Category: Economy and Policy

Economic trends, analysis, and policy discussions that impact businesses and industries in the Southern United States. This section may provide in-depth articles and reports on topics such as regional economic growth, business regulations, tax policies, and the influence of state and federal legislation on local markets. It could also cover issues like labor markets, trade policies, infrastructure developments, and government initiatives designed to stimulate economic activity in the South. Additionally, this section might feature expert opinions, interviews with policymakers, and case studies of how businesses are adapting to changing economic conditions. The goal is to provide valuable insights for business leaders, investors, and policymakers seeking to understand and navigate the economic and policy landscape in the region.

  • ‘Druckonomics’ and the Southern Implications of Stanley Druckenmiller’s Expanding Influence

    ‘Druckonomics’ and the Southern Implications of Stanley Druckenmiller’s Expanding Influence

    Few figures stand as quietly influential as Stanley Druckenmiller. A titan of finance and founder of Duquesne Capital Management, Druckenmiller is now seeing his legacy extend beyond Wall Street into the highest echelons of U.S. economic policymaking—with implications for markets across the country, including the rapidly growing economies of the American South.

    For decades, Druckenmiller has operated in the shadows of public attention, building a formidable reputation as one of the most intuitive and adaptive investors in modern history. Known for his tenure under George Soros—most notably during the famed shorting of the British pound—Druckenmiller has long been revered among insiders for his tactical brilliance and ability to pivot decisively when market conditions change.

    But what’s bringing Druckenmiller back into the spotlight is not a market call—it’s his protégés. Two men in particular: Scott Bessent, now the U.S. Treasury Secretary, and Kevin Warsh, a leading candidate to chair the Federal Reserve. Both are reportedly in close and regular contact with their former mentor, whose economic philosophy—what some have dubbed “Druckonomics”—is now shaping conversations on interest rates, inflation, and fiscal discipline at the highest levels of government.

    The potential selection of Warsh to lead the Fed signals a marked shift in Washington’s economic thinking—one that leans toward tighter monetary policy and a more skeptical view of prolonged quantitative easing. These views align with Druckenmiller’s long-standing concerns about over-reliance on cheap money and ballooning federal debt, critiques that resonate with many business leaders, particularly in fiscally conservative Southern states.

    For Southern entrepreneurs, financial executives, and economic developers, Druckenmiller’s reemergence may represent both a challenge and an opportunity. A tighter, more hawkish monetary environment could constrain access to low-interest capital, potentially slowing large infrastructure and real estate developments that have defined the region’s growth in recent years. But at the same time, a renewed emphasis on sound money, innovation-driven investment, and public-private discipline could position the South as a model for sustainable economic expansion.

    Moreover, the broader implications of Druckonomics could echo in the South’s unique mix of legacy industries and burgeoning tech corridors. As federal policy grows more responsive to market risks and inflationary pressures, regional players with agile strategies—those mirroring Druckenmiller’s own capacity for swift, decisive adaptation—may find themselves better equipped to thrive.

    Stanley Druckenmiller may not carry the household name recognition of the presidents and policymakers now seeking his counsel. But as his influence grows through the voices of those in power, Southern business leaders would be wise to tune in. The next chapter in American economic policy may bear his fingerprints—and for a region on the rise, understanding Druckonomics might be key to navigating what’s ahead.

  • Petrolicious Accelerates Into the Future: A New Era Under Michael Chapin’s Leadership

    Petrolicious Accelerates Into the Future: A New Era Under Michael Chapin’s Leadership

    duPont REGISTRY Group (DRG) is putting the pedal to the metal with its recent appointment of Michael Chapin as the Chief Executive Officer of Petrolicious, the iconic platform celebrated by classic car enthusiasts worldwide. Known for producing cinematic-quality content that brings to life the artistry of automotive culture, Petrolicious has long been a fixture for collectors and car lovers alike, amassing millions of views on its YouTube channel and expanding its legacy through exclusive automotive documentaries and series.

    With Chapin’s leadership, the future of Petrolicious looks poised for a new chapter—one that blends his entrepreneurial expertise with the enduring passion of car culture. But this isn’t just about reviving an established brand; it’s about ushering it into a new age, a time when digital content, community engagement, and storytelling are more vital than ever before.

    A Vision for Growth and Revival

    The duPont REGISTRY Group’s acquisition of Petrolicious in 2024 marked a turning point for the storied brand, which had seen a series of ownership transitions over the past few years. The brand, which started in 2012, became known for its emotive and visual celebration of classic automobiles, with its original videos touching the hearts of car enthusiasts and setting industry standards for automotive content.

    With Chapin at the helm, Petrolicious is set for a revival that blends nostalgia with innovation. Antoine Tessier, CEO of duPont REGISTRY Group, expressed his confidence in Chapin’s leadership, citing his background in both entrepreneurship and media as the perfect fit to reinvigorate the brand’s core values of storytelling and high-quality production.

