there’s something smaller and more technical where there’s way more asymmetric risk, it’s much harder to convince others that you should continue to invest in that as well. RITHOLTZ: So, let’s stay with that a second because that’s — there’s some really interesting things. When I hear someone like you say double down, what I’m usually thinking of is, hey, we made a small investment in the seed round and now it’s the A or the B round, and we’re going to have to step-up. And $500,000 is now a $50 million or $2 million becomes $100 million. Is that what you mean by double down versus … PALIHAPITIYA: No, I mean, the following decision, which is very hard. So, let’s just say — and — and we use explicit examples because it’s easier. So, let’s just say we invested in the crypto business and the software-as-a-service start up on the same day. $10 million in each. The SaaS business has a much higher probability of short-term progress. I sold, you know, X amount of software, here’s my bookings, here’s my revenue. RITHOLTZ: High probability of modest success. PALIHAPITIYA: High probability of modest success. Most people are, you know, enraptured with that. RITHOLTZ: That’s what — well, that’s what the S&P 500 is for. If you want a high probability amount of success, go by the spiders. But I … PALIHAPITIYA: Sure. RITHOLTZ: … imagine people come to venture because — hey, I have all my … PALIHAPITIYA: No. RITHOLTZ: … conservative stuffs. PALIHAPITIYA: No, not true. RITHOLTZ: I’m looking for you to … PALIHAPITIYA: Not true. RITHOLTZ: … hit me the 100X. PALIHAPITIYA: It’s not true. It … RITHOLTZ: Really? PALIHAPITIYA: … it may be — listen. So there — there are two conundrums here. The conundrum number one is if you’re a limited partner. If you’re a limited partner right now sitting inside of a foundation or a pension fund and you have to return capital, and you have to get over your hurdle, you need an allocation into venture, but those allocations are minuscule. Nobody is getting, you know, huge allocations into Sequoia, right? RITHOLTZ: Because the capacity is that’s limited as it is. PALIHAPITIYA: Nobody — nobody is getting huge allocations in the benchmark. You know, these are $500 million funds, you know. And I — you know, in my example, I was 30 percent of all the capital, so there’s just not a lot of room for other. RITHOLTZ: Right. PALIHAPITIYA: Number one. And then the more insidious problem is actually the human capital inside the funds themselves. And what I mean by that is not that they’re bad people, they are wonderful people, but they are products of a very specific and very rigid hierarchy. You know, they typically went to a handful of schools. RITHOLTZ: Right. PALIHAPITIYA: They typically are educated in exactly the same way. They typically, you know, have the exact same kind of risk tolerance as a result of all those things. And so, when the rubber meets the road, this Harvard MBA or the Stanford MBA, they want to treat the venture capital organization as their version of the S&P 500. Very predictable, Steady Eddie. Let me make, you know, a good salary. Don’t rock the boat. So, what happens? Crypto stuff gets underfunded until it’s obvious. You know, hard tech and — and, you know, life sciences get underfunded until it’s obvious. SaaS gets overfunded until it’s obvious. And that’s the whipsaw that you face now. Now, there are a handful of organizations that have fought against that and have done it brilliantly. So, when you look, for example, like Founders Fund, I’ll pick an example. Incredible set of investors who are iconoclasts to the one. Atypical in every dimension. There’s not a single drop of real pedigree amongst them, except they are all incredible entrepreneurs. If you look at Coastal Ventures, same situation. Incredibly atypical in their intellectual makeup, and the way they think, and what they value. And to a one, they’re generally great entrepreneurs, so you see this recurring theme. So, you know, for me, what I’ve tried to do is recalibrate my time around that realization. I have a fixed amount of capital. If I surround myself with these good — they’re good people, it will lead me astray because I will get risk off. And the whole goal of this business, as you exactly well put it, is to be 100 percent massively risk on. And so, that’s how I live my life. I have a small allocation of capital in case all of this goes to zero, but otherwise 99 percent of my net worth and wealth is massive risk on. RITHOLTZ: That’s quite, quite fascinating. I — I keep wanting to go to some of my questions, but you keep saying things that make me have to respond. I’m still kind of struck by your LPs, meaning management. And what I mean by that is someone runs a successful fund. There’s a very limited amount of slots for money to come in. I just imagine it’s like here’s the deal. I have a slot for 100 for you. I’ll send you the annual updates, we’ll have an annual meeting, and I don’t want to hear from you the rest of the year. PALIHAPITIYA: You can’t take — it’s not … RITHOLTZ: It’s the approach. It doesn’t work that way? PALIHAPITIYA: … it’s not that — well, it’s not that easy even for the best organizations. You know, when you’re dealing with these large pools of capital, they are large bureaucracies. And in fairness to these bureaucracies, there’s — there’s really important guardrails of risk management, right, and legal and operational due diligence that they have to do because again, it’s the fireman’s pension, it’s the teachers’ pension, it’s the … RITHOLTZ: Right. PALIHAPITIYA: … you know, it’s the foundation. It’s the — they’re all doing good work, right? So, it’s not like, you know, they have a right to be cavalier, but it creates an infrastructure of folks that approach their job in a very specific way that, for me, didn’t make sense. For others, I think it does make a ton of sense because, you know, they — look, there’s a tradeoff. Today, that tradeoff, by the way, has rewarded them more than me. And what is the tradeoff? When you’re a successful investor, you’ll get to a fork in the road at a certain level of assets where you have to go on the path well-traveled or the path less traveled. The path less traveled is what I’ve taken. You’re alone … RITHOLTZ: Meaning …by yourself, more risk … PALIHAPITIYA:  you’re by yourself … all your own money, all risk gone. The path well-traveled says syndicate the risk, let the — let the returns decay, build an AUM machine, monetize the fee income, sell a percentage to dial or to whomever, and then eventually sell the G.P. to somebody and you’re done. And, you know, if you have enough capital at some point, you’re like, well, what do I need any more money? This is a safer route to take. RITHOLTZ: Right. PALIHAPITIYA: I am of this different view, which is I want very specific kinds of progress that will