Advertisements



Professional views on "harmonization" of sustainability standards (Part 4)

Some professionals believe that harmonization of sustainability standards will make it easier for companies to assess and manage their risks. Others believe that harmonization of sustainability standards is challenging as different governments have different systems......»»

Category: topSource: digitimesJun 24th, 2022

6 LinkedIn Automation Tools for Lead Generation That You Should Try

Everyone needs a source of energy to sustain life and stay productive. A person needs food, cars need fuel, Instagram bloggers need likes, and businesses need leads. But to get such “nutrition”, you need to constantly act: buy food for cooking, come to the gas station, write posts. The same thing happens with leads: to […] Everyone needs a source of energy to sustain life and stay productive. A person needs food, cars need fuel, Instagram bloggers need likes, and businesses need leads. But to get such “nutrition”, you need to constantly act: buy food for cooking, come to the gas station, write posts. The same thing happens with leads: to find them and close a deal, you need to perform an extensive search. Only then you will find the right customers who will be interested in the product and buy it. LinkedIn, a network with 750 million followers, is a perfect place to reach your marketing goals. Let’s talk about LinkedIn automation tools that provide a 24/7 business presence on the site and speed up customer search. .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); Q1 2022 hedge fund letters, conferences and more LinkedIn Automation: How Does It Function? To “catch” potential customers on LinkedIn, a marketer needs to perform four main operations. They must: visit the profile of a company representative; analyze the page of a potential client; be added to the contact list of an influential decision-maker; send a message that favorably advertises a product or service. LinkedIn automation tools for lead generation streamline these activities by mimicking the behavior of a marketer online. But unlike a human, a program works around the clock. The application not only saves time but also collects valuable information for organizing personalized and meaningful marketing campaigns. Marketers use two types of automation software: Google Chrome extensions and cloud apps. The first ones are downloaded from the Google store, connected to a LinkedIn account, and work on the page. Some robots “act” in real time, preventing a person from using their page. Others work in the background without limiting the marketer’s actions. A program performs tasks according to a given scenario while a user is browsing pages. Cloud applications are installed on the user's computer, but all actions technically take place from a remote PC via the cloud. It turns out that a marketer can work in Belgium, but parse leads from the USA. LinkedIn considers such procedures suspicious, so specialists often have to set up a proxy server so that the cloud and country IP addresses match. Despite technical nuances, such a program will work even when the computer is turned off. Lead generation automation tools “communicate” with contacts by sending them automated messages. Programs allow connecting with thousands of potential customers, which will lead them to purchase products. If you send out so many emails manually, LinkedIn may ban your account due to spam. Automation apps protect you from being blocked and allow you to complete your marketing tasks as rapidly as your company needs. 6 Best LinkedIn Automation Tools for Lead Generation Running a business is easier when a special program takes over lead generation: Marketers are focused on completing sales, and not on finding potential buyers; Programs find customers faster than a human and provide accurate contact details; Managers have time to analyze and compare marketing campaigns; A business is more likely to “hit the target”, expand and scale the enterprise; Programs exclude human errors. “The best”, however, is a very subjective concept. We will try to stay objective when giving an overview of popular lead automation software. Let’s take a look at six platforms with a user-friendly interface, useful functionality, and wide integration with other marketing services. Sales Navigator, An Invaluable Addition To LinkedIn The platform has already taken care of marketers by offering an internal tool for increasing sales - Sales Navigator. It allows you to find customers in your niche, receive important marketing information, and build strong relationships with potential buyers. The peculiarity of the application is that it allows marketers to send up to 30 messages per month to people who are not on their contact list. For users, this is an excellent opportunity, given that the platform has limitations. It is impossible to send messages to users outside your list of contacts. Sales Navigator is also unique because: it allows setting marketing preferences: the company’s industry, location, and size; offers advanced lead search with detailed filtering; helps to quickly find decision-makers in the company, who are more likely to be interested in the product; integrates with CRM to conveniently manage leads; replaces external analytics tools, helping to compare the results of marketing campaigns. Ashley Evans, Global Sales Enablement Director at Transmission, notes the exclusivity of Sales Navigator in his blog. He states that “LinkedIn has transformed SN from simply a hunter/gatherer tool to a very robust piece of martech that should be central to your stack and your strategic planning framework”. More than 3,000 firms use Sales Navigator and speak positively about it. Source: artplusmarketing.com Expandi Cloud Application The creators of the program call Expandi one of the safest applications for working with LinkedIn. The developers have limited the number of simultaneous connection requests and provided intervals for sending messages to simulate human behavior. The system offers the function of excluding holidays from the parsing schedule so that account activity does not arouse suspicion. Thanks to such a mechanism, LinkedIn will not ban the account of a marketer. Source: expandi.io Advantages of Expandi: it allows initiating multiple marketing campaigns from one account; integrates with such marketing tools as CRM, Zapier, and so on; has an auto warmup function: the number of daily connection requests and messages depends on the status and “age” of the profile; offers an extended list of filters in the smart inbox for incoming messages; supports dynamic personalization of messages, providing an 83% response rate; provides dedicated and local IP addresses to work from the same country. All this makes Expandi one of the best tools for growth marketers, recruiters, startup founders, and agency owners. The service has performed well and more than 12,000 companies use it to improve their marketing campaign. Phantombuster "Ghost" Assistant Phantombuster is one of those programs that help businesses to develop faster. The application becomes a "deputy" marketer on the LinkedIn network with one difference: it works around the clock. It automatically follows target profiles, likes posts, sends messages at a set interval, and performs other useful tasks. Data collection takes place in the cloud, so the program works even when the computer is turned off. A marketer needs to set the pace and trigger actions once, and they will perform automatically. Application phantoms take on valuable business functions: Network Booster automatically sends a request to establish a connection in a couple of minutes and expands the list of friends on LinkedIn; Profile Scraper extracts useful information from thousands of profiles (name, position, interest in a particular product); Message Sender is responsible for correspondence with first-level contacts; Auto Commenter/Liker comments and likes posts of target customers. These and other features make Phantombuster extremely popular among sales, marketing and development teams around the world. Source: g2.com Dux-Soup Browser Plugin This extremely simple built-in browser tool is suitable for beginners and advanced users who use LinkedIn for business purposes. To collect a client base, you only need to visit the target profiles, and the service will automatically copy them to a CSV file. The plugin will extract valuable information from the pages, such as phone number, email address, company name, location, and other details. Dux-Soup simplifies lead generation in the following way: it forms a database of target customers; downloads detailed information from LinkedIn profiles; integrates with CRM; automates profile visits and communication with customers; launches email and LinkedIn campaigns with active customer support; tags potential customers to keep in touch and know at what stage of interaction the marketer and the client are; supports advanced filtering by keywords (applicant, influencer, CEO, and others). Dux-Soup regularly publishes new user guides. The system takes into account the algorithms and programs for detecting bots, therefore, it guarantees that the marketer's profile will not be blocked. This is one of the reasons why over 70,000 people use Dux-Soup. Judging by the user reviews published on the official website of the service, in some cases, the application increases sales by seven times and provides up to 70% of the responses of potential customers. Source: octopuscrm.io MeetAlfred Professional Networking Tool MeetAlfred also offers secure lead generation automation that is compliant with LinkedIn policies. The program performs standard tasks of marketers such as profile views, sending invitations, and creating and sending personalized messages. The tool allows marketers to: adjust responses to messages from potential customers depending on their content; imitate human behavior so that it would be interesting for the target contact to maintain a dialogue; adhere to business ethics, congratulating contacts from the network on their birthday or professional anniversary; track the progress of the marketing campaign to improve the strategy; adjust the number and frequency of actions with specific clients; manage contacts through the built-in CRM and group them by filters, tags, and notes. MeetAlfread is considered one of the most “responsive” services that stimulate customer interest through personalization. Simple convenient functionality, the ability to save up to 10 hours of working time per week and increase the response rate by 10 times make MeetAlfred an indispensable assistant for more than 80,000 active users. Source: dripify.io WeConnect For Smart Lead Search The creators of the WeConnect cloud tool propose to abandon the mass mailing of invitations in favor of smart customer search. The program allows you to properly build communication depending on the response of a person and increase the percentage of transactions: the platform offers seven ways to interact with customers: invite a contact, report first connections, visit a profile, endorse skills, InMails, send messages to members of groups, auto-subscribe; the program allows you to set up campaigns based on smart sequences. For example, before an invitation, view a profile, like a post, and then send a contact request. If the person accepted it, send a message; if they rejected it - visit the profile and like some posts or a skill; the cloud application has a dedicated IP address and performs actions at a set-up frequency so that LinkedIn does not mistake the marketer's actions for spam. WeConnect supports about 60 features that are constantly updated based on user feedback. Having checked the trial version of the program, more than 4,000 marketers have started to use this tool regularly. Source: pearllemonreviews.co Lead Generation Automation: The Future Of Potential Client Search LinkedIn is a fount of business contacts, a public database waiting to be used. More than 750 million profiles are registered on the platform with detailed indications of the place, industry, position, and other data. The percentage of responses to letters sent via the business network is 300% higher than by email. In addition, LinkedIn states that 50% of platform members are more likely to buy a product from a company they interact with online. The possibilities for building relationships with clients are endless. The main thing is to use these opportunities correctly to build a win-win marketing strategy. For example, using a suitable automation tool such as Sales Navigator, Expandi, Phantombuster, Dux-Soup, or others. A program will help you to find thousands of potential customers, without the need to contact each of them. Thus, you won’t lose them among numerous contacts and bring a lead to a purchase. It would take at least half a year to do this manually, given that LinkedIn allows you to send out up to 100 invitations per week. Marketers are often ahead of their sales schedule because LinkedIn automation tools find relevant customers. Using a cloud assistant and browser plugins, managers fill a sales funnel with quality leads who are more likely to buy products. Thanks to automation software, this work takes less effort than with the standard approach. Marketers have more time to think through the strategy: how to communicate with people so as not to put them off. With the help of automation platforms for lead generation, sellers will attract more leads and accelerate business growth. About the Author My name is Alexandr Khomich, and I data with a diverse set of interests across machine learning, finance, and technology. Currently, I work as a CEO at Andersen. Being a part of the IT family for years, I aim at transforming IT processes in support of business transformation. Updated on Jun 24, 2022, 3:15 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: valuewalkJun 24th, 2022

Professional views on "harmonization" of sustainability standards (Part 4)

Some professionals believe that harmonization of sustainability standards will make it easier for companies to assess and manage their risks. Others believe that harmonization of sustainability standards is challenging as different governments have different systems......»»

Category: topSource: digitimesJun 24th, 2022

The Bill Gurley Chronicles: Part I

The Bill Gurley Chronicles: Part I By Alex of the Macro Ops Substack What if there was a way to distill all the knowledge that someone’s written over the last 25 years into one, easy-to-read document? And what if that person was a famous venture capital investor known for betting big on companies like Uber, Snapchat, Twitter, Discord, Dropbox, Instagram, and Zillow (to name a few)?  Well, that’s what I’ve done with Bill Gurley’s blog Above The Crowd.  Gurley is a legendary venture capital investor and partner at Benchmark Capital. His blog oozes valuable insights on VC investing, valuations, growth, and marketplace businesses.  This document is a one-stop-shop summary of every blog post Gurley’s ever written.  Here’s how it’ll look. Each summary will contain the following:  Date, title, and link to blog post One paragraph summary My favorite quote This piece allows anyone to absorb all of Gurley’s knowledge bombs in the fraction of the time it took me to do it. I hope this piece brings you as much value as it did to me.  Let’s get after it. Years: 1996 -1999 October 21, 1996: Backhoes Don’t Obey Moore’s Law: A Story Of Convergence (Link) Summary: The backhoe improved at an annual rate of 4.4%, falling short of Moore’s Law equivalent improvement of 59.7%. Computers are dependent on telecom to deliver the internet. But telecom is dependent on Moore’s Law failing-backhoes. This means we’re building computer-centric solutions to Internet-based problems without addressing the core problem: laying fiber cables with obsolete backhoes.  Favorite Quote: “Backhoe dependency is really just the simple side of our message. It is our impression that the majority of the players in the computer industry bring a “computer centric viewpoint” (CCV) when analyzing the issues that exist with the Internet. This computer-centric view could prove hazardous. Not only will it lead to disappointed expectations, but it may also lead to a less than accurate vision of the future.” April 20, 1998: How To Succeed In Advertising (Link) Summary: There are three reasons why success-based advertising wins the day on the internet:  Customers want it: Advertisers can quickly see if their programs work and easily predict margins using COGS + “bounty fee” model Solves excess inventory problems: The best way to reduce inventory is through direct-selling, success-based advertising (think 1-800 ads on cable TV) Unsold Ad-Space on Internet: As internet population increases, it reduces the CPM per pageview. This causes an inventory glut of internet space and a perfect place for performance-based ads Also, you can use a DCF to find the LTV of a customer. It’s simply: $ in FCF per customer/year divided by the discount rate.  Favorite Quote: “The lifetime value of the customer is equal to the future cash flows (not revenue!) expected over the life cycle of the customer, discounted back by a reasonable discount rate. What we are really doing is treating the customer acquisition as an investment and the lifetime cash flows of the customer as the yield on that investment.” May 5, 1998: Standards: Open For Business (Link) Summary: Open standards is the idea that companies in an industry operate within a specified set of rules (or parameters). Think of printers and PCs. It makes sense for all PCs and printers to be compatible with one another. This reduces time to market for most products. The issue, however, arises when open standards are applied to tech-heavy businesses without distribution advantages. Software is a perfect example. Distribution is effortless, so the only way to gain an edge in open standards is through sales teams and technical support. And who has the lead in that? Large companies.  Favorite Quote: “Theoretically, you could have a better sales force or better service and support, but these are not typically assets that small innovative companies possess. This means that competing with a completely “open” strategy would offer very little room for differentiation, and there is almost a necessity to have some closed proprietary advantage. It is difficult to criticize companies for trying to innovate in a proprietary manner. After all, survival is instinctive.” August 17, 1998: Internet Investors: Beware Of The Proxy Valuation (Link)  Summary: Investors use proxy valuations to value companies without hard free cash flows (NOPAT – capex). Proxy valuations come in all shapes and sizes, including: P/Revenues, Market Cap / Subscriber, Market Cap / Unique Page View, etc. While proxy valuations are better than blindly picking stocks — it’s not the end goal. Businesses must generate cash flow to survive. This brings us to a few dangers of proxy valuations:  Symmetry Risk: Not all proxies are created equal (e.g., Price/Sub not the same as Price/Page View) Assumption Risk: A customer’s value changes. We can’t assume a company will generate $X from each customer over its lifetime Arbitrage Risk: Companies IPO based on # of customers, revenue stats or subscribers … not cash flows or profitability Favorite Quote: “Another reason to be skeptical of proxy valuations is arbitrage. If Wall Street comes to believe that customers, or visitors, or page views, or even revenues are uniquely valuable (regardless of profitability), than entrepreneurs are likely to rush to market with companies that can achieve these targets quite handily, but may have little chance at producing real value in terms of cash flow. With no focus on costs, it is easy to reach non-financial targets. This is the great thing about cash flow-based valuation, it’s hard to sweep costs under the rug.” October 16, 1998: The Continued Evolution Of Advertising Or How To Succeed In Advertising Part II (Link)  Summary: Traditional advertising is squeezed out of the value chain as ad buyers recognize the difference between pay-per-impression and pay-per-click through. Further, the invention of TiVO (recording shows & content) increased demand for a direct-to-consumer content delivery system. Ideas like pay-per-view TV were born from the idea that you can cut the middleman (networks & advertisers) and directly charge your customer.  Favorite Quote:  “While this is possible, it ignores the fact that the viewer now has a choice, and that these devices will allow the content provider to push content directly to the end-user, potentially on a pay-per-view basis. If the consumer is willing to pay $5 to watch Seinfeld commercial-free, why should they be denied?” July 12, 1999: The Rising Impact Of Open Source (Link)  Summary: There are six things to know about open source (OS) code. One, open source works. Two, OS can produce business-quality code. Three, OS business models are emerging. Four, OS is a tough competitor (hard to beat free!). Five, OS models are entering the content generation space. Six, OS may be as helpful as a defensive mechanism than an offensive weapon.  Favorite Quote: “Open source as a production model should be appreciated in the same light as Henry Ford’s assembly line or Demming’s Just-In-Time manufacturing process. By taking advantage of the electronic communication medium of the Internet as well as the distributed skills of its volunteers, the open-source community has uncovered a leveraged development methodology that is faster and produces more reliable code than traditional internal development. You can pan it, doubt it, or ignore it, but you are unlikely to stop it. Open source is here to stay.” October 18, 1999: The Rising Importance Of The Great Art Of Storytelling (Link) Summary: Storytelling is one of the most underappreciated business skills. Bill Gates admired a man (Craig McCaw) because he was able to convince investors to invest in a capital-heavy infrastructure business. McCaw created new (proxy) valuations to sell the story the company was trying to deliver. Storytelling also gets a bad rap because it’s associated with “hype” — overpromising and under delivering. Recognizing a good story from a bad one helps investors avoid dreams and invest in the future.  Favorite Quote: “As public market investors begin to evaluate younger and younger companies, their valuation tools become limited to subjective notions such as quality of the team and the uniqueness and boldness of the idea.  In other words, if there isn’t enough proof that a business already exists, then they must make a judgment as to whether one will.” Years: 2000 – 2002 March 6, 2000: The Most Powerful Internet Metric Of All (Link)  Summary: Conversion rate is the most important metric for internet-based companies. Why? Conversion rate captures total user engagement. It also boasts high leverage. Here’s the big idea: as conversion increases, revenue rises and marketing costs decline. There are five things that affect conversion rate: 1) user interface, 2) performance (slow v. fast), 3) convenience, 4) effective advertising and 5) word of mouth.  Favorite Quote: “Let’s assume you spend $10,000 to drive 5,000 people to your site, and your conversion rate is 2 percent. This means that 100 transactions cost you $10,000, or $100 per transaction. Now let’s assume your conversion rate rises to 4 percent. The same $10,000 buys you 200 transactions at a cost of $50 per transaction. An 8 percent rate gives you 400 transactions at a cost of $25 per transaction. As conversion rate goes up, revenue rises while marketing costs as a percentage of sales fall – that’s leverage.” April 17, 2000: Can Napster Be Stopped? NO! (Link) Summary: Napster paved the way for the free digital music we enjoy today. Here’s how. The software leveraged each user’s computer files and shared music freely between PC devices, not the internet. Napster’s popularity grew, and within six months the software had 9 million users. It took AOL 12 years to get to that figure. There are two important lessons from Napster: 1) the power of community-building and 2) information wants to be free. Connect those two lessons and you have an incredible community-based business.  Favorite Quote: “Remember that the amount of bits it takes to represent high-quality audio is finite. Until the past few years, the amount of space on a hard drive, as well as the bandwidth required to transfer an MP3 file, was prohibitive for widespread usage. However, both bandwidth and storage space are susceptible to Moore’s Law. This means that within six years, the amount of drive space or bandwidth needed to trade high-quality music will be unnoticeably negligible. Emailing an entire album of music to a friend will be no different than forwarding a Microsoft Word document today.” May 15, 2000: A Return To Demand-Driven Capital (Link) Summary: There is a huge difference between demand-driven and supply-driven start-ups. Demand-driven start-ups see an area of the market where a need doesn’t have a solution. Then, they create a company to fill that need. Supply-driven start-ups conceive companies on the idea that one day consumers will need their solutions to problems that might not exist yet. The intellectual satisfaction of creating solutions is more appealing than bottom-fishing for long-standing consumer problems. At the end of the day, it’s better to start (and invest in) demand-driven businesses.   Favorite Quote (emphasis mine): “I suspect what’s at work is that Plato-esque idea that creation is much more intellectually appealing than combing the earth for steadfast problems to solve. But keep this in mind: Even a sexy Internet company like eBay was born of demand instead of supply. Founder Pierre Omidyar’s girlfriend wanted a place to trade Pez dispensers online. The company rose after the market voted. I suspect that entrepreneurs and venture capitalists alike would be well-served to return to the boring, but perhaps more successful, world of demand-driven capitalism.” June 12, 2000: Like It Or Not, Every Startup Is Now Global (Link) Summary: The rising prevalence of start-up infrastructure overseas poses a threat to US-based start-up companies. US start-ups face two main threats: 1) imitation from overseas competitors and 2) expanding too quickly. Faced with growing competition, US companies might go global before establishing a solid footprint on their home turf. This has devastating consequences as they’ll burn more cash and lose focus on their core markets. There are three solutions: 1) Joint ventures, 2) acquisitions and 3) start-up your own global market. Favorite Quote: “Ironically, the same courage that leads a start-up to look overseas could cause failure if the company moves too quickly and aggressively or assumes it can get by without local partners. When considering such alternatives, it is important to keep one fact in mind: 50 percent of something is worth a lot more than 100 percent of nothing.” July 10, 2000: The End Of CPM (Link) Summary: Echoing Gurley’s 1998 article, 2000 saw the rise of performance-based advertising. The catalyst for such rapid adoption was the outflow of capital to money-losing internet companies. With tight budgets, companies needed ad campaigns that worked. The other catalyst is the proliferation of customer behavior data on company websites. Management can see exactly who is on their site, how long they stay, and if they convert.  Favorite Quote: “Of course, the biggest catalyst in the past 90 days has been the closing of the IPO market and the subsequent focus in the start-up world on profits and cost controls. This abrupt and refreshing change is a major accelerator that immediately tightens the belt of most Internet marketing departments and targets their spending on the most efficient forms of advertising they can find. Gone are the days when companies indiscriminately bought the “anchor tenancy” on the favorite portal just as a branding event.” February 19, 2001: The Next Big Thing: 802.11b? (Link) Summary: WiFi will revolutionize the way we conduct business and where we choose to interact online. While there are critics of the technology, there is no denying its potential to reach critical mass and spread nationwide. The real catalyst for WiFi’s adoption is the move from corporate offices to homes, then to public places like colleges.  Favorite Quote: “Like other dislocating technologies, Wi-Fi is now working its way from the office into the home. While home networks are still in their infancy, the benefits of a wireless architecture may be even higher than at the office. Who has the capability to rewire their whole house? And although less obvious, the interest in aesthetics at home heightens the benefit of not stringing wires halfway across the room. Also, as we integrate the home entertainment center with the PC, a wireless link is particularly appropriate. Lastly, what if I could carry my laptop home from work, lay it on the kitchen counter and be online instantly? You can today with Wi-Fi.” June 25, 2001: The Smartest Price War Ever (Link) Summary: Dell engaged in the smartest price war ever. Their business model, which focused on just-in-time inventory, resulted in positive cash-flows even under income statement compressions. Through five-day inventory, 59-day average payables and 30 days receivables, Dell generated a negative cash conversion cycle. This allowed them to cut prices while their competitors’ models couldn’t allow such maneuvers. Competitors were forced into a lose-lose situation (cut prices and lose margin or not participate and lose market share).  Favorite Quote: “Much has been written about Dell’s direct model, which removes the middleman, along with his margin, from the sales process. And others have noted that Dell’s incredible five days of inventory allow it to pass on component price declines faster than anyone else in the industry. But perhaps the unique aspect of Dell’s business advantage is its negative cash conversion cycle. Because it keeps only five days of inventories, manages receivables to 30 days, and pushes payables out to 59 days, the Dell model will generate cash—even if the company were to report no profit whatsoever.” August 13, 2001: Bye, Bye, Bluetooth (Link)  Summary: WiFi will eliminate the need for Bluetooth. In its simplest explanation, WiFi works for the internet model whereas Bluetooth works for walkie-talkies. That’s a huge difference. It also shows the power of companies that can quickly cut products/ideas that fail despite tremendous sunken-costs. Bluetooth was a three-year push designed to revolutionize the way computers and devices interacted. Then WiFi came along. Those that quit Bluetooth early not only had a head start on their stubborn competition, they also saved thousands in wasted R&D.  Favorite Quote: “Even without competition from Wi-Fi, Bluetooth would have major challenges. That’s because the very concept of a cable replacement like Bluetooth is flawed. In a world where every device is connected to a single network (read: Internet), there is no need to connect individual devices on an ad hoc basis. Consider this – a walkie-talkie is a device that supports communication directly between two nodes. A cell phone is a device that supports communications between “any” two nodes because they are all connected to a common network and they all have unique addresses. Blue-tooth is to a walkie-talkie whereas 802.11 connected to the Internet is more analogous to the cell-phone model.” October 1, 2001: Tapping The Internet (Link) Summary: After the terrorist attacks on 9/11, many government officials sprang forward, calling for increased surveillance and backdoors on many privacy networks. The main argument was that these terrorists had access to high level technology and software. The reality was less cinematic. Osama Bin Laden used Steganography to spread information amongst his followers. Unfortunately for senators, Steganography uses every day files like images to transmit messages. So it’s not as simple as allowing backdoor access to private channels.  Favorite Quote: “The government should not give up on computer surveillance. In fact, as a tool that is used to track down a particular offender after isolation and identification, these technologies can be extremely effective. However, we should not be unrealistic about what type of “magic” spy technologies are at our disposal. We are only going to spend a lot of money, waste a lot of time, and create a false sense of security.” October 29, 2001: When It Comes To Pricing Software, The Greener Grass Is Hard To Find (Link)  Summary: The internet allowed software companies to price their product as a subscription service (SaaS) right when companies were facing hardship. The SaaS model eliminates the high-dollar upfront sales pitch and allows the company to generate predictable revenue during the year. However, stretching revenues over months (not upfront) increases short-term operating losses. Those that can withstand the short-term negativity should reap the long-term rewards of the SaaS model.  Favorite Quote: “About this same time, the rise of the Internet gave birth to the idea of an ASP – a model where software would be delivered as a service over the web, and customers would “subscribe” to the software. Analysts raved at the genius of the idea. With this model, the customer would pay an incremental fee each month, therefore eliminating the “start from zero” sales game inherent in the software model. Assuming no loss of customers, the revenue from last quarter is already booked for this quarter – all new sales theoretically represent incremental growth.” April 3, 2002: It’s Time To Put A Stop To Spam (Link) Summary: Hackers and spammers always find a way to exploit new technology. Spammers were so bad in 2002 that Gurley had to write about it. The problem lies in time spent deleting spam messages. Time that should garner more productive activities like business. This creates incentives for start-ups to solve such problems. But, the biggest risk facing these spam software companies is a false positive. False positives could delete an email that was legit — potentially costing companies millions in lost revenues.  Favorite Quote: “Email is fast becoming the preferred communication medium for many corporations. Moreover, email is also the baseline for many new cross-company workflow applications. We simply cannot allow a bunch of Viagra ads to put a dent in the evolution of the global economy.” Years: 2003 – 2005 January 6, 2003: 802.11 & Cellular: Competitor Or Complement? (Link) Summary: Gurley explains that WiFi is to 3G as the personal computer was to the mainframe. By understanding the mainframe/personal computing industry, you could “see” the future of WiFi and cellular data. No-one envisioned personal computers operating hundreds of websites or ERP systems. Yet technologists built products on top of the standardized mainframe. WiFi is no different. At the time, a ~$30 WiFi radio and a Pringles can could get you high-speed connectivity at a 10 mile distance. To Gurley, WiFi and cellular data are complementary. Like chips and salsa, with WiFi stealing incremental market opportunities over time.  Favorite Quote: “This exact thing is currently happening with 802.11. This tiny, and increasingly inexpensive radio is already shockingly versatile. The same $30 radio can be used to serve wireless connectivity in your office, connect both you PCs and your multimedia in your home, and provide coverage to a police force across an entire downtown area. Add a Pringles can as a directional antenna (no kidding!), and this $30 radio is capable of providing high-speed line-of-sight connectivity at a distance of 10 miles. In fact, the majority of the volume in the line-of-sight fixed wireless market has shifted almost entirely to low-cost 802.11 radios.” February 10, 2003: Software In A Box: The Comeback Of The Hardware Based Business Model (Link) Summary: Software companies might pitch their product inside a hardware offering, going against conventional Silicon-Valley logic. Gurley notes that while pure software businesses generate higher margins with lower capital intensity, it comes at a cost: software-only business models are harder to execute. Gurley saw the software-in-a-box path as the easier option because it addressed seven key issues:  Development complexity/Quality Assurance Performance Security Provisioning Reliability/Stability/Customer Service Pricing Distribution Favorite Quote: “There is a silver lining. The industry has changed in ways that improve the “business model” elements of selling hardware. The key driver is the standardization and general availability of hardware components, particularly those used in generic Intel-based 1U servers. As a result, the hardware is not a proprietary design, but rather a type of packaging. Think of it as an alternative to a cardboard box.” March 18, 2003: Pay Attention To BPM (Link) Summary: Business Process Management, or BPM, will change all of business. Gurley was so excited about BPM because it solved four main sticking points in an enterprise’s day-to-day process:  Codifying current processes Automating execution Monitoring current performance Making on-the-fly changes to improve current processes For the first time, employees could “hand off” applications to other employees inside the firm. This allowed for faster improvement and implementation of better processes throughout the organization.  Favorite Quote: “Of course, the real winners here will be customers that embrace BPM to further automate, enhance, streamline, and optimize their core business processes. These processes are the core intellectual property of most businesses. And just as the level of competition in manufacturing increased with JIT, the level of competition with respect to non-manufacturing business processes will increase with BPM. Companies that lead will succeed.” April 23, 2003: Dot-Com Double Take (Link) Summary: Many investors threw all “Internet Based” businesses out with the bathwater during the Dot-Com bubble. According to Gurley, that was clearly the wrong approach. Underneath the grime of pump-and-dump schemes, the Dot-com Bubble created durable, profitable businesses (like AMZN, GOOGL, Verisign, etc.).  Gurley saw four reasons why these left-for-dead Internet companies worked:  They weren’t bad ideas. Rationality set in first.  Quick capacity reduction.  Internet usage growth is systematic, not cyclical.  Favorite Quote: “Consumer spending may be down 5%, but online spending is still such a small percentage of overall consumer spending that growth results from the continued increase in online usage. With IT expenditures already at 50% of corporate capital expenditures, the opposite is true for traditional information technology spending.” June 10, 2003: In Search Of The Perfect Business Model: Increasing Marginal Utility (Link) Summary: Increased marginal utility (IMU) is the holy grail of capitalism. It’s also easier than ever to attempt IMU in our internet-based world. IMU means that for each incremental time a customer uses your product/service, they receive more value than the previous time they used it. You don’t need switching costs in an increasing marginal utility ecosystem. Why? Because switching costs lock in a customer in an “I win, you lose” scenario. In an IMU world, the customer feels left out if they don’t use your product or service. The goal: find companies that produce increased marginal utility for their customers.  Favorite Quote: “This may be the nirvana of capitalism – increased marginal customer utility. Imagine the customer finding more value with each incremental use. Some may suggest that this concept already exists in the form of volume discounts. However, this offers a vendor no real competitive advantage, as all of its competitors are likely to offer the same discount to large purchasers. Others may feel this is just a buffed-up version of “high switching costs.” On the contrary, increased marginal customer utility preempts the need to impose switching costs, which can be seen as “trapping” or “tricking” the customer. Instead, the customer who abandons increasing marginal customer utility would experience ‘switching loss.’” July 16, 2003: The Comeback Of The Mobile Internet (Link)  Summary: Mobile internet flourished thanks to the growth in cell phones. With cell phones, billions of people could access the internet, purchase items, and engage in content. In fact, cell phones will dominate the war against PCs. There are a few reasons Gurley believes this claim. First, cell phones are everywhere. Billions of people have them. Second, they’re portable, allowing users to kill time on apps and games. Third, people are more likely to purchase over the internet on their phones. Finally, IP addresses make it easy for billions of users to connect simultaneously.  Favorite Quote: “While a more carrier-friendly split may be good for the carrier’s bottom line, it could drive content providers to more generous carriers, rendering the greedy carriers’ offerings less attractive to users. Interestingly, one of the most successful content platforms, Japan’s DoCoMo service, is built around an extremely generous 91%-9% split, which is more favorable than all U.S. and European carriers’ current deals. The carriers are all walking a fine line between driving revenues and creating a viable ecosystem to encourage publishers to invest in content.” August 23, 2003: Much Ado About Options (Link) Summary: People worry too much about stock options and their impact on bottom-line earnings. Yes, there are certain instances where stock options balloon to large percentages of pre-tax earnings. But those are few and far between. Also, it doesn’t really matter whether a company grants options or restricted stock. Both offer employees skin in the game, and both cost the company roughly equal equity. That said, restricted stock incentivizes value retention. Whereas options incentivize value creation.  Favorite Quote: “In addition, restricted stock grants could encourage a form of widespread corporate conservatism. If an executive is granted $2MM worth of stock, he or she might have incentive to help increase the price to say $2.3MM, or 15%. That said, the incremental $300K is peanuts when it comes to protecting the value of the $2MM already on the table. There is a huge difference between corporate sustainability and corporate value creation. GM traded at $38 per share in 1994, and since it is $38 per share today, it has “sustained” value for the past nine years. Is this the type of behavior we hope to encourage?” October 7, 2003: Beware The Digital Hand (Link)  Summary: Digitization is great for consumers, but awful for consumer electronics producers. Semiconductors make electronics faster, cheaper and more powerful. Who reaps the rewards? The semiconductor industry. That’s where differentiation happens. Consumer electronics (CE) companies commoditize, forced to differentiate another way: supply chain. The CE leaders will be the ones with the shortest distance between their product and the customer.  Favorite Quote: “Digitization is creeping its way across the entire consumer electronics industry, as we slowly remove analog media and components from our lives. While this is good news for consumers who benefit from the low prices that the digital hand ensures, the quid pro quo for businesses is brutal competition.” December 18, 2003: Cleaning Up After The Ninth Circuit In An Attempt To Save The Internet (Link)  Summary: A regulated internet disproportionately hurts these four groups: consumers, IT businesses, American competitiveness, and RBOCs. Regulation hurts consumers in the form of higher prices to compensate for increased taxes. IT businesses hurt because if you slow the speed of internet adoption, you remove the runway for the IT industry. This translates into competitiveness issues as places like South Korea see 60%+ internet adoption. Finally, RBOC’s hurt because it would be a repeat of DSL regulations, which slashed growth and prompted the switch to cable modems.  Favorite Quote: “We should all know by now that rather than increasing competition, regulation typically reinforces monopolies and oligopolies. Startups will not and cannot prevail in heavily regulated industries. They lack the required resources and capital to manage fifty different utility commissions on a hundred different regulatory issues. For this same reason, you will never see a startup deliver an automobile in the U.S. as the regulatory red tape swamps all efforts. Increased regulation will do nothing more than ensure that new competitors and innovative solutions are permanently locked out of the market.” * * * That’s about where Substack cuts us off! Stay tuned next week for the next part of our Bill Gurley Chronicles Series! Tyler Durden Sun, 06/12/2022 - 15:30.....»»

