01 Apr Widespread Global Stability…April Fools!
The world continues to feel fragile. As I write this note, Iranian nuclear negotiations continue (after the supposed deadline), Brazil is in the midst of a massive corporate scandal, the Canadian economy seems destined to shrink, Japan is continuing to struggle, instability is plaguing Syria and Yemen, China’s slowdown continues to apply downward price pressure to certain commodities (look at iron ore, for instance), and Europe continues to be a work in progress.
There is one seemingly (at least at this stage) bright spot: Nigeria. What?!?! I know! Felt like an April Fool’s joke to me when I read that the election seems to have gone smoothly and a peaceful transition of leadership seems likely. My expectations, like many Africa watchers, were too low. While I’m now optimistic and very hopeful, I do think the situation warrants continued attention in the weeks and months ahead.
Another noteworthy development is rising wage pressure. McDonald’s recently agreed to raise wages. Walmart did so early this year. Is this a sign that incomes are starting to rise? Might this squeeze corporate margins, a concerning scenario at a time when markets are already fully-priced? (Click HERE for my interview with CNBC in which I briefly discuss wage pressures). Could these wage gains spark the dreaded wage-price spiral that generates runaway inflationary pressures? It’s worth watching.
I’ll continue to comment on developments I find interesting and noteworthy. In addition to posting my thoughts on my website every Wednesday, I have also begun posting them to LinkedIn, Facebook, and Twitter. Listed below are links to my most recent comments. As always, I’d welcome feedback!
PS. Given the extensive commentary that my notes are generating on LinkedIn, the links below are now pointing to my posts on LinkedIn so that you can also read what others are saying and join the conversation if you feel so inspired!
Forthcoming War In The Arctic?
Last month’s developments in the Arctic were concerning. Norway held military exercises on its Russian border in the Arctic, and Russia quickly followed with a demonstration that included 40,000+ troops. Tensions in the region are rising. In this short note, I explore how the Arctic heating up has the risk of escalating into war. Click HERE to read my comment.
Canadian Economic Bubble?
While speaking at an event in Florida last month, I expressed my concerns about Canada’s housing market and leveraged consumer. I was shocked by the fact that the audience was shocked. In this short comment, I discuss how Canadian household debt, high housing prices, and a booming subprime mortgage market are blowing a bubble that the fall in crude oil prices is about to burst. I lay out my thesis for why I believe Canada may be the most vulnerable large economy in the world today. Click HERE for my comment.
Three Questions About The Robolution
The increasing automation that is spreading globally is forcing us to rethink the role humans will play in a host of industries — ranging from farming, camel racing, logistics, manufacturing, publishing, and even dance and music. My note about robots explores possible implications of this seemingly unstoppable trend. Click HERE to read the piece.
Focus on Customers, Not Competitors
I recently had the pleasure of flying to and from Abu Dhabi on Etihad Airways. The experience was fabulous and I’m unlikely to fly another airline if Etihad is an option. Upon returning, I noticed that Delta Airlines and other US carriers were suggesting the US government modify its Open Skies agreement with the UAE. In this short note, I suggest US carriers would be better served by focusing on customers rather than competitors. Click HERE for my comment.
You’re Underestimating Africa
Few people truly understand how large Africa actually is. Its land area is equivalent to the United States, Europe, India, China, Mexico, Japan, and the United Kingdom — COMBINED! Further, it’s population is booming. Nigeria (about the size of Texas) will have 1 billion residents by the end of the century. Click HERE for more.
Sheep Pulling Lobsters from Snow?
Amidst the never-ending snowfall this winter, I took a trip up to Southern Maine. While stopping in Perkin’s Cove in Ogunquit, I noticed that many lobstermen were busy. This was extremely unusual, leading me to explore the connection between China’s Year of the Sheep celebrations and the Maine lobster industry. My short note generated more than 12,000 views on Linkedin! Click HERE to read it.
Bloomberg TV Appearance
In mid-March, I had the opportunity to guest host Bloomberg Surveillance with Tom Keene, Olivia Stearns, and Brendan Greeley. Over the course of the show, I was able to discuss Wall Street culture (click HERE for short video), political manipulation of markets (click HERE for a short video), and Canadian economic vulnerability (click HERE for a short video).