not happen unless I am a tip of the spear on a bunch of things that I want to change. And I’m using my money as a mechanism of showing the change that I want to see in the world with the idea that if free markets are ultimately efficient, other money will follow. And it will unlock and create change. SPACs are a perfect example. RITHOLTZ: We’re going to talk about SPACs in a little bit. I’m fascinated by the path less traveled. And I — I’m kind of reminded of an old joke a friend used to say, what’s the difference between having $1 billion or having $2 billion? And the answer is really nothing. PALIHAPITIYA: Nothing. RITHOLTZ: Right, there’s not — what is the difference? PALIHAPITIYA: Nothing. RITHOLTZ: So — so once you wrap your head around that, why build an AUM machine? Why take a G.P. and do all the things you don’t want to do just so you can sell it in the road? PALIHAPITIYA: Well, look, I mean — I think there’s something very valiant in building a company of any kind. I don’t care what it is because you end up hiring people, you end up creating your own little economy. You know, by hiring good people and paying them, you’re giving them a path. You’re giving them, you know, some amount of purpose in their lives. So, you know, any form of company building, I think, is heroic, the person that uses to build a company. I don’t care what it is. It could be a garbage business, an AUM business. You know, they’re all to me where I look at the founders of those things like you, and you’re in a class of hero for me. Everybody may not be with the same, you know, sometimes now founders, unfortunately, sometimes can get vilified for being an entrepreneur. But in general, I think they’re heroic. But again, that’s not what I was trying to do. My returns in society, I wanted to be expressed by a different kind of change and a different kind of purpose, which was a practical problem solved. You know, I want reforestation to be, you know, done differently. I want a gene editing solution to be so cheap and so fast the available we can eradicate, you know, the 32,000 inherited Mendelian diseases. You know, I want to figure out how to get, you know, sub $100 solar on everybody’s roof and to build a massive distributed energy utility in America. It turns out I’m doing all those things. Now, I can do that with my capital and that’s really great. That capital may go to zero … RITHOLTZ: But you’re saying … PALIHAPITIYA: … but it may not … RITHOLTZ: … you couldn’t do that if you had these institutional endowments and other … PALIHAPITIYA: Maybe not. RITHOLTZ: … large more conservative investors who are more concerned about IRR than moving the needle. PALIHAPITIYA: Short-term IRR because, you know, again they have a job to do. They have pension obligations to make. They have, you know, other things that they’re funding. They have the lifestyle they want to pay for. They have their own annual reviews and bonuses and things. So, you know, it’s not to debate the validity of it, it just exists, and I’m not willing to sign up for that because duration. And, by the way, you can see that certain funds have realized that that durational limitation doesn’t work in tech anymore, right, so now you’re seeing these 15-year funds, right? Some of these climate funds are really long-dated so that they can take huge long risk with very sticky money. I think that’s moving.....»»

Category: blogSource: TheBigPictureOct 12th, 2021

Economic Theory & Long-Wave Cycles

Economic Theory & Long-Wave Cycles Authored by Alasdair Macleod via GoldMoney.com, Investors and others are confused by the early stages of accelerating price inflation. One misleading belief is in cycles of industrial production, such as Kondratieff’s waves. The Kondratieff cycle began to emerge in financial commentaries during the inflationary 1970s, along with other wacky theories. We should reject them as an explanation for rising prices today. This article explains why the only cycle that matters is of bank credit, from which all other cyclical observations should be made. But that is not enough, because on their own cycles of bank credit do not destroy currencies - that is the consequence of central bank policies and the expansion of base money. The relationship between base money and changes in a currency’s purchasing power is not mechanical. It merely sets the scene. What matters is widespread public perceptions of how much spending liquidity is personally needed. It is by altering the ratio of currency-to-hand to anticipated needs that purchasing power is radically altered, and in the earliest stages of a hyperinflation of prices it leads to imbalances between supply and demand, resulting in the panic buying for essentials becoming evident today. Panics over energy and other necessities are only the start of it. Unless it is checked by halting the expansion of currency and credit, current dislocations will slide rapidly into a wider flight from currency into real goods - a crack-up boom. Introduction For eighteen months, the world has seen a boom in commodity prices, which has inevitably led to speculation about a new Kondratieff, or K-wave. Google it, and we see it described as a long cycle of economic activity in capitalist economies lasting 40—60 years. It marks periods of evolution and correction driven by technological innovation. Today’s adherents to the theory describe it in terms of the seasons. Spring is recovery, leading into a boom. Summer is an increase in wealth and affluence and a deceleration of growth. Autumn is stagnating economic conditions. And winter is a debilitating depression. But these descriptions did not feature in Kondratieff’s work. Van Duijan construed it differently around life cycles: introduction, growth, maturity, and decline. We must discard the word growth, substituting for it progress. Growth as measured by GDP is no more than an increase in the amount of currency and bank credit in circulation and therefore meaningless. Most people who refer to growth believe they are describing progress, or a general improvement in quality of life. Instead, they are sanctioning inflationism. There is little doubt that economic progress is uneven, but that is down to innovation. Kondratieff’s followers argue that innovation is a cyclical phenomenon, otherwise as a cyclical theory it cannot hold water. An economic historian would argue that the root of innovation is the application of technological discoveries which by their nature must be random, as opposed to cyclical, events. Furthermore, a decision must be made about how to measure the K-wave. Is it of fluctuations in the price level and of what, or of output volumes? Bear in mind that GDP and GNP were not invented until the 1930s, and all prior GDP figures are guesswork. Is it driven by Walt Rostow’s contention that the K-wave is pushed by