Category: blogSource: zerohedgeJun 12th, 2022

BOMA New York Claims Half of the Regional MAC TOBY Awards 

The 2022 Middle Atlantic Conference and TOBY Awards was held end of this past April. BOMA New York is proud to announce that one executive and four New York City buildings and their respective owner/manager teams have won the prestigious BOMA MAC TOBY Award at the recent in-person regional conference... The post BOMA New York Claims Half of the Regional MAC TOBY Awards  appeared first on Real Estate Weekly. The 2022 Middle Atlantic Conference and TOBY Awards was held end of this past April. BOMA New York is proud to announce that one executive and four New York City buildings and their respective owner/manager teams have won the prestigious BOMA MAC TOBY Award at the recent in-person regional conference located in Albany, NY. The Outstanding Building of the Year (TOBY®) Awards is the most prestigious and comprehensive program of its kind in the commercial real estate industry, recognizing quality in commercial buildings and rewarding excellence in building management. To win a regional MAC TOBY Award, a professional and/or property first must win at a local competition. By way of recognizing quality in properties throughout the Middle Atlantic region of the United States, and rewarding excellence in building management, twelve awards were presented at the conclusion of the annual regional conference. The Middle Atlantic Region, better known as MAC, is comprised of 15 local associations covering 11 states The five New York City 2022 BOMA MAC REGIONAL TOBY winners are: James R. Kleeman, BOMA Fellow, RPA won the BOMA MAC Regional Outstanding Member of the Year. Jim has been an active member of BOMA NY since 2003 and is regularly involved at the Local, Regional, and International level. He led the BOMA NY Mentor Program for Emerging Leader and Student Members, is the Chair of the BOMA NY Preparedness Committee, as well as is the Regional Emergency Committee Chair and co-author of the BOMA International’s publication ‘Managing Through Pandemics… Preparing Your Buildings, Tenants and Staff’. Mr. Kleeman has also been bestowed a BOMA International Fellow designation since 2020. 110 Greene Street, better known as The SoHo Building, won the BOMA MAC Regional TOBY Award “Operating Office Building of the Year (100,000-249,999 SF)”. 110 Greene Street is located at the epicenter of SoHo and features high ceilings, open floorplates and historic details throughout. The SoHo Building is BOMA360, Energy Star, LEED Gold, WELL and WiredScore certified. Notable tenants include UNTUCKit, BIRKENSTOCK, Anne Fontaine, Vashi and Meermin Mallorca Shoes. 110 Greene Street is owned and managed by SL Green Realty Corp. 10 Hudson Yards won the BOMA MAC Regional Award “Operating Office Building of the Year (Over 1 Million SF)”. 10 Hudson Yards is the cultural hub of Manhattan’s New West Side. Designed by global architects KPF, the 1.8 million-square-foot tower stands an astounding 895 feet tall and features panoramic views. Designed for the new workplace paradigm and typified by expansive, column-free floor plates, above-average ceiling heights, an abundance of natural light – tenants include Coach, L’Oréal, SAP, Boston Consulting Group, VaynerMedia, Intersection Co. and Sidewalk Labs. 10 Hudson Yards is the first NYC commercial skyscraper to receive LEED v2009 Platinum Certification. Lindsay DeFouw, Vice President at Related Companies said, “Since opening just six short years ago, the team at 10 Hudson Yards has exceeded expectations from both tenants and visitors alike. Our latest BOMA win is the proof in the pudding! We are proud of the continued commitment by our management, engineering, janitorial, and security teams to delivering the highest levels of customer service, sustainability, and best-in-class operations in New York City and beyond. Ms. DeFouw continued, “We look forward to representing our region at BOMA International later this year.” 10 Hudson Yards is owned by Allianz, Related Companies, and Oxford Properties Group; and managed by Related Companies.. 11 Madison Avenue won the BOMA MAC Regional Award “Earth Building of the Year”. 11 Madison has been a cornerstone of innovation since its conception in 1929. Nine decades and multiple renovations later – including NYC’s largest – it has fully taken on the mantle of sustainability. Today, 11 Madison is BOMA360, LEED Gold and Fitwel certified; houses two ice plants, and has achieved Energy Star certification since 2016. Forty-nine elevators transport tenants throughout its 2.3 million SF of diverse workspace. Tenant corporate sustainability commitments enhance the building’s profile through LEED-certified and ISO40001-compliant facilities, where infrastructure, programs and practices encompass ice plant technology, the drive to achieve 100% renewable power by 2030. 11 Madison is owned by SL Green Realty Corp. and PGIM Real Estate; and managed by SL Green Realty Corp. Edward V. Piccinich, Chief Operating Officer of SL Green said, “Year after year, BOMA brings together the best properties in the Mid-Atlantic region that set the standard for operational excellence. SL Green Realty Corp. is proud to be the recipient of this top award in not only one, but two categories. It is a true testament to our team’s continued dedication to excellence. At both 11 Madison Avenue and 110 Greene Street, historic properties have been reinvigorated through strategic capital upgrades and industry-leading standards, while showcasing the details of their original design. Achieving the Earth Award at 11 Madison demonstrates how a 2.3M SF Art Deco mainstay has been reawakened by exceeding the highest standards for efficiency and social responsibility, whereas 110 Greene Street winning Operating Building of the Year highlights our comprehensive approach to operations, community impact, tenant satisfaction, and sustainability – all while harmonizing with the artistic vibe of the surrounding SoHo neighborhood.” 101 Greenwich won the BOMA MAC Regional Award “Renovated Building of the Year”. 101 Greenwich was delivered in 1907 and considered a timeless icon of Downtown Manhattan. After an $85 million complete renovation, the building was enhanced with a beautifully redesigned lobby, upgraded elevators, bathrooms, building systems and a large bike-friendly storage room for tenants, among several state-of-the-art workspaces and amenities. Upgrades were also made to the property’s mechanical, electrical, plumbing, and fire alarm systems in the lobby, elevators, and bathrooms to promote safety and efficiency. 101 Greenwich features facial recognition scanning turnstiles granting tenants safe passage 24/7 and immediate access to 12 different NYC subway lines. The renovation transformed a Class B building to one of the finest, fully modernized, pre-war Class A buildings in Lower Manhattan. “This major win would not have been achieved without the help of our creative and innovative ownership team, and the execution of our management team, who work so hard every day to sustain the standard,” said Chirstopher Gildea, General Manager, Property Management at JLL. 101 Greenwich is owned by BentallGreenOak and Cove Property Group; and managed by JLL. Matthew J. Duthie, Chair of BOMA New York, said, “Congratulations to the exemplary New York City owners and managers for their respective TOBY Awards. We also congratulate Jim Kleeman for receiving the prestigious Regional Outstanding Member of the Year Award.” Mr. Duthie continued, “They, together with the other recent Regional TOBY winners, lead the commercial real estate industry with excellence.” Winners of all regional TOBY Awards will compete against one another at the upcoming BOMA International Conference & Expo in Nashville, TN, scheduled for June 25-28, 2022. The cycle begins again at the local level when BOMA New York will host its 51st Annual Pinnacle Awards on September 29th at Pier 60. The post BOMA New York Claims Half of the Regional MAC TOBY Awards  appeared first on Real Estate Weekly......»»

Category: realestateSource: realestateweeklyMay 28th, 2022

Alpha Tau Medical Announces First Quarter 2022 Financial Results and Provides Corporate Update

-Debuted as publicly-traded oncology company in March 2022 under symbol DRTS while raising approximately $104 million in gross proceeds- -Targeted start of U.S. multi-center pivotal trial in skin cancers in the middle of 2022- JERUSALEM, May 26, 2022 /PRNewswire/ -- Alpha Tau Medical Ltd. (NASDAQ:DRTS) (NASDAQ: DRTSW), ("Alpha Tau" or the "Company"), the developer of the innovative alpha-radiation cancer therapy Alpha DaRT™, reported first quarter 2022 financial results and provided a corporate update. "2022 is an important year for the Company, as we look to initiate a number of important clinical trials across large global markets, including our first U.S. pivotal trial as well as trials in internal organs such as the prostate," commented Alpha Tau CEO Uzi Sofer. "The first quarter of 2022 already saw us reach a number of meaningful milestones, including our first U.S. data read out and our debut as a public company traded on NASDAQ under symbol "DRTS." We are also working in parallel to expand our manufacturing capabilities and to strengthen our supply chain in the U.S., Israel, and Asia, as part of the expansion of our clinical trial activities and future commercialization." First quarter 2022 Corporate Highlights: Reported results in January 2022 from the first pilot multi-center study of Alpha DaRT in the United States, led by Memorial Sloan Kettering Cancer Center. In this trial of malignant skin and soft tissue cancer patients, a complete response, as measured by RECIST criteria, was observed in all ten out of ten tumors treated (100%), with no product-related serious adverse events reported. Alongside these data, a 98% overall response rate was observed in a pooled analysis of superficial tumors treated that reached their efficacy endpoint measurement by quarter end, across the Company's various trials. Completed patient recruitment in the Company's Japanese pivotal trial in head and neck cancer, with data submission targeted for the second half of 2022. Entered into a sponsored research agreement with investigators at The University of Texas MD Anderson Cancer Center in January 2022 to evaluate the combination of Alpha DaRT with DNA-repair inhibitors and immune checkpoint inhibitors for the treatment of breast tumors. Completed its business combination in March 2022 with Healthcare Capital Corp., a special purpose acquisition company, together with a concurrent Private Investment in Public Equity (PIPE) financing, raising a total of approximately $104 million in gross proceeds, and commenced trading of its shares and warrants on the Nasdaq Capital Market under the symbols "DRTS" and "DRTSW", respectively. Appointed Ruth (Ruti) Alon to its Board of Directors in March 2022. Ms. Alon brings a wealth of healthcare experience and serves on the boards of multiple private and public companies in the sector. Upcoming 2022 Milestone Targets Include: First Israeli patient in the prostate cancer feasibility trial in the second quarter of 2022. Initiation of multi-center pivotal U.S. trial in skin cancers in the middle of 2022. Recruitment in the Canadian feasibility trial in pancreatic tumors to begin in the second half of 2022. Submission of Alpha DaRT pivotal trial in head and neck cancer to Japan's PMDA in the second half of 2022 for marketing authorization. Financial results for the first quarter ended March 31, 2022 R&D expenses for the quarter ended March 31, 2022 were $5.2 million, compared to $2.2 million for the same period in 2021, primarily due to increased R&D activity and increased share-based compensation costs. Marketing expenses for the quarter ended March 31, 2022 were $0.2 million, compared to $0.2 million for the same period in 2021. G&A expenses for the quarter ended March 31, 2022 were $3.3 million, compared to $0.4 million for the same period in 2021, primarily due to costs associated with the merger with Healthcare Capital Corp., increased professional fees and share-based compensation. Financial expenses, net, for the quarter ended March 31, 2022 were $17.0 million, compared to $9.0 million for the same period in 2021, primarily due to an increase in the revaluation of warrants. For the quarter ended March 31, 2022, the Company had a net loss of $25.7 million, or ($0.54) per share, compared to a loss of $11.7 million, or ($0.29) per share, in the same period in 2021. Balance Sheet Highlights As of March 31, 2022, the Company had cash and cash equivalents, restricted cash and short term deposits in the amount of $107.0 million, compared to $31.9 million on December 31, 2021. In addition, incremental proceeds of approximately $13 million from the original PIPE were received after March 31, 2022. The Company expects that this cash balance will be sufficient to fund operations for at least two years. In addition, the Company's Board of Directors approved a program for the buyback of the Company's publicly traded warrants in an amount of up to $3 million. Repurchases may be started or suspended at any time without prior notice, depending on market conditions and other factors. About Alpha DaRT™ Alpha DaRT™ (Diffusing Alpha-emitters Radiation Therapy) is designed to enable highly potent and conformal alpha-irradiation of solid tumors by intratumoral insertion of radium-224 impregnated seeds. When the radium decays, its short-lived daughters are released from the seed, and disperse while emitting high-energy alpha particles with the goal of destroying the tumor. Since the alpha-emitting atoms diffuse only a short distance, Alpha DaRT aims to mainly affect the tumor, and to spare the healthy tissue around it.  About Alpha Tau Medical, Ltd. Founded in 2016, Alpha Tau is an Israeli medical device company that focuses on research, development, and potential commercialization of the Alpha DaRT for the treatment of solid tumors. The technology was initially developed by Prof. Itzhak Kelson and Prof. Yona Keisari from Tel Aviv University. Forward-Looking Statements This press release includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. When used herein, words including "anticipate," "being," "will," "plan," "may," "continue," and similar expressions are intended to identify forward-looking statements. In addition, any statements or information that refer to expectations, beliefs, plans, projections, objectives, performance or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking. All forward-looking statements are based upon Alpha Tau's current expectations and various assumptions. Alpha Tau believes there is a reasonable basis for its expectations and beliefs, but they are inherently uncertain. Alpha Tau may not realize its expectations, and its beliefs may not prove correct. Actual results could differ materially from those described or implied by such forward-looking statements as a result of various important factors, including, without limitation: (i) Alpha Tau's ability to receive regulatory approval for its Alpha DaRT technology or any future products or product candidates; (ii) Alpha Tau's limited operating history; (iii) Alpha Tau's incurrence of significant losses to date; (iv) Alpha Tau's need for additional funding and ability to raise capital when needed; (v) Alpha Tau's limited experience in medical device discovery and development; (vi) Alpha Tau's dependence on the success and commercialization of the Alpha DaRT technology; (vii) the failure of preliminary data from Alpha Tau's clinical studies to predict final study results; (viii) failure of Alpha Tau's early clinical studies or preclinical studies to predict future clinical studies; (ix) Alpha Tau's ability to enroll patients in its clinical trials; (x) undesirable side effects caused by Alpha Tau's Alpha DaRT technology or any future products or product candidates; (xi) Alpha Tau's exposure to patent infringement lawsuits; (xii) Alpha Tau's ability to comply with the extensive regulations applicable to it; (xiii) the ability to meet Nasdaq's listing standards; (xiv) costs related to being a public company; (xv) changes in applicable laws or regulations; (xix) impacts from the COVID-19 pandemic; and the other important factors discussed under the caption "Risk Factors" in Alpha Tau's Annual Report on Form 20-F filed with the SEC on March 28, 2022, and other filings that Alpha Tau may make with the United States Securities and Exchange Commission. These and other important factors could cause actual results to differ materially from those indicated by the forward-looking statements made in this press release. Any such forward-looking statements represent management's estimates as of the date of this press release. While Alpha Tau may elect to update such forward-looking statements at some point in the future, except as required by law, it disclaims any obligation to do so, even if subsequent events cause its views to change. These forward-looking statements should not be relied upon as representing Alpha Tau's views as of any date subsequent to the date of this press release. Investor Relations Contact:IR@alphatau.com   CONSOLIDATED BALANCE SHEETS  U.S. dollars in thousands March 31, 2022 December 31, 2021 Unaudited Audited ASSETS CURRENT ASSETS: Cash and cash equivalents $      98,071 $     23,236 Restricted cash 837 618 Short-term deposits 8,092.....»»