    “Michael’s experience in media, e-commerce, and startups, combined with his deep-rooted passion for automotive culture, makes him uniquely qualified to bring Petrolicious back to its roots,” Tessier said. “This is not just about rebooting a brand; it’s about reigniting a community and a way of telling stories that resonates deeply with car lovers everywhere.”

    Chapin’s Automotive Journey: A Career Built on Passion

    For Chapin, the road to leading Petrolicious has been a lifelong journey—one that started with a passion for understanding the intricacies of vehicles. From a young age, he was captivated by the mechanics of cars, often found dismantling engines to understand how they worked. This fascination with engineering naturally evolved into a career as a race mechanic during his college years. But over time, his focus shifted from working with cars to building businesses—particularly in the digital space.

    As the founder and former CEO of PartsHub, a cloud-based software company for the automotive aftermarket, Chapin gained invaluable experience in media and e-commerce. His company’s eventual acquisition by the Specialty Equipment Market Association (SEMA) only further cemented his status as a key player in the automotive industry.

    Now, Chapin’s vision for Petrolicious is clear: to embrace the brand’s legacy while steering it into the future with modern-day storytelling techniques that will captivate a new generation of enthusiasts.

    “Petrolicious inspired car enthusiasts around the world, and it’s important that we return to those core values of emotional storytelling,” said Chapin. “The love between a driver and their car transcends all cultures and backgrounds. That connection unites us, and we’ll continue to celebrate that bond in ways that resonate with both longtime fans and newcomers alike.”

    The Intersection of Passion and Innovation

    As Petrolicious transitions under Chapin’s leadership, the platform is poised to leverage the growing interest in luxury and classic cars while tapping into digital spaces where collectors and enthusiasts engage. With duPont REGISTRY Group’s extensive portfolio—spanning Canossa Events, Cavallino, FerrariChat, and Sotheby’s Motorsport—Petrolicious is poised to offer even more exclusive access to high-end car culture. The content will expand beyond documentaries and short films to incorporate new formats that engage digital audiences on multiple platforms.

    Given the accelerating digital transformation in the automotive industry, Petrolicious’s ability to innovate and adapt is crucial. In 2025, content that blends storytelling with immersive experiences (think virtual reality, live-streaming events, and interactive car showcases) is becoming increasingly popular. Chapin’s strategic vision aims to expand Petrolicious’s offerings by leaning into these trends while preserving the essence of the brand’s heart: the emotional connection people have with cars.

    With Chapin’s leadership, Petrolicious will continue its legacy of excellence, merging traditional automotive storytelling with cutting-edge technology to capture the passion and excitement of the classic car community. It’s about combining history with innovation, nostalgia with progress, and car culture with the future of media.

    A Fresh Start for an Iconic Brand

    In February 2025, Petrolicious is more than just a brand relaunch—it’s an opportunity for the automotive world to reconnect with the stories that make car culture so special. Under Chapin’s direction, the platform will celebrate the nuances of automotive art while expanding its reach and tapping into the next wave of car enthusiasts.

    The road ahead for Petrolicious is as thrilling as the vehicles it celebrates—full of potential, driven by passion, and fueled by innovation. As the brand accelerates into this new era, it will continue to captivate the hearts of collectors and fans, offering a front-row seat to the world’s most cherished and legendary automobiles.

  • $155 Million and Counting: A Tally of Celebrity Homes Lost in and Around the Pacific Palisades

    $155 Million and Counting: A Tally of Celebrity Homes Lost in and Around the Pacific Palisades

    The wildfires raging through the Pacific Palisades and surrounding areas in Los Angeles have left a path of destruction that is difficult to fully comprehend. As the flames continue to burn, they have claimed the lives of at least 10 people and consumed entire neighborhoods. But perhaps the most striking aspect of this devastation is the toll it has taken on some of the priciest luxury real estate in the country, including homes owned by A-list celebrities like Paris Hilton, Billy Crystal, Jeff Bridges, and Eugene Levy.

    The Pacific Palisades, a prestigious neighborhood known for its multimillion-dollar homes, has long been home to Hollywood’s elite. In 2021, actor Eugene Levy was even sworn in as the honorary mayor of the area—a testament to the enclave’s connection to the entertainment industry. However, this week, Levy’s own home was destroyed by the flames, a stark reminder that no property, regardless of wealth or fame, is immune to the ravages of these increasingly severe wildfires.

    The total financial loss from celebrity homes in the area has already surpassed $155 million, and the tally continues to rise as the fire continues to devastate the region. High-profile residents like Hilton, Crystal, and Bridges are among those whose properties have been lost in the fires, highlighting the reach of the disaster beyond just the local community. These are not just celebrities who’ve lost their homes; these are people whose properties represent some of the most valuable and luxurious real estate in the country.