variations in the relative scarcity of food and raw materials? Or is it a monetary phenomenon, which appeared to cease after the Second World War, when currency expansion was not hampered by a gold standard? It was an argument consistent with that put forward by Edward Bernstein, who was a key adviser to the US delegation at Bretton Woods, when he concluded that the war need not be followed by the deep post-war depression which based on historical precedent was widely expected at the time. Kondratieff’s wave theories were buried by the lack of a post-war slump, until price inflation began to increase in the 1970s and Kondratieff became fashionable again. Kondratieff maintained that his wave theory is a global capitalist phenomenon, applicable to and detected in major economies, such as those of Britain, America, and Germany. But there is no statistical evidence of a long wave in Britain’s industrial production in the first half of the nineteenth century, when Britannia ruled the economic waves. And while there were financial crises from time to time, the downward phase to complete Kondratieff’s cycle never materialised. Today, with K-waves being fundamental to so much analysis of cyclical factors and their extrapolation, the lack of evidence and rigour in Kondratieff theory should be concerning to those who believe in it. That there are variations in the pace of human progress is unarguable, and that there is a discernible cycle of them beyond mundane seasonal influences cannot be denied. But that is a cycle of credit, a factor which was at least partially understood by Bernstein, when he correctly surmised that the way to bury a post-war depression was by expanding the quantity of money. Bank credit cycles and inflation When the inflation of money supply is mostly that of bank credit, it is cyclical in nature. Its consequences for the purchasing power of the currency conforms with the cycle, but with a time lag. Furthermore, the effect is weaker in a population which tends to save than with one which tends to spend more of its income on immediate consumption. No further comment is required on this effect, other than to state that over the whole cycle of bank credit prices are likely to be relatively stable. This was the situation in Britain, which dominated the global economy for most of the period between the introduction of the gold sovereign following the 1816 Coinage Act until the First World War. Figure 1 confirms that despite fluctuating levels of bank credit, from 1822—1914 the general level of prices was broadly unchanged. The price effect of the expansion of coin-backed currency between the two dates and the increase in population offset the reduction of costs in production through a combination of improvements in production methods, technological developments, and increased volumes. What cannot be reflected in the graph is the remarkable progress made in improving the standards of living for everyone over the nineteenth century. The gold standard was abandoned at the start of the First World War, and the general level of prices more than doubled. Having seen prices rise during the war, in December 1919 the Cunliffe Committee recommended a return to the gold standard and the supply of currency was restricted from 1920 with this objective in mind. A gold bullion standard instead of a coin standard was introduced in 1925, tying sterling at the pre-war rate of $4.8665, which remained in place until 1931.[iv] From thereon, the purchasing power of the currency began its long decline as central bank money supply expanded. There is no long-term cyclicality in these changes. Following the abandonment of the gold standard, and in line with other currencies which abandoned gold convertibility in the 1930s sterling simply sank. The key to this devaluation is not fluctuations in bank credit, but the expansion of base currency. And there is no evidence of a Kondratieff, or any other long-term cycle of production. It can only be a monetary effect. The role of money in long waves It is worth bearing in mind that the so-called evidence discovered by Kondratieff was in the mind of a Marxist convinced that capitalism would fail. The downturn of a capitalist winter, or decline in growth — whatever definition is used, was baked in the anti-capitalist cake. The Marxists and other socialists were and still are all too ready to claim supposed failings of capitalism, evidenced in their eyes by periodic recessions, slumps, and depressions. Kondratieff’s economic bias may or may not have coloured his analysis — only by digging deeply into his own soul could he have answered that. But in the absence of firm evidence supporting his wave theory we should discard it. After all, there is a rich history of the religious zeal with which spurious theories in the fields of economics and money arise. The consequences of sunspot cycles and the supposed importance of anniversary dates are typical of this ouija board theme. Non-monetary cycle themes such as that devised by Kondratieff have socialism at their core. It is assumed that capitalists, bourgeois businessmen seeking through the division of labour to manufacture and supply consumer goods for profit, in their greed are reckless about commercial risks from overinvestment. This is nonsense. Fools are quickly discovered in free markets, and they are also quickly dismissed. Successful entrepreneurs and businessmen are very much aware of risk and do not embark on projects in the expectation they will be unprofitable, and it is therefore untrue to suggest that the capitalist system fails for this reason. To the contrary, markets that are truly free have been entirely responsible for the rapid improvement in the human condition, while it is government intervention that leads to periodic crises by interfering in the relationships between producers and consumers and setting in motion a cycle of interest rate suppression and currency expansion. Markets which are truly free deliver economic progress by anticipating consumer demands and deploying capital efficiently to meet them. It is no accident that economies with minimal government intervention deliver far higher standards of living than those micro-managed by governments. Hong Kong under hands-off British administration, with no natural resources and enduring floods of impoverished refugees from Mainland China stood in sharp contrast with China under Mao. Post-war East and West Germany, populated by the same ethnic people, the former communist and the latter capitalist, provides further unarguable proof that capitalism succeeds where socialism fails. Marxist socialism kills cycles by the most brutal method. It cannot entertain the economic calculations necessary to link production with anticipated demand. There is no mechanism for the redistribution of capital for its more