Category: earningsSource: benzingaMay 26th, 2022

Saga Partners 1Q22 Commentary: Carvana And Redfin

Saga Partners commentary for the first quarter ended March 31, 2022. During the first quarter of 2022, the Saga Portfolio (“the Portfolio”) declined 42.4% net of fees. This compares to the overall decrease for the S&P 500 Index, including dividends, of 4.6%. The cumulative return since inception on January 1, 2017, for the Saga Portfolio […] Saga Partners commentary for the first quarter ended March 31, 2022. During the first quarter of 2022, the Saga Portfolio (“the Portfolio”) declined 42.4% net of fees. This compares to the overall decrease for the S&P 500 Index, including dividends, of 4.6%. The cumulative return since inception on January 1, 2017, for the Saga Portfolio is 112.0% net of fees compared to the S&P 500 Index of 122.7%. The annualized return since inception for the Saga Portfolio is 15.4% net of fees compared to the S&P 500’s 16.5%. Please check your individual statement as specific account returns may vary depending on timing of any contributions throughout the period. 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); Q1 2022 hedge fund letters, conferences and more Interpretation of Results I was not originally planning to write a quarterly update since switching to semi-annual updates a few years ago but given the current drawdown in the Saga Portfolio I thought our investors would appreciate an update on my thoughts surrounding the Portfolio and the current market environment in general. The Portfolio’s drawdown over the last several months has been hard not to notice even for those who follow best practices of only infrequently checking their account balance. Outperformance vs. the S&P 500 since inception has flipped to underperformance on a mark-to-market basis and the stock prices of our companies have continued to decline into the second quarter. In past letters I have spent a lot of time discussing the Saga Portfolio’s psychological approach to investing to help prepare for the inevitable chaos that will occur while investing in the public markets from time-to-time. It’s impossible to know why the market does what it does at any point in time. I would argue that the last two years could be considered pretty chaotic, both on the upside speculation and now what appears to be on the downside fear and panic. I will attempt to give my perspective on how events played out within the Saga Portfolio with an analogy. Let’s say that in 2019 we owned a fantastic home that was valued at $500,000. We loved it. It was in a great neighborhood with good schools for our kids. We liked and trusted our neighbors; in fact, we gave them a spare key in case of emergencies. It was the perfect home for us to live in for many years to come. Based on the neighborhood becoming increasingly attractive over time, it was likely that our home may be valued around $2 million in ~10 years from now. This is strong appreciation (15% IRR) compared to the average home, but this specific home and neighborhood had particularly strong long-term fundamental tailwinds that made this a reasonable expectation. Then in 2020 a global pandemic hit causing a huge disorientation in the housing market. For whatever reasons, the appraised value of our home almost immediately doubled to $1 million. Nothing materially changed about what we thought our home would be worth in 10 years, but now from the higher market value, the home would only appreciate at a lower 7% IRR assuming it would still be worth $2 million in 10 years. What were our options under these new circumstances? We could move and try to buy a new home that provided a higher expected return. However, the homes in the other neighborhoods that we really knew and liked also doubled in price, so they did not really provide any greater value. Also, the risk and hassle of moving for what may potentially only be modestly better home appreciation did not make sense. We could buy a home in a less desirable neighborhood where prices looked relatively cheaper, but we would not want to live long-term. Even if we decided to live there for many years, the long-term fundamental dynamics of the crummy neighborhood were weak to declining and it was uncertain if the property would appreciate at all despite its lower valuation. We could sell our home for $1 million and rent a place to live for the interim period while holding cash and waiting for the market to potentially correct. However, we did not know if, when, or to what extent the market would correct and the thought of renting a place temporarily for our family was unappealing. For the Saga family, we decided to stay invested in the home that we knew, loved, and still believed had similar, if not stronger prospects following the COVID-induced surge in demand in our neighborhood. Now, for whatever reason, the market views our neighborhood very poorly and the appraised value of our home declined to $250,000, below any previous appraisals. It seems odd because it is the exact same home and the fundamentals of the neighborhood are much stronger than several years ago, suggesting that the expected $2 million value in the future is even more probable than before. It is a very peculiar situation, but the market can do anything at any moment. Fortunately, the lower appraisal value does not impact how much we still love our home, neighborhood, schools, or what the expected future value will be. In fact, we prefer a lower value because our property taxes will be lower! One thing is for certain, we would never sell our home for $250,000 simply because the appraised value has declined from prior appraisals. We would also never dream of selling in fear that the downward price momentum continues and then hopefully attempt to buy it back one day for $200,000. We can simply sit tight for as long as we want while the neighborhood around us continues to improve fundamentally over time, fully expecting the value of our home to eventually go up with it. It just so happens humans are highly complex beings and do not always react in what an economist may consider a rational way. Our emotions are highly contagious. When someone smiles at you, the natural reaction is to smile back. When someone else is sad, you feel empathy. These are generally great innate characteristics for helping to build the strong relationships with friends and family that are so important throughout life. But it also means that when other people are scared, it also makes you feel scared. And when more and more people get scared, that fear can cascade exponentially and turn into panic, which can cause people to do some crazy things, especially when it comes to making long-term decisions. As fear spreads, all attention shifts from thinking about what can happen over the next 5-10+ years to the immediate future of what will happen over the next day or even hour. Of course, during times of panic, “this time is always different.” It may very well be the case, but the world can only end once. Historically speaking, things have tended to work out pretty well over time on average. I am by no means immune to these contagious feelings. My way of coping with how I am innately wired is by accepting this fact and then trying to know what I can and cannot control. A core part of my investing philosophy is that I do not know what the market will do next, and I never will. Inevitably the market or a specific stock will crash, as it does from time-to-time. This “not timing the market” philosophy or treating our public investments from the perspective of a private owner may feel like a liability during a drawdown, but it is this same philosophy of staying invested in companies we believe to have very promising futures which positions us perfectly for the inevitable recovery. Eventually, emotions and the business environment will normalize, and the storm will pass. It could be next quarter, year, or even in several years, but we will be perfectly positioned for the recovery, at which point the stock price lows will likely be long gone. The whole investing process improves if one can really take the long-term view. However, it is not natural for people to think long-term particularly when it comes to owning pieces of publicly traded companies. It is far more natural to want to act by jumping in and out of stocks in an attempt to outsmart others who are trying to outsmart you. When the market price of your ownership in a business is available and fluctuating wildly every single day, it is hard to ignore and not be influenced by it. While one can get lucky through speculation, the big money is made by investing, by owning great businesses and letting them compound owner’s capital over many years. As the market has evolved over the last few decades, there appears to be an ever-increasing percent of “investors” who are effectively short-term renters, turning over the companies in their portfolios so quickly that they never really know the business that lies below the surface of the stock. While more of Wall Street is increasingly focused on the next quarter, a potentially looming recession, the Fed’s next interest rate move, or trying to time the market’s rotation from one industry into another, we are trying to think about what our companies’ results will be in the year 2027, or better yet 2032 and beyond. The most significant advantage of investing in the public market is the ability to take advantage of it when an opportunity presents itself or to ignore the market when there is nothing to do. The key to success is never giving up this advantage. You must be able to play out your hand and not be forced to sell your assets at fire sale prices. Significant portfolio declines are a good reminder of the importance of only investing money that you will not need for many years. This prevents one from being in a position where it is necessary to liquidate when adverse psychology has created unusually low valuations. However, we do not want to simply turn a blind eye to stock price declines of 50% or more and dig our heals into the ground believing the market is just being irrational. When the world is screaming at you that it believes your part ownership in these companies is worth significantly less than the market believed not too long ago, we attempt to understand if we are missing something by continually evaluating the long-term outlooks of our companies using all the relevant information that we have today from a first principles basis. Portfolio Update Instead of frequently checking a stock’s price to determine whether the company is making progress, I prefer looking to the longer-term trends of the business results. There will be stronger and weaker quarters and years since business success rarely moves up and to the right in a perfectly straight line. As a company faces headwinds or tailwinds from time-to-time, the stock price may fluctuate wildly in any given year, however the underlying competitive dynamics and business models that drive value will typically change little. Regarding our companies as a whole, first quarter results reflected a general softness in certain end markets, including the used car, real estate, and advertising markets. However, the Saga Portfolio’s companies, on average, provide a superior customer value proposition difficult for competitors to match. Most of them have a cost advantage compared to competitors; therefore, the worse it gets for the economy, the better it gets for our companies’ respective competitive positions over the long-term. For example, first quarter industry-wide used car volumes declined 15% year-over-year while Carvana’s retail units increased 14%. Existing home sales decreased 5% during the quarter while Redfin’s real estate transactions increased 1%. Digital advertising is expected to grow 8-14% in 2022 while the Trade Desk grew Q1’22 revenues 43% and is expected to grow them more than 30% for the full year 2022. While industry-wide TV volumes remain below 2019 pre-COVID levels, Roku gained smart TV market share sequentially during the quarter, continuing to be the number one TV operating system in the U.S. and number one TV platform by hours streamed in North America. Weaker industry conditions will inevitably impact our companies’ results; however, our companies should continue to take market share and come out on the other side of any potential economic downturn stronger than when they went in. For the portfolio update, I wanted to provide a more in-depth update on Carvana and Redfin which have both experienced particularly large share price declines and have recent developments that are worth reviewing. Carvana I first wrote about Carvana Co (NYSE:CVNA) in this 2019 write-up. I initially explained Carvana’s business, superior value proposition compared to the traditional dealership model, attractive unit economics, and how they were uniquely positioned to win the large market opportunity. Since then, Carvana has by far exceeded even my most optimistic initial expectations. While the company did benefit following COVID in the sense that customers’ willingness to buy and sell cars through an online car dealer accelerated, the operating environment over the last two years has been very challenging. Carvana executed exceedingly well considering the shifting customer demand in what is a logistically intensive operation and what has been a tight inventory environment due to supply chain issues restricting new vehicle production. Sales, gross profits, and retail units sold have grown at a remarkable 104%, 151%, and 87% CAGR over the last five years, respectively. Source: Company filings Shares have come under pressure following their first quarter results, which reflected larger than expected losses. The quarter was negatively impacted by a combination of COVID-related logistical issues in their network that started towards the end of the fourth quarter as Omicron cases spread. Employee call off rates related to Omicron reached an unprecedented 30% that led to higher costs and supply chain bottlenecks. As less inventory was available due to these problems, it led to less selection and longer delivery times, lowering customer conversion rates. Additionally, interest rates increased at a historically fast rate during the first quarter which negatively impacted financing gross profits. Carvana originates loans for customers and then sells them to investors at a later date. If interest rates move materially between loan origination and ultimately selling those loans, it can impact the margin Carvana earns on underwriting those loans. Industry-wide used car volumes were also down 15% year-over-year during the first quarter. While Carvana continues to grow and take market share, its retail unit volume growth was slower than initially anticipated, up only 14% year-over-year. Carvana has been in hyper growth mode since inception and based on the operational and logistical requirements of the business, typically plans, builds, and hires for expected capacity 6-12 months into the future. This has historically served Carvana well given its exceptionally strong growth, but when the company plans and hires for higher capacity than what occurs, it can lead to lower retail gross profits and operating costs per unit sold. When combined with lower financing gross profits in the quarter from rising interest rates, losses were greater than expected. In February, Carvana announced a $2.2 billion acquisition of ADESA (including an additional $1 billion plan to build out the reconditioning sites) which had been in the works for some time. ADESA is a strategic acquisition to help accelerate Carvana’s footprint expansion across the country, growing its capacity from 1.0 million units at the end of Q1’22 to 3.2 million units once complete over the next several years. It is unfortunate the acquisition timing followed a difficult quarter that had greater than expected losses, combined with a generally tighter capital market environment. Carvana ended up raising $3.25 billion in debt ($2.2 billion for the acquisition and $1 billion for the buildout) at a higher than initially expected 10.25% interest rate. Given these higher financing costs and first quarter losses, they issued an additional $1.25 billion in new equity at $80 per share, increasing diluted shares outstanding by ~9%. Despite the short-term speedbumps surrounding logistical issues, softer industry-wide demand, and a higher cost of capital to acquire ADESA, Carvana’s long-term outlook not only remains intact but looks even more promising than before. To better understand why this is the case and where Carvana is in its lifecycle, it helps to provide a little background on the history of retail. While e-commerce is a more recent phenomena that developed from the rise of the internet in the 1990s, the retail industry has undergone several transformations throughout history. In retailing, profitability is determined by two factors: the margins earned on inventory and the frequency with which they can turn inventory. Each successive retail transformation had a similar economic pattern. The newer model had greater operating leverage (higher fixed costs, lower variable costs). This resulted in greater economies of scale (lower cost per unit) and therefore greater efficiency (higher asset turnover) with size that enabled them to charge lower prices (lower gross margins) than the preceding model and still provide an attractive return on capital. The average successful department store earned gross margins of ~40% and turned inventory about 3x per year, providing ~120% annual return on the capital invested in inventory. The average successful big box retailer earned ~20% gross margins and turned its inventory 5x per year. Amazon retail earns ~10% gross margins (including fulfillment costs in COGS) and turns inventory at a present rate of 12x times annually. The debate that surrounds any subscale retailer, particularly in e-commerce, is whether they have enough capital/runway to build out the required infrastructure and then scale business volume to spread fixed costs over enough units. Before reaching scale, analysts may point to an online business’ lower price points (“how can they charge such low prices?!”), higher operating costs per unit (“they lose so much money per item!”), and ongoing losses and capital investments (“they spend billions of dollars and still have not made any money!”) as evidence that the model does not make economic sense. Who can blame them since the history books are filled with companies that never reached scale? However, if the retailer does build the infrastructure and there is sufficient demand to spread fixed costs over enough volume, the significant capital investment and high operating leverage creates high barriers to entry. If we look to Amazon as the dominant e-commerce company today, once the infrastructure is built and reaches scale, there is little marginal cost to serve any prospective customer with an internet connection located within its delivery footprint. For this reason, I have always been hesitant to invest in any e-commerce company that Amazon may be able to compete with directly, which is any mid-sized product that fits in an easily shippable box. As it relates to used car retailing, the infrastructure required to ship and recondition cars is unique, and once built, the economies of scale make it nearly impossible for potential competitors to replicate. Carvana is in the very early stages of building out its infrastructure. There is clearly demand for its attractive customer value proposition. It has demonstrated an ability to scale fixed costs in earlier cohorts as utilization of capacity increases, providing attractive unit economics at scale. Newer market cohorts are tracking at a similar, if not faster market penetration rate as earlier cohorts. Carvana is still investing heavily in building out a nationwide hub-and-spoke transportation network and reconditioning facilities. In 2021 alone, Carvana grew its balance sheet by $4 billion as it invested in its infrastructure while also reaching EBITDA breakeven for the first time. The Amazon story is a prime example (pun intended) of a new and better business model (more attractive unit economics) that delivered a superior value proposition and propelled the company ahead of its competition, similar to the underlying dynamics occurring in the used car industry today. Amazon invested heavily in both tangible and intangible growth assets that depressed earnings and cash flow in its earlier years (and still today) while growing its earning power and the long-term value of the business. The question is, does Carvana have enough capital/liquidity to build out its infrastructure and scale business volume to then generate attractive profits and cash flow? Following Carvana’s track record of scaling operating costs and reaching EBITDA breakeven in 2021, the market was no longer concerned about its liquidity position or the sustainability of its business model. However, the recent quarterly loss combined with taking on $3 billion in debt to buildout the 56 ADESA locations across the country raises the question of whether Carvana has enough liquidity to reach scale. Carvana’s current stock price clearly reflects the market discounting the probability that Carvana will face liquidity issues and therefore have to raise further capital at unfavorable terms. However, I think if you look a little deeper, Carvana has clearly demonstrated highly attractive unit economics. It has several levers to pull to protect it from any liquidity concerns if needed. The $2.6 billion in cash (as well as $2 billion in additional available liquidity in unpledged real estate and other assets) it has following the ADESA acquisition, is more than enough to sustain a potentially prolonged decline in used car demand. The most probable scenario over the next several quarters is that Carvana will address its supply chain and logistical issues that were largely due to Omicron. As the logistical network normalizes, more of Carvana’s inventory will be available to purchase on their website with shorter delivery times, which will increase customer conversion rates. This will lead to selling more retail units, providing higher inventory turnover and lower shipping costs, and therefore gross profit per unit will recover from the first quarter lows. Other gross profit per unit (which primarily includes financing) will also normalize in a less volatile interest rate environment. Combined total gross profit per unit should then approach normalized levels by the end of the year/beginning of 2023 (~$4,000+ per unit). Like all forms of leverage, operating leverage works both ways. For companies with higher operating leverage, when sales increase, profits will increase at a faster rate. However, if sales decrease, profits will decrease at a faster rate. While Carvana has high operating leverage in the short-term, they do have the ability adjust costs in the intermediate term to better match demand. When demand suddenly shifts from plan, it will have a substantial impact on current profits. First quarter losses were abnormally high because demand was lower than expected. Although, one should not extrapolate those losses far into the future because Carvana has the ability to better adjust and match its costs structure to a lower demand environment if needed. As management better matches costs with expected demand, operating costs as a whole will remain relatively flat if not decline throughout the year as management has already taken steps to lower expenses. As volumes continue to grow at the more moderate pace reflected in the first quarter and SG&A remains flat to slightly declining, costs per unit will decline with Carvana reaching positive EBITDA per unit by the second half of 2023 in this scenario. Source: Company filing, Saga Partners Source: Company filing, Saga Partners With the additional $3.2 billion in debt, Carvana will have a total interest expense of ~$600 million per year, assuming no paydown of existing revolving facilities or net interest income on cash balances. Management plans on spending $1 billion in capex to build out the ADESA locations. They are budgeting for ~$40 million in priority and elective capex per quarter going forward suggesting the build out will take ~6 years. Total capex including maintenance is expected to be $50 million a quarter. Carvana would reach positive free cash flow (measured as EBITDA less interest expense less total Capex) by 2025. Note this assumes the used car market remains depressed throughout 2022 and then Carvana’s retail unit growth increases to 25% a year for the remainder of the forecast and no benefit in lower SG&A or increased gross profit per unit from the additional ADESA locations was assumed. Stock based compensation was included in the SG&A below so actual free cash flow would be higher than the chart indicates. Source: Company filings, Saga Partners Note: Free cash flow is calculated as EBITDA less interest expense less capex After the close of the ADESA acquisition, Carvana has $2.6 billion in cash (plus $2 billion in additional liquidity from unpledged assets if needed). Assuming the above scenario, Carvana has plenty of cash to endure EBITDA losses over the next year and a half, interest payments, and capex needs. Source: Company filings, Saga Partners The above scenario does not consider the increasing capacity that Carvana will have as it continues to build out the ADESA locations. After building out all the locations, Carvana will be within one hundred miles of 80% of the U.S. population. This unlocks same-day and next-day delivery to more customers, leading to higher customer conversion rates, higher inventory turn, lower risk of delivery delays, and lower shipping costs, which all contribute to stronger unit economics. Customer proximity is key. Due to lower transport costs, faster turnaround times on acquired vehicles, and higher conversion from faster delivery speeds, a car picked up or delivered within two hundred miles of a recondition center generates $750 more profit than an average sale. It is possible that industry-wide used car demand remains depressed or even worsens for an extended period. If this were the case, management has the ability to further optimize for efficiency by lowering operating costs to better match demand. This is what management did following the COVID demand shock in March 2020. The company effectively halted corporate hiring and tied operational employee hours to current demand as opposed to future demand. During the months of May and June 2020, SG&A (ex. advertising expense and D&A) per unit was $2,600, far lower than the $3,440 reported in 2020 or $3,654 in 2021. Carvana has also historically operated between 50-60% capacity utilization, indicating further room to scale volumes across its existing infrastructure without the need for materially greater SG&A expenses. Advertising expense in older cohorts reached ~$500 per unit, compared to the $1,126 reported for all of 2021, while older cohorts still grew at 30%+ rates. If needed, Carvana could improve upon the $2,600 SG&A plus $500 advertising expense ($3,100 in total) per unit at its current scale and be far below gross profit per unit even if used car demand remains depressed for an extended period of time. When management optimizes for efficiency as opposed to growth, it has the ability to significantly lower costs per unit. Carvana has highly attractive unit economics and I fully expect management will take the needed measures to right size operating costs with demand. They recently made the difficult decision to layoff ~2,500 employees, primarily in operations, to better balance capacity with the demand environment. If we assume it takes six years to fully build out the additional ADESA reconditioning locations, Carvana will have a total capacity of 3.2 million units in 2028. If Carvana is running at 90% utilization it could sell 2.9 million retail units (or ~7% of the total used car market). If average used car prices decline from current levels and then follow its more normal longer-term price appreciation trends, the average 2028 Carvana used car price would be ~$23,000 and would have a contribution profit of ~$2,000 per unit at scale. This would provide nearly $5.6 billion in EBITDA. After considering expected interest expense, maintenance capex, and taxes, it would provide over $4 billion in net income. If Carvana realizes this outcome in six years, the company looks highly attractive (perhaps unreasonably attractive) compared to its current $7 billion market cap or $10 billion enterprise value (excluding asset-based debt). Redfin I recently wrote about Redfin Corp (NASDAQ:RDFN) in this December 2021 write-up. I explained how Redfin has increased the productivity of real estate agents by integrating its website with its full-time salaried agents and then funneling the demand aggregated on its website to agents. Redfin agents do not have to spend time prospecting for business but can rather spend all their time servicing clients throughout the process of buying and selling a home. Since Redfin agents are three times more productive than a traditional agent, Redfin is a low-cost provider, i.e., it costs Redfin less to close a transaction than a traditional brokerage at scale. It is a similar concept as the higher operating leverage of e-commerce relative to brick & mortar retailers. Redfin has higher operating leverage compared to the traditional real estate brokerage. Real estate agents are typically contractors for a brokerage. They are largely left alone to run their own business. Agents have to prospect for clients, market/advertise listings, do showings, and service clients throughout each step of the real estate transaction. Everything an agent does is largely a variable cost because few of their tasks are automated. Redfin, on the other hand, turned prospecting for demand, marketing/advertising listings, and investments in technology to help agents and customers throughout the transaction into more of a fixed cost. These costs are scalable and become a smaller cost per transaction as total transaction volumes grow across the company. Because Redfin is a low-cost provider, it has a relative advantage over traditional brokerages. No other real estate brokerage has lowered or attempted to lower the costs of transacting real estate in a similar way. This cost advantage provides Redfin with options about how to share these savings on each transaction. Redfin has primarily shared the cost savings with customers by charging lower commission rates than traditional brokerages. By offering a similar, if not superior, service to customers compared to other brokerages yet charging lower fees, it naturally attracts further demand which then provides Redfin with the ability to scale fixed costs per transaction even more, further widening their cost advantage to other brokerages. So far, the majority of those cost savings are shared with home sellers as opposed to homebuyers. Sellers are more price sensitive than homebuyers because the buyer’s commission is already baked into the seller’s contract and therefore buyers have not directly paid commissions to agents historically. Also, growing share of home listings is an important component of controlling the real estate transaction. The seller’s listing agent is the one who controls the property, decides who sees the house, and manages the offers and negotiations. Therefore, managing more listings enables Redfin to have more control over the transaction and further streamline/reduce inefficiencies for the benefit of both potential buyers and sellers. Redfin also spends some of their cost savings by reinvesting them back into the company by hiring software engineers to build better technology to continue to lower the cost of the transaction. This may include building tools for agents to service clients better, improving the web portal and user interfaces, on-demand tours for buyers to see homes first, automation to give homeowners an immediate RedfinNow offer, etc. Redfin also invests in building other business segments like mortgage, title forward, and iBuying which provide a more comprehensive real estate offering for customers which attracts further demand. So far, the lower costs per transaction have not been shared with shareholders in the form of dividends or share repurchases, and for good reason. In theory, Redfin could charge industry standard prices and increase revenue immediately by 30-40% which would drop straight to the bottom-line assuming demand would remain stable. However, giving customers most of the savings through lower commissions has obviously been one of the drivers for attracting demand and growing transaction volume, particularly for home sellers. The greater the number of transactions, the lower the fixed costs per transaction, which further increases Redfin’s cost advantage compared to traditional brokerages, which provides Redfin with even more money per transaction to share with either customers, employees, and eventually shareholders. With just over 1% market share, Redfin should be reinvesting in growing share which will increase the value of the business and inevitably benefit long-term owners of the company. Redfin’s stock price has experienced an especially large decline this year. I typically prefer to not attempt to place an explanation or narrative on short-term stock price movements, but I will do it anyways given the substantial drop. There are primarily two factors contributing to the market’s negative view of the company: first, the market currently dislikes anything connected to the real estate industry and second, the market currently has little patience for any company that reports net losses regardless of the underlying economics of the business. Real estate is currently a hated part of the market, and potentially for good reason. It is a cyclical industry, and the economy is potentially either entering or already in a recession. Interest rates are expected to continue to rise, negatively impacting home affordability, while an imbalance in the housing supply persists with historically low inventory available helping fuel an unsustainable rise in housing prices. From a macro industry-wide perspective, the real estate market will ebb and flow with the economy over time, but demand to buy, sell, and finance homes will always exist. I do not have the ability to determine how aggregate demand for buying or selling a home will change from year-to-year, but I do know that people have to live somewhere and if Redfin is able to help them find, buy or rent, and finance where they live better than alternative service providers, then the company will gain share and grow in value overtime. Redfin has also reported abnormally high losses of $91 million in the first quarter for which the current market has little appetite. It feeds the argument that Redfin does not have a sustainable business model. While losses can be a sign of unsustainable economics, that is not the case for Redfin. There are several factors that are all negatively hitting the income statement at the same time, and all should improve materially over the next year or two. Higher first quarter losses largely reflect: Agent Productivity: First quarter brokerage sales increased 7% year-over-year, but lead agent count increased 20%, which meant agents were less productive, leading to real estate gross profits declining $17 million from the prior year. Lower productivity was a result of a steeper ramp in agent hiring towards the end of the year against lower seasonal transaction volumes. It typically takes about six months for new agents to get trained and start closing transactions and then contributing to gross profits. Any accelerated hiring, particularly during a softer macro environment, will be a headwind while Redfin is paying upfront costs before any revenue is being generated. Further, closing transactions has been difficult particularly for buyers, which is where most new agents start. The housing market has been unbalanced where there is not enough inventory. A home for sale will typically receive many competing offers which makes it difficult for a buyer to win the deal. Since Redfin agents are mostly paid on commission (~20% salary plus the remainder being commission), it has been more difficult for new agents to earn a sufficient income in the current real estate environment. In response, Redfin started paying $1,500 retention bonuses for new agents who could guide customers to the point of bidding on a home, regardless of whether those bids win. While the bonus may impact gross profits in the near-term before a customer closes a transaction, it will not impact gross margins in the long-term when a transaction eventually takes place. Going forward, agent hiring will return to more normal rates and the larger number of new hires from recent quarters will ramp up which will improve productivity and gross profits. RentPath: Redfin bought RentPath out of bankruptcy for $608 million in April 2021, primarily to incorporate its rentals on its website which helps Redfin.com show up higher on Internet real estate searches. Prior to the acquisition, RentPath had no leadership direction for several years and declining sales and operating losses. RentPath had new management start in August 2021 and was integrated into Redfin.com in March. It finally started to see operational improvement with sales increasing in February and March year-over-year for the first time since 2019 despite a significant decrease in marketing expenses. While RentPath had $17 million in losses during the first quarter and is expected to have $22 million in losses in the second quarter, operations will improve going forward. Management made it clear that RentPath will be a contributor to net profits in its own right and not just a driver of site traffic and demand to Redfin’s brokerage business. Mortgage: A recent major development was the acquisition of Bay Equity for $135 million in April. Redfin was historically building out its mortgage business from scratch but after struggling to scale the operation decided to buy Bay Equity. Redfin was spending $13 million per a year on investing in its legacy mortgage business but going forward, mortgage will now be a net contributor to profits with Bay expected to provide $4 million in profit in the second quarter. The greater implication of having a scaled mortgage underwriter that is integrated with the real estate broker is that they can work together to streamline and expedite the transaction closing which has become an increasingly important value proposition for customers. Looking just a little further into the future, having a scaled and integrated mortgage underwriter can provide Redfin with the capability of providing buyers with the equivalent of an all-cash offer to sellers. Prospective homebuyers who offer all-cash offers to sellers are four times as likely to win the bid and sellers will often accept a lower price from an all-cash buyer vs. one requiring a mortgage. A common problem that many homeowners face is that when they are looking to move, it is difficult to get approved for a second mortgage while holding the current one. Much of their equity is locked in their current home. Frequently, a homebuyer wins an offer on a new home and then is in mad dash to sell their existing home in order to get the financing to work. It is not ideal to attempt to sell your home as fast as possible because it decreases the chance of getting the best price possible. A solution that Redfin could offer as a customer’s agent and underwriter is provide bridge financing between when a customer buys their new home and is then trying to sell their existing home and is therefore paying on two mortgages. Redfin would be able to make a reasonable appraisal for what a customer’s existing home will sell for (essentially what Redfin already does with iBuying) and underwriting the incremental credit exposure they are willing to provide the buyer. The buyer would then have “Redfin Cash” which would work like a cash offer. If this service helps buyers win a bid four times more often, it would even further differentiate Redfin’s value proposition and attract further demand. At least in the near-term, the mortgage segment will go from being a loss center to a contributor to net profits as well as further improving Redfin’s customer value proposition. Restructuring and transaction costs: Redfin had $6 million in restructuring expenses related to severance with RentPath and the mortgage business as well as closing the Bay Equity acquisition. $4 million in restructuring expenses are expected in the second quarter but these expenses will go away in future quarters. The combination of the above factors provided the headline $91 million net loss for the first quarter. Larger than normal losses between $60-$72 million are still expected in the second quarter. However, going forward losses are expected to continue to improve materially. While Redfin is not done investing in improving its service offerings, it should benefit from the significant investments it has already made over the last 16 years. Redfin has been building and supporting a nationwide business that only operated in parts of the country and had to incur large upfront costs. Going forward, it will benefit from the operating leverage baked into its cost structure with gross profits expected to grow twice as fast as overhead operating expenses. Redfin is expected to be cash flow breakeven in 2022 and provide net profits starting in 2024. Redfin has built a great direct to consumer acquisition tool that is unmatched by any real estate broker. It has spent the costs to acquire the customer and has now built out the different services to provide customers any of the real estate services that they may need, whether that is one or a combination of brokerage services, mortgage underwriting, title forward, iBuying, or rental search. Being able to monetize each customer that it has already acquired by offering them any of these services provides Redfin with a better return on customer acquisition costs that no other competitor is able to do to the same extent. Additionally, these real estate services work better when they are integrated under the same company. One does not have to dig very deep to see how attractive Redfin’s shares are currently priced. Shares are now selling around all-time historic lows since its IPO in August 2017. The prior all-time lows were reached during the COVID crash which was a time the world was facing an unknown pandemic that would shut down the economy and potentially put us through a great depression. At its current $1.2 billion market cap, Redfin is selling for 3x expected 2022 real estate gross profits, or 4x its current $1.7 billion enterprise value (excluding asset-based debt). Both are far below the historic average of 15x (which excludes peak multiples reached towards the end of 2020 and early 2021), or the previous all-time low of 6x reached in the depths of March 2020. If we assume Redfin can raise brokerage commissions by 30%, in line with traditional brokerage commission rates, and it does not lose business, Redfin would be able to provide ~20% operating margins. If we take a more conservative view and say Redfin can earn 10% net margins on its 2022 expected real estate revenues of $990 million, it would provide $99 million in net profits, providing a current 12x price-to-earnings ratio. This is for a company that has a long track record of being able to grow 20%+ a year on average, consistently gains market share each quarter, and has barely monetized its significant upfront investments and fixed costs with a long runway to continue to scale. This also does not place any value on its mortgage or iBuying segments which are now contributors to gross profits. There may be macro risks as well as other concerns today, however Redfin’s business and relative competitive advantage have never been stronger. The net losses reported are not representative of Redfin’s true underlying earning power. Redfin has untapped pricing power, an increasingly attractive customer value proposition, and a growing competitive advantage compared to alternative brokerages, which will help Redfin to continue to grow and take market share in what is a very large market. Conclusion Of course, the future can look scary, as it often does when headlines jump from one risk to the other. Despite what may be happening in the macro environment, our companies on average are stronger than they have ever been and are now selling for what we believe are the most attractive prices we have seen relative to their intrinsic value. I have no idea what shares will do in the near-term and I never will. Stock prices can swing wildly for many reasons, and sometimes seemingly for no reason at all. They can diverge, sometimes significantly from their true underlying value. I have no idea when sentiment will shift from optimism to pessimism and then back to optimism. This is what keeps us invested in both good times and in bad. The current selloff can continue further, but assuming our companies continue to execute over the coming years by winning market share and earning attractive returns on their investment spending, the market’s sentiment surrounding our portfolio companies will eventually reflect their underlying fundamentals. I will continue to look towards the longer-term operating results of our companies and not to the movements in their stock price as feedback to whether our initial investment thesis is playing out as expected. While the market can ignore or misjudge business success for a certain period, it eventually has to realize it. During times of greater volatility and periods of large drawdowns, I am reminded of how truly important the quality of our investor base is. It is completely natural to react in certain ways to rising or declining stock prices. It takes a very special investor base to look past near-term volatility and to trust us to make very important decision on their behalf as we continually try to increase the value of the Saga Portfolio over the long-term. As always, I am available to catch up or discuss any questions you may have. Sincerely, Joe Frankenfield Saga Partners Updated on May 16, 2022, 4:44 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: valuewalkMay 17th, 2022

