Shareholder value: when companies talk the talk not walk the walk

Thursday, 5 January, 2012

Company executives spend excess amounts of time trying to manage the expectations of financial markets – in the guise of maximising shareholder value – rather than focussing on their core activities, argues Steve Denning, writing for Forbes.

In today’s paradoxical world of maximizing shareholder value, which Jack Welch himself has called “the dumbest idea in the world”, the situation is the reverse. CEOs and their top managers have massive incentives to focus most of their attentions on the expectations market, rather than the real job of running the company producing real products and services.

For all the talk of maximising shareholder value, is that even the case, given the precarious state of global sharemarkets anyway?

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I’d never have guessed haircuts caused chaos in money markets

Wednesday, 17 August, 2011

Haircuts, but not haircuts as most of us would know them, apparently played a big part in the recent chaos that gripped the world’s money markets.

The cause, it seems, are “haircuts”, Wall Street jargon for the amount subtracted from the market value of an asset, such as a government bond, that is used as security when a bank borrows cash from another bank. During boom times, haircuts range from 1 to 10 per cent, making it easy for bankers to borrow. Having a cheap and plentiful source of ready cash tempts bankers to gamble it on risky and potentially “toxic” investments, as happened in the run-up to the crash in 2008. But in recession, haircuts zoom up as high as 100 per cent as banks rein in their assets, which can paralyse the financial system through a cash-flow drought.

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Finders Keepers Sydney photos

Monday, 10 May, 2010

Finders Keepers Markets, Sydney

I quickly stepped into the Finders Keepers Markets last Friday evening, 8 May, taking place in Eveleigh, in Sydney’s inner west.

Finders Keepers Markets, Sydney

The work of about 80 indie designers and artists, inluding Akina, Kareena Zerefos, and The Design Kids, were on show.

Finders Keepers Markets, Sydney

It was also the first time I’ve been to CarriageWorks, the Finders Keepers Sydney venue… a place well worth visiting on its own.

Check out my Flickr page for more photos.

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Finders Keepers, Sydney, this Friday and Saturday

Wednesday, 5 May, 2010

Finders Keepers flyer

Finders Keepers is a twice a year art market held in Sydney and Brisbane, showcasing the work of emerging Australian and New Zealand designers and artists.

The Sydney event is on this Friday and Saturday (7 & 8 May), at Carriageworks in Eveleigh, and since I’ve not been before, I’m hoping to check it out this time.

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Do we live in a world without a superpower?

Friday, 3 October, 2008

The ascendancy of the United States is history says John Gray in an article outlining his take on the global financial crisis.

Our gaze might be on the markets melting down, but the upheaval we are experiencing is more than a financial crisis, however large. Here is a historic geopolitical shift, in which the balance of power in the world is being altered irrevocably. The era of American global leadership, reaching back to the Second World War, is over.

If nature abhors a vacuum, what happens next? Neither China or Russia strike me as being of superpower stature… just yet.

In other news, US federal debt has recently broken through the US$10 trillion barrier (US$10,124,225,067,127.69), up from US$5.8 trillion when George W Bush took office in 2001.

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In times of crisis don’t listen to Seth Godin, eat cupcakes

Thursday, 2 October, 2008

If Google Trends is anything to by, it seems we are more interested in “our impending inability to afford cupcakes” than share markets crashes or the meltdown of the global financial system.

What you have remember though, is that in times of crisis and uncertainty people will, rightly or wrongly, turn to comfort food to see them through, hence the interest, as I see it, in cupcakes.

Via Everything On The Internet Is True.

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Crisis? What crisis? This is an opportunity

Thursday, 2 October, 2008

Now is the time to get entrepreneurial says Seth Godin, because in crisis there is opportunity:

Growth is frightening for a lot of people. It brings change and the opportunity for public failure. So if the astrological signs aren’t right or the water is too cold or we’ve got a twinge in our elbow, we find an excuse. We decide to do it later, or not at all. What a shame. What a waste. Inc. magazine reports that a huge percentage of companies in this year’s Inc. 500 were founded within months of 9/11. Talk about uncertain times. But uncertain times, frozen liquidity, political change and poor astrological forecasts (not to mention chicken entrails) all lead to less competition, more available talent and a do-or-die attitude that causes real change to happen. If I wasn’t already running my own business, today is the day I’d start one.

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