efficient use. Consumption is never satisfied, and consumers must wait interminably for inferior products to be supplied. Any pretence at a cycle is simply suppressed out of existence. Almost all long-wave literature assumes that prices change due to supply and demand for commodities and goods alone, and never from variations in the quantity of money and credit. But even under a gold standard, the quantities of money and credit varied all the time. In Britain, and therefore in the rest of the financially developed world which adopted its banking practices, gold was merely partial backing for currency and bank deposits, which since the days of London’s goldsmiths also lubricated the creation of debt outside the banking system. While originally gold was used as coin money, since 1914 when Britain went off the gold coin standard even this role in transactions ceased. Having explained the random nature of free market capitalism, the difference from capitalistic banking must be explained. It owes its origin to London’s goldsmiths, who took in deposits to use for their own benefit, paying six per cent out of the profits they made by dealing in money. This evolved into fractional reserve banking which became the banking model for the British Empire and the rest of the world. As well as renewing the Bank of England’s charter, the Bank Charter Act of 1844 further legitimised fractional reserve banking by giving in to the Banking School’s argument that the amount of credit in circulation is adequately controlled by the ordinary processes of competitive banking. If banks acted independently from one another competing for customers and business, we might reasonably conclude that there would be from time-to-time random bank failures without cyclicality, as the Banking School argued. In capitalistic commerce, it is this process of creative destruction that ensures consumers are best served and an economy progresses to their advantage. But with banks, it is different. Each bank creates deposits which are interchanged between other banks, and imbalances are centrally cleared. Therefore, every bank has financial relations with its competitors and is exposed to its competitors’ counterparty risks, which if acted upon creates losses for themselves and other banks, risking in extremis a system-wide crisis. Banking is therefore a cartel whose members acting in their own interests tend to act in unison. In the nineteenth century his led to systemic crises, the most infamous of which were the Overend Gurney and Baring failures. It was to address this systemic risk that central banking took upon itself the role of lender of last resort, so that in future these failures would be contained. But this mitigation of risk merely strengthened the banking cartel even further, leading to the possibility of a complete banking and currency failure. And since bankers have limited liability and personally risk little more than their salary in the knowledge that a central bank will always backstop them, reckless balance sheet expansion is richly rewarded — until it fails. Fred “the shred” Goodwin, who grew a staid Royal Bank of Scotland to become the largest bank in Europe before it collapsed into government ownership was a recent example of the genre. It is these differences between banking and other commercial activities that drive a cycle of bank credit expansion and contraction while non-financial business activities cannot originate cycles. The state-sponsored structure of the banking system attempts to control it. Governments through their central banks also trigger a boom in business activity by suppressing interest rates as the principal means of encouraging the growth of currency and credit. The distortions created by these interventions and their continuence inevitably lead to a terminating crisis. As Ludwig von Mises put it: “The wavelike movement affecting the economic system, the recurrence of periods of boom which are followed by periods of depression, is the unavoidable outcome of the attempts, repeated again and again, to lower the gross market rate of interest by means of credit expansion. There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as a result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved." A long period of credit expansion with relatively minor hiccups ending in such a crisis could easily be confused with a Kondratieff 40—60-year cycle. But the error is to mistake its origins. Kondratieff tried to persuade us that the boom and bust was a feature of capitalist business failings when it is a currency and credit problem. The irony is that Stalin refused to admit even to an expansionary phase in capitalism, condemning Kondratieff to the gulags, and then a firing squad in 1938. He lived as a Marxist-Leninist and was executed by the system he venerated. Having identified the source of cycles as being a combination of state action and fluctuations in currency and credit in a state-sponsored banking system and not capitalistic production for profit, we can admit that there are further cyclical consequences. Whether they exist or not is usually a matter of conjecture. Purely financial cycles, such as Elliott Wave Theory, will also owe their motive forces to cycles of credit and not business activity. The effect on commodity and consumer prices Kondratieff wave followers claim that commodity bull and bear markets are the consequence of a K-wave spring and summer followed by autumn, when it tops out, and winter when it collapses before rising into the next K-wave cycle. But we have demonstrated that the K-wave is not supported by the evidence. Instead, changes in the general level of commodity prices are a function of changes in the quantity of money. And as we have seen, there is a base component and a cyclical component of bank credit. We must now refocus our attention from the long-run UK statistics shown in Figure 1 to the contemporary situation for the US dollar, in which commodities have been priced almost exclusively since the early 1970s. The chart from the St Louis Fed below is of an index of industrial materials from 1992. We can see why the Kondratieff myth might be perpetuated, with industrial material prices more than halving between 2011 and 2016. But these swings came substantially from the dollar side of prices, whose trade-weighted index rose strongly between these dates. Between 2016—2018 the dollar weakened, before strengthening into 2020. Clearly, it was the purchasing power of the dollar driving speculative as well as commercial flows in international commodity markets. In March 2020, the Fed reduced its fund rate to the zero bound and announced QE (money-printing) of an unprecedented $120bn every month. Figure 2 below shows the consequences for the general level of commodity prices. Since late-March, the components of this ETF