ESG Investing: IG Prime Report Reveals Energy Companies Have The Highest Carbon Footprint

Key findings:  The energy sector was found to have the highest carbon footprint, with around 12 billion tonnes of CO2 emitted each year. The transport sector was revealed to be the second least eco-friendly sector, releasing around 8 billion tonnes of annual carbon emissions. The machinery and paper sectors are the industries with the smallest […] Key findings:  The energy sector was found to have the highest carbon footprint, with around 12 billion tonnes of CO2 emitted each year. The transport sector was revealed to be the second least eco-friendly sector, releasing around 8 billion tonnes of annual carbon emissions. The machinery and paper sectors are the industries with the smallest carbon footprint, with 0.24 and 0.29 billion tonnes of CO2 emitted per year. 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); Q1 2022 hedge fund letters, conferences and more S.no Sectors  Annual CO2 Emission (in Billions) 1 Energy use in Industry 11.955 2 Energy use in Buildings 8.645 3 Transport 8.003 4 Road Transport 5.879 5 Residential Buildings 5.385 Fig: Sectors with Highest Carbon Footprint S.no Sectors  Annual CO2 Emission (in Billions) 1 Machinery 0.247 2 Paper and Pulp 0.296 3 Food and Tobacco 0.494 4 Rice Cultivation 0.642 5 Waste Water 0.642 You can view the press release below or see the full report on the following link. Strong CSR policies will reflect on yearly stock returns, new report finds  The machinery sector has the smallest carbon footprint with 0.247 billion  tonnes of CO2E emitted each year Report reveals the stocks in environmentally-friendly sectors with the highest returns Strong CSR policies will reflect on yearly stock returns, making eco-conscious investing more popular Tackling Climate Change October 2021, London— Efforts to tackle climate change have extended to the world of investment; recent years have given rise to socially responsible investing (SRI) in which investors utilise a strategy that will not only reward them in financial returns but also instigate  positive environmental and social change. A new study by IG Prime reveals which sectors have the lowest carbon footprint and how this reflects on their yearly stock returns. The institutional trading and prime brokerage solutions provider  analysed over 600 companies listed in the S&P 500 or FTSE 100 to determine the carbon  footprint of the sectors they work in. Eco-conscious investment is defined by the carbon footprint of investors’ portfolio. According to the Alternative Investment Management Association, which surveyed 135 institutional  investors, hedge fund managers and long-only managers, 84% reported a spike  in ESG-orientated funds and strategies in 2019, with this expected to grow in the  coming years. It is important to remember that any investment still comes with risk, but eco-conscious investments come with the added benefit of knowing stocks are being  bought in companies who have a key focus on corporate social responsibility, and in  the case of this report, climate change and CO2 emissions (CO2E). The machinery sector, which covers Machinery, Tools, Heavy Vehicles, Trains and Ships has been revealed  to have the lowest annual CO2E out of the 32 industries researched by IG Prime. Every year, a comparatively  low 0.247 billion tonnes of CO2E is produced by the machinery sector. Reducing Greenhouse Gas Emissions The main goals in terms of a more sustainable line of production in this sector lies in reducing greenhouse gas emissions. The Paper and Pulp industry, including Materials and Containers & Packaging sectors, was found to  be the second most eco-friendly sector based on CO2E for investors aiming to create a sustainable  portfolio. With 22 of the companies listed in the FTSE 100 and S&P 500 falling under the category of ‘Food  and Tobacco’, investors will be pleased to know that this sector is one of the most eco-friendly  industries. 0.494 billion tonnes of CO2E is produced by the food and tobacco sector annually, which pales in  comparison to the likes of road transport (8 billion) or residential property (5.3 billion). When looking at other industries besides the main low-emission ones discussed within this report,  companies in the sectors of wastewater and shipping perform well. 0.64 billion tonnes of CO2E is produced by the wastewater sector annually, followed by the shipping  industry which accounts for 0.83 billion tonnes of CO2E annually. Within each of these sectors there are certain stocks that perform well and offer good returns, as  detailed in the report, however markets can be volatile, so it is important research is always conducted. Whilst CO2 emissions are the  main environmental impact that is often looked at, it is however not the only way to measure the  sustainability of an investment. Despite there still being a long way to go and many targets lying  decades ahead, some industries have already seen great success in the reduction of their carbon  footprint. Although by nature some sectors are likely to be higher CO2 emitters, some companies within these sectors can look at more eco-conscious sectors in a bid to improve their sustainability plans and  offerings. Some companies are paving the way to a greener future by greatly reducing their CO2 emissions and having ambitious sustainability plans in place. It is likely that companies with strong CSR policies will see this reflected in yearly stock returns with  more and more emphasis being placed on environmental factors. This in turn will encourage investors  to put money into eco-conscious stocks, and potentially steer away from those industries who are  shying away from the issue. About IG’s Institutional Business IG Prime IG is bringing a new focus to its institutional offering by targeting family offices and small hedge funds, utilising the IG’s platform capability, range of markets and depth of liquidity to gain market share in this segment. IG Prime’s prime brokerage business gives clients access to a range of synthetic, custody, trading and financing solutions. The worldwide network provides global market access and IG Prime’s technology is cutting edge. IG Prime provides web-based trading, mobile apps, and own proprietary execution systems. The company also supports third-party trading access via FIX, MT4, API and Bloomberg EMSX. About IG IG empowers informed, decisive, adventurous, people to access opportunities in over 17,000 financial markets. With a strong focus on innovation and technology, the company puts client needs at the heart of everything it does. IG’s vision is to provide the world’s best trading experience. Established in 1974 as the world’s first financial derivatives firm, it continued leading the way by launching the world’s first online and iPhone trading services. IG is an award-winning, multi-platform trading company which allows retail, professional and institutional clients to trade 24 hours a day, 7 days a week*. IG is the world’s No.1 provider of CFDs** and a global leader in forex. It provides leveraged services with the option of limited-risk guarantees and offers an execution-only stock trading service in the UK, Australia, Germany, France, Ireland, Austria and the Netherlands. IG has a range of affordable, fully managed investment portfolios, which provide a comprehensive offering to investors and active traders. IG is a member of the FTSE 250, with offices across Europe, including a Swiss bank, Africa, Asia-Pacific, the Middle East and North America. IG Group Holdings plc holds a long-term investment grade credit rating of BBB- with a stable outlook from Fitch Ratings. *Excluding 10pm Friday (GMT) to 4am Saturday (GMT) **Based on revenue excluding FX (from published financial statements, June 2019) Sources And Methodology A seed list of the top companies from the FTSE 100 and S&P 500 was created. We then found the  percentage of total global emissions belonging to each sector, and used that with figures for total  global emissions per year to work out how many tonnes of CO2 equivalent each sector creates. We  also tracked 1-year returns for each company and its current share price to allow for comparison  between the more eco-conscious companies and their value to investors. Emissions categories are based on appropriate sectors. Where companies that crossed over  sectors have been used, the best estimates were selected. Where other industries didn’t apply,  “Commercial Buildings” has been assigned to reflect office usage and similar. Updated on Apr 19, 2022, 12:54 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: valuewalkApr 19th, 2022

Eyewear Market Projected To Hit $111 Billion In 2026; Here Is How Investors Can Profit

Like most consumer markets at the time of the outbreak of the pandemic, the vision and eyewear industry was no different, seeing retail revenue decline by 14.2% between 2019 and 2020. Now as industries try to make up for lost time, and revenue, with the global economy mostly back to normal, staggering growth predictions have […] Like most consumer markets at the time of the outbreak of the pandemic, the vision and eyewear industry was no different, seeing retail revenue decline by 14.2% between 2019 and 2020. Now as industries try to make up for lost time, and revenue, with the global economy mostly back to normal, staggering growth predictions have placed market leaders in the eyewear industry in a battle to outpace consumer demand and market competitiveness. 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); Q4 2021 hedge fund letters, conferences and more By the early months of 2021, global sales for eyewear were seen climbing 5% during the same period from the year before. And with estimates for market size to reach $111.12 billion by 2026, with an average CAGR of 5.83% between 2022 and 2026, ongoing consumer demand and emerging markets are positioning eyewear companies right in the middle of a soaring industry. Growing opportunities and competition have led Brooklyn-based eyewear company, Designer Optics, to pursue new innovations in technology advancement and marketing strategies to garner ongoing consumer support. Expansion and Market Improvement While the lens and eyewear market expects a positive market improvement in the coming years, changes in consumer habits, trends, and the increasing need for better eye care treatment have led to an explosive expansion of industry-related services and products. Traditionally, the market was solely focused on providing prescription and nonprescription lenses, with growing popularity for fashionable sunglasses taking off during the digital revolution of online shopping and social media. Modern practices have expanded beyond conventional means, involving an array of contemporary offerings. Aron Ekstein from Designer Optics comments, “We’re seeing a rapid transformation in the eyewear and vision industry, and it’s led us to rethink our place within the sector, among our competitors, and more importantly how we can be impact-driven towards our consumers.” Emerging economies, ongoing fashion trends, and a surge in visual impairment in both young and older generations have left eyewear providers with an opportunity to bridge the gap between the industry and the consumer. Countries in Asia Pacific, including China and India, are seeing a rapid increase in younger populations with excess disposable income, and demand for eyewear treatment services and products. The region will add more than $7.8 billion worth of revenue to the overall market between 2021 and 2026, matching western Europe in regional revenue sales. Over in Brazil, the same occurrence is playing out, as the economy is rapidly developing, allowing the consumer market easier access to eyewear services, and the adoption of premium quality and branded lenses. “There’s no denying that we’re right in the middle of an exciting period, where we can see developing and emerging economies take advantage of the market to its fullest extent, even if it’s not directly tied to any pre-existing eyesight-related conditions,” wrote Ekstein. The Public Market Offering It’s no surprise that the rise of eCommerce and online shopping has burst through the doors of the global eyewear industry. And while scepticism is shared over the longevity of traditional brick-and-mortar stores in the modern consumer world, the eyewear industry is zig-zagging between two partial worlds. In September 2021, eyewear startup Warby Parker (NYSE:WRBY) went public with share prices starting at $54.05 per share on the NYSE. While the initial public offering was set against a range of factors, company executives shared that clients, whether shopping online or in-store makes no real difference to their overall success and operations. The eyewear startup which saw its revenue grow to more than $390 million ending 2020, mentioned that they were in the process of opening 30 to 35 new stores, totalling a shop count between 155 and 160 locations. But the digital presence of its stores during the height of the pandemic saw the company attain more than 50% of its 2021 sales through online purchases. Warvy Parker shares have since fallen 32.65% on a year-to-date earnings basis. CooperVision, a division of Cooper Companies Inc. (NYSE:COO) have on the other hand trailed a successful 2021 and start to 2022 thus far. In the past year alone, the company saw shares increase by 9.9%, well over the 8.5% predicted for industry growth. Currently, COO shares are in place of a Hold position according to the Zacks Rank. But Cooper Companies and CooperVision for that matter are backed by industry-leading brands including Biofinity and Clariti, which is helping them hold a strong trading position. Their eyewear division saw revenues rise by 14%, and reported earnings of close to $561.5 million in 2021. “Going out on a limb, and looking how companies have been performing in a semi-post COVID economy makes it difficult to fully understand how market offering, both for consumers and investors will be able to impact the survival of eyewear companies in an eerie economy in 2022,” told Aron Ekstein. Teetering Consumer Shopping Habits While the case may stand that online shopping offers better convenience, a larger variety selection, fast and simple delivery services, and a growing demand - the eyewear industry might have lagged a bit behind when it came to the virtual world of trading and conducting business. Yet, it’s been possible for companies and eyewear specialists to grow beyond their traditional sense of marketing and consumer attraction, bringing to life a new branch within the market - telehealth, or sometimes referred to as eHealth. Aron Ekstein commented that the pandemic pushed them to think differently, while at the same time still providing their customers with excellent service and offerings. “Giving clients the option where they can choose from premium brands and designs, to still being able to offer affordable pricing on what we do has helped us through the worst part of the pandemic.” And that’s been working for most retailers. Diversifying their selections, keeping prices to a minimum, and allowing consumers better selection. According to a report published by The Vision Council, surveyed individuals spent roughly 15% more time online using prescription contact lens retailer apps or websites in 2020. The same is said for prescription glasses retailer apps and website users, who spent  9% more time online amid COIVD-19. Between online sales and in-store shopping, companies within the eyewear market are experiencing a rapid shift in consumer demand and trends. National Vision Holdings Inc. (NASDAQ:EYE) gained 76.6% in comparable store sales for eyeglasses in the second quarter of 2021. The same was said for Eyeglass World, with an increase of 67.6% adjustable comparable store sales. All over, in-store sales have pushed investors to rethink their strategy, and portfolio standing when it comes to eyewear companies, as share prices and holding positions have ranked strongly on the Zack Rank. American Swiss medical company, Alcon Inc. (NYSE:ALC)  has been on the #2 “buy” position according to Zack Ranks, with sales figures jumping 74.8% in the second quarter of 2021. “It will be interesting to study how share prices for major retailers will be impacted by the gradual shift towards online shopping and eCommerce. Telehealth and eHealth solutions are still only a temporary solution for people living with eyesight problems. In-person and in-office consultation visits will perhaps hold a strong position,” Ekstein mentioned. Even with the gradual shift towards the online world, younger consumers remain the majority of online shoppers. Statistics indicate that Millennials (25-34) make up 20.2% of the eCommerce shopper market, with individuals aged 35-44 being the second largest group at 17.2%. Older generations, those aged 55 to 64 and 65 plus, respectively make up roughly 14.6% and 14.4% of the market share. And bringing structure to the narrative, we see that 93% of people between the ages of 65 and 75 make use of corrective lenses and prescription eyewear, a number that rapidly increases after the age of 45. This is the same sentiment shared by Ekstein: “There’s always room for adjustment, and improving on what we already know gives us a head start to see how we can drive meaningful change, while at the same time, remaining a stronghold within our current client market.” Future Potential As ongoing global uncertainty looms over the heads of consumers and market leaders, changes in the overall retail industry, including the lense and eyewear market have directed consumer interests towards a different set of moral and ethical questions. Questions of sustainability, environmental impact, and ethically sourced products are now quickly filtering into nearly every sector of the retail market. While it’s been a long time coming since consumers started regarding the importance of sustainability, and the growing concerns regarding climate change, perhaps this is a new potential area in which the eyewear industry can grow. For Digital Optics, this remains an element they take into consideration throughout the shopping and retail experience. “Younger consumers and those who are requiring prescription lenses are rethinking how their needs are having an impact on the environment, and it’s become a strong driving force for not just us, but all contenders.” Technological advancements and innovation on the manufacturing side will help lead the industry towards sustainable and environmental change, while at the same time having the ability to garner younger consumers and create meaningful impact. Final Thoughts Perhaps the pandemic has changed a lot within our society and general consumer habits. Looking towards the coming decades, we see a rapid modernization and digitization of the eyewear and prescription glasses market, an industry taking form in all corners of the world and leading the path to new advancements in professional eyecare. Updated on Apr 7, 2022, 1:45 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: valuewalkApr 7th, 2022