    This loss is not just about financial value but also about the emotional and personal toll that comes with the destruction of a home. For these celebrities, as for anyone, a house is a place of memories, family, and personal sanctuary. While their wealth may provide them with resources to rebuild, the emotional strain of losing a home is something that cannot be measured in dollars.

    The ongoing disaster in the Pacific Palisades serves as a painful reminder of the devastating effects of climate change. Wildfires have become an increasingly common and dangerous threat, particularly in California, where prolonged droughts and rising temperatures create the perfect conditions for these kinds of catastrophes. The destruction of luxury homes, even those owned by Hollywood’s elite, underscores the vulnerability of all people to the growing frequency and intensity of natural disasters.

    While the recovery process will be long and costly, the devastation of this fire also calls attention to the broader issue of how we prepare for and respond to such events. As wildfires continue to rage, especially in areas that have historically been considered “safe,” it is clear that a more robust and proactive approach to disaster prevention and relief is needed. In particular, the growing number of homes lost in these fires, including those of the rich and famous, highlights the need for stronger building codes, more resilient infrastructure, and better fire management practices.

    In the case of the Pacific Palisades, the destruction is also a testament to the deep social and economic divides that exist in communities prone to such disasters. While celebrities may have the resources to rebuild, for many residents in the surrounding areas, the loss is more than just a physical one; it is a financial blow that could take years to recover from. And yet, the media focus on celebrity homes, while understandable due to their public nature, risks overshadowing the plight of those who do not have the same resources.

    The ongoing wildfires in the Pacific Palisades serve as a powerful reminder of the destructive power of climate change and the growing risk that these disasters pose to all communities, regardless of wealth or fame. As the flames continue to burn, the toll on both the emotional and financial well-being of residents—celebrity and otherwise—cannot be understated. The fire’s devastation is not just a Hollywood story but a reflection of the broader challenges society faces in adapting to a world where such disasters are becoming increasingly common. How we respond in the aftermath will determine the future resilience of our communities.

  • The Future of Work: Striking a Balance Between Innovation and Humanity

    The Future of Work: Striking a Balance Between Innovation and Humanity

    As we stand on the cusp of unprecedented technological advancement, the conversation around the future of work has never been more urgent. Artificial intelligence (AI), automation, and digital transformation promise to revolutionize industries, unlocking efficiency and innovation at a scale once thought impossible. Yet, these advancements also challenge us to redefine the role of humanity in the workforce.

    The question is not whether change is coming—it is already here—but how we can harness its potential while preserving the dignity and value of human labor. Balancing technological innovation with a commitment to social equity is a delicate act, but one that must be approached with foresight and responsibility.

    The Promise of Progress

    The benefits of technological advancement are undeniable. AI-powered tools have enhanced productivity in sectors ranging from manufacturing to healthcare. Automation has streamlined repetitive tasks, freeing employees to focus on creative and strategic pursuits. Meanwhile, remote work technologies have expanded opportunities, breaking down geographic barriers and enabling companies to tap into a global talent pool.

    These transformations have created an exciting vision of a future where work is more flexible, efficient, and inclusive. For instance, AI-driven advancements in healthcare could allow doctors to diagnose diseases earlier and with greater accuracy, while autonomous vehicles could reduce traffic fatalities. The potential for innovation seems boundless.

    But this utopian vision is not without its challenges. The same technologies that promise progress also threaten to displace millions of workers. A recent report by the World Economic Forum estimates that automation could disrupt 85 million jobs globally by 2025, even as it creates 97 million new roles. However, the transition to these new roles will require reskilling at a scale and pace that few economies are currently prepared for.

    The Human Cost of Progress

    Job displacement is only one piece of the puzzle. Technological progress often exacerbates existing inequalities, disproportionately impacting workers in low-income and low-skill roles. While well-educated professionals may pivot to new opportunities, those with limited access to education and training could be left behind. This growing digital divide has profound implications for social stability and economic equality.

    Moreover, an over-reliance on automation risks dehumanizing workplaces. The intrinsic value of human interaction—creativity, empathy, and judgment—cannot be replicated by machines. As companies chase efficiency, they must avoid creating sterile environments where employees feel like cogs in a machine.

    A Roadmap for the Future

    To navigate this era of transformation, governments, businesses, and individuals must work together to forge a path that aligns technological progress with human well-being. Here’s how we can start:

    1. Invest in Education and Reskilling: Public and private sectors must prioritize lifelong learning initiatives, equipping workers with the skills they need to thrive in a tech-driven economy. This includes not only technical skills but also soft skills like critical thinking and emotional intelligence, which are uniquely human.
    2. Promote Ethical Technology Use: Companies should adopt ethical frameworks for deploying AI and automation. Transparency and accountability in decision-making processes will help build public trust while ensuring that technology serves humanity, not the other way around.
    3. Foster Public-Private Partnerships: Governments cannot tackle these challenges alone. Collaboration with the private sector will be essential to create policies and programs that support displaced workers, encourage innovation, and address systemic inequalities.
    4. Preserve the Human Element in Work: Businesses must recognize that people are their most valuable asset. Investing in workplace culture, fostering collaboration, and prioritizing employee well-being will be critical in maintaining a motivated and engaged workforce.