have almost doubled in price, and after a period of consolidation appear to be increasing again. K-wave followers might conclude that it is evidence of a new Kondratieff spring or summer, with the global economy set for a new spurt of economic “growth”. But this ignores the expansion of the Fed’s balance sheet reflected in base money, which is the next FRED chart. The monetary base has approximately doubled since the Fed’s March 2020 stimulus, additional to the post-Lehman crisis expansion. The last expansion undermined the purchasing power of the dollar to a similar extent in terms of the commodity prices shown in Figure 2. Evidential consequences of price inflation Sudden increases in the money quantity have disruptive effects on markets for goods and services and the behaviour of individuals. As well as undermining a currency’s purchasing power, supplies of essential goods become disordered by unexpected shifts in demand. Throughout history there has been evidence of these inflationary consequences, often exacerbated by statist attempts to impose price controls. The Roman emperor Diocletian with his edict on maximum prices caused starvation for citizens, who were forced to leave Rome to forage for food in the surrounding countryside. The edict made the provision of food uneconomic, leading to extreme scarcity. During the reign of Henry I in England there was a monetary crisis in 1124 from the debasement of silver coins, which combined with a poor harvest drove up the prices of staples, causing widespread famine. The French revolution has been attributed to the insensitivity of royalty and the aristocracy to the masses; but it occurred at the time of the assignat inflation, which led to aggravated discontent among the lower orders and the storming of the Bastille. And today, we have widespread disruption of essential supplies, ranging from energy to carbonated foodstuffs. The lesson from history is it has only just started. Why today’s logistics and energy disruptions have only just started The problems arise because individuals’ knowledge of the relationship between money and goods comes from the immediate past. They use that knowledge to decide what to buy for future consumption, and if they are in business, for production. In the latter case, they might change inventory policies from today’s just-in-time practices to ensure an adequate stock of components is available, driving up demand for them and creating shortages of vital factors of production. Consumers faced with shortages will alter the balance between their money liquidity and goods for which they may not have an immediate need but expect to consume at a future date. Bank account balances and credit available on credit cards will be drawn down, for example, to fill their car tanks with fuel, even though no journey is planned. And as we see in the UK today, it rapidly leads to fuel shortages and rationing at the petrol pumps. While the authorities try to calm things down, either by denying there is a supply problem or by imposing price controls, consumers are likely to see these moves as propaganda and justification for reducing money liquidity even further by purchasing yet more goods. The flight out of currency liquidity has a disproportionate effect on prices, particularly for essentials. They will simply drive prices higher until no further price rises are expected. Or put more accurately, the value of the currency continues to fall. It is worth illustrating the problem for its true context. If on the one hand everyone decides they would rather have as much cash in hand money as possible rather than goods, prices will collapse. It is, as a matter of fact, a situation which cannot occur. If alternatively, everyone decides to dispose of all their liquidity by buying everything just to get rid of the currency, then the purchasing power of the currency sinks to zero. Unlike the former case, this can and does happen, when it becomes widely recognised that the currency might become worthless. In other words, a state-issued unbacked currency then collapses. Almost no one, so far, attributes today’s logistical and economic dislocations to monetary inflation, yet as pointed out above, empirical evidence points to a clear connection. Governments and central banks also seem unaware. But they appear to sense that there is an undefinable risk of consumer panic, making fuel and other shortages even worse. So far, the blame lies with logistic failures, which seem to be getting worse. Comments from leading central bankers, currently meeting in Portugal and organised by the ECB, confirm the official position of playing popular tunes while the ship goes down. The heads of the Fed, the ECB, the Bank of England, and the Bank of Japan are quoted in the Daily Telegraph as agreeing that staff shortages, shipping chaos and surging fuel costs are likely to cause further disruption as winter draws near. Andrew Bailey, Governor of the Bank of England, warned “…that the UK’s GDP will not recover to pre-pandemic levels until early next year”. But besides the Bank keeping a close watch on inflation, he commented that monetary policy can’t solve supply side shocks. Jay Powell admitted that at the margin apparently bottleneck and supply chain problems are getting marginally worse. But all the central bankers agreed that price pressures will be temporary. We can see from these comments a desire not to rock the boat and cause further panic among consumers. More worrying is the insistence that inflation remains a temporary problem. Unless there is a move to stop the monetary printing presses, they must believe it. It is confirmation that there is no intention to change monetary policy. But these problems are not restricted to the West. This week we learn that even China, which has followed a policy of restricting monetary growth, faces an energy crisis with coal at power plants critically low, and coal prices up fourfold. Energy is being rationed with production of everything from food and animal feedstuffs to steel and aluminium plants supplying other factories, which in turn face power outages. China is the world’s manufacturing hub. The United States relies on China’s exports. There were some seventy container ships at anchor or at drift areas off San Pedro earlier this week, but after dropping slightly the numbers are expected to rise again. And in China, there are delays at ports of more than three days in Busan, Shanghai, Ningbo and Yantian. Ship charter rates have rocketed from $10,000 a day to as much as $200,000.