Malthusianism, Prometheanism, & The Hyper-Bitcoinized World To Come

Malthusianism, Prometheanism, & The Hyper-Bitcoinized World To Come Via Cathedra.com, 2021 Letter to Shareholders Dear Fellow Shareholders of Cathedra Bitcoin Inc: In 1798, a British economist was concerned that the incessant increase in population would cause humanity to run out of food. As a solution, he supported a variety of measures aimed at curbing the rate of population growth (e.g., taxes on food) to improve the living standards for those humans who did survive. The economist in question, Thomas Malthus, was raised in a country house in Surrey, was educated at Jesus College Cambridge, became a Fellow of the Royal Society in 1818, and–in simple terms–championed policies designed to limit (or end) human life to prevent this population bomb. “Instead of recommending cleanliness to the poor, we should encourage contrary habits. In our towns we should make the streets narrower, crowd more people into the houses, and court the return of the plague.” – Thomas Malthus, “An Essay on the Principle of Population” (1798) Looking back, we can see that such predictions have (fortunately) not come to fruition. The human population has grown ninefold since Malthus penned his infamous piece, “An Essay on the Principle of Population.” Meanwhile, technology has given humanity the ability to channel energy in ways unimaginable to Malthus, allowing us to enjoy levels of prosperity that make the elitist Malthus look like a serf in comparison. Yet we are not without our troubles. In response to COVID-19, the last two years have seen an unprecedented degree of government intervention around the world, through mandates as well as record-breaking fiscal and monetary stimulus. Meanwhile, food shortages have visited the developed and developing worlds alike. Housing, asset, and commodity prices are soaring, with even the dubious Consumer Price Index reaching its highest level in four decades in the U.S. And around the world, civil unrest is on the rise. We believe the root causes of these issues are quite simple: unsound money and unsound energy infrastructure. In this first annual letter to Cathedra Bitcoin shareholders, we examine the current state of both and discuss how they inform our vision for the future of the company. Macro Update: Energy The European Energy Crisis For the last six months, headlines have been filled with a “European Energy Crisis.” As the global economy surged back to life after 18 months of lockdowns, a perfect storm of events unfolded: over the summer, China increased natural gas imports following a coal shortage, causing power prices to rise in Europe; in September, a wind shortage beset northern Europe, resulting in enormous sums being paid to dispatch other (“dirtier”) forms of generation; reduced natural gas imports from Russia left Europe with historically low natural gas reserves; in December, unusually cold temperatures hit the continent, sending shockwaves through energy markets (even serving as a catalyst for the civil unrest in Kazakhstan); and Russia’s invasion of Ukraine in recent weeks has sent oil and gas prices surging, bringing calls for increased domestic energy production. These events have conspired to cause a sharp increase in energy prices around the continent. One is tempted to point to any one of the above as a “black swan event” driven by unforeseeable forces beyond our control (in hindsight, it will be even more tempting to blame this crisis on Putin’s invasion of Ukraine). But in reality, Europe has been systematically dismantling its stable energy infrastructure for over a decade. And unfortunately, they are not alone. Take California, for example: over the last decade, the state has seen energy prices rise 7x more than those in the rest of the U.S., and blackouts have become “almost daily events.” If one looks deeper, a far subtler cause reveals itself: misguided policies that subsidize intermittent renewables and shutter stable forms of generation, the net effects of which are energy insecurity and higher energy costs. The Real “Energy Transition” Beginning in the early 2000s, governments around the world began reorienting energy policy around climate change. These “net-zero” policies push for an “energy transition” away from CO2-emitting energy sources toward 100% “renewable” energy, primarily via subsidies to intermittent wind and solar generation. On the surface, these policies seem to have worked. EU power generation from renewables has increased 157% in the last ten years. As a result, in 2020, renewable generation in Europe surpassed that of fossil fuels for the first time, providing 38% of the region’s electricity (vs. fossil fuels’ 37%). And these policies are only accelerating: in July 2021, the EU announced its even more ambitious goal to reduce greenhouse gas emissions by 55% by 2030, requiring an estimated tripling of wind and solar generation from 547 TWh in 2020 to ~1,500 TWh in 2030. These pro-renewables policies have been paired with the abandonment of more stable forms of generation. Coal continues to be pushed out of the generation stack due to its heavy carbon footprint and the rising cost of carbon credits. Additionally, despite the seemingly obvious importance of nuclear energy in a “net-zero” carbon future, regulators have been shutting down nuclear reactors around the world in response to environmentalist movements[1] (a trend that accelerated in the wake of the Fukushima disaster). Germany alone shut down 16 GW of nuclear power since 2011, and plans to retire its last three nuclear power plants this year. With hydro being geography-dependent and long-term energy storage unsolved, natural gas is left as the main  viable form of dispatchable generation. Given self-imposed fracking bans, Europe has no choice but to import natural gas via LNG or pipelines (largely from Russia). Returning to California, we see the same dangerous combination of policies. Despite the aforementioned rising electricity costs and grid fragility, the state is decommissioning its last nuclear power plant at Diablo Canyon–responsible for ~10% of the state’s electricity–while reasserting goals to achieve “net-zero” by 2045. Unfortunately, even if stable forms of generation are not discarded by mandates, renewables subsidies distort market signals. This auxiliary revenue stream of carbon or renewable energy credits allows wind and solar farms to sell power to the grid at negative prices, often driving unsubsidized, baseload generation out of business. The net result? The hollowing out of sound energy infrastructure, which increases both the costs and fragility of the energy system. In her book Shorting the Grid, Meredith Angwin warns of a “fatal trifecta” affecting grids around the world: (1) overreliance on renewables, (2) overreliance on natural gas, often used to load-follow renewables, and (3) overreliance on energy imports. When demand outpaces supply, either due to diminished output from renewables or heightened demand (e.g., during a cold snap), grid operators seek to dispatch additional generation. But natural gas and energy imports are both vulnerable to disruptions, as natural gas is typically delivered just-in-time via pipelines and neighboring regions are likely to experience correlated supply or demand shocks (read: weather). This results in more expensive energy (increased demand chasing limited supply) or enforced blackouts (e.g., Texas in February 2021). “Grid fragility” may sound like a highly abstract concept, but its real-world consequences are severe. It means industry halting, hospitals losing power, and even access to clean water being threatened. Such effects are so severe that energy-insecure countries tend to rely on more rudimentary forms of energy, including expensive backup diesel generators, to keep the lights on. Robert Bryce has termed this phenomenon the “Iron Law of Electricity”: people, businesses, and governments will do whatever they must to get the electricity they need[2]. We fear these confused policies are causing an energy transition of the wrong kind–one toward energy insecurity. Its effects are clear in the U.S., where “major electric disturbances and unusual occurrences” on the grid have increased 13x over the last 20 years. Meanwhile, Generac, a leading gas-powered backup generator company, saw 50% growth in sales in 2021 (it's worth highlighting the contradiction between the stated aims of these “net-zero” policies and their downstream effects). A Malthusian Approach to Energy Energy insecurity is also expensive. Dependence on intermittent renewables often results in paying top-dollar for energy when it’s needed most. During its September wind shortage, the UK paid GBP 4,000 per MWh to turn on a coal power plant–a clear demonstration that not all megawatt hours are created equal. The quality of energy matters. With renewables, humanity is once again at the mercy of the weather. This is the underlying logic of these “net-zero” policies: make energy more expensive so that we use less of it. In fact, economists advising the European Central Bank view rising energy costs (“greenflation”) as a feature, not a bug–a necessary consequence of the energy transition. Rising energy prices are a regressive tax on the least well-off in society. We all require energy to survive (heating/cooling, food, water, etc.), regardless of our wealth. These requirements are effectively a fixed cost; the lower one’s income, the greater the percentage of it one spends on energy. There is a point beyond which rising energy costs become unsustainable, sending people to the streets to fight for their survival–as we saw in Kazakhstan after the spike in LPG prices. Researchers estimate that each 1% increase in heating prices causes a 0.06% increase in winter-related deaths, with disproportionate effects in low-income areas. “If energy is life, then the lack of energy is death.” – Doomberg, “Shooting Oil in a Barrel” (2021) Energy is the key input for every other good and service in the economy, and over time accounts for all wealth in an economy. To the extent energy gets more expensive, so does everything else (including and especially food), making society poorer. This is the Malthusian approach to energy. Expensive “green” energy that the elites can afford, while the unwashed masses bear the brunt of those rising costs. Energy for me, but not for thee. We question the political and social sustainability of such an approach. Enter Entropy Energy’s role is even more fundamental to the economy and human well-being than most understand. As we’ve discussed elsewhere, what is commonly understood as “energy generation” is really just the conversion of energy into a more highly ordered form; it is the reduction of entropy locally by shedding even greater amounts of entropy elsewhere. Despite the universality of this entropy reduction, some energy resources are inherently lower-entropy than others (highly dense nuclear fission vs. low-density wind power). We depend on this entropy reduction to sustain us through the food and energy we need to maintain the order of civilization. This entropy reduction is cumulative; without sufficient entropy-reducing energy infrastructure, we cannot maintain our existing order. We cannot create entropy-reducing energy infrastructure without adequate pre-existing infrastructure. And we cannot advance further as a civilization (i.e., create more order) unless we develop even more entropy-reducing infrastructure. “We never escape from the need for energy. Whatever the short-term variations might look like, the trend over time is for greater energy use, to deliver and crucially to maintain and replace a human sphere that is progressively further away from thermodynamic equilibrium. There is no point at which you sit down and have a rest.” – John Constable, “Energy, Entropy and the Theory of Wealth” (2016) There is no free lunch when it comes to energy. If a country’s economy grows while reducing energy consumption, it is only through de-industrialization, exporting its energy footprint to other countries (the same often holds true for carbon emissions). The second law of thermodynamics is indeed a law, the best attested regularity in natural science, not a tentative suggestion: the entropy must go somewhere. Unfortunately, distortions caused by our current monetary system have convinced many otherwise, a deception that has had dire consequences. Macro Update: Money For the last 50 years the world has participated in an unprecedented experiment: a global fiat monetary standard. In 1974, a few years after “Tricky Dick” Nixon rug-pulled the other governments of the world by severing convertibility of the U.S. dollar into gold, the U.S. struck a deal with Saudi Arabia to cement the dollar’s status as the global reserve currency: the OPEC nations would agree to sell oil exclusively for U.S. dollars, and the Saudis would receive the protection of the U.S. military in return. This arrangement, which survives to this day, became known as the “Petrodollar system,” and it has had enduring economic, social, and political consequences: securing the dollar’s status as the reserve currency of the world; bidding up U.S. asset prices via petrodollar “recycling;” displacing U.S. manufacturing capabilities and increasing economic inequality between American wage-earners and asset-owners; and contributing to the secular decline in interest rates, causing an accumulation of public- and private-sector debts and distortions in the pricing mechanism for all other assets (typically viewed in relation to the “risk-free rate” of interest on Treasuries). In recent years, cracks in the foundation of this system have begun to show. A half-century of irresponsible fiscal and monetary policy has pushed sovereign and private sector debt to the brink of unsustainability and fragilized financial markets. The once steady foreign demand for Treasuries is evaporating, forcing the Fed to begin monetizing U.S. deficits at an increasing rate. The U.S.’s share of global GDP is waning, and the role of the dollar in key trading relationships is diminishing. Even the once-mighty U.S. military—on whose supremacy the entire Petrodollar system was predicated—shows signs of degeneration. The U.S. response to the COVID-19 pandemic has accelerated many of these trends. Through a series of legislative and executive actions in 2020 and 2021, Congress and the Trump and Biden administrations approved nearly $7 trillion of spending on COVID relief, a large majority of which increased the federal deficit. Not to be outdone, the Fed authorized its own emergency measures to the tune of $7 trillion. In the nearly two years since these extraordinary actions, the U.S. and the global economy has been defined by record-low interest rates (which is part of the explanation for the interest in subsidized renewables); acute supply chain disruptions (read: shortages) across critical markets; a continuation of the asset price inflation of prior decades; and the highest levels of consumer price inflation in 40 years. This last development—“not-so-transitory” CPI inflation—is perhaps most significant given it represents a departure from economic conditions since the Great Financial Crisis. The Fed now faces a predicament. With mounting cries from the public and political officials over the runaway CPI, the pressure is on Jay Powell & Co. to arrest inflation by raising interest rates. But the current state of public and private sector balance sheets complicates matters. As the Fed increases rates, so too does it increase the federal government’s borrowing cost, not to mention that of a private sector which is also saddled with dollar-denominated debt. If corporates are unable to service or refinance their debt, they will be forced to reduce costs, resulting in higher unemployment. Rest assured; rates aren’t going higher for long. Global balance sheets will not allow it. This suggests to us that we may be entering a period of financial repression, whereby inflation is allowed to run hot while interest rates remain pinned near zero, producing negative real returns and deleveraging balance sheets over several years. We also find it likely that the Fed will be forced to implement some version of a yield curve control program. Under such a policy, the central bank commits to purchasing as many bonds as necessary to cap the yields of various maturities of Treasuries at certain predetermined levels. There is precedent for a maneuver of this sort: the Fed implemented a version of the policy throughout the 1940s to inflate away the national debt during and after WWII. At the end of the long-term debt cycle, the only option is to inflate away the debt and debase the currency. But unlike in the 1940s, citizens, businesses, and governments now have several monetary alternatives available to them. We therefore believe the coming period of structural inflation will hasten a transition to a new monetary standard. The Currency Wars Cometh The writing is on the wall; the post-Bretton Woods monetary system is in its death throes. The question is not if we will see a paradigm shift away from the present dollar-based monetary order, but when. And the far more interesting question, in our view, is: what will replace it? We believe the next global monetary system will be built atop Bitcoin—with bitcoin the asset and Bitcoin the network working together to offer final settlement in a digitally native, fixed-supply reserve currency on politically neutral rails. Bitcoin uniquely enables this value proposition, and game theory and economic incentives will compel nation-states to take notice amid the collapsing monetary order. But it is not without competition. Central Bank Digital Currencies Bitcoin is the ideological and economic foil to another candidate for heir to the petrodollar: the central bank digital currency (“CBDC”). The retail CBDC—which is the variety most often discussed in policy circles—is a natively digital form of fiat money that is issued, managed, and controlled by the central bank. Their proponents claim CBDCs would enable many of the same benefits as cryptocurrencies—near-instant final settlement, programmability, high availability, etc.—without many of the attendant “disadvantages”—decentralization, untraceability, etc. CBDCs open up a whole new design space for monetary authorities, empowering them to implement creative and fine-grained policies which heretofore have been confined to masturbatory thought-experiments in BIS papers (e.g., negative interest rates). They would also allow for all manner of fiscal policies which today are operationally or technically infeasible; one can imagine government-imposed parameters around how and when a given sum of CBDC money is spent, digitally programmed into one’s Fed wallet. A universal basic income program could be effected with a single keystroke. In many ways, the CBDC is the perfect Malthusian implement. Their inherent programmability allows for granular, top-down rationing of resources for whatever “greater good” suits the politically powerful. “I’m sorry, sir. Your card has been declined, as you have already exceeded your weekly beef quota. Might we suggest a more environmentally friendly alternative, such as a Bill Gates pea protein patty?” Such a system amounts to highly efficient regulatory capture; citizens are only permitted to spend money on those goods and services favored by The Powers That Be (or the corporate interests that fund them). Expect CBDCs to further distort the pricing mechanism, leading to a variety of market failures (such as the current energy crises). Skeptics of such claims need only be reminded of the U.S. government’s recent history of abusing its power to restrict politically undesirable financial activities. It should come as no surprise that the CBDC model is being pioneered by the Chinese Communist Party in the form of a “digital renminbi.” Make no mistake—wherever a CBDC is implemented, it will be weaponized by the State for political ends. In the West, such a system would be readily abused to create a Chinese-style social credit system—but one cloaked in the neo-liberal parlance of “financial inclusion,” “climate justice,” and “anti-money laundering.” CBDCs: Coming to A Country Near You? We remain cautiously optimistic that the U.S. will forgo implementing this dystopian technology. The U.S. remains among the freest nations in the world, both politically and culturally. A CBDC is wholly incompatible with American values, and we expect millions of Americans would resist the complete usurpation of their financial lives by the State. Additionally, a retail CBDC implemented by the Fed would transfer power from the commercial banks whose interests the Fed was conceived to protect to the federal bureaucracy[3]. And is there any doubt that the U.S. now lacks the state capacity to implement a CBDC, a feat which would require a high degree of technical and operational competence? Figure 1: Which Way, Western Man? BTC vs. CBDC Bitcoin for America So, how can the U.S. extend its financial leadership of the 20th century amid the decaying Petrodollar system? The U.S. is already the frontrunner in nearly all things Bitcoin—trading volumes, mining activity, number of hodlers, entrepreneurial and business activity, capital markets activity, etc. We submit that the path of least resistance would be for America to lean into its leadership in the Bitcoin industry and embrace the technology as a privacy-respecting, open-source, free-market, and fundamentally American alternative to the totalitarian CBDC. What does “adopting Bitcoin” look like for a country like the U.S.? It is likely some combination of: (i) authorizing bitcoin as legal tender, (ii) removing onerous capital gains tax treatment, (iii) subsidizing or sponsoring mining operations (which could support domestic energy infrastructure, in turn), (iv) purchasing bitcoin as a reserve asset by the Fed and/or Treasury, or (v) making the dollar convertible into bitcoin at a fixed exchange rate. We see early signs that such a move by the U.S. may not be so far-fetched. Notably, major American policymakers have already signaled support for bitcoin as an important monetary asset and nascent industry. The “crypto” sector has grown into an important lobby in D.C. and represents a highly engaged, motivated constituency—politicians are taking notice. In our estimation, Bitcoin’s economic incentives and congruence with American values make it the leading candidate for U.S. adoption as a successor to the present monetary order. As the current dollar-based system continues to deteriorate, we are excited by the potential for a U.S.-led coalition of freedom loving nations moving to a Bitcoin Standard. Money, Energy, and Entropy Energy is the fundamental means to reduce entropy in the human sphere, and money is our tool for the direction of energy towards this end. We use money to communicate information about economic production, resolving uncertainty about how scarce resources ought to be employed. And we seek out highly ordered sources of energy to resist the influence of entropy on our bodies and societies. In his lecture, “Energy, Entropy and the Theory of Wealth,” John Constable of the Renewable Energy Foundation observes that all goods and services—and indeed, civilizations—are alike in that they are thermodynamically improbable. All require energy as an input and necessarily create order (i.e., reduce entropy) in the human domain, shifting the local state further away from thermodynamic equilibrium. So then, wealth can be understood as a thermodynamically improbable state made possible through human entropy reduction. If material wealth is measured by the goods and services one has at one’s disposal, then wealth creation on a sound monetary standard is the reduction of entropy for others, and one’s wealth is a record of one’s ability to reduce entropy for fellow man. Unsound money (of the sort the Malthusians celebrate) increases uncertainty—and therefore, entropy—in economic systems. Active management of the money supply confuses the price signal, reducing the information contained therein and erecting an economic Tower of Babel. Fiat money therefore contributes to malinvestment—entrepreneurial miscalculations which produce the wrong goods and services and increase societal entropy. Nowhere is this more apparent than in our energy infrastructure: unsound money has caused malinvestment in unsound sources of generation. As noted above, a half-century of government subsidies and declining interest rates made possible by the Petrodollar system has steered capital towards unreliable renewables that invite greater entropy into the fragile human sphere, dragging us ever closer toward thermodynamic equilibrium (read: civilizational collapse). Cathedra Bitcoin Update Our macro views on energy and money inform everything we’re doing at Cathedra. Chief among them is the belief that sound money and cheap, abundant, highly ordered energy are the fundamental ingredients to human flourishing. Our company mission is to bring both to humanity, and so lead mankind into a new Renaissance—one led by Bitcoin and the energy revolution we believe it will galvanize. Accordingly, with Cathedra we’ve set out to build a category-defining company at the intersection of bitcoin mining and energy. One which is designed to thrive in the turbulent years of the present energy and monetary transition and in the hyperbitcoinized world we believe is to come. In December we announced a change of the company’s name from Fortress Technologies to Cathedra Bitcoin. Our new name reflects our aspirations for the company and for Bitcoin more broadly. The gothic cathedral is a symbol of bold, ambitious, long-term projects; indeed, any single contributor to the monument would likely die before its completion, but contributed nonetheless—because it was a project worth undertaking. So it is with Cathedra, and so it is with Bitcoin. The religious connotations of the name “Cathedra” are not lost on us. Rather, they’re an indication of the seriousness with which we regard this mission. Ours is a quest of civilizational importance. Our new name also hints at another distinguishing feature of our business: we focus our efforts on Bitcoin, and Bitcoin only. The difference between Bitcoin and other “crypto” networks is one of kind, not degree. Bitcoin is the only meaningfully decentralized network in the “crypto” space, which is why bitcoin the asset will continue to win adoption as the preferred form of digitally native money by the world’s eight billion inhabitants. Bitcoin seeks to destroy the institution of seigniorage once and for all. Your favorite shitcoin creator just wants to capture the seigniorage himself. We feel strongly that our long-term mission of delivering sound money and cheap, abundant energy to humanity can be best achieved through a vertically integrated model. In the long-term, Cathedra will develop and/or acquire a portfolio of energy generation assets that leverages the synergies between energy production and bitcoin mining to the advantage of both businesses. In a decade, Cathedra may be as much an energy company as a bitcoin miner. Vertical integration will allow us to control our supply chain and rate of expansion to a greater degree, in addition to giving us a cost advantage over our competitors. As a low-cost producer of bitcoin, we will also be positioned to deliver a suite of ancillary products and services to customers in the Bitcoin and energy sectors. And we’ve begun making strides toward this goal. Earlier this year, the Cathedra team expanded by three with the hires of Isaac Fithian (Chief Field Operations and Manufacturing Officer), Rete Browning (Chief Technology Officer), and Tom Masiero (Head of Business Development). Each of these gentlemen brings years of experience in developing and deploying mobile bitcoin mining infrastructure in off-grid environments. With this expanded team, we recently began production of proprietary modular datacenters to house the 5,100 bitcoin mining machines we have scheduled for delivery throughout 2022. We’re calling these datacenters “rovers,” a nod to their mobility, embedded automation, and capacity to operate under harsh environmental conditions in remote geographies. The modularity and modest footprint of our rovers will allow us to produce them at a rapid pace and deploy them wherever the cheapest power is found, in both on- and off-grid environments. We are proud to be manufacturing our fleet of rovers entirely in New Hampshire, working with the local business community to bring heavy industry back to the U.S. As bitcoin miners, we view ourselves as managers of a portfolio of hash rate. As in the traditional asset management business, diversification can be a powerful asset. Whereas most of the large, publicly traded bitcoin miners are pursuing a similar strategy to one another—developing and/or renting space at hyperscale, on-grid datacenters in which to operate their mining machines—we have optimized our approach to minimize regulatory, market, environmental, or other idiosyncratic risk within our portfolio of hash rate. If one has 90% of one’s hash rate portfolio concentrated in a single on-grid site, 90% of one’s revenue can be shut off by a grid failure or other catastrophic event—an occurrence which is sadly becoming more common, as highlighted in our Energy Update. To our knowledge, Cathedra is the only publicly traded bitcoin miner with both on- and off-grid operations today. We increasingly believe that the future of bitcoin mining is off-grid. On-grid deployments are already vulnerable to myriad unique risks today, and we believe their economic proposition will become less attractive over time. As power producers continue to integrate bitcoin mining at the site of generation themselves, large on-grid miners positioned “downstream” in the energy value chain will see their electricity rates rise. Today, “off-grid” describes any arrangement in which a bitcoin miner procures power directly from an energy producer. Popular implementations include stranded and flared natural gas and behind-the-meter hydro and nuclear. In the long-term, we believe the only way to remain competitive will be to vertically integrate down to the energy generation asset. Mining bitcoin is a capital-intensive business. To ensure we have access to the capital we’ll require to execute on our vision, we’ve embarked on several capital markets initiatives. In February, Cathedra commenced trading on the OTCQX Best Market under the symbol “CBTTF.” This milestone represents a significant upgrade from our prior listing on the OTC Pink Market and should enhance our stock’s accessibility and liquidity for U.S. investors. We intend to list on a U.S. stock exchange in 2022 to further increase the visibility, liquidity, and trading volume in our stock. We recently announced that Cathedra secured US$17m in debt financing from NYDIG, a loan secured by bitcoin mining equipment. When it comes to borrowing in fiat to finance assets that produce bitcoin—an asset which appreciates 150%+ per year on average—almost any cost of debt makes sense. We intend to continue using non-dilutive financing in a responsible manner where possible, with a sober appreciation for the risks debt service presents as an additional fixed cost. Accumulating a formidable war chest of bitcoin on our corporate balance sheet is a priority for us. If one believes, as we do, that the next global monetary order will be built with Bitcoin at its center, then those companies with the largest bitcoin treasuries will thrive. We will continue to hold as much of our mined bitcoin as possible and may even supplement our mining activities with opportunistic bitcoin purchases on occasion. At time of writing, Cathedra has 187 PH/s of hash rate active, and another 534 PH/s of hash rate contracted via purchases of mining machines we expect to be delivered from April through December of this year. Since we replaced the prior management team in September, we have grown Cathedra’s contracted hash rate by more than 300%. And we’re just getting started. Conclusion We stand today at a crossroads between two divergent movements defined by conflicting visions for the future: Malthusianism and Prometheanism. The Malthusians believe progress is zero (or even negative) sum; resources are finite and “degrowth” is the only viable path forward; we ought to judge human action first and foremost by whether it disturbs the natural world. This movement is characterized by totalitarian CBDCs and a desire to make energy more scarce and expensive, so that earth’s resources can be appropriately rationed. On the other hand, the Prometheans carry with them a more optimistic vision: progress is positive-sum; human creativity allows us to liberate and employ resources in novel ways, in turn preserving the natural world for our own benefit; and that human flourishing is the moral standard by which we should evaluate human action. These are social, cultural, and spiritual choices we are all called to confront. “The century will be fought between Malthusians (“resources are finite”; obsessed with overpopulation; scarcity mindset; zero-sum, finite games) and Prometheans (“human imagination is the most valuable natural resource”; abundance mindset; positive sum, infinite games).” – Alpha Barry (2020) The Malthusian camp wants top-down, centralized management of resources via CBDCs and energy rationing policies. They believe our energy resources are fixed; the only path forward is backward, farming for energy using huge swaths of land controlled by the privileged few. “Industrialization for me but not for thee.” “You’ll own nothing and be happy.” These are the slogans of the Malthusian movement. This is not the path that took us to space and lifted billions out of poverty. We, Cathedra, choose the other path. That of Prometheus, who stole fire from the gods to benefit humankind. We believe in a future of sound money that brings property rights to eight billion humans around the world. A world of beautiful, free cities powered by dense and highly ordered forms of energy generation. Small modular nuclear reactors with load-balancing bitcoin miners (and no seed oils). A future in which technology is employed to improve the human condition–not only for those who walk the earth today, but for generations to come. Bitcoin mining is a powerful ally to the Promethean cause. As the energy buyer of last resort, Bitcoin promotes sound money and sound energy infrastructure. No two forces are more fundamental to keeping disorder at bay and advancing human civilization. We at Cathedra are not alone; there are other Prometheans working tirelessly to further this vision of a freer, more prosperous tomorrow. Human flourishing is earned, not given. Together, we win. Drew Armstrong President & Chief Operating Officer AJ Scalia Chief Executive Officer Tyler Durden Mon, 03/14/2022 - 19:40.....»»

Category: dealsSource: nytMar 14th, 2022

With the State of the World in the Hands of Big Business, Some Executives Think It Can Pay to Do Good

As global leaders discuss how to build a better future in a post-pandemic world, business executives weigh profits and purpose Even by the pandemic’s standards of Zoom fatigue, the hours-long virtual meeting one Sunday in March 2021 was draining. Around 2 a.m., the board members of the global food giant Danone finally wound down their fractious arguments, and announced they had fired the company’s CEO and chairman Emmanuel Faber—a stunningly swift end to his 24 years at the company. The ouster of an executive at a Paris-based multinational might have been a passing, internal disruption, but for one fact: Faber had become a champion among environmentalists and climate activists for having turned Danone into a company that focused not only on making money and increasing its share price, but also on trying to remake the agricultural business, an industry with a far-reaching impact on the environment. Faber had in 2020 declared Danone—maker of products like Activia and Actimel yogurts, and Evian water—France’s first enterprise à mission, a public company whose goals included targets aimed at bettering the world, akin to an American B Corp. Inserting climate change into Danone’s core strategy, Faber introduced a so-called carbon-adjusted earnings-per-share indicator, measuring the company’s value not only by its profits and revenues—as virtually every business in the world does—but by its environmental footprint too. The slogan he devised: “One planet, one health.” [time-brightcove not-tgx=”true”] His firing was also one sucker punch, which Faber says felt like being cast adrift, or “leaving your family,” as he put it to TIME. The reasons were complex, including the fact that the company’s share price on the stock markets—the financial world’s key measure of success—had risen a minuscule 2.7% in Faber’s six years in charge, compared with the rocketing growth of Danone’s competitors Unilever and Nestlé. Its revenues plummeted during work-from-home lockdowns, too, when items like bottled water were suddenly less relevant. Even so, Faber’s departure provoked a deeper question, one that lingers nearly a year later: Do CEOs risk a backlash from their investors if they make a point of putting the planet’s health above purely financial returns? Answering that question could hardly be more urgent. An ever growing share of the global economy is in the hands of private business. By 2021, businesses accounted for 72% of the economic output in major industrial countries—triple what they did 60 years before—and, of that, more than one-third of the gross value comes from just 5,000 companies, like Danone, with revenues topping $1 billion, according to a study by the intergovernmental Organisation for Economic Co-operation and Development (OECD) and the consultancy McKinsey. How those companies succeed in cutting their carbon emissions—or in tackling problems like human-rights abuses, inequality or racial justice—will have a significant impact on the state of the world, for better or worse. Of the 2,000 companies analyzed by the organization Net Zero Tracker, 682 have declared target dates by which they aim to zero out their carbon emissions. Brands like Coca-Cola and McDonald’s have vowed to cut plastic waste, and automakers like GM and Volkswagen say they aim to end the production of fossil-fuel cars within the near future. There are holes in all these promises, but one thing is now clear: for companies, it has become a risk not to make them. The actual debate now is whether tackling those issues—“purpose-driven capitalism,” as it is known—is in sync or in conflict with what businesses have always thought was their main job: making money. Read more: What Kind of Capitalism Do We Want? “People ask me, ‘Is there a dissonance between profits and purpose?’” says Dan Schulman, PayPal’s president and CEO, who has said he aims to bring his social views to the financial tech giant, where he has hiked pay and cut employees’ health care costs. “My view is that profits and purpose are fully linked together,” he tells TIME from his home in Palo Alto, Calif. “We cannot be about just maximizing our profit next quarter. We need to be part of our societies,” he says. “We need to think about the medium term and the long term, and we need to act accordingly.” More and more business leaders have begun to echo that opinion. Those voices were especially loud during the months leading up to the COP26 climate talks last fall, when corporate executives and government officials converged in Glasgow for the biggest such negotiations ever. In advance of the gathering, hundreds of companies raced to declare commitments to environmental and social issues, and to set net-zero targets. Net zero is a mammoth job. Take, for example, the oil major BP, whose CEO Bernard Looney became one of the first fossil-fuel executives, in February 2020, to declare a net-zero goal for the company (its target date is 2050); BP alone adds a huge 415 million metric tons of carbon to the atmosphere each year, all of which, according to Looney, the company intends to zero out with oil-production cuts, ramped-up renewable energy and the use of carbon capture—technology, with still uncertain results, that removes carbon from the air. “We’re reallocating capital, we’re restructuring the company,” Looney told TIME during a November interview in his London office. “We are all in on the transition.” It is easy to dismiss the proclamations of corporate executives like Looney—and many surely do. After all, their hugely profitable business operations have clashed with environmentalists for decades; in the run-up to COP26, organizers told oil and gas executives, including Looney, that they could play no formal role in the talks because it was “unclear whether their commitments stack up yet.” Plus, despite all the talk of purpose-driven business, the world has yet to invent any sure way to measure whether companies in fact make good on their environmental commitments. “There is no universally agreed system,” says Ian Goldin, professor of globalization at Oxford University. “The counting relies on self-reporting.” That system is deeply faulty at a time when companies are making promises about limited solutions like carbon capture or committing to planting billions of trees in order to “offset” their emissions. “You say you’re planting a forest, or the airline is offsetting your air miles,” Goldin says. “Is anyone tracking if that forest is there? Has someone also claimed that forest? There is no system in place that has accountability to it.” Read More: As More Companies Make Net-Zero Pledges, Some Aren’t as Good as They Sound And yet the fact that so many corporate executives feel compelled to make such statements signals just how drastically the climate crisis and social upheavals have impacted business decisions within a very brief period of time. The onrush seemed to begin in earnest in January 2020, when Larry Fink, head of BlackRock, the world’s biggest asset-management company, announced in a letter to CEOs that “climate change has become a defining factor in companies’ long-term prospects.” Though that fact seemed obvious to climate activists, the statement was widely regarded in the financial world as a game changer. Fink—whose firm manages close to $10 trillion in assets—was telling companies, and their potential investors, that those without a climate strategy faced a shaky future. “We are on the edge of a fundamental reshaping of finance,” he wrote. It is no surprise that companies have since rushed to put climate policies in place. “We have seen quite significant commitments made,” says Paul Polman, co-author of the book Net Positive and co-founder of IMAGINE, a sustainability-focused business consultancy based in London. Until three years ago, Polman was CEO of Unilever, the $135 billion consumer-goods behemoth, where he drove a dramatic overhaul of the company, implementing environmental commitments and lobbying officials on issues of poverty and climate. In a move that was hugely controversial at the time, Polman scrapped Unilever’s quarterly earnings reports—standard for publicly traded companies—on his first day in office in 2009, saying the practice forced CEOs into short-term decisions in order to push up share prices, at the expense of longer-term social issues. Although that angered some investors, Polman told Harvard Business Review, “I figured I couldn’t be fired on the first day.” Now, principles for which Polman fought a relatively solitary battle for years have been adopted by countless other business leaders. “There has been more progress in the last year and a half than the previous five years,” he tells TIME. Even Emmanuel Faber still thinks purpose-driven capitalism brings with it more reward than risk. By his telling, his firing had little to do with his environmental commitments. In his mind, it resulted from the intense financial pressure the pandemic brought, which prompted him to impose layoffs and cuts; Danone’s shares sank 27% on the French stock exchange in 2020. Activist shareholders from two funds in London, who together owned less than 4% of Danone, blamed the company’s difficulties on Faber’s management, and they pressed board members to fire him. “The mess in the Danone boardroom is a reminder that distractions from the core goal of making a profit can be dangerous,” the Financial Times opined days after he was fired. Within hours of the meeting, Danone released a statement saying that the board “believes in the necessity of combining high economic performance and the respect of Danone’s unique model of a purpose-driven economy”—perhaps hinting that the high returns were lacking. “A few people saw a window of opportunity at the moment when it was easy to destabilize the governance of the company,” Faber tells TIME, over tea in Paris. “In no way should that discourage progressive CEOs,” he says. “They have, ultimately, the backing of large shareholders.” Mario Fourmy—Sipa/APFaber presents sales results as CEO of Danone in 2019 To Polman, the saga at Danone brought back memories of the battle he fought five years ago, while he was CEO of Unilever. In February 2017, the U.S. conglomerate Kraft Heinz launched a hostile takeover bid worth about $143 billion against his company. Back then, Polman was spending considerable time traveling the world, meeting government officials and NGOs about issues like mass poverty and clean water. “There is no better way than using companies like this to drive development,” Polman told me then, just weeks before Kraft Heinz made its hostile bid. When I asked Polman whether he was prepared to be fired as CEO, if shareholders finally grew tired of his busy social campaigning, he said, “I never wanted to be a CEO, and I don’t really care about that.” Kraft Heinz’s 2017 bid collapsed within days, after most shareholders backed Polman. But five years on, Polman is still deeply marked by the episode, which he says crystallized a fraught conflict within the world’s biggest companies. “These were two opposing economic models,” he says. “One focused on a few billionaires; the other focused on serving billions of people.” He believes Kraft Heinz “would have milked the company.” Both Polman and Faber saw their companies as a means to improve the world, rather than simply profitmaking machines. Yet there were crucial differences between their situations. For one thing, Unilever was able to try save the world while making boatloads of profit; shareholder return was about 290% over Polman’s decade running the company. Danone, by comparison, struggled. That left Faber vulnerable to doubts and hostile challenges, even while he gained fans outside the financial world, and many inside too. Still, not even Polman’s profitable returns at Unilever sheltered him from shareholders growing irked as he focused on campaigning for a better world. British shareholders shot down his plan in 2018 to close Unilever’s London headquarters and consolidate at the company’s other base, the Dutch port of Rotterdam; Polman resigned within months. Read more: Good Intentions Are Not Enough. We Must Reset for a Fairer Future Despite the trend toward purpose-driven capitalism, one fundamental truth remains: companies need to be profitable. “If you go bankrupt, or get taken over, you certainly cannot be investing in the long term,” says Goldin, the Oxford professor, whose 2021 book Rescue examined how businesses have weathered the pandemic. “You need to be successful in the short term to think about the long term,” he says. The optimistic view is that those two needs—short-term profits and long-term vision—might finally be inching closer together, after decades in which the first has dominated the second. One hint is the steep rise in ESG (environmental, social and governance) investment funds that focus on those issues. Even though the vast majority of regular people have little idea of what harm the companies in their pension funds might wreak on the planet or in communities—and it’s still unclear how quickly that might change—the new money plowed into those funds, which claim to be attracting trillions of dollars, more than doubled from 2019 to 2020. And increasingly, CEOs realize they can hire top talent and keep customer loyalty if their companies are seen as championing environmental and social issues. “I am beginning to see more and more shareholders embrace that concept,” says PayPal CEO Schulman. He says that major shareholders had told him in a meeting the previous day that they appreciated the company’s diversity and equity program. “We do it regardless, because it is the right thing to do,” he says. “But it is nice it is being noticed.” —With reporting by Eloise Barry.....»»

