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Top 3: Barron's 2019 Roundtable, El Chapo's Management Style, & Skill Over Experience– How Clemson emulated Silicon Valley Thumbnail

Top 3: Barron's 2019 Roundtable, El Chapo's Management Style, & Skill Over Experience– How Clemson emulated Silicon Valley

IRC Top 3 Business Market Investing

In case you missed it, here are three things you should know this week...

  1. 1.)  Barron's 2019 Roundtable

     "For all of their worries about debt, disruption, interest rates, and trade, our experts see a decent year ahead for stocks," says Lauren Rublin for Barron's. 

  2. Jeffrey Gundlach, CEO and CIO DoubleLine Capital says, "I’m not looking for a terrible economy, but an artificially strong one, due to stimulus spending. I expect the market to fall further. I see almost a reverse of last year, in that stocks could be weak early in 2019 and stronger later in the year."  

  3. While William Priest, CEO and co-CIO Epoch Investment Partners, concurs, "My thoughts are similar to Jeff’s. Our year-end letter to clients discusses four elements that we expect to shape market outcomes in 2019, and none are very positive. 

  4. "First, as Jeff alluded to, is quantitative tightening, or QT, whose impact will be profound. In my view, quantitative easing was necessary after the financial crisis to offset liquidity and solvency issues... The second issue is trade wars... Third is the debt situation, which Jeff explored in detail. I will add that student debt is now $1.5 trillion, and 20% of U.S. student loans are already likely to be in default. The Brookings Institution has forecast that about 40% of student loans will be in default by 2023. This mountain of consumer debt, including student debt, is going to impact home buying and auto purchases, particularly within the millennial generation... Finally, the global liberal order is coming apart."

  5. Even with Priest's four elements expected to shape the market in the next year, experts in the field, like Abby Cohen, Advisory Director and Senior Investment Strategist at Goldman Sachs, foresees the possibility of good opportunity outside the U.S. and Rupal Bhansali, CIO and Global Equities Portfolilo Manager at Ariel Investments, believes "the thing to bet on in coming years is net-cash companies."

  6. Rublin, Lauren. “The 2019 Roundtable.” Barron's, 14 Jan. 2019, pp. 20-34.

  7. 2.)  El Chapo's Management Style

     While emulating El Chapo's management style may not be at the top of your list for the new year, the kingpin of the Sinaloa cartel does bring about another way to approach management.

  8. Contributing to the list of terms companies have used to describe their management style to human resources, is El Chapo's method of valuing loyalty and re-positioning loyal workers into appropriate positions. When a young pilot made several mistakes in flight, for example, he promoted him into another position rather where he proved a profitable employee rather than jumping (or firing) the gun.

  9. "GE once practiced "rank and yank." Other companies live by "hire slow, fire fast." If the Sinaloa cartel had a management slogan, it might have been "coddle or kill," says the Wall Street Journal.

  10. With a plethora of management styles to consider, what approach do you take as a business owner?

    Walker, Sam. “The El Chapo School of Management.” The Wall Street Journal, 12 Jan. 2019, pp. B1–B4.

  11. 3.) Skill Over Experience: How Clemson Emulated Silicon Valley

    Leading Clemson to the national title, was freshman Trevor Lawrence. Though, in the past this would've been unheard of, "it is a part of a new normal in which college football teams are resembling the companies that reside only a short drive from the site of Monday's game," says Brian Costa and Rachel Bachman. 

  12. The speed of one's ascent is no longer subject to years and years, or an especially grueling input prior to return and opportunity. Rather, one's talent has every bit as much to do with it. 

  13. "Just as technology business became known for the relative youth of its executives – valuing skill over experience – Clemson typifies the sport's growing embrace of quarterbacks straight out of high school."

  14. Accelerating learning and choosing to bring people on board and empower them based on their skillset is a proven win, just take it from Clemson and their national title or any number of Silicon Valley businesses.

    “How Clemson Emulated Silicon Valley.” The Wall Street Journal, 9 Jan. 2019, p. A14, www.wsj.com/.