[ix] There can be no doubt as the northern hemisphere enters its winter that the consuming nations in America and Europe will see yet more product shortages, more price rises, and continuing logistics disruption. Central banks will become increasingly desperate to discourage consumers’ from hoarding items by claiming that shortages and price increases are transitory. What they fail to realise is that the consequences of currency debasement have led to consumption goods being wrongly priced, fuelling the shortages. These shortages can only be addressed by yet higher prices, even in the absence of further monetary debasement — until no further price increases are expected by consumers. But with massive and increasing government deficits to finance, central banks have no mandate to restrict the expansion of currency. An acceleration of monetary debasement as each unit of it buys less is therefore inevitable because consumers and businesses alike will begin to understand there is no limit to prices increasing. Left to its logical conclusion, the purchasing power of a currency falls exponentially until it has no value left. The speed at which it happens depends on the time taken for acting humans to realise what is happening. Unless it is stopped, an economy experiences what in the 1920s was described as a flight into real goods, or a crack-up boom. Economists today seem unable to comprehend the instability caused by monetary inflation. They adopt their models to ignore it. As von Mises put it, “The mathematical economists are at a loss to comprehend the causal relation between the increase in the quantity of money and what they call ‘velocity of circulation’". The confusion in the minds of central bank economists renders it unlikely that they will take the actions necessary to stop their currencies sliding towards worthlessness sooner rather than later. Central to resolving the problem is maintaining confidence that the currency will retain its purchasing power. But with the advent of cryptocurrencies, there is a growing proportion of the public who understand in advance of inflationary consequences that fiat currencies are being debauched at an accelerating rate. This represents a major change from the past, when, as Keynes put it supposedly quoting Lenin, “There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction and does it in a manner which not one man in one million is able to diagnose”. The fact that millions now do understand the currency is being debauched is likely to make it more difficult for the state to maintain confidence in the currency in these troubled times. We should know that what is happening to commodity prices is not some long-term Kondratieff wave, or any other wave with origins in production beyond purely seasonal factors. We can say unequivocally that the cause is in changing quantities of currency and bank credit. We can also see that there are yet further effects driving prices higher from the expansion of currency so far. We can expect currency expansion to continue, so prices of commodities and consumer goods will continue to rise. Or put in a way in which it is likely to become more widely understood as the current hiatus continues, the purchasing power of the currencies in which prices are measured will continue to fall. Tyler Durden Mon, 10/04/2021 - 21:40.....»»

Category: blogSource: zerohedgeOct 4th, 2021

Interview With Orlando Bravo From The CNBC Delivering Alpha Conference

Following are excerpts from the unofficial transcript of a CNBC EXCLUSIVE interview with Orlando Bravo, Thoma Bravo Co-Founder and Managing Partner, from the CNBC Delivering Alpha Conference, which took place on Wednesday, September 29th. Q2 2021 hedge fund letters, conferences and more Bravo On Being The Best Time To Buy We’re getting to buy the […] Following are excerpts from the unofficial transcript of a CNBC EXCLUSIVE interview with Orlando Bravo, Thoma Bravo Co-Founder and Managing Partner, from the CNBC Delivering Alpha Conference, which took place on Wednesday, September 29th. if (typeof jQuery == 'undefined') { document.write(''); } .first{clear:both;margin-left:0}.one-third{width:31.034482758621%;float:left;margin-left:3.448275862069%}.two-thirds{width:65.51724137931%;float:left}form.ebook-styles .af-element input{border:0;border-radius:0;padding:8px}form.ebook-styles .af-element{width:220px;float:left}form.ebook-styles .af-element.buttonContainer{width:115px;float:left;margin-left: 6px;}form.ebook-styles .af-element.buttonContainer input.submit{width:115px;padding:10px 6px 8px;text-transform:uppercase;border-radius:0;border:0;font-size:15px}form.ebook-styles .af-body.af-standards input.submit{width:115px}form.ebook-styles .af-element.privacyPolicy{width:100%;font-size:12px;margin:10px auto 0}form.ebook-styles .af-element.privacyPolicy p{font-size:11px;margin-bottom:0}form.ebook-styles .af-body input.text{height:40px;padding:2px 10px !important} form.ebook-styles .error, form.ebook-styles #error { color:#d00; } form.ebook-styles .formfields h1, form.ebook-styles .formfields #mg-logo, form.ebook-styles .formfields #mg-footer { display: none; } form.ebook-styles .formfields { font-size: 12px; } form.ebook-styles .formfields p { margin: 4px 0; } Get The Full Warren Buffett Series in PDF Get the entire 10-part series on Warren Buffett in PDF. Save it to your desktop, read it on your tablet, or email to your colleagues (function($) {window.fnames = new Array(); window.ftypes = new Array();fnames[0]='EMAIL';ftypes[0]='email';}(jQuery));var $mcj = jQuery.noConflict(true); Q2 2021 hedge fund letters, conferences and more Bravo On Being The Best Time To Buy We're getting to buy the market leaders at scale and at high growth as well. The three of them combined. And we're fortunate that we can do that because our team can execute. The reason for that is people like to work with us. We have great people on our team, we have a great culture, and really importantly, a reputation over 20 years of making big improvements in the companies that we buy and doing that with existing management. Bravo On The Quality Of Companies More important than where valuations are is the quality of the companies now in the South Korean industry. It is totally different and totally superior than where it was 10 years ago. You're getting companies now that are 100% recurring revenues, that have a 90% gross margins, and they have growth rates that are four to five times the growth rate that existed before 2010 Bravo On Cybersecurity We're seeing huge opportunities in cybersecurity. Workflows right now in the software industry are about 50% on premise and 50% cloud. And that is creating a big cybersecurity challenge for companies. They call it, what is your cybersecurity posture now. As a result of that, we are the largest – if you combine all of our portfolio companies – by far the largest cybersecurity company in the world, with about 5.6 billion in revenue. And that's a sector that we've been so active in since 2009 and our activity has accelerated. Bravo On Software Being A Productivity Enhancing Tool You take the current inflationary fears, which