Category: topSource: timeJan 21st, 2022

Eurizon The Globe: “2022: A Further Step Towards Normality”

The latest issue of ‘The Globe’, Eurizon’s publication describing the Company’s investment view. Q3 2021 hedge fund letters, conferences and more In 2022, the economic cycle is expected to continue. Global growth will lose some steam after accelerating sharply in 2021, and this should allow an easing of inflation pressures. Within a context of sustainable […] The latest issue of ‘The Globe’, Eurizon’s publication describing the Company’s investment view. 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 In 2022, the economic cycle is expected to continue. Global growth will lose some steam after accelerating sharply in 2021, and this should allow an easing of inflation pressures. Within a context of sustainable growth and declining inflation, the reduction of monetary stimulus by the Central Banks should be well tolerated by the markets. If Central Banks have to tackle more persistent inflation than expected, the situation could be different. Under the baseline scenario, procyclical market trends should be confirmed. Government bond rates in the US and Germany should be driven upwards by the removal of monetary stimulus. Prospected absolute return on spread bonds seems modest and limited to carry. Stocks are expected to generate positive return, albeit below 2021 levels; earnings growth will return to levels in line with the long-term average (8-10%) after flaring up last year (S&P 500 +50%, Eurostoxx +70%). The evolution of inflation is the main risk factor, although developments in terms of the pandemic may also affect the pace of economic growth. In China, focus will be on economic policy decisions. In January and April, new Presidents of the Republic will be elected in Italy and France; in November, the US Congress will be renewed (mid-term elections). Macro Economy Global growth should slow in 2022, after flaring up in 2021, and this should allow an easing of inflation pressures. The Central Banks are in any case set to reduce monetary stimulus, all the more rapidly if inflation proves persistent. Asset Allocation According to our baseline scenario, economic growth will continue to recover at the global level, even as monetary stimulus is reduced. Pro-cyclical approach to portfolio management confirmed, underweighting duration and overweighting stocks. Positions on the dollar confirmed, exposure to the yen stepped up. Fixed Income Long-term rates in the US and Germany are likely to increase in 2022, as the economic recovery continues and monetary stimulus is removed. Spread bonds hold more appeal than core government bonds, but yields-to-maturity are historically low. Equity Outlook for the stock markets favourable in 2022, although forecast return is lower and exposed to greater volatility than in 2021. Earnings growth is expected to return to normal levels (8-10% in year-on-year terms) after proving extraordinarily strong in 2021. Currencies Dollar set to remain well supported as the Fed starts to remove quantitative stimulus. Portfolio weight of the yen stepped up to buffer potential bouts of volatility on risk assets. Investment View According to our baseline scenario, economic growth will continue to recover at the global level, even as monetary stimulus is reduced. Existing pro-cyclical approach confirmed. Asset Classes Compared In 2021 the Stock markets performed very well, led by the US and Europe, as opposed to neutral performances in the emerging economies of Asia and Latin America. Government bond rates in the US and Germany increased in the opening quarter of the year, and expressed a lateral trend in the following months of 2021. In the year, spreads narrowed on the High Yield bond market, widened for emerging bonds, and widened moderately in Italy. The dollar gained ground in the year. 2022 Scenario The goal in 2021 was to replace the “V” for virus with the “V” for vaccines, and was successfully achieved. Although the virus is still with us, lifestyles are almost back to normal and translated into an extraordinary reacceleration of the economy. The goal in 2022 will be to take a further step towards normality. In terms of the virus, this will mean overcoming the Omicron wave, and any potential subsequent waves, without having to resort to particularly invasive restrictive measures. In this case the impact of the virus on market volatility will remain modest, as was the case in 2021, much unlike 2020. On the economic front, furthering the return to normal will mean a slowdown of economic growth after the major positive shock introduced by reopenings. According to the baseline the scenario, global growth will lose some steam compared to 2021, while staying stronger than the average for the latest economic cycles. A full return to normal is more likely to be achieved in 2023. According to the baseline scenario, moderating growth should ease pressures on the production system and distribution chains, resulting in gradual re-absorption of inflation pressures. This will be the main goal for 2022, and there is good reason to believe it will be achieved. For instance, energy commodity prices have stopped rising since October. For a few months, the second-round effects of past increase will continue to show, but prices should then moderate. However, more persistent than expected inflation, despite a slowdown of economic growth, represents the factor of risk weighing on the scenario. The extent to which this may generate volatility will mostly depend on the approach taken by the Central Banks. In all likeliness, faced with a loss of steam of the economy, the Fed and the ECB will be cautious in removing stimulus. However, should Central Bank focus be on inflation, regardless of the strength of the economy, uncertainty on the length of the current economic cycle would increase, and market volatility with it. The return to normal, in 2022, will also mean that the Central Banks will attempt to progressively remove stimulus measures. The Fed has in fact already kicked off the process, by reducing asst purchases starting in last November. And at the December FOMC it indicated that it intends to accelerate along this path, terminating asset purchases by the end of March 2022, in order to start hiking fed funds rates in the second half of the year. The ECB will probably follow a similar agenda, at a lag of a few months. QE will probably continue throughout 2022, and rate hikes should begin in 2023. The more the removal of monetary stimulus is determined by a return to normal economic activity, with an easing of inflation pressures, the better it will be handed by the economy and the markets. On the other hand, if Central Banks focus primarily on containing inflation, the risk of volatility will be higher. Strictly on the political front, an important theme in 2022 will be the election of new Presidents of the Republic in Italy and France. The election of the Italian President of the Republic will take place by the end of January. Focus will then turn back to the stability of the government, that will have to continue implementing the NRRP, in a pre-electoral year (the legislature will end in March 2023). Political uncertainty, combined with the reduction of ECB asset purchases, will be factors to take into account in assessing the evolution of the BTP–Bund spread. In France the election will be held in April. The two-round French electoral system makes the election of a President with extremist views unlikely. The market impact of the vote should therefore be limited. The outcome of the election will be important, however, in terms of the leadership that will take future decisions in Europe, also in light of the new composition of the German government. Also on the agenda are the midterm elections in the United States, in November, that will renew the House and one third of the Senate. This will be the first real test for the US administration, that can currently count on a full Democrat majority in Congress. Lastly, China deserves special attention. GDP growth has dropped below the medium term goal of the Chinese govenment, of at least 6% y/y, but unlike in the past, the economic authorities are proving reluctant for the time being to visibly eased credit conditions, that they were prompt to tighten at the beginning of 2021. However, a slackening of the restrictive measures still seems to be the likeliest option in the opening months of the new year, with the aim of preventing an excessive slowdown of the economy. The foreign investors’ assessment of China will also depend heavily on whether or not the Xi administration will want to press forward with its anti-market regulatory action, initiated last summer. However, it seems unlikely that China will want to further isolate, a strategy that could ultimately act as a boomerang. Under the baseline scenario, a less hostile attitude to the market economy, and a few growthsupportive stimulus measures, could reverse the trend of the Chinese Stock market, that over the past two years has been worse than the already weak overall performance of the emerging markets. According to our baseline scenario, the financial markets should confirm pro-cyclical trends. The main guiding theme for the markets will be how the combination of growth and inflation intersects with Central Bank decisions. Historically, when the Fed starts tightening monetary policy, shortterm government bond rates (2- year maturity) tend to rise, anticipating the increase of fed funds rates. The long ends of the curves, on the other hand, tend to decline in waiting to assess the resilience of the economic cycle. This was the case in 2014/2015, in the long preparative run-up the rate hike cycle, and has been happening for a few months, in anticipation of the upswing of Fed rates in the second half of 2022. After the initial rate hikes, if investors show confidence in the strength of the economy, rates on the longer end of the curve typically resume rising. In the present situation, the more persistent inflation proves to be, the more the increase of government bond rates will be accompanied by a flattening of the curves. Vice versa, if the removal of stimulus takes place while inflation is on the decline, interest rate maturity curves could steepen. Eurizon Capital hold an underweight view on the US and EUR government bond duration. Within a context of rising core rates, the outlook for spread bonds in terms of absolute return seems modest and limited to carry. For what concerns peripheral euro area government bonds, spreads have widened slightly since last October, in waiting for the ECB’s decisions on purchases. At its December policy meeting the ECB confirmed it will reduce purchases in 2022, albeit gradually and at a slower pace than the Fed. This approach should prevent a further widening of spreads. Italian spreads have widened (from 100 bp in October to 130 at present) also as a result of the uncertainty clouding the election of the President of the Republic and the resilience of the government. Uncertainty seems set to continue at least into the opening months of 2022. As regards the other spread bond markets, at least in the first part of 2022, High Yield bonds will hold more appeal than emerging market bonds, which need greater clarity on the evolution of the pandemic, as well as on the combination of growth and inflation, to tighten spreads. Among emerging bonds, the appeal of Chinese government issues is confirmed. The stock markets have performed very strongly for 20 months now. From the lows marked in March 2020, the US stock index has climbed consistently, with only a few instances of volatility. In 2020, the US upswing had been accompanied by the emerging markets, that faltered in 2021, giving way to the Eurozone stock markets. This year, the Eurostoxx has kept up with the S&P 500, after a weaker 2020. The outlook for stocks sill seems to be favourable in 2022, although forecast return is inevitably lower than in 2021. This is because earnings growth will slow towards the historical average. Consensus forecasts point to 8-10% y/y growth in the advanced markets, after the 2021 surge that saw the S&P 500 score gains of +50% and the Eurostoxx rise by +70%. In the emerging markets, forecast earnings growth in 2022 is lower than for the advanced countries. The emerging economies, especially in Asia and Latin America, are being more affected than the advanced countries by the long wave of the pandemic, the still unresolved disruptions of trade, and the impact on inflation, that their Central Banks have already attempted to counter with restrictive monetary policies. For what concerns valuations, the excesses recorded in the opening months of 2021 have been partly reabsorbed. Multiples (Price/Earnings ratios) have decreased as a result of quotations rising less than earnings. As a result, the equity risk premium, already high, increased further, with corporate earnings on the rise and bond rates essentially stable. The re-absorption of valuation excesses is more evident in the emerging markets and for the Eurostoxx, less so for the US Stock market, where high-growth sectors, for instance technology, have shown stable multiples. However, the US Stock market is still the most appealing in risk-return terms. Its composition by industry makes it more defensive than the other markets, thanks to the weight of growth sectors (technology) that can perform well in case of an only partial macro recovery, and may also benefit from potential rotation to the advantage of cyclical sector if the macro recovery proves more stable. Among the other markets, the Eurozone and Japan seem to hold more appeal, at least in the opening months of the new year, than the emerging markets, that will probably need clearer signals of the sustainability of the economic recovery and of easing inflation pressures to interrupt their underperformance. The dollar recovered in 2021. Against the other currencies taken together (dollar index), the dollar is mid way between its pre-Covid levels and the lows hit at the end of 2020. Against the euro, the change this year was from 1.23 to 1.13; before Covid, the exchange rate was 1.08. In the opening months of 2022, the dollar could keep up its recovery, supported by a reduction of monetary stimulus, that the Federal Reserve is set to implement at a faster pace than the other Central Banks. Therefore, it is confirmed a bullish position on the US dollar, that could also act as a safe haven in case of market volatility bouts. For the same reason, dictated by hedging needs, the intention is to open the year with a long yen position, in a year that is expected to prove favourable for risk assets, albeit subject to more volatility than in 2021. Updated on Dec 23, 2021, 1:16 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: valuewalkDec 23rd, 2021

Camilla Love, MD of eInvest, Explains the Benefits of Active ETFs

Just four years ago, Camilla Love made the jump from Head of Institutional Business at Perennial to Managing Director of eInvest. She started the business in 2017. eInvest is a specialist company that actively manages exchange-traded funds. Their focus is on investment capability to partner with proven investment managers. Q3 2021 hedge fund letters, conferences […] Just four years ago, Camilla Love made the jump from Head of Institutional Business at Perennial to Managing Director of eInvest. She started the business in 2017. eInvest is a specialist company that actively manages exchange-traded funds. Their focus is on investment capability to partner with proven investment managers. 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 Before her time at eInvest, she was responsible for client management and institutional sales, dealing in equities, fixed interest, and derivatives products. When Love moved to open eInvest she brought over 17 years of experience in the financial sector. In 2021, eInvest has five active ETFs. The income generator fund (EIGA) aims to provide investors with a regular monthly income. ECOR aims to provide investors will a regular stream of income over the medium term, as does DHOF (global hybrid securities). EMAX offers a monthly income stream. IMPQ (better future fund) is suited to those trying to achieve long-term capital growth. At the core of eInvest's business is the belief that investors should access institutional-quality investment management capabilities to build their investment portfolios. Love recognized a gap in the listed market for ETFs and is a firm believer in investors taking greater control of their investments. Investors want a more straightforward investment, ease of access, and more control. What Are Some Things That People Should Consider Before Investing In An ETF? According to Love, there are several factors investors should consider before they make the step to invest in ETFs. "What are your goals? What is your time frame? What level of risk can you handle? You need to consider your circumstances before investing and seek advice if you need to." As with any investment, there is always a financial risk, and every investor has a different threshold for risk. Love says that investors should "Always do their research first. Research the business, the ETF, the index if necessary, and the investment team. You should never invest in something unless you have a full understanding of the product." Love adds, "You should always read the product disclosure statement (PDS)." The PDS will provide you with important information that will help you determine whether an investment in the product is the right choice. It provides you with clean language that explains the product. What Should New Investors Do? Love says that new investors "Should dip their toes in first if they are new to investing." Investment is a learning process, and you will learn more the longer you do it. Your first investment is an excellent opportunity to educate yourself on ETFs and the portfolio management process. It would help if you got to grips with when an ETF's value increases and when it may decrease in value. “Diversification is key." Assess your portfolio's diversification in terms of adding an ETF. Is the ETF you plan to add adequately diverse? Does it meet your needs when you compare it to your existing investments? What Is The Difference Between A Passive And Active ETF? Love points out two significant differences between passive and active ETFs that investors should consider. "Firstly, an active ETF doesn't follow an index; they are focused on outperforming an index or other objective." "Secondly, an active ETF utilizes a team of investment professionals to choose which companies to invest in. An investment team may prefer certain companies based on their criteria. ETF holdings, therefore, reflect their views rather than an arbitrary market weight." There are other differences, of course. So, do your homework on the exchange-traded fund you plan to invest in. Why Do You Think Active ETFs Are Better? Love says that "They aren't better or worse than passive ETFs. They are just different. An active ETF makes sense for certain asset classes and not so much for others." “An excellent example would be smaller companies, sustainability, or fixed income. There is an imbalance in available information, which causes a disadvantage for those investing in the index. Tapping into the investment knowledge of professionals is a better way to do this.” "Our view is it shouldn't be a case of either-or, but AND. In the context of a total investment portfolio, active AND passive ETFs make sense. Which Industries Are You Most Excited About? Right now, Love is excited about sustainable investing. She says, "It isn't an industry, but rather a movement. Sustainable investing has come a long way in the past several years. Some great companies hold it at the heart of their operation. It's good to reward them with capital to grow." “In turn, this creates a bigger reward for the investors who support those companies who try to do good things to build a better future for the planet. You can learn more about the type of companies we support by checking out the eInvest Better Future Fund (Managed Fund) ASX:IMPQ.” “This takes us back to the point of thoroughly researching ETFs before investing because many will claim they are sustainable when they are not. Be sure to look under the hood and review what the ETF invests in before you put your money into it; you might get a nasty surprise if you don't.” Updated on Dec 21, 2021, 1:10 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: valuewalkDec 21st, 2021

Camille Love, MD of eInvest, Explains the Benefits of Active ETFs

Just four years ago, Camille Love made the jump from Head of Institutional Business at Perennial to Managing Director of eInvest. She started the business in 2017. eInvest is a specialist company that actively manages exchange-traded funds. Their focus is on investment capability to partner with proven investment managers. Q3 2021 hedge fund letters, conferences […] Just four years ago, Camille Love made the jump from Head of Institutional Business at Perennial to Managing Director of eInvest. She started the business in 2017. eInvest is a specialist company that actively manages exchange-traded funds. Their focus is on investment capability to partner with proven investment managers. 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 Before her time at eInvest, she was responsible for client management and institutional sales, dealing in equities, fixed interest, and derivatives products. When Love moved to open eInvest she brought over 17 years of experience in the financial sector. In 2021, eInvest has five active ETFs. The income generator fund (EIGA) aims to provide investors with a regular monthly income. ECOR aims to provide investors will a regular stream of income over the medium term, as does DHOF (global hybrid securities). EMAX offers a monthly income stream. IMPQ (better future fund) is suited to those trying to achieve long-term capital growth. At the core of eInvest's business is the belief that investors should access institutional-quality investment management capabilities to build their investment portfolios. Love recognized a gap in the listed market for ETFs and is a firm believer in investors taking greater control of their investments. Investors want a more straightforward investment, ease of access, and more control. What Are Some Things That People Should Consider Before Investing In An ETF? According to Love, there are several factors investors should consider before they make the step to invest in ETFs. "What are your goals? What is your time frame? What level of risk can you handle? You need to consider your circumstances before investing and seek advice if you need to." As with any investment, there is always a financial risk, and every investor has a different threshold for risk. Love says that investors should "Always do their research first. Research the business, the ETF, the index if necessary, and the investment team. You should never invest in something unless you have a full understanding of the product." Love adds, "You should always read the product disclosure statement (PDS)." The PDS will provide you with important information that will help you determine whether an investment in the product is the right choice. It provides you with clean language that explains the product. What Should New Investors Do? Love says that new investors "Should dip their toes in first if they are new to investing." Investment is a learning process, and you will learn more the longer you do it. Your first investment is an excellent opportunity to educate yourself on ETFs and the portfolio management process. It would help if you got to grips with when an ETF's value increases and when it may decrease in value. “Diversification is key." Assess your portfolio's diversification in terms of adding an ETF. Is the ETF you plan to add adequately diverse? Does it meet your needs when you compare it to your existing investments? What Is The Difference Between A Passive And Active ETF? Love points out two significant differences between passive and active ETFs that investors should consider. "Firstly, an active ETF doesn't follow an index; they are focused on outperforming an index or other objective." "Secondly, an active ETF utilizes a team of investment professionals to choose which companies to invest in. An investment team may prefer certain companies based on their criteria. ETF holdings, therefore, reflect their views rather than an arbitrary market weight." There are other differences, of course. So, do your homework on the exchange-traded fund you plan to invest in. Why Do You Think Active ETFs Are Better? Love says that "They aren't better or worse than passive ETFs. They are just different. An active ETF makes sense for certain asset classes and not so much for others." “An excellent example would be smaller companies, sustainability, or fixed income. There is an imbalance in available information, which causes a disadvantage for those investing in the index. Tapping into the investment knowledge of professionals is a better way to do this.” "Our view is it shouldn't be a case of either-or, but AND. In the context of a total investment portfolio, active AND passive ETFs make sense. Which Industries Are You Most Excited About? Right now, Love is excited about sustainable investing. She says, "It isn't an industry, but rather a movement. Sustainable investing has come a long way in the past several years. Some great companies hold it at the heart of their operation. It's good to reward them with capital to grow." “In turn, this creates a bigger reward for the investors who support those companies who try to do good things to build a better future for the planet. You can learn more about the type of companies we support by checking out the eInvest Better Future Fund (Managed Fund) ASX:IMPQ.” “This takes us back to the point of thoroughly researching ETFs before investing because many will claim they are sustainable when they are not. Be sure to look under the hood and review what the ETF invests in before you put your money into it; you might get a nasty surprise if you don't.” Updated on Dec 20, 2021, 2:23 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: valuewalkDec 20th, 2021

Purpose AND Profit – How Companies Have To Rethink Their Approach

In an effort to maximise profits, businesses in the past have sometimes forged questionable models that serve the few but let down the many. From factories at the time of the industrial revolution to the institutions responsible for the 2008 financial crash and most recently overinflated billion-dollar startups, we have repeatedly witnessed what happens when […] In an effort to maximise profits, businesses in the past have sometimes forged questionable models that serve the few but let down the many. From factories at the time of the industrial revolution to the institutions responsible for the 2008 financial crash and most recently overinflated billion-dollar startups, we have repeatedly witnessed what happens when investors fail to recognise the importance of responsible capitalism. 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 Walter Schloss Series in PDF Get the entire 10-part series on Walter Schloss 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 In today’s fast-paced world it can be easy to neglect the bigger picture. But as many businesses look towards their post-pandemic futures, a different approach to leadership and investing is emerging. In practice, it’s all about sustainability, but what leaders who implement this way of investing are finding out is that it’s also about profitable longevity. Those getting it right, like CG Tech’s Niall Carroll and group CEO Jason English, are proving that playing the long game isn’t just good business but smart business. Purpose-Driven Approach The purpose-driven approach isn’t a new concept. In Jim Collins’ 1994 book, Built to Last he found that companies with a strong purpose were able to generate shareholder returns that were six times higher than those of their profit-driven competitors. Collins also delves into something he calls the “Genius of the AND.” This refers to visionary companies who are able to be distinctly idealistic whilst also being profitable. “Instead of being oppressed by the ‘Tyranny of the OR,’ highly visionary companies liberate themselves with the ‘Genius of the AND’—the ability to embrace both extremes of a number of dimensions at the same time. Instead of choosing between A OR B, they figure out a way to have both A AND B,” writes Collins. Purpose isn’t just something leaders are thinking about either, as research shows employees and consumers also gravitate towards businesses with a strong vision. A 2019 study by McKinsey found that 82% of employees think it is important to have a purpose, while 72% stated this should receive even more weight than profit. Likewise, the 2020 Strength of Purpose Study by Zeno concluded that consumers were four times more likely to purchase from a brand they believed had a strong purpose and six times more likely to protect that company in the event of a misstep or public criticism. For over three decades, Niall Carroll has been honing a different method of investing. Drawing on his experiences within the corporate banking world, as well as his time heading Royal Bafokeng Holdings (a community-owned investment company for the Royal Bafokeng Nation), Carroll’s views regarding social capitalism and the importance of re-defining long term goals led him to establish CG Tech in 2014. Sustainability Is About Promoting Longevity “Sustainability often gets conflated to the environment, but it’s not just about that, it’s about promoting longevity. I realised early on that I wanted to do more than just make a quick buck in the short term. While a lot of venture capitalists subscribe to the ‘get in early and get out quick’ formula, that’s not always in the best interest of the company. Creating something with long term horizons and being able to serve the community and people around the investment is more attractive to me,” explains Carroll. With interests in oil and gas, construction, virtual reality, sound stages and more, the CG Tech portfolio is diverse but cleverly interlinked. Utilising a unique ecosystem approach, owner-operators of the CG Tech subsidiaries make up the group’s senior leadership and governance team. Chairman Niall Carroll and his team, including Chief Ecosystem Officer Jason English, have created an environment of transparency and a solid company culture that’s proving productive for all. “For me, the real value in teaming up with owner-managers is that they are already invested in their companies. They’re excited to grow and eager to learn new things. Inviting them to be part of the senior governance structure only encourages this curiosity and drives a willingness to see not only their own business success but also the others within the portfolio. A shared sense of purpose is the driving force behind our success,” says Carroll. While Jason English might come from a different background than Carroll, the former member of the South African Police Services and present Chief Ecosystem Officer of CG Tech follows the same purpose-driven approach to business, with a focus on building teams that understand a company’s vision and long-term goals. Whether it’s developing a platform to virtually train oil and gas engineers, or giving teams a meaningful way to work by getting involved in community projects, English’s distinct brand of leadership is proving to be a perfect match to Carroll’s. “We want to infuse our people with a strong sense of purpose in a way that also promotes autonomy. We understand there will always be challenges,” notes English. Adding, “but what we hope for is that our teams learn something from every situation, good or bad, that then helps them power success in the future.” Utilising Disruptive Technologies While many businesses were ground to a halt during COVID-19, CG Tech saw the pandemic as an opportunity to promote what they do best – utilising disruptive technologies to help solve emerging issues within traditional markets. “The pandemic gave us the perfect chance to make integral changes. Overnight, the disruptive technologies we’ve been using within the group suddenly became essential to businesses around the globe. Because the companies in the CG Tech portfolio already operate with a clear vision and purpose for the future, we were able to pivot and quickly mobilise our teams to not only survive but, in many cases, thrive during what was a challenging time for many businesses,” says English. For CG Tech a strong purpose is what gets you through the tough times, and perhaps more importantly is what allows you to emerge even stronger. While many people might focus on the innovations and results, it’s important to recognise success didn’t start there. It was the purpose that made it all possible. Updated on Dec 15, 2021, 3:02 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: valuewalkDec 15th, 2021

13 careers to consider if you"re interested in environmental science and the skills you need to succeed