    The Opportunity Before Us

    The future of work is not a dystopian inevitability. It is a narrative that we can shape with thoughtful choices and bold actions. While the challenges are significant, so too is the potential for a more equitable and innovative world.

    By striking a balance between technological innovation and humanity, we can create a future where progress uplifts everyone, leaving no one behind. But the time to act is now—before the promise of the future becomes a missed opportunity.

    Xiantao studies Sociology and Data Science at UC Berkeley. He writes on Hong Kong, U.S.-China relations, and technology.

  • Behind Closed Doors: Trump and Dimon’s Secret Talks Shaping a Second Term Agenda

    Behind Closed Doors: Trump and Dimon’s Secret Talks Shaping a Second Term Agenda

    In a recent report, FOX Business correspondent Charlie Gasparino revealed that President-elect Donald Trump and JPMorgan Chase CEO Jamie Dimon have been engaged in secret discussions for months regarding Trump’s policy agenda for a potential second term. According to sources close to Trump’s transition team, Dimon has served as a key “sounding board” for Trump, advising on critical issues such as reducing government spending, tax policy, trade, and banking regulations. One source even described Trump’s admiration for Dimon as a “man crush,” further underlining the close rapport between the two.

    Despite these ongoing discussions, neither JPMorgan Chase nor the Trump transition team has responded to requests for comment regarding the talks. The revelation comes just two weeks after Trump publicly announced that Dimon, who runs the largest bank in the U.S., would not be joining his upcoming administration, effectively putting an end to speculation that Dimon might be nominated for the role of Treasury secretary.

    In a post on his Truth Social platform, Trump acknowledged Dimon’s contributions but made it clear that he would not be part of his administration. “I respect Jamie Dimon, of JPMorgan Chase, greatly, but he will not be invited to be a part of the Trump Administration,” Trump wrote. “I thank Jamie for his outstanding service to our country!”

    This announcement followed Trump’s naming of Key Square founder Scott Bessent as his pick for Treasury secretary. Despite their reported private discussions, Trump has been openly critical of Dimon in the past, including calling him a “Highly overrated Globalist” on Truth Social. Earlier this year, Trump had floated the idea of considering Dimon for Treasury secretary in a second term but later walked back those comments.

    Dimon, for his part, has had a complicated relationship with Trump. Although he condemned the January 6th Capitol attack, he has also praised some of Trump’s positions and policies. Dimon acknowledged that Trump had been “kind of right” about NATO, immigration, and China, and praised his economic policies, including trade tax reforms. Dimon’s candid and balanced remarks appear to have resonated with Trump, who reportedly “greatly appreciated” Dimon’s honest assessment.

    While Dimon did not endorse any candidate in this year’s presidential election, his ongoing influence and his role as an advisor to Trump indicate the complex, evolving relationship between the business world and politics. The continued private conversations between Dimon and Trump suggest that, even without a formal position in the administration, Dimon may remain a significant figure in shaping future policy discussions under a second Trump term.

  • Young Workers Embrace Blue-Collar Opportunities, but Challenges Persist

    Young Workers Embrace Blue-Collar Opportunities, but Challenges Persist

    A growing trend among younger workers, especially Gen Z, reveals a shift towards blue-collar careers as an appealing alternative to traditional college pathways. This contrasts with the previous generation, Millennials, who largely viewed a college degree as essential for success. However, both generations often overlook the challenges that accompany these jobs.

    Dalian Foucha, a 21-year-old fleet technician for an electric-bike rental company in New Orleans, exemplifies this trend. Earning $17 an hour, he redistributes bikes and changes batteries, often in sweltering conditions. “The job has its ups and downs,” he says, but lately, there have been more downs. Previously studying herpetology, he dropped out of college during his junior year due to financial pressures. While he found blue-collar work without a degree, his earnings last year were under $30,000, and he faced rising health insurance costs with no pay raises in nearly two years. “I want guaranteed stability,” he adds.

    In January, Foucha will begin an apprenticeship with the International Brotherhood of Electrical Workers (IBEW) to become an electrician. This opportunity promises a structured raise schedule, two weeks of paid time off, and fully covered health insurance, highlighting the potential benefits of trade careers.

    Many Gen Z workers, recognizing the rising costs of college and the burden of student loans, see blue-collar jobs as a viable pathway to financial stability. A survey by Intuit Credit Karma indicated that young workers value work-life balance, job security, and availability in trade positions.