have been going on for a while now, and software is a productivity enhancing tool. So these tools have a lot more value if there's labor inflation, because they allow you to do more with less labor. And there's certainly a labor shortage right now all over the economy, whether it's restaurant workers or knowledge workers or what have you, and software's a great productivity tool to be able to deal with that. Bravo On Labor Issues Labor is a big issue. Retaining knowledge workers, motivating knowledge workers, hiring people, building culture is even more challenging today than it's ever been. And it's a board discussion in every company and we have our ways of dealing with it. Bravo On The SPAC Market Another trend that you're seeing, right, is the worlds colliding between private equity, venture capital and hedge funds. Once again, it’s how do you finance more of these great companies and innovations? And the SPAC market boomed because of that. Bravo On Improvements To The SPAC Market There could be major improvements in the SPAC market, like, accountability. We believe that a SPAC sponsor, together with a company, should put up all their numbers in the past and continue to report on every quarter on how they've done versus projections. That will improve in that market. Bravo On Retail Investors I really like the retail investor. I think the retail investor is smart. I think it's adding capital to these companies, and it's providing some competition to the establishment. Bravo On Crypto How could you not love crypto? You know, look at the movement. Aren’t we all tired of paying all those transaction fees and exchange rates, and seeing currencies in different countries being completely devalued, and watching our friends in Argentina carry calculators around to try to purchase based on inflation rates? I mean, crypto is just a great system. It's frictionless. It's decentralized. And young people want their own financial system. So it is here to stay. Bravo On Getting The Latin Community Into Private Equity That's what allowed us to think as a team, a bit differently about software in the year 2000, and think about it as both a cash flow and growth business. Not just as a venture business before. Maybe our backgrounds and our different backgrounds allowed us to think a bit differently about that. Now, what we do is very meaningful, because just looking to get more Latin Americans into private equity, into tech. What we do in the Bravo Family Foundation in Puerto Rico with our rising entrepreneurs program, and providing a role model of, go ahead and take risk, do it in North America where the opportunity and the money is.   Updated on Sep 29, 2021, 8:35 pm (function() { var sc = document.createElement("script"); sc.type = "text/javascript"; sc.async = true;sc.src = "//mixi.media/data/js/95481.js"; sc.charset = "utf-8";var s = document.getElementsByTagName("script")[0]; s.parentNode.insertBefore(sc, s); }()); window._F20 = window._F20 || []; _F20.push({container: 'F20WidgetContainer', placement: '', count: 3}); _F20.push({finish: true});.....»»

Category: blogSource: valuewalkSep 29th, 2021

3 things you should know about every person you manage at work

Managers should learn their workers' personality styles, areas to improve, and what motivates them to do their best work. Knowing three key characteristics about your employees can help them grow in their careers. Luis Alvarez/Getty Images Business coach and author David Finkel says there are three things every manager should know about their workers. Managers should get to know their employees' individual personality styles to better meet their needs. Ask whether they prefer hands-on or hands-off instruction, and what you can do to help them be more productive. See more stories on Insider's business page. A large number of entrepreneurs and business owners start their businesses not because they're fantastic managers, but because they have the vision and drive to put a new product or service out into the marketplace. Most learn very quickly, however, that the ability to manage and coach their employees is a challenging yet important one and it takes a lot of effort and practice to be proficient at it. Many seek out help from those, like me, who specializes in business coaching for growth. And one of the first things I cover with a new coaching client is the set of three things that I think they should know about every person they manage.These three things will not only help them get to know their employees better but will give them the opportunity to meet them where they are in their career journey and help them grow and develop into leaders down the road.1. Personality styleThere are a number of different "personality assessments" out there, from the Kolbe to Myers-Briggs to the MMPI to the Enneagram, etc. And all personality assessments have their strengths and weaknesses. So find one you're comfortable with and go with what you know. Keep notes of where your team members fall in the different categories, paying attention to which team members share similar or complementary traits.There is no such thing as a good or a bad personality type; it is simply the way that they tackle challenges and see the world. Remember, any assessment is simply a quick way to help you better understand and effectively interact with each team member.2. Areas to coach aroundThe next thing you need to know about your team members has to do with their coachable areas. What are the key strengths this team member brings to the table? What are the areas this person needs to develop in order to progress in his or her career with your company? What areas of deficit are likely always going to be a deficit for this person? Knowing all of this helps you put this person in the right roles and assign them the most appropriate projects.You want to leverage their strengths, give them opportunities to develop their key skills, and avoid placing them in a role that is one of their likely permanent deficit areas. And this will also help you develop a long-term coaching plan to help them mature as leaders themselves.3. Performance enhancersThe last thing you want to know about your team members is how to help them do their very best work. To bring out his or her best performance, consider these questions. What three things do you need to remember to help bring out the best performance in this team member? Does she thrive in novel, challenging roles but get bored with repetitive assignments?Does he need projects that he's done successfully before or else his anxiety overwhelms his performance? While there likely could be a dozen or more ideas for each key team member that you can focus on, pick the three most important reminders to yourself to get the best performance from him or her.Read the original article on Business Insider.....»»