There are dozens of career options in environmental science. Wildlife biologist, conservation officer, or science editor could be your perfect fit. A career in environmental science can help you make a difference in the world.CasarsaGuru/Getty Images Jobs in environmental science are viable career paths and crucial for the future of our planet.  If you studied environmental science, you probably have more transferable skills than you realize. Consider one option, environmental engineering, where you can make an average of $57,685 a year. You might be the kid who loved being outdoors, exploring the nearby woods, and collecting bugs in a jar or taking samples from the local pond to look at under your most prized possession: a microscope (you know, the one you'd never let your little brother so much as breathe near). Or maybe you were that, umm, let's say spirited, high school volunteer who led an effort to clean up a state park after you realized what all that litter was doing to the poor animals. Perhaps you watched in horror — in person or on TV — as a wildfire consumed a West Coast town or as Hurricane Maria battered Puerto Rico, killing so many that we still don't have an exact death toll.Whatever drove you to study — or consider studying — environmental science, you're well aware that the world needs you right now. Environmental science majors are prepared to take on our climate crisis, conserve natural resources and environments, lead the charge on renewable energy, and — not to be dramatic — literally save the planet.But as you're sitting in class, doing your labs, and trying to imagine your next steps, you might start to feel overwhelmed. "Can I really make a difference in a world that's burning and melting and only getting worse?" you might wonder. "There's so much to do, where would I even start?" The great thing is: There are so many options open to environmental science majors. But the problem is: There are so many options open to environmental science majors.You don't need a list of 734 possible jobs. But what you probably could use is a tailored list that digs into a few particularly promising career options — and maybe a quick look at some of the skills you've gained that will help you thrive in the workplace and what types of organizations and industries are looking to hire former amateur pond sleuths like you.Skills environmental science grads already haveAnybody who's completed college already has valuable skills for the workplace. And "environmental science degrees specifically provide an abundance of transferable skills," Alaina G. Levine, a STEM career coach, writer covering environmental science topics, and president of Quantum Success Solutions, LLC, a career consultancy focused on engineering and the sciences, said. Your degree has prepared you to work in basically any field you'd like, Levine said, whether you want to pursue a career related to environmental science or go in another direction.Here are a few of the transferable skills you likely gained:Communication and storytelling: Throughout your coursework, you learned to communicate by writing research proposals and reports, essays, and emails; discussing information with others in classes or group projects; and giving presentations. Environmental science majors often need to take complex topics and translate them into a compelling story that convinces people they need to care about something and take action, Levine said. You learn how to "mine data and distill it in a way your 'constituents' will understand," whether your constituents are your classmates, teachers, colleagues, managers, executives, policymakers, or the public.Marketing: Most environmental science programs won't mention that you're learning marketing skills, Levine said, but any time you're explaining the value of a project or even a natural resource, you're using marketing skills. "Marketing" might feel like a dirty word in the context of our planet, but it simply means crafting a message that convinces someone to take action. In environmental science, you might be persuading a company to put money or time into a new process that's more sustainable or writing a grant proposal where you're communicating the value of your research.Leadership: Many employers are looking for leadership skills in employees at all levels. Leadership "isn't just being appointed or anointed a leader," Levine said. It's any time you take ownership or initiative. Individuals have to lead "a team of one every day," and decide how to do their work productively and efficiently, Levine said. You'll also have to lead your own initiatives, programs, and/or research even as an early-career employee. You already got practice with these skills whenever you led a group project, coordinated resources to meet deadlines or budgets, or made decisions based on new information or data. Research: "Environmental science programs turn out students who are excellent in conducting research," Sara Hutchison, a career coach who's advised environmental science majors and has a degree in sustainable development herself, said. Students often have to study primary sources, read through compliance and legal documentation, collect their own data in the field, employ the scientific method, and write about their findings, all of which teach them strong research practices, such as how to select reliable sources and data. Even if you're not working in a research setting, these skills help you collect the information you need to solve problems. Speaking of which...Problem-solving: In addition to gathering the data they need and making autonomous decisions, environmental science students learn how to look at a problem from multiple perspectives, which "is an extremely valuable asset, both in scientific careers and less 'traditional' careers," Dr. Gemma Cassidy, who's hired and advised environmental science majors and is currently the senior journals publishing manager for Wiley, a large scientific-publishing company, said. For example, they may need to look at how an issue with air quality might be affecting different parts of an ecosystem and evaluate the economic costs of various solutions. Or in a very different context, they might consider how proposed upgrades to a software product might affect users.Risk assessment/management: Since environmental science students often need to conduct field research, they're practiced in risk assessment and management, Levine said. They may have to shift priorities or adjust plans either before going out in the field or on the fly due to risks like weather, wildlife, environmental conditions, or even other humans. For example, a dangerous storm may compromise your ability to safely collect water samples, so maybe you have to analyze the nearby soil instead or adjust your research timelines. You may also specifically study the possible risks to a certain population of frogs as the climate changes, for example. Risk assessment and management is useful whenever you're evaluating the best course of action for a given project or initiative.Computer skills: Like most fields, environmental science is increasingly relying on technology. During your coursework, you likely learned the computing skills needed to analyze and visualize data, build models or projections to predict outcomes, and possibly utilize AI and machine learning. These computer skills are highly sought after both inside and outside of the environmental science field."As a final point, graduates from an environmental sciences background likely have a passion for our planet, and how best to protect it," Cassidy said. Employers are always looking for workers who care deeply and are knowledgeable about what they'll be doing — and many organizations are hiring workers to help fight the climate crisis in particular.Where can environmental science majors work?When you're deciding where you'd like to work — whether that's a type of organization or a certain industry — Levine suggests thinking about your values and what drives you. "Do you want to protect the coastlines because you grew up in a seaside area?" Levine asked. Or would you like to help decrease the negative effects big companies have on our environment? Are there certain animals or plant life you want to protect? Are you interested in maintaining and improving public health? Do you want to directly affect policy?Here are some of the common industries and types of organizations where environmental science majors work:Local, city, state, and federal governmentMunicipalities and utilitiesNonprofit organizationsEducationMuseumsEnergy (both renewable energy companies and traditional fossil fuels companies looking to decrease their environmental impact)Manufacturing and safetyFood productionReal estate developmentPublishing and mediaPublic healthZoos, aquariums, national parks, and other conservation centersBut this list is far from exhaustive. More and more organizations are prioritizing sustainability in their day-to-day operations, Cassidy said. As a result, those with environmental science degrees are needed "across the board." Many environmental science careers might feel "hidden," Levine said, but you can find them through networking and environmental professional organizations such as the National Association of Environmental Professionals (NAEP).Even if you don't want a career in environmental science, "​​The degree you pick to complete in college does not define the career you will pursue," Hutchison said. So don't feel boxed in.13 jobs and careers for environmental science majorsBelow you'll find 13 jobs and careers you can pursue with an environmental science degree (and you can click on the links to search for current openings on The Muse). Many of these jobs can be found in multiple or all of the above industries or types of organizations and you can specialize according to your area of focus or interest. For example, you can be an environmental science technician for a real estate company that studies the effects different developments may have on the water in a local ecosystem or you might be an environmental consultant who specializes in helping manufacturers decrease the air pollutants produced by their work.Unless otherwise noted, all salary information is from PayScale.com. (Note that PayScale's database is updated nightly; the numbers below reflect figures as of November 2021.)1. Environmental educator or environmental science teacherAverage educator salary: $51,316Average secondary school teacher salary: $50,038Environmental educators come in multiple forms. You may choose to become a secondary school teacher in either environmental science or a smaller subset of the subject such as oceanography, or you might work for a museum, national park, zoo, or other conservation center or program.Regardless, environmental educators teach others about the environment and issues facing it — plus how they as individuals can help. For example, Hutchison once worked as a tour guide for a local cavern. "Sharing my passion for the environment with children and tourists was amazing," Hutchison said. "I loved how it opened their eyes to why they should clean up their pet waste or not pollute waters because all that goes downstream into a cave like ours."The qualifications you'll need to be an environmental educator depend on exactly where you'd like to work. If you'd like to be a secondary school teacher, you may need to take education classes or obtain a master's degree depending on which state you'd like to teach in.Find environmental educator or teacher jobs on The Muse2. Environmental engineer or environmental engineering technicianAverage environmental engineer salary: $66,621Average engineering technician salary: $57,685Environmental engineers design, plan, and build systems that improve or monitor the environment. They also collect and/or analyze scientific data and conduct quality control tests to inform or adjust their plans. For example an environmental engineer may be responsible for designing a new water treatment center, equipment that reduces the pollution a factory releases, a sustainable recreational attraction, or a building that minimally disrupts the environment. Meanwhile, environmental engineering technicians and technologists carry out the plans that environmental engineers create."If you really like building things, deploying applications, and seeing the work you do transform people's lives directly," you might consider one of these careers, Levine said.If you haven't already completed substantial engineering coursework alongside or as part of your major, you may need to complete a master's in engineering — but it depends where you'd like to work. However, engineering technician jobs often don't require engineering-specific degrees (though you may still need an OSHA certification).Find environmental engineer and environmental engineering technician jobs on The Muse3. Environmental scientist and environmental science and protection techniciansAverage environmental scientist salary: $52,680Average environmental technician salary: $43,485These professionals conduct research, experiments, field work, and tests to monitor or discover more about the environment. Environmental scientists may propose new research and design experiments with the goal of evaluating, preventing, controlling, or fixing environmental problems.Environmental science and protection technicians are often responsible for conducting tests in the field and reporting findings to a scientist, municipality, or any other entity that's monitoring environmental conditions. For example, you may be responsible for gathering and testing water samples to make sure a nearby company is not compromising the ecosystem or you might work for a city government, continuously monitoring air quality.You can focus in a myriad of areas in environmental science such as microbiology, ecology, oceanography, or geology. In order to become an environmental scientist, you'll need a master's degree or PhD in your chosen area of focus, but technicians can often land jobs with bachelor's degrees in environmental science.Find environmental scientist, environmental science technician, and other environmental science jobs on The Muse4. Wildlife biologistAverage salary: $50,186Wildlife biologists are a subset of environmental scientists that focus specifically on animals and other wildlife and how they interact with their environments. They may conduct studies on animals in their natural habitat or in zoo or sanctuary environments and/or monitor threats to populations and come up with ways to mitigate them. Wildlife biologists often focus on specific types of animals or plants.Depending on where you'd like to work, you can often find an entry-level position with a bachelor's degree in environmental science, but to advance and/or conduct independent research you'll need to obtain a PhD.Find wildlife biologist jobs on The Muse5. Environmental health and safety specialistAverage salary: $64,210Environmental health and safety (EHS) specialists study how different environmental conditions affect human health, protect the health and safety of individuals and ecosystems by setting regulations and guidelines, and ensure compliance with these regulations and guidelines. They may work for governments or other oversight organizations to set and enforce safety and environmental standards for geographic areas or industries, or they might work for individual companies to ensure the safety of work processes and the company's overall sustainability.You can often get these jobs with a bachelor's degree, though some employers will require that you obtain relevant safety certifications for their industry.Find environmental health and safety specialist jobs on The Muse6. Conservation officerAverage salary: $44,667Conservation officers, also known as park rangers, manage state and national parks, forests, and other wildlife areas. They are responsible for the safety of guests and wildlife as well as the conservation of the area. Conservation officers may also maintain campgrounds, trails, and other facilities; manage programs for the public; answer questions; and address and correct possible risks to the environment or guests. If you love being outside and interacting with the public, this could be the job for you. You can land a job as a conservation officer with a bachelor's degree in environmental science.Find conservation officer and park ranger jobs on The Muse7. Recycling coordinatorAverage salary: $53,705Recycling coordinators and officers oversee the way recyclables are handled by an organization or municipality. For smaller companies or schools, this might be part of a broader role, but for larger entities, overseeing recycling efforts could be your full-time job."It's no longer about making signs for the recycling cans," Hutchison, who was previously a recycling coordinator for a university, said. "It's about waste trucks, dumpster pulls, procurement of containers, writing [requests for proposals to] vendors, endless spreadsheets on waste to create baselines for reduction goals, and hosting field trips for the local classrooms." Basically, you need to make sure all the recycling gets sorted properly, picked up, and transferred to the appropriate facility so that the material can be reused, all while advocating for the program and encouraging individuals to participate.If you're super organized and want to help decrease the amount of waste going to landfills, this could be a job for you. Hutchison snagged her role right out of college — so there are entry-level opportunities.Find recycling coordinator and other recycling positions on The Muse8. Environmental consultantAverage salary: $58,387In general, consultants evaluate client companies and their departments and processes; analyze their findings; and propose solutions to solve problems, save money, or increase efficiency. Environmental consultants specifically focus on sustainability and environmental impact. For example, they might suggest ways for companies to reduce their carbon footprints or advise them on how to better use and dispose of hazardous materials.Consultants often work for consultancies or as freelancers. If you want to help companies increase their sustainability and curb emissions or waste, this career could be a great fit. You can often get these jobs with a bachelor's degree.Find environmental consultant jobs on The Muse9. Environmental policy analystAverage policy analyst salary: $60,216Environmental policy analysts research, analyze, and evaluate the effects an existing or proposed law, regulation, or program will have on the environment, people, wildlife, or any other facet of society. These jobs involve "packaging research in a way that can be used in policy to make laws and regulations that will make a difference," Levine said. So if you want to have a direct effect on what companies and individuals need to do to curb climate change, for example, a career in environmental policy may be for you.You may be able to find an entry-level position with a bachelor's degree in environmental science (look for federal, state, and local government fellowships and programs specifically designed for this) — but you could need further education to progress in your career.Find environmental policy analyst jobs on The Muse10. Science editorAverage salary: $60,499Science editors put together academic journals or textbooks consisting of science information and new discoveries, research, and studies. Depending on your role and career level, you may be responsible for copyediting and formatting articles, assigning and editing articles or book sections, or assessing original research and coordinating peer reviews of it. Scientific publishing "is a great career for those who feel passionately about the science but want to step away from being the ones doing the research themselves," Cassidy said. "Working on academic journals gives you a front-row seat to new, cutting-edge research, and working with editors and academic societies can be very inspiring."While an environmental science degree will give you the scientific background you need to understand the research, you'll also need strong writing and editing skills to pursue this career.Find science editor and other editing jobs on The Muse11. Science communications specialistAverage communications specialist salary: $54,008While this might sound like a similar role to science editor, science communicators work across industries and mediums. No matter what your focus is, though, all science communications specialists have the same goal: sharing often complex information about science (or the environment) in a way that the intended audience understands it, cares about it, and knows what to do about it. Depending on where you work, you may write press releases, website or social copy, TV, radio, or online video scripts, or reported and researched articles; create infographics, videos, pamphlets, and other presentations; or produce educational materials for schools, museums, and other programs.Your background in environmental science will give you the technical know-how you'll need and lend you credibility, Levine said. You may also need strong writing skills, social media savvy, video production knowledge, or graphic design chops, depending on the roles you'd like to pursue. You may find jobs for science or environmental nonprofits, departments, or organizations labeled "communications specialist," "communications coordinator," or similar, but you should also search for roles that describe the specific work you'd like to do, such as "copywriter," "video editor," or "social media manager" at companies that focus on an area of the environment or science you're passionate about.Find science communications specialist jobs and science communication jobs on The Muse12. Data analystAverage salary: $61,881Data analysts collect, organize, and interpret large amounts of information in order to solve problems or make recommendations. They may also be responsible for creating projections, models, or data visualizations.You can find these roles at companies across many industries, so if you'd like to work for a company focused on some aspect of the environment, you can. For example, you might analyze the data from a large number of water samples taken along a coastline to look for patterns for a clean water–focused nonprofit.But as an environmental science graduate, you likely have the data knowledge you need to seek a position in a different field entirely — particularly if you can demonstrate coding experience, which employers are increasingly looking for in data professionals. You can also take online classes or look into a data science bootcamp to boost your skills. A bachelor's degree is usually the only education requirement for entry-level roles, but you may need a master's degree for more senior roles.Find data analyst and other data jobs on The Muse13. Marketing analystAverage salary: $57,134Marketing analysts evaluate data, prices, markets, strategies, and customer bases to answer marketing questions or solve issues either for the company they work for or for a client company. If you have an environmental science degree but you're interested in something outside of that field, marketing analysts are needed in every industry. For example, you could find a marketing analyst job for a renewable energy company that sells solar panels to individual homes or you can find a position for a tech company working on a productivity app.With the storytelling, data analysis, research, and marketing skills you gained from your coursework, you can likely find an entry-level marketing analyst job right out of undergrad.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderDec 12th, 2021

2022 Predictions: GlobalData Identifies The 30 Themes That Will Be Most Disruptive In 2022

Companies that invest in the right themes become success stories, while those that miss the big themes end up as failures, according to GlobalData. The leading data and analytics company’s brand new report, ‘Tech, Media & Telecom Predictions 2022’, identifies the thirty themes GlobalData predicts will cause the most disruption in 2022. Below, analysts at […] Companies that invest in the right themes become success stories, while those that miss the big themes end up as failures, according to GlobalData. The leading data and analytics company’s brand new report, ‘Tech, Media & Telecom Predictions 2022’, identifies the thirty themes GlobalData predicts will cause the most disruption in 2022. Below, analysts at the Thematic Research team at GlobalData offer their views on five of these themes: the metaverse, batteries, cryptocurrency, space economy and environment, social and governance (ESG) issues. 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 The Metaverse Emma Taylor, Thematic Analyst at GlobalData, comments: “While the metaverse won’t be realized for several years yet, early prototypes and use cases will begin to emerge as early as next year as tech titans battle for early market dominance. The variety of use cases is already becoming apparent, ranging from Facebook and Microsoft’s enterprise focus to Epic Games and Roblox’s gaming ambitions. “China is a potentially lucrative metaverse market due to its massive and affluent user base. Leading Chinese tech companies such as Tencent and Alibaba will continue to file for metaverse-related trademarks. However, the ongoing regulatory crackdown on China’s tech sector will hinder their progress.” Batteries Daniel Clarke, Thematic Analyst, comments: “Batteries are the oil barrels of the 21st century – they will underpin many of the core technologies needed in the climate transition. The US and Europe have finally woken up to Chinese dominance of the battery supply chain, which represents a significant chokepoint for advanced Western economies trying to reach net-zero. Furthermore, the battery metals supply and demand gap is a core issue in the batteries theme. “GlobalData predicts that companies will invest in alternative battery chemistries due to lithium supply constraints. In addition, Western countries will invest in building battery supply chains to offset China's dominance, while the increasing cost of lithium batteries will force several automakers to raise electric vehicle (EV) prices.” Cryptocurrency Amna Mujahid, Thematic Analyst, comments: “Decentralized finance (DeFi) — a fully open financial system that uses blockchain-powered smart contracts instead of relying on centralized entities like banks and brokerages — will disrupt traditional financial institutions with its promise to remove any sneaky intermediaries from transactions. “Start-up companies will lead the bulk of DeFi innovations as they compete to create more sophisticated platforms. Traditional financial bodies will work hard to catch up with the DeFi trend, introducing central bank digital currencies (CBDCs) and using stablecoins. Only a proactive response will keep traditional institutions relevant, and many — such as Goldman Sachs, Citi, and UBS — have already taken the plunge by entering the DeFi landscape.” Space Economy Thematic Analyst Francesca Gregory, comments: “The expansion of satellite networks will provide up to 70% of the space economy’s growth in the near term. This short-term growth will pave the way for larger aspirations. “Following the announcement of plans for space business parks from Blue Origin, Voyager Space Holdings, and Lockheed Martin, commercial actors will have a more sustained presence in space, signaling a commercial infrastructure boom in the longer term.” ESG Rachel Foster Jones, Thematic Analyst, comments: “ESG is the most important theme discussed in boardrooms, and disclosing ESG will become the norm in 2022. Companies that fail to demonstrate their commitment to ESG will face a backlash from their stakeholders. “Companies are flooding to sign the Climate Pledge. As its targets can be achieved through carbon offset schemes, there will be increasing pressure for the voluntary carbon market to be regulated. However, companies should be careful as committing to non-credible net-zero targets through offset schemes will cause reputational damage.” About GlobalData 4,000 of the world’s largest companies, including over 70% of FTSE 100 and 60% of Fortune 100 companies, make more timely and better business decisions thanks to GlobalData’s unique data, expert analysis and innovative solutions, all in one platform. GlobalData’s mission is to help our clients decode the future to be more successful and innovative across a range of industries, including the healthcare, consumer, retail, financial, technology and professional services sectors. Updated on Dec 9, 2021, 2:55 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: valuewalkDec 9th, 2021

Fed Issues Stock Market Warning As Valuations Surge

Fed Issues Stock Market Warning As Valuations Surge Authored by Lance Roberts via RealInvestmentAdvice.com, In the semi-annual Financial Stability Report, the Fed issued a stock market warning as elevated valuations are causing markets to be “vulnerable to significant declines”. To wit: Prices of risky assets generally increased since the previous report, and, in some markets, prices are high compared with expected cash flows. House prices have increased rapidly since May, continuing to outstrip increases in rent. Nevertheless, despite rising housing valuations, little evidence exists of deteriorating credit standards or highly leveraged investment activity in the housing market. Asset prices remain vulnerable to significant declines should investor risk sentiment deteriorate, progress on containing the virus disappoint, or the economic recovery stall. Is the Fed’s stock market warning justified? The Fed is stating that valuations, as the prices of “risky” assets keep rising, make the stock market continually more vulnerable to a crash. It is the “stability/instability” paradox. What could cause asset prices to crash? The Fed notes specifically: Another surge, or variant, of the COVID virus, A stalling of the economic recovery, or; Investor “risk-sentiment” deteriorates Given that Fed interventions boosted the stock market and “investor sentiment,” the withdrawal of that support could be problematic. As I discussed in “Bob Farrell’s Rules For A QE Market:” “The high correlation between the financial markets and the Federal Reserve interventions is all you need to know to navigate the market.“ Those direct or psychological interventions are the basis for justifying all the speculative “risk” investors can muster. Fed Driven “Irrational Exuberance” There is little doubt that “risky” assets are surging higher, driven by speculative investor confidence. That speculation appears throughout the market, from record call options to “meme” stocks surging in price. Chart courtesy of TheMarketEar via Zerohedge But it’s not just the retail investor piling into stocks, but even professional managers are now “all in” the equity risk pool. Of course, such speculative appetite is no surprise as the Fed’s monetary policy created the “Pavlovian” response to “risk-taking.”Or, more commonly known as: “Don’t fight the Fed.” And “fight the Fed” retail investors did not. As shown below, household equity ownership is rocketing higher, towards $30 trillion. Chart courtesy of TheMarketEar via Zerohedge Before you marvel at the feat of household equity ownership, you need to remember two crucial factors. The top 10% of income earners own 90% of those assets, and; It took $43.5 trillion dollars of liquidity to create that “wealth.” Given the amount of “liquidity” thrown at the stock market, the Fed should take responsibility for investors’ “irrational exuberance.” Valuations Are Extreme By Virtually Every Measure “Across most asset classes, valuation measures are high relative to historical norms. Since the May 2021 Financial Stability Report, equity prices rose further.” – Federal Reserve The description of valuations by the Fed is somewhat misleading. When saying something is high relative to historical norms, its meaning gets lost without some context. In this case, the context best comes from historical charts of various valuation measures. The most obvious is the Shiller CAPE ratio which takes current prices dividend by 10-years of earnings. This method smoothes out the volatility of earnings that can occur on an annual basis. At 40x trailing earnings, current valuations are higher at the peak of the market in 1999. A look at market capitalization to the economy also gives you some sense of the “excess” in markets. Given that earnings and revenue come from economic activity, the market can not “outgrow” the economy long term. Lastly, price-to-sales (what happens at the top line of the income statement) is also exceedingly stretched. While stock prices can advance, earnings are ultimately a function of economic growth and sales. Therefore, when excesses occur, an eventual reversion must, and will, occur. The only question is the timing and the catalyst. Hoping For A “Soft Landing” In the Fed notes, valuations are elevated; in the stock market warning report, they identify several risks to the stock market. The Fed report, highlighting the most salient risks that could undermine the financial system, flagged many previously stated concerns. Those included “structural vulnerabilities” in money market funds. “stable coins,” which the central bank now uses as a generic warning about risks associated with cryptocurrency adoption, inflation, and fading fiscal support. But, as always, the Fed hopes they can orchestrate a “soft-landing” for the stock market. Unfortunately, the Fed has a miserable track record of such outcomes. Richard Thaler, the famous University of Chicago professor who won the Nobel Prize in economics, stated: “We seem to be living in the riskiest moment of our lives, and yet the stock market seems to be napping. I admit to not understanding it. I don’t know about you, but I’m nervous, and it seems like when investors are nervous, they’re prone to being spooked. Nothing seems to spook the market.” Such is always the case, just before something does. History Always Rhymes While the Fed notes valuations are elevated, the crucial message to investors gets obfuscated. From current valuation levels, the expected rate of return for investors over the next decade will be low. There is a large community of individuals who suggest differently. They rationalize a case this “bull market” can continue for years longer. But, unfortunately, any measure of valuation does not support that claim. Such does not mean that markets will produce single-digit rates of return each year for the next decade. The reality is there will be some great years to get invested. Unfortunately, there will likely also be a couple of tough years in between. That is the nature of investing. It is just part of the full-market cycle. The economic cycle, demographics, debt, and deficit also suggest optimistic views are unlikely.  “History doesn’t repeat itself, but it often rhymes.” – Mark Twain Unfortunately, despite the Fed’s stock market warning, the market will ultimately deal with “irrational exuberance,” just as it has done every time previously. Tyler Durden Mon, 11/15/2021 - 13:50.....»»