    However, data indicates that neither blue-collar nor white-collar jobs guarantee a stable living. Both sectors experienced higher-than-average layoffs this year, according to the Bureau of Labor Statistics. “There’s as much variation within these job categories as between them,” explains Ben Hanowell of ADP Research.

    Compensation in blue-collar professions varies widely, from an average of $42,210 for woodworkers to $67,810 for electricians and up to $100,060 for elevator-repair workers. In contrast, the average annual wage across all occupations was approximately $65,470 as of May 2023.

    While some blue-collar workers share success stories, others highlight significant drawbacks: long hours, harsh weather, and physical tolls on their bodies. The stigma associated with blue-collar work can also deter some from pursuing these careers. Reports of higher rates of addiction in blue-collar jobs further complicate the narrative.

    Despite these challenges, the growing interest in skilled trades underscores a vital reality: not everyone can or wants to pursue a college education, and viable alternatives must exist for those seeking a good life.

    The rising costs of higher education have made college increasingly inaccessible for many, particularly those from lower- and middle-income households. Journalist Will Bunch argues in his book that the promise of college is failing, particularly for Black and Hispanic students who face higher dropout rates than their white and Asian counterparts.

    While college graduates tend to earn more on average, a 2023 Pew Research survey revealed that only 22% believe the cost of a four-year degree is justifiable, especially if it requires loans. Many feel that a degree is less essential now than it was two decades ago.

    Kathryn Testament, who dropped out of community college while juggling work, found her path in a five-year paid apprenticeship through IBEW. Starting at $12.50 an hour, she now earns $32 an hour as an electrician, exemplifying the potential financial rewards of trade careers.

    John Seaman, a blue-collar business owner, noted that some of his employees earn more than he did with a degree. He believes that opportunities in skilled trades are plentiful, especially as employers face a shortage of skilled workers.

    While the Bureau of Labor Statistics predicts that occupations like wind-turbine technicians and solar installers will see significant growth, the job market for white-collar positions remains tough. Many tech workers, including those with advanced degrees, have faced layoffs, challenging the notion that a degree guarantees job security.

    The increasing number of young workers in blue-collar roles reflects changing attitudes towards vocational training. Recent political platforms emphasize trade school and community college access, recognizing that four-year degrees are not the only pathway to success.

    However, trade school also carries risks. For example, Keelan Didier graduated from a two-year vocational school with substantial debt and is struggling to find consistent work in woodworking.

    Scott Pressley Jr., another young worker, found success in solar panel installation, earning around $67,000 in his first year. He appreciates the opportunities available in skilled trades without the burden of educational debt.

    Yet, not every story ends with financial success. Jason Blinsinger, a carpenter, faces the uncertainty of inconsistent work, often earning less than $40,000 annually while managing family responsibilities. He voices concerns about his physical well-being and the sustainability of his career.

    Jeff Torlina’s journey from academia to masonry illustrates the volatility of both sectors. After losing his university job, he returned to trade work, now self-employed without benefits. He reflects on the quest for job security amid a landscape where both blue-collar and white-collar jobs can be precarious.

    In conclusion, while blue-collar careers offer promising opportunities for many, the realities of these jobs necessitate careful consideration. The narratives of young workers like Foucha, Testament, and Pressley highlight the potential for success, yet also underscore the challenges that come with pursuing a path outside of traditional higher education.

  • The worst may be over for the stock market.

    The worst may be over for the stock market.

     

    Southern Business Review

    Bye-Bye, Bear Market? The Worst Could Be Over for Stocks.

    The worst may be over for the stock market.

    Key equity indexes continued their autumn rally, and there could be more gains before the end of the year, helped by continued strength in the Treasury bond market.

    The Global Picture

    We define a bear market as a decline of 20% or more over a period of at least two months. If this was followed by a 20% rise over a period of at least two months we considered a subsequent fall of 20% or more as a new bear market. Because international investors are usually more interested in U.S. Dollar returns we have chosen USD indices rather than the local currency ones.

    Based on these indices the average bear market decline was about 49% across all markets but the declines ranged from a low of 23% to a high of 92%. In terms of the length of time a bear market lasted (from the peak of the bull market to the lowest point in the bear phase) this was on average over a year and to be precise, approximately 15 months. But the range was from a few months to over three years. As one would expect, emerging markets proved more volatile than the developed markets with more bear markets, a higher average decline of 51% and a shorter duration of about one year.

    But let’s have a look at the individual markets. (Please note we are not yet counting the recent market downturn).

    U.S.

    Examining the world’s largest market, the U.S., we focused on the S&P 500 Index and found that since 1987 the market experienced only three bear markets, excluding the current one. Those three bear markets averaged a 47% decline and ranged between a low of 34% and a high of 57%. The length of time of the bear markets ranged between three months and three years and averaged 17 months.

