The New Year is here. You have many things to do, and possibly a few resolutions to mull upon if not implement. In that light, let us herein be brief so as to not load you with too much reading in the first days of 2013.
“All That Jazz” was a movie about Broadway, womanizing and drugs. Yet its undercurrent theme, at least to us, was hard work. Sweat laden hard work produced good results in spite of the cacophony of distractions and noise.
Forgive us for minimizing it, but the fiscal cliff is along the same lines of noise. Things will change (later, if not sooner), but mostly I’m disappointed that so much political noise is in the air, the effect of which is to simply confuse the basic issues.
A lesson in contrast; Corporations, both big and small, have no such similar distractions. Their job is to produce profits. All the rest is noise.
And so they do.
Corporations adapt. Their adaptations occur because they have the profitability motive. Though it has been attributed to numerous business writers, the adage “What gets measured gets done”, seems to focus the minds.
The result is that corporations are healthy, arguably by some the healthiest they have ever been, and producing profits. Investor emotions certainly wrack the stock market in the short term, but profits rack the price long-term. Please never forget that simple and very direct tie.
Therefore, the tremors of Washington DC (or Paris, or Brussels) certainly distract, but they do not make the financial markets. For us, in 2013 and beyond, we’re betting on the continued good instincts and creativity of the private sector. It has been an extremely good bet for 200 years, and the underlying current of hard work by the motivated men and women of this world allows us to rise above the noise. Stock markets, whether in New York or New Delhi, are inherently based upon the free market efforts of these entrepreneurs. Anyone, anywhere, who has bet against that ingenuity, has been wrong.
Put that in your New Year stocking.
May your 2013 be productive and fulfilling.