Category: personnelSource: nytSep 27th, 2021

Trump"s lawyer says he"s not worried prosecutors named Trump personally in the tax-fraud indictment against his namesake company

Donald Trump's lawyer Ronald Fischetti said he's confident the Manhattan DA's office wouldn't charge the former president as part of its inquiry. Former President Donald Trump at an August 21 rally in Cullman, Alabama. Chip Somodevilla/Getty Images A tax-fraud indictment against the Trump Organization and its CFO personally named Donald Trump. Still, his lawyer Ronald Fischetti told Insider he didn't think the Manhattan DA would charge Trump. He said Trump's tax savings in the alleged fraud scheme would amount to "pennies." See more stories on Insider's business page. An attorney representing Donald Trump said he wasn't worried that the former president was personally named in the indictment against his namesake company, telling Insider he's confident Trump wouldn't be charged in the Manhattan district attorney's long-running investigation.Prosecutors named Trump in charging documents unsealed July 1. They said he cut checks for family members of Trump Organization CFO Allen Weisselberg, whom they also accused of tax crimes."Trump Corporation personnel, including Weisselberg, arranged for tuition expenses for Weisselberg's family members to be paid by personal checks drawn on the account of and signed by Donald J. Trump, and later drawn on the account of the Donald J. Trump Revocable Trust," prosecutors alleged in the indictment.Trump's lawyer Ronald Fischetti told Insider the mention had no bearing on the former president's personal legal exposure in the district attorney's investigation. He said Trump paid the tuition bills personally, rather than through corporate accounts, and took "no deductions" on them."All that money paid for [Weisselberg's] grandson's tuition - to the same school that Donald Trump's son Barron goes to - was paid by Donald Trump personally, never from the company," Fischetti said. "No checks ever went from the company to pay for that tuition."Fischetti said Trump made the tuition payments because Weisselberg's son, Barry, was undergoing an acrimonious split from his wife, Jennifer Weisselberg. Trump wanted to make sure the grandchildren of a "trusted employee" could remain at their school, Fischetti said."Donald Trump, out of his generosity, paid for it personally," Fischetti said. "No deductions, no nothing."The Trump Organization is expected to face trial next yearWeisselberg and attorneys for the Trump Organization pleaded not guilty to a 15-count indictment, where prosecutors described a wide-ranging tax scheme in which they accused Weisselberg of dodging taxes on $1.7 million of his income, much of which they said came in the form of perks like tuition payments, apartments, and cars.Prosecutors said more than $359,000 of that untaxed compensation came in the form of tuition payments from 2012 to 2017. They alleged the tuition payments were categorized as compensation in the Trump Organization's internal records but not on Weisselberg's personal tax forms. The Trump Organization's CFO, Allen Weisselberg, in State Supreme Court in New York City on Monday. Jefferson Siegel/The New York Times via AP Fischetti said that Trump paying the tuition out of his own pocket, rather than corporate coffers, indicated Trump had already paid all the appropriate taxes on his end."It's not taxable for that person," Fischetti said. "And it's not a deduction for the person who's giving it to them."Weisselberg's grandchildren have attended the Columbia Grammar & Preparatory School in Manhattan's Upper West Side, which was subpoenaed in the district attorney's investigation.Since last fall, Jennifer Weisselberg has been a cooperating witness and has given troves of documents to prosecutors. She told Insider in an interview earlier this year that the Trump Organization sometimes gave employees perks like apartments and tuition payments in lieu of monetary bonuses as a way to control their lives.In a court hearing Monday, New York State Supreme Court Justice Juan Merchan said attorneys for Weisselberg and the Trump Organization had until January to review 6 million pages of documents in the case and submit pretrial motions. Merchan told the attorneys to expect a trial to begin in August or September of next year.Fischetti said Trump's tax savings in the alleged fraud scheme would amount to 'fucking pennies'Bryan Skarlatos, an attorney representing Weisselberg in the case, said in court Monday that he expected more indictments from the grand-jury investigation.Fischetti told Insider he didn't expect Trump to be among the indicted. He said the tax savings prosecutors describe would amount to "pennies" for the former president."This guy's a billionaire. What's he going to get out of this?" he said, adding: "It's fucking pennies! It's ridiculous. They have nothing on the president. Absolutely nothing."Fischetti said he met with prosecutors in June and they'd brought no evidence that Trump had any personal knowledge of or involvement in the alleged tax scheme."They have said nothing about the president knowing about this," Fischetti said. "They have no tape recordings, they have no email, they have no text. They have no documents. They have nothing!" Weisselberg waiting for a car after leaving a court appearance on Monday. AP Photo/Craig Ruttle Prosecutors typically meet with attorneys of people they plan to accuse of white-collar crimes shortly before indictments, but Fischetti said he'd heard nothing from the district attorney's team since that summer meeting. Mark Pomerantz - Fischetti's former law partner and a leading member of the Manhattan district attorney's team - assured Fischetti he'd give him a chance to defend Trump in advance of bringing any charges.Attorneys for other witnesses who've testified before the grand jury said none of the clients had anything to say about Trump's personal involvement, according to Fischetti. He said prosecutors' only hope of indicting Trump would be to "coerce" people to tell the grand jury they acted at Trump's direction."The only thing they could possibly have are witnesses that would go into the grand jury and say, 'Yes, I got a free car and I got a free apartment, and he deducted it from my salary or would give it to me as a bonus so the company made money,'" Fischetti told Insider. "He needs witnesses! He has none! Zero!"A representative for the Manhattan district attorney's office declined to comment for this story.Prosecutors also were said to have been investigating whether the Trump Organization broke tax laws by keeping two sets of books to secure favorable tax, insurance, and loan rates, as well as whether the company broke campaign finance laws by facilitating hush-money payments to Stormy Daniels in advance of the 2016 election.Fischetti said he hasn't heard anything about charges related to those inquiries.Read the original article on Business Insider.....»»

Category: personnelSource: nytSep 21st, 2021