    U.K.

    In the U.K. the market (in USD terms) was more volatile than in the U.S. Since 1987 the FTSE 100 Index (USD) experienced six bear markets with declines ranging between 65% and 23% with the average being 38%. Like the U.S. the average length of time was 17 months for the bear markets with a range of 4 months to three years.

    Turkey

    Turning to emerging markets, we found that the Turkish market was highly volatile. This is one reason why this market has been very attractive to some investors who love volatility since it provides them with more opportunities. During the time period starting in 1988 the Turkish market experienced 10 bear markets which showed an average decline of 64% with a range of between 81% and 46%. The average length of the bear markets was 14 months but ranged between a high of three years and a low of 4 months.

    Korea

    Next on our list was Korea, another volatile market with nine bear markets. Those bear markets averaged a decline of 49% ranging from a low of 27% to a high of 86%. The average time length of all the bear markets was 17 months and ranged between 4 months and three years.

    China

    We found that the China market as indicated by the MSCI China Index had a total of eight bear markets averaging a decline of 56% and ranging between a low of 33% to a high of 82%. The average length of time was 14 months with the longest period being more than two years and the shortest five months.

    The MSCI China Index was launched on Oct 31,1995. Data prior to the launch date is back-tested data

    Taiwan

    We would expect the Taiwan market with its economy so closely tied to China to perform similarly but that was not the case. The Taiwan market proved to be more volatile with 11 bear markets between 1988 and 2019. The average decline was lower than in China with 48% ranging between a high of 80% and a low of 23%. The length of the bear markets ranged between a few months and almost two years with the average being 11 months.

    Brazil

    The Brazilian market experienced 11 bear markets during the period averaging 56% decline and ranging between a decline of 75% and 35%. Average time length was 12 months ranging between a few months and almost three years.

    India

    In India, the market experienced nine bear markets averaging a decline of 44% ranging between a high of 71% and a low of 24%. The average time length for the Indian markets was a little over one year.

    Japan

    In Japan there were seven bear markets averaging a decline of 42% and ranging between a fall of 62% to 24%. The longest bear market in Japan lasted more than three years and the shortest 9 months with the average at 24 months.

    Thailand

    The Thai market was rather volatile with ten bear markets averaging a decline of 46% and ranging between a high fall of 92% and a low of 24%. The average length of time was nine months.

    Hong Kong

    The last market we looked at was the Hong Kong stock market, which witnessed eight bear markets since 1987. The average decline was 45% with a high of 64% and a low of 21%. The average length was 13 months.

    What lessons can we draw from history?

    So what can we learn from the above? We can see that on average bear markets declined by about 50%. The developed markets declined even less on average. In terms of the length, a bear market lasted on average more than a year. Bear markets in emerging markets were on average lasting shorter than bear markets in developed markets. This is important, as I believe the critical question is not only what the bottom is but how long it will last. You will need the cash reserves to continue to gradually buy and hold for what may seem like a long time.So at what stage are we now? In reaction to the Covid-19 pandemic markets went down between 20 and 30% so much less than the average 50% we have seen above. The market swings have been wild on the upside and the downside. As I write this piece the indexes might already have moved higher or lower.This kind of volatility is not unusual. If we look at the behaviour of the indices in bear markets we see that this sort of up and down is part of the game. So unfortunately, the recent positive movement in many markets does not necessarily mean that we will see a continuous upward trend. There will always be backtracking and corrections along the way. This seems to be confirmed by the historical data from previous bear markets. However, the figures mentioned above are averages and averages are exactly that. The range can be wide. Many bear markets went down far less than 50% so it’s probably a good time to start nibbling but leave enough firepower to continue buying if the markets retreat more.The full economic cost of the shutdowns around the world cannot be accurately assessed and will, of course, be quite different from one industry to another and one company to another. We merely need to keep our eye on the long term developments and take an optimistic stance: Of the many years since 1987 when I’ve been investing in emerging markets all over the world I can say that there are two conclusions that I can confidently ascribe to: (1) all emerging markets experience bear markets, and (2) all emerging markets recover from those bear markets and experience a bull market. It’s very much like the conclusions of Arnold Toynbee, the famous historian and scholar of civilisations since ancient times. After all the years of study he said that there were two conclusions that he could ascribe to: first, all civilisations rise and, second, all civilisations fall. The wonderful thing about this phenomenon in emerging markets is that the rise and fall of the markets is relatively frequent and the bear markets tend to be shorter than the bull markets. So if you are a patient and disciplined investor you can purchase bargain stocks in the bear phases when everyone else is selling.At the rate the coronavirus is spreading globally there might be worse to come but stock markets are starting to price that in. And given the efforts now undertaken by governments, central banks and scientists to contain the crisis I am confident we will see containment followed by a recovery on the horizon but as history teaches us it might not be for another year.