Category: blogSource: zerohedgeNov 15th, 2021

America"s Woke Colleges Can"t Be Salvaged. We Need New Ones

America's Woke Colleges Can't Be Salvaged. We Need New Ones Authored by Niall Ferguson, op-ed via Bloomberg.com, I'm Helping to Start a New College Because Higher Ed Is Broken If you enjoyed Netflix’s “The Chair” - a lighthearted depiction of a crisis-prone English Department at an imaginary Ivy League college - you are clearly not in higher education. Something is rotten in the state of academia and it’s no laughing matter.   Grade inflation. Spiraling costs. Corruption and racial discrimination in admissions. Junk content (“Grievance Studies”) published in risible journals. Above all, the erosion of academic freedom and the ascendancy of an illiberal “successor ideology” known to its critics as wokeism, which manifests itself as career-ending “cancelations” and speaker disinvitations, but less visibly generates a pervasive climate of anxiety and self-censorship. Some say that universities are so rotten that the institution itself should simply be abandoned and replaced with an online alternative — a metaversity perhaps, to go with the metaverse. I disagree. I have long been skeptical that online courses and content can be anything other than supplementary to the traditional real-time, real-space college experience. However, having taught at several, including Cambridge, Oxford, New York University and Harvard, I have also come to doubt that the existing universities can be swiftly cured of their current pathologies. That is why this week I am one of a group of people announcing the founding of a new university — indeed, a new kind of university: the University of Austin. The founders of this university are a diverse group in terms of our backgrounds and our experiences (though doubtless not diverse enough for some). Our political views also differ. To quote our founding president, Pano Kanelos, “What unites us is a common dismay at the state of modern academia and a belief that it is time for something new.” There is no need to imagine a mythical golden age. The original universities were religious institutions, as committed to orthodoxy and as hostile to heresy as today’s woke seminaries. In the wake of the Reformation and the Scientific Revolution, scholars gradually became less like clergymen; but until the 20th century their students were essentially gentlemen, who owed their admission as much to inherited status as to intellectual ability. Many of the great intellectual breakthroughs of the Enlightenment were achieved off campus. Only from the 19th century did academia become truly secularized and professional, with the decline of religious requirements, the rise to pre-eminence of the natural sciences, the spread of the German system of academic promotion (from doctorate up in steps to full professorship), and the proliferation of scholarly journals based on peer-review. Yet the same German universities that led the world in so many fields around 1900 became enthusiastic helpmeets of the Nazis in ways that revealed the perils of an amoral scholarship decoupled from Christian ethics and too closely connected to the state. Even the institutions with the most sustained records of excellence — Oxford and Cambridge — have had prolonged periods of torpor. F.M. Cornford could mock the inherent conservatism of Oxbridge politics in his “Microcosmographia Academica” in 1908. When Malcolm Bradbury wrote his satirical novel “The History Man” in 1975, universities everywhere were still predominantly white, male and middle class. The process whereby a college education became more widely available — to women, to the working class, to racial minorities — has been slow and remains incomplete. Meanwhile, there have been complaints about the adverse consequences of this process in American universities since Allan Bloom’s “Closing of the American Mind,” which was published back in 1987. Nevertheless, much had been achieved by the later years of the 20th century. There was a general agreement that the central purpose of a university was the pursuit of truth — think only of Harvard’s stark Latin motto: Veritas — and that the crucial means to that end were freedom of conscience, thought, speech and publication. There was supposed to be no discrimination in admissions, examinations and academic appointments, other than on the basis of intellectual merit. That was crucial to enabling Jews and other minority groups to take full advantage of their intellectual potential. It was understood that professors were awarded tenure principally to preserve academic freedom so that they might “dare to think” — Immanuel Kant’s other great imperative, Sapere aude! — without fear of being fired. The benefits of all this defy quantification. A huge proportion of the major scientific breakthroughs of the past century were made by men and women whose academic jobs gave them economic security and a supportive community in which to do their best work. Would the democracies have won the world wars and the Cold War without the contributions of their universities? It seems doubtful. Think only of Bletchley Park and the Manhattan Project. Sure, the Ivy League’s best and brightest also gave us the Vietnam War. But remember, too, that there were more university-based computers on the Arpanet — the original internet — than any other kind. No Stanford, no Silicon Valley. Those of us who were fortunate to be undergraduates in the 1980s remember the exhilarating combination of intellectual freedom and ambition to which all this gave rise. Yet, in the past decade, exhilaration has been replaced by suffocation, to the point that I feel genuinely sorry for today’s undergraduates. In Heterodox Academy’s 2020 Campus Expression Survey, 62% of sampled college students agreed that the climate on their campus prevented them from saying things they believed, up from 55% in 2019, while 41% were reluctant to discuss politics in a classroom, up from 32% in 2019. Some 60% of students said they were reluctant to speak up in class because they were concerned other students would criticize their views as being offensive. Such anxieties are far from groundless. According to a nationwide survey of a thousand undergraduates by the Challey Institute for Global Innovation, 85% of self-described liberal students would report a professor to the university if the professor said something that they found offensive, while 76% would report another student. In a study published in March entitled “Academic Freedom in Crisis: Punishment, Political Discrimination and Self-Censorship,” the Centre for the Study of Partisanship and Ideology showed that academic freedom is under attack not only in the U.S., but also in the U.K. and Canada. Three-quarters of conservative American and British academics in the social sciences and humanities said there is a hostile climate for their beliefs in their department. This compares to just 5% among left-wing faculty in the U.S. Again, one can understand why. Younger academics are especially likely to support dismissal of a colleague who has made some heretical utterance, with 40% of American social sciences and humanities professors under the age of 40 supporting at least one of four hypothetical dismissal campaigns. Ph.D. students are even more intolerant than other young academics: 55% of American Ph.D. students under 40 supported at least one hypothetical dismissal campaign. “High-profile deplatformings and dismissals” get the attention, the authors of the report conclude, but “far more pervasive threats to academic freedom stem … from fears of a) cancellation — threats to one’s job or reputation — and b) political discrimination.” These are not unfounded fears. The number of scholars targeted for their speech has risen dramatically since 2015, according to research by the Foundation for Individual Rights in Education. FIRE has logged 426 incidents since 2015. Just under three-quarters of them resulted in some kind of sanction — including an investigation alone or voluntary resignation — against the scholar. Such efforts to restrict free speech usually originate with “progressive” student groups, but often find support from left-leaning faculty members and are encouraged by college administrators, who tend (as Sam Abrams of Sarah Lawrence College demonstrated, and as his own subsequent experience confirmed) to be even further to the left than professors. There are also attacks on academic freedom from the right, which FIRE challenges. With a growing number of Republicans calling for bans on critical race theory, I fear the illiberalism is metastasizing. Trigger warnings. Safe spaces. Preferred pronouns. Checked privileges. Microaggressions. Antiracism. All these terms are routinely deployed on campuses throughout the English-speaking world as part of a sustained campaign to impose ideological conformity in the name of diversity. As a result, it often feels as if there is less free speech and free thought in the American university today than in almost any other institution in the U.S. To the historian’s eyes, there is something unpleasantly familiar about the patterns of behavior that have, in a matter of a few years, become normal on many campuses. The chanting of slogans. The brandishing of placards. The letters informing on colleagues and classmates. The denunciations of professors to the authorities. The lack of due process. The cancelations. The rehabilitations following abject confessions. The officiousness of unaccountable bureaucrats. Any student of the totalitarian regimes of the mid-20th century recognizes all this with astonishment. It turns out that it can happen in a free society, too, if institutions and individuals who claim to be liberal choose to behave in an entirely illiberal fashion.  How to explain this rapid descent of academia from a culture of free inquiry and debate into a kind of Totalitarianism Lite? In their book “The Coddling of the American Mind,” the social psychiatrist Jonathan Haidt and FIRE president Greg Lukianoff lay much of the blame on a culture of parenting and early education that encourages students to believe that “what doesn’t kill you makes you weaker,” that you should “always trust your feelings,” and that “life is a battle between good people and evil people.” However, I believe the core problems are the pathological structures and perverse incentives of the modern university. It is not the case, as many Americans believe, that U.S. colleges have always been left-leaning and that today’s are no different from those of the 1960s. As Stanley Rothman, Robert Lichter and Neil Nevitte showed in a 2005 study, while 39% of the professoriate on average described themselves as left-wing in 1984, the proportion had risen to 72% by 1999, by which time being a conservative had become a measurable career handicap. Mitchell Langbert’s analysis of tenure-track, Ph.D.-holding professors from 51 of the 66 top-ranked liberal arts colleges in 2017 found that those with known political affiliations were overwhelmingly Democratic. Nearly two-fifths of the colleges in Langbert’s sample were Republican-free. The mean Democratic-to-Republican ratio across the sample was 10.4:1, or 12.7:1 if the two military academies, West Point and Annapolis, were excluded. For history departments, the ratio was 17.4:1; for English 48.3:1. No ratio is calculable for anthropology, as the number of Republican professors was zero. In 2020, Langbert and Sean Stevens  found an even bigger skew to the left when they considered political donations to parties by professors. The ratio of dollars contributed to Democratic versus Republican candidates and committees was 21:1. Commentators who argue that the pendulum will magically swing back betray a lack of understanding about the academic hiring and promotion process. With political discrimination against conservatives now overt, most departments are likely to move further to the left over time as the last remaining conservatives retire. Yet the leftward march of the professoriate is only one of the structural flaws that characterize today’s university. If you think the faculty are politically skewed, take a look at academic administrators. A shocking insight into the way some activist-administrators seek to bully students into ideological conformity was provided by Trent Colbert, a Yale Law School student who invited his fellow members of the Native American Law Students Association to “a Constitution Day bash” at the “NALSA Trap House,” a term that used to mean a crack den but now is just a mildly risque way of describing a party. Diversity director Yaseen Eldik’s thinly veiled threats to Colbert if he didn’t sign a groveling apology — “I worry about this leaning over your reputation as a person, not just here but when you leave” — were too much even for an editorial board member at the Washington Post. Democracy may die in darkness; academic freedom dies in wokeness. Moreover, the sheer number of the administrators is a problem in itself. In 1970, U.S. colleges employed more professors than administrators. Between then and 2010, however, the number of full-time professors or “full-time equivalents” increased by slightly more than 50%, in line with student enrollments. The number of administrators and administrative staffers rose by 85% and 240%, respectively. The ever-growing army of coordinators for Title IX — the federal law prohibiting sex-based discrimination — is one manifestation of the bureaucratic bloat, which since the 1990s has helped propel tuition costs far ahead of inflation. The third structural problem is weak leadership. Time and again — most recently at the Massachusetts Institute of Technology, where a lecture by the University of Chicago geophysicist Dorian Abbot was abruptly canceled because he had been critical of affirmative action — academic leaders have yielded to noisy mobs baying for disinvitations. There are notable exceptions, such as Robert Zimmer, who as president of the University of Chicago between 2006 and 2021 made a stand for academic freedom. But the number of other colleges to have adopted the Chicago statement, a pledge crafted by the school’s Committee on Freedom of Expression, remains just 55, out of nearly 2,500 institutions offering four-year undergraduate programs. Finally, there is the problem of the donors — most but not all alumni — and trustees, many of whom have been astonishingly oblivious of the problems described above. In 2019, donors gave nearly $50 billion to colleges. Eight donors gave $100 million or more. People generally do not make that kind of money without being hard-nosed in their business dealings. Yet the capitalist class appears strangely unaware of the anticapitalist uses to which its money is often put. A phenomenon I find deeply puzzling is the lack of due diligence associated with much academic philanthropy, despite numerous cases when the intentions of benefactors have deliberately been subverted. All this would be bad enough if it meant only that U.S. universities are no longer conducive to free inquiry and promotion based on merit, without which scientific advances are certain to be impeded and educational standards to fall. But academic illiberalism is not confined to college campuses. As students collect their degrees and enter the workforce, they inevitably carry some of what they have learned at college with them. Multiple manifestations of “woke” thinking and behavior at newspapers, publishing houses, technology companies and other corporations have confirmed Andrew Sullivan’s 2018 observation, “We all live on campus now.” When a problem becomes this widespread, the traditional American solution is to create new institutions. As we have seen, universities are relatively long-lived compared to companies and even nations. But not all great universities are ancient. Of today’s top 25 universities, according to the global rankings compiled by the London Times Higher Education Supplement, four were founded in the 20th century. Fully 14 were 19th-century foundations; four date back to the 18th century. Only Oxford (which can trace its origins to 1096) and Cambridge (1209) are medieval in origin.  As might be inferred from the large number (10) of today’s leading institutions founded in the U.S. between 1855 and 1900, new universities tend to be established when wealthy elites grow impatient with the existing ones and see no way of reforming them. The puzzle is why, despite the resurgence of inequality in the U.S. since the 1990s and the more or less simultaneous decline in standards at the existing universities, so few new ones have been created. Only a handful have been set up this century: University of California Merced (2005), Ave Maria University (2003) and Soka University of America (2001). Just five U.S. colleges founded in the past 50 years make it into the Times’s top 25 “Young Universities”: University of Alabama at Birmingham (founded 1969), University of Texas at Dallas (1969), George Mason (1957), University of Texas at San Antonio (1969) and Florida International (1969). Each is (or originated as) part of a state university system. In short, the beneficiaries of today’s gilded age seem altogether more tolerant of academic degeneration than their 19th-century predecessors. For whatever reason, many prefer to give their money to established universities, no matter how antithetical those institutions’ values have become to their own. This makes no sense, even if the principal motivation is to buy Ivy League spots for their offspring. Why would you pay to have your children indoctrinated with ideas you despise? So what should the university of the future look like? Clearly, there is no point in simply copying and pasting Harvard, Yale or Princeton and expecting a different outcome. Even if such an approach were affordable, it would be the wrong one. To begin with, a new institution can’t compete with the established brands when it comes to undergraduate programs. Young Americans and their counterparts elsewhere go to college as much for the high-prestige credentials and the peer networks as for the education. That’s why a new university can’t start by offering bachelors’ degrees. The University of Austin will therefore begin modestly, with a summer school offering “Forbidden Courses” — the kind of content and instruction no longer available at most established campuses, addressing the kind of provocative questions that often lead to cancelation or self-censorship. The next step will be a one-year master’s program in Entrepreneurship and Leadership. The primary purpose of conventional business programs is to credential large cohorts of passive learners with a lowest-common-denominator curriculum. The University of Austin’s program will aim to teach students classical principles of the market economy and then embed them in a network of successful technologists, entrepreneurs, venture capitalists and public-policy reformers. It will offer an introduction to the world of American technology similar to the introduction to the Chinese economy offered by the highly successful Schwarzman Scholars program, combining both academic pedagogy and practical experience. Later, there will be parallel programs in Politics and Applied History and in Education and Public Service. Only after these initial programs have been set up will we start offering a four-year liberal arts degree.  The first two years of study will consist of an intensive liberal arts curriculum, including the study of philosophy, literature, history, politics, economics, mathematics, the sciences and the fine arts. There will be Oxbridge-style instruction, with small tutorials and college-wide lectures, providing an in-depth and personalized learning experience with interdisciplinary breadth.   After two years of a comprehensive and rigorous liberal arts education, undergraduates will join one of four academic centers as junior fellows, pursuing disciplinary coursework, conducting hands-on research and gaining experience as interns. The initial centers will include one for entrepreneurship and leadership, one for politics and applied history, one for education and public service, and one for technology, engineering and mathematics. To those who argue that we could more easily do all this with some kind of internet platform, I would say that online learning is no substitute for learning on a campus, for reasons rooted in evolutionary psychology. We simply learn much better in relatively small groups in real time and space, not least because a good deal of what students learn in a well-functioning university comes from their informal discussions in the absence of professors. This explains the persistence of the university over a millennium, despite successive revolutions in information technology. To those who wonder how a new institution can avoid being captured by the illiberal-liberal establishment that now dominates higher education, I would answer that the governance structure of the institution will be designed to prevent that. The Chicago principles of freedom of expression will be enshrined in the founding charter. The founders will form a corporation or board of trustees that will be sovereign. Not only will the corporation appoint the president of the college; it will also have a final say over all appointments or promotions. There will be one unusual obligation on faculty members, besides the standard ones to teach and carry out research: to conduct the admissions process by means of an examination that they will set and grade. Admission will be based primarily on performance on the exam. That will avoid the corrupt rackets run by so many elite admissions offices today. As for our choice of location in the Texas capital, I would say that proximity to a highly regarded public university — albeit one where even the idea of establishing an institute to study liberty is now controversial — will ensure that the University of Austin has to compete at the highest level from the outset. My fellow founders and I have no illusions about the difficulty of the task ahead. We fully expect condemnation from the educational establishment and its media apologists. We shall regard all such attacks as vindication — the flak will be a sign that we are above the target. In our minds, there can be no more urgent task for a society than to ensure the health of its system of higher education. The American system today is broken in ways that pose a profound threat to the future strength and stability of the U.S. It is time to start fixing it. But the opportunity to do so in the classic American way — by creating something new, actually building rather than “building back” — is an inspiring and exciting one. To quote Haidt and Lukianoff: “A school that makes freedom of inquiry an essential part of its identity, selects students who show special promise as seekers of truth, orients and prepares those students for productive disagreement … would be inspiring to join, a joy to attend, and a blessing to society.” That is not the kind of institution satirized in “The Chair.” It is precisely the kind of institution we need today. *  *  * Niall Ferguson is the Milbank Family Senior Fellow at the Hoover Institution at Stanford University and a Bloomberg Opinion columnist. He was previously a professor of history at Harvard, New York University and Oxford. He is the founder and managing director of Greenmantle LLC, a New York-based advisory firm. His latest book is "Doom: The Politics of Catastrophe." Tyler Durden Wed, 11/10/2021 - 22:05.....»»

Category: smallbizSource: nytNov 10th, 2021

Gaining An Edge: How Hedge Funds Are Navigating The New Talent Landscape

AIMA has just published new research exploring where hedge funds are sourcing talent and the steps taken to retain employees during the so-called ’Great Resignation’ and what roles (such as ESG specialists) will be most in demand in near future. Asked what they are doing to help develop talent in a remote working environment, the […] AIMA has just published new research exploring where hedge funds are sourcing talent and the steps taken to retain employees during the so-called ’Great Resignation’ and what roles (such as ESG specialists) will be most in demand in near future. Asked what they are doing to help develop talent in a remote working environment, the most popular answer given by hedge funds was regular online meetings (78%), followed by webinars and online seminars (50%) and coaching – both external and internal — (44%). .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 Introduction Many column inches have been dedicated to detailing how different hedge fund strategies fared during the COVID-19 pandemic, but much less has been written about the ways they – and the people that run them – have maintained normal processes and supported their staff in the virtual working environment. On average, hedge funds managed to shield their investors from the worst of the volatility sparked by the pandemic in Q1 2020, registering roughly half the losses seen by major equities indices around the world. Since then, hedge fund performance has averaged around 13% net of fees as of 31 August 20211. Meanwhile, inflows for 2021 up to May reached around US$57.8 billion, erasing outflows of roughly US$23.4 billion for 2020, according to the H2 2021 Investor Intentions report by AIMA and HFM Global2. All this, however, tells us very little about what is going on inside these hedge funds and how the industry is taking on modern best practices around attracting and retaining top talent. This report attempts to address that. We paint a picture of an industry embracing the changing times to remain competitive in attracting best-in-class people. Fierce competition for the brightest minds within the alternative investment sector is set against a backdrop of large sell side institutions raising the ante further with sharp wage hikes for junior staff and technology giants countering with promises of innovative and flexible working environments. Respondents to the survey that informed this report detail how they are manoeuvring to take on both these challenges. Simultaneously, a strong emphasis is being placed on improving diversity, equity and inclusion (DE&I) across the industry, with many strategies being incorporated into hiring policies to attract and retain talent from a wide range of pools. Elsewhere, this report examines which areas of their businesses firms are looking to build upon most in the coming year. Some of the most in-demand skill sets are predictable, but others may surprise you. Tom Kehoe - Global Head of Research and Communications - AIMA Drew Nicol - Associate Director, Research and Communications - AIMA About the research The demand for this report was borne out of the findings of the Agile & Resilient paper3 conducted in 2020 in partnership with KPMG which focused on talent retention and company culture as part of a wider study into the myriad challenges facing the alternative investment industry at the time. A year on, much has changed, requiring the topic of talent to be revisited in more detail. The market survey that underpins this report was conducted during Q2 2021 and garnered responses from 100 hedge fund managers, accounting for roughly US$520 billion in assets under management (AuM). Just over two-thirds of all respondents are Chief Operating Officers or HR professionals within those firms. An additional 11% manage the investor relations (IR) function at their firm. The remainder hold either C-level or other senior management roles at hedge funds or consultants. As per figure 1, 51% of all respondents are based in Europe, the Middle East and Africa (EMEA) with 37% of that portion from the UK. Asia Pacific (APAC) represents 17% — the majority in Hong Kong — and 28% are from North America. Responses are also divided by size (see figure 2), with 59% of respondents representing managers with more than US$1 billion in AuM, and 41% with an AuM of US$1 billion or less. Upon closer examination of the respondents by investment strategy (see figure 3), the majority of respondents are either multi-strategy funds (23%), equity long–short (21%), credit long–short (15%), event-driven or managed futures funds (6% each). This tilt toward investment strategies that traditionally do not leverage quantitative expertise to a great extent is worth bearing in mind throughout this report, as all signals from the market indicate that technologists and data scientists are in high demand. To further contextualise the findings of this survey, AIMA canvassed the views of the hedge fund industry through one-to-one interviews with hedge funds, headhunters and consultants. Case studies that underscore some of the themes discussed throughout this report are also offered at the end of chapters one and four. AIMA would like to thank all the participants in this project and particularly those who offered their time for the subsequent interviews that were essential to effectively interrogate the data. Additional thanks go to the members of AIMA’s research committee who guided this project from inception through to publication. Key Takeaways Chapter 1 The talent wars are intensifying — As major economies reopen for business, many people in the hedge fund industry find themselves in a strong position to assess new professional opportunities. Almost 90% of the total respondents are ‘somewhat’ or ‘very concerned’ about talent retention in the near term. Strong industry performance in recent years, including the rapid recovery from the market correction that took place in the first quarter of last year, is creating significant demand to bolster teams across various functions, but particularly around technology, operations and quantitative analytics. However, the new flexible working model many employees have come to value means employee compensation is far from the only factor when deciding whether staff members stay or leave, with non-financial benefits more important now than ever. Chapter 2 ESG will be the next hiring frontier — ESG specialists, in all their various forms, are expected to become one of the most in-demand hires over the next five to 10 years. Almost two-thirds of all firms surveyed do not have a dedicated ESG specialist on staff, with another third boasting between one and five ESG dedicated specialists. But, investor demand for ESG products combined with increasing regulatory pressures will make expertise in responsible investing the must-have skill set of the future. Chapter 3 Technology now permeates every facet of hedge funds — The need to apply a technologyfocused solution to almost all functions within a hedge fund – from front-office portfolio management through to back-office treasury processes – is a near-universal truth across the industry. Primarily, this has shaped hiring decisions to create intense pressure to bring data scientists and quantitative analysts into investment strategies. It is also changing the skill sets required for other roles within the firm’s operations that previously did not have such a strict need for technology acumen. Chapter 4 The desire to improve DE&I is a driving force in hiring decisions — Almost all the hedge funds surveyed describe improving DE&I as a ‘very important’ or ‘important’ theme shaping how the hedge fund industry sources talent. Firms are putting this into practice in their hiring policies with a wide range of strategies to remove biases and maximise opportunities to uncover hidden gems among candidates that might have been missed by only drawing on traditional talent pools. Although the industry, along with the wider financial sector, could always do more, this chapter includes several case studies of how progress is being made to make the alternative investment sector an inclusive working environment. Chapter 5 Can company culture survive the end of full-time office working? — The assimilation of new hires within the company’s culture and training junior staff are the biggest challenges when recruiting in the remote working environment, according to more than two-thirds of respondents. Concerns primarily revolve around ensuring junior staff still develop the hard and soft skills in a digital setting that they would have learned by being in the office full time. Despite these challenges, the survey data suggests hybrid working will become the norm for many. Hedge funds should consider accommodating flexible working while facilitating the effective communication and close collaboration within and across teams that comes from working in the same physical space. Read the full paper here by Tom Kehoe and Drew Nicol, AIMA Updated on Nov 4, 2021, 2:00 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: valuewalkNov 4th, 2021

The Importance of Cryptocurrency Trading Platforms To The Wider Industry

At the rate smaller governments and corporations are embracing cryptocurrency and even notwithstanding the fact that the US government is still slow to move towards adoption and approval, a global community of early adopters are fast gaining pace. This begs the question as to the importance relevant platforms have within the wider industry. Q3 2021 […] At the rate smaller governments and corporations are embracing cryptocurrency and even notwithstanding the fact that the US government is still slow to move towards adoption and approval, a global community of early adopters are fast gaining pace. This begs the question as to the importance relevant platforms have within the wider industry. 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 In recent years, cryptocurrency has skyrocketed in its value and renown amongst the public. An array of cryptocurrency trading platforms have recently earned valuations exceeding $1 billion, and the number of blockchain wallets (an equivalent to a bank account) has been almost exponentially increasing since 2016. An explosion in the awareness and interest in cryptocurrency has inflated formerly small-time brokers into household names generating in excess of several million dollars in revenue every single day. For those hoping to initiate their cryptocurrency trading, it is paramount that the correct exchange is chosen for one’s goals. There is an optimal option for every investor, whether they require a plethora of currencies, a simple experience or the low fees. This article aims to discuss the biggest platforms in the industry in the hope that the conundrum of deciding which to choose may be elucidated. The Biggest Cryptocurrency Trading Platforms Binance Binance is the biggest cryptocurrency trading platform by volume; producing over $1.8 billion in revenue since this year commenced. The Binance platform established itself as one of the top three cryptocurrency exchanges at a mere 143 days of age. The industry giant is close to beating last year’s profits of $800 million, according to the company’s CEO: Changpeng Zao. Widely known as CZ, the founder noted that their company scarcely chooses to calculate its earnings in terms of US dollars, as they are “held in various cryptocurrencies”. The exchange has a strong focus on the trading of altcoins, offering over 100 unique trading pairs between different cryptocurrencies; fiat-crypto pairs are also available. Due to this focus, Binance is resolutely suited to those planning on investing in less well-known ‘altcoins’. When considering the charting abilities, features and data included with every account, especially when combined with their reasonable fees, the size of this platform is no surprise. The only factors to consider before setting up an account with this trading platform is that it is more tailored to advanced users. Furthermore, the exchange only allows deposits of $USD by global usering via SWIFT, and is not supported in all states across the US. That being said, it has lower fees than its counterparts and offers a large variety of cryptocurrencies and trading pairs. Mandala ICO A revolutionary cryptocurrency exchange, Mandala is attempting to disrupt this booming market with its well-defined, unique values that it claims uphold the company. The focal points of their platform are security, sustainability and simplicity; each of its functions is aimed at enabling users to become ever more profitable. It does this through myriads of bots, P&L analysis and trading advice alongside easily comprehensible risk management and strategies to seize profit. One quality of this exchange that will not go unappreciated is its educative facet; Mandela has sought to surpass its competitors by making tuition available to its users, should they desire it. The ethos behind its offering of education in relation to how it is supposed to be used is that a more educated user can trade more efficiently. Therefore, engaging in the education of its new users is a worthwhile pursuit because a more educated user base will better understand the nuances associated with trading cryptocurrency. These useful features are not limited solely to newer users though - the platform’s advanced features will certainly prove beneficial to the more experienced traders as well. These include simplistic bot trading, analytics and data on trading, signals for entry and exit that are built in. Coinbase Founded in 2012, Coinbase quickly became one of the largest cryptocurrency exchanges in the US, and is listed in the two highest in the world for traffic, volume and liquidity. During the first quarter of 2021, Coinbase estimated an asset value of $223 billion was on the platform; 11.3% of the crypto asset market. This trading platform offers over 50 currencies for its users to trade, with even more available on their premium service; this is far greater than on many other widely-used platforms. Coinbase is available to residents of all states except Hawaii. Regular services on the standard Coinbase platform have a minimum transaction of $2, and a total of $25,000, per day; with Coinbase Pro trade and balance levels are unlimited. This platform is highly regarded in the industry. Its easy-to-understand interface and other basic services are a joy to use and extremely intuitive, though costs can be difficult to track without the use of the more advanced premium package. The Pro version’s pricing model is far more straightforward since it is based on each user’s monthly trading volume and the asset’s liquidity at the time of purchase. These are all factors to consider. DayTradingTrainer DayTradingTrainer is a relative newcomer to the industry that is making waves due to its focus on its users. Its founder, Cody Rose, is more cognizant than anyone of the dangers presented by cryptocurrency: millenials are increasingly using social media platforms for investing advice, this, compounded with the exponentially increased access to the virtual trading floor with smartphones, could render this year’s viral trading craze disastrous. Despite young investors being able to access the stock market far more easily than previous generations (and at a much lower age on average), a 2020 study by the FINRA Investor Education Foundation discovered that far too few of them rely on actual financial professionals for the investing decisions. This service hopes to combat this with the offering of financial advice through their private Discord community. The platform’s private trading algorithm provides signals for the top 50 cryptos in order to provide precise trade setups for each of their users. The website also offers in-depth personal tutoring by extremely educated consultants on a number of topics. UpBit UPbit Exchange was founded in South Korea on October 24, 2017, by the company Dunamu Inc. Its debut in the cryptocurrency market took place under an alliance with U.S. company Bittrex, with the purpose of trading bitcoin in the Korean region. Part of its beginnings was marred with setbacks and several scam accusations of scams, which terminated the partnership with Bittrex. However, this did not impede UpBit continued trading cryptocurrencies. In 2018, the company saw significant growth, ranking first in South Korea’s crypto asset market. In addition, 2018 was the same year when UPbit became the first platform in Korea to obtain legal certificates from security agencies, allowing it to incorporate Blockchain technology. According to Statista, it became the fourth crypto exchange in November, based on trading volume, reaching $11.72 billion in 24h. OKEx OKEx is a multi-currency exchange that allows users to trade cryptos and tokens backed by fiat. It also offers futures based on digital assets with multiple leverage options, and it has also created a set of algorithmic trading tools designed for professional traders. Also, it is a leader at providing advanced financial services to global investors through blockchain. Founded in 2017, in Hong Kong, it has earned millions of dollars in investments from leading companies in the industry. OKEx provides hundreds of currency pairs and futures for trading, helping traders optimize their strategy. It is also one of the top exchanges with the highest volumes of operations –$8.77 billion in 24h–, and holds a solid base of millions of users in more than 100 countries. Its strong foundation has attracted technology and business experts from the world's leading organizations, enabling the exchange to offer secure, stable, and reliable business services over the internet and mobile solutions. FTX Exchange FTX is a cryptocurrency exchange and token trading house formed by a group of technology experts who come from the Wall Street quant market, and from companies such as Facebook Inc (NASDAQ:FB) or Google –Alphabet Inc Class A (NASDAQ:GOOGL). The company took off with the support of the market’s biggest names –as well as some venture capital firms– such as Binance, The Circle, Alameda Research, True USD, Paxos, Fenwick & West, HUSD, Proof of Capital, FBG Capital, and Galois Capital. Trading at $2.9 billion in 24h, FTX is much more than a cryptocurrency exchange –its name could indicate some Forex trading. However, this company specializes in tokenization, including shares. In addition, it is one of those exchanges that offers derivatives trading of the critical market with very high leverage for speculators who love futures and operations on margin. The Quant Zone –a special feature– allows the development of automatic trading that can be connected to the FTX and many other platforms. Any programmer with programming skills can create trading strategies that can be automated and used on this exchange. Why They Are Important Cryptocurrency is here to stay; through its fast transactions and digital, secure and global nature, cryptocurrency has established its necessity. They are made important not only by their numerous benefits (such as how they minimise fraud and should not result in inflation), many large banks are not investing either through collaboration with pre-existing cryptocurrency clients, or by producing their own digital currency. The cryptocurrency market is difficult to navigate; with the well-respected providers of investment services known in the traditional market, the digital one can seem quite murky and confusing in comparison. Bitcoin and Ethereum are not the only tokens worth investing in, and many other high quality coin issuers offer many more worth considering. Such platforms (e.g. those listed above) have excellent backers and management with stable procedures in place and an effective business model; they represent a safe method through which to get started or continue investing in digital currencies. As the effective equivalents of the notable banks and other financial investment service companies that the public regards as trustworthy, these are credible institutions to entrust with your money, but this is not true of all platforms. Yet with that being said, there are also many unreliable and untrustworthy websites out there that are. Such services act as a strong indicator for the need for regulator “buyer beware” notices, as well as for the need for research before investing. The Treasury Department has made releases about the dangers of cryptocurrency in the past. This extremely young industry offers many concurrent opportunities and risks due to its novelty, so it is important to navigate it carefully; big trading platforms such as those explored above can help with this, as their renown acts as a security to people that ensures them they are a trustworthy website to pour money into. Concluding Remarks On balance, choosing the optimal cryptocurrency trading platform requires one to first evaluate what one needs it to provide. Many of the biggest exchanges will be geared towards those with a pre-existing foundation in trading. For new investors, it is important to consider the exchanges which include financial education as part of their services. Such big cryptocurrency trading platforms are extremely important to the wider industry because they represent clear and safe options through which to choose to invest. This is paramount for an industry in its infancy still trying to find its feet, and certainly one that will only become more intertwined with society as time goes on. These online providers dispel any fears and qualms of whether that might be racing through a person’s head when deciding which institution is credible enough to be trusted with their money. Updated on Nov 4, 2021, 11:16 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: valuewalkNov 4th, 2021