  • Overcoming Imposter Syndrome

    Overcoming Imposter Syndrome

     

    southern business review


    As a woman in AI, Rana has always been very aware of being “the only woman in the room” and, moving on from Affectiva, she has decided to do something about this. To this end, she is seeking out opportunities to support and encourage diversity in the tech world with the AI Fund, which is helping to invest in and build the next generation of tech giants.

    “I realize how hard it is for women, under-represented founders and even under-represented ideas. I’ve become used to it and now found my voice but it took years,” she reveals.

    “It’s actually awesome to be different because we need diverse people to solve problems in our world and diverse teams actually do better, financially and economically.”

    Rana recounts the moment she realized she needed to work as hard on herself as her company. After starting Affectiva in 2009, she hired an experienced CEO to please investors. When he left in 2013, she didn’t put herself in the running for the role as it was not one she had held before. It was several years later, when she really drilled down into what the position entailed, that she realized she was not only qualified for the job, she was actually already doing it.

    “One of my mentors said, ‘You have to convince yourself first that you’re ready’, so we did a lot of visualization exercises,” Rana explains. “And once I believed that I was ready, we took it to the board for a vote and it was unanimous to have me step into the CEO role.

    “That was a big lesson – you don’t want to be your own biggest obstacle. But often women don’t raise their hand for opportunities unless they check 100 per cent of the requirements, whereas sometimes men are ready to if they check 30 per cent. I encourage the women on our team to raise their hand even if they think they’re not ready.”

    Perpetuating Bias

    It is not just companies that are being held back by a lack of diversity. Rana highlights the wider ethical issues for society, which are caused by the lack of women and people from minority groups in the AI workspace.

    “The biggest issue in AI today is data and algorithmic bias,” she points out. “If you train any AI algorithm on data that’s not diverse, it becomes bias, and then if you deploy it around the world, scale it, you’ve accentuated the bias that exists in society by thousands of times.

    “I think business leaders have to be intentional about diversity, equality and inclusion. It’s not going to happen on its own.”

    “The only way to solve this is to have diverse data – and the only way to have diverse data is to have diverse people around the table saying, ‘Have you thought about including data of women who wear the hijab or guys who have beards?’ I think the more diverse the people around the table are, the more robust the solution is going to be.”

    A Seat at the Table

    To ensure this change happens, Rana believes companies need to take a proactive stance in recruiting, rather than hoping the right candidates will come knocking on their door. “We as business leaders need to do a better job, to reach out to underprivileged minorities who might not think they could have a career in tech,” she stresses.

    “Affectiva had an incredible internship program and would get 600-plus applications for five positions. But we realised we were getting kids from private universities and schools, so decided to seek out kids who would never think to apply. Sometimes they didn’t have any coding background and we were like, ‘It’s OK, we will teach you – you just have to be a hustler, be driven and motivated’.

    The pace of change is something Rana finds frustrating as she launches the AI Fund. Since establishing her startup all those year ago, she says things have not moved on as much as she would have hoped. “It’s so hard to find women investors to put money in the fund. But I’m adamant there must be women out there; even if they put in smaller cheques, I want to bring women around the table as investors and as founders.”

    However, the inspiration and joy Rana gets from working with those beginning their companies through the AI Fund makes it all worthwhile and she has achieved everything – and more – she ever hoped she would when she was a teen.

    And Rana admits she too gains in addition to those the Fund supports. “One of my core values is lifelong learning,” she explains. “I’m an intellectual, curious human and love learning about new things, it just feeds my brain.

    “It’s definitely key for any entrepreneur who has done well, because that stops you going stale and it pushes you – sometimes you have to look outside of yourself and your own business. You have to put yourself in a spot where you’re open to random connections, to open new doors.”

    Letting that all-too-precious serendipity in once again.

  • UPDATE 1-Warren Buffett says prospects poor for 'elephant-sized acquisition'

    (Reuters) – Warren Buffett is hunting for “an elephant-sized acquisition,” but he is not optimistic about getting it done.

    FILE PHOTO – Warren Buffett, CEO of Berkshire Hathaway Inc, gestures while playing bridge as part of the company annual meeting weekend in Omaha, Nebraska U.S. May 6, 2018. REUTERS/Rick Wilking

    The billionaire investor wrote in an annual letter to shareholders on Saturday that the prospects of landing a mega-deal for his Berkshire Hathaway Inc conglomerate are “not good,” because “prices are sky-high for businesses possessing decent long-term prospects.”

    It is a problem for the Berkshire chairman and chief executive, whose company is sitting on $112 billion in cash and other low-returning assets that it has been struggling to invest for years.

    “In the years ahead, we hope to move much of our excess liquidity into businesses that Berkshire will permanently own. The immediate prospects for that, however, are not good: Prices are sky-high for businesses possessing decent long-term prospects,” Buffett wrote. “That disappointing reality means that 2019 will likely see us again expanding our holdings of marketable equities. We continue, nevertheless, to hope for an elephant-sized acquisition.”

    The prospect of such a deal, “causes my heart … to beat faster,” the 88-year-old investor said.

    NO ELEPHANT IN THE ROOM

    But Buffet said he would not get caught short of cash that he could use should market conditions deteriorate. Some of Buffett’s transactions over the last decade or so have included complex deals with distressed companies, including in the aftermath of the global financial crisis.

    Buffett’s insurance business, meanwhile, collects premiums from businesses and individuals, cash that Buffett and his deputies use to make other investments.

    But the U.S. stock market has been on a stride since the financial crisis a decade ago, leaving little room for the bargain-hunting value investor to make his mark, much as had been the case for Buffett during the run-up in technology stocks in the 1990s.

    Buffett often invests in stocks, such as Apple Inc , when he cannot find whole companies to buy. On Saturday, he said his inability to find a company to buy meant more stock buying is likely in 2019.

    The Omaha, Nebraska, investor has also been snapping up more shares of his own stock. Berkshire bought back about $1.3 billion of its common stock in 2018, the company said.

    But Buffett slammed corporate bosses who buy stock back when prices are lofty. Stock buybacks “should be price-sensitive,” and “blindly buying an overpriced stock is value-destructive, a fact lost on many promotional or ever-optimistic CEOs,” Buffett said in the closely watched letter.

    Several U.S. lawmakers have proposed restricting share buybacks, saying companies are incurring debt or wasting money to prop up their stock prices, while not making investments in their business or properly paying employees. Companies often argue they are just returning cash they cannot use to shareholders who can put the money to work.

    Reporting By Jennifer Ablan, Jonathan Stempel and Trevor Hunnicutt in New York; Editing by Andrea Ricci

  • UPDATE 1-Falling stocks, Kraft Heinz trigger huge Berkshire loss

    (Reuters) – Sinking stocks and deteriorating prospects from an investment in Kraft Heinz Co pummeled the bottom line of Warren Buffett’s Berkshire Hathaway Inc, which on Saturday reported a huge quarterly net loss even as operating profit soared.

    FILE PHOTO: Warren Buffett, CEO of Berkshire Hathaway Inc, plays bridge as part of the company annual meeting weekend in Omaha, Nebraska U.S. May 6, 2018. REUTERS/Rick Wilking/File Photo

    The fourth-quarter net loss was $25.39 billion, or $15,467 per Class A share, reflecting more than $27.6 billion of investment losses, including from stocks Berkshire still owns.

    That compared with a year-earlier profit of $32.55 billion, or $19,790 per Class A share, most of which resulted from a lowering of the U.S. corporate tax rate.

    Results included a $3.02 billion writedown for intangible assets that Buffett said was “almost entirely” attributable to Kraft Heinz, in which Berkshire owns a 26.7 percent stake.

    The packaged food company on Thursday shocked investors when it reported its own $15.4 billion writedown for Kraft, Oscar Mayer and other assets, and said U.S. securities regulators were examining its accounting practices.

    Buffett also released his annual letter to Berkshire shareholders, which did not discuss Kraft Heinz’s recent travails or the day-to-day management of the company by his business partner, the Brazilian firm 3G Capital.

    Net results suffered because many of Berkshire’s common stock holdings saw double-digit price declines, including a 30 percent decline in Apple Inc, its largest holding.

    Accounting rules require Berkshire to report unrealized stock gains and losses with net income. This causes huge swings in net results, and Buffett has urged investors not to use them as a measure of Berkshire’s business performance.

    Quarterly operating profit rose 71 percent to $5.72 billion, or about $3,484 per Class A share, benefiting from improved results in many businesses including the Geico auto insurer and BNSF railroad.

    Analysts on average expected operating profit of $3,349.04 per share, according to Refinitiv I/B/E/S data.

    The decline in stock prices also pummeled Berkshire’s book value per Class A share, which fell 7.1 percent in the quarter to $212,503.

    Buffett had long used book value as a gauge of Berkshire’s intrinsic worth.

    But he told shareholders on Saturday it has “lost the relevance it once had,” citing changes in Berkshire’s business and investment mix, accounting rules, and the likelihood of additional stock buybacks that could depress it.

    Book value, he said, has become “increasingly out of touch with economic reality.”

    Berkshire ended the year with $111.9 billion of cash and equivalents.

    For all of 2018, Berkshire’s operating profit rose 71 percent to $24.78 billion, while net income tumbled 91 percent to $4.02 billion.

    Berkshire Class A shares closed at $302,000 on Friday, about 10 percent below its October record high.

    Reporting by Jonathan Stempel in New York; Editing by Andrea Ricci