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It would be easy to spend all this week on Trump.  Always enjoyable fodder, but the feeling I get is many are “over it”.   Seems no chance that the result will be anything other than what it is.

All I would say is that we in Oz would look at that result and say with a popular vote of a smidgeon over 50% you would not say Biden got a glowing endorsement or mandate.  It is though, the highest support for a challenger since Roosevelt in 1932.

I did like the Venn diagram below though, that highlights Trump will go down in history as unique.

The old fella Biden seems comfortable for everything to take its time – when you the oldest President elect in history, one would think time is against you…and as Buffet put it-

But my Twitter award of the week goes to:

The bigger movement this week has been Pfizer’s vaccine result.  With efficacy quoted at well over 90% the market believes the world could be back on track earlier than expected.  Chances even of the vaccine being rolled out this calendar year.  Reckon it is a just in time result with the USA out of control – the Rona is everywhere.

Of course this news pushed equity markets into the stratosphere.  But not all companies benefited.  “Old” school companies that had been written off bounced solidly, whilst some tech stocks got belted.  Take a look at Zoom for example:

My mates in the big end of town are thrilled that the Democrats look very unlikely to win the Senate – thus any radical policy changes (eg a lift in company tax rates) will get squashed/deferred/delayed/destroyed.

That said shares in clean energy stocks rose while oil and gas stocks fell.  Some real volatility in gold and silver too.

More good new when the Wetpatch Consumer Sentiment survey hit a seven year high.  Victoria’s success seems to be the icing on that cake.

Chatting during the week, apart from a very brief period in 2010 RBA have been cutting cash rates for 10 years.  You don’t usually cut rates when the economy is booming.  We were getting fat and lazy well before the Rona hit, and challenges were clearly already evident.  Maybe 2021 will see a raft of SME defaults, but many of these may have been quasi zombies already.  It might be a good clean out and give scope for good businesses to expand.

The general happy days move has seen the interest rate curve “steepen” – long end yields moved higher on the good news, whilst the shorter dated yields are anchored by RBA commitments to buy paper.  For hedgers, I would remain on the sideline for now.

The Aussie dollar remains higher than RBA would like.  Sitting just under 73 cents it seems to be struggling to go higher, but equally uncomfortable to fall.  One to watch would be how China/Australian trade relationship builds or blows up in coming weeks and months.

We will see.

One theory that I become more wedded to is that assets will hold value strongly in the next couple of years – be they property, equities or crypto.  With global capital so cheap for so long, why would they be anything different?  Of course updated fair valuations may ultimately follow in years beyond and some might find that the tide has gone out and taken their swimming trunks with it.

A favorite quote from John Howard, circa 2003….”I said I haven’t found anybody who owns a home complaining to me that the value of it has gone up.”  This is as true know as anytime and so get on to the Aussie home Ponzi scheme early…it is government backed.

Thought of the week.

Don’t “turn off” – Black Swan may surprise – or offend.

As most will know, BS spent many years in the machines called Banks.

Watching a predominately left biased news platform, many seem to be taking much pleasure from Trump’s implosion.  I must confess to not being immune myself.  But you can clearly see how commentators these days are very measured in language.  It is all inclusive, and frankly at times too bland to be interesting.  If nothing else, watching right biased is entertaining.  Sky News / Fox News commentators for example.  Entertainers.

But I digress, and yet again I may need to apologise early.  I keep in touch with many existing and past bankers from many “shops” – of both sexes.

Spoken softly behind bike sheds in muffled tones, there is a theme as to why many good bankers are getting out of the game.  Even as insiders, they feel the game is rigged.  Only part of it relates to big bonuses getting harder to find (and hide).  Big banking has a mandate that is absolute.  I choose to quote Westpac‘s for no other reason than it is easy to find on their web site:

“Our commitment to gender equality continues through our FY21 gender objectives to have:

• Maintain 50% Women in Leadership
• At least 40% women in our Senior Executive¹ population
• At least 30% women on our Board of Directors
• Maintain no less than 50% women in our workforce generally”

Most (including me) would say that seem logical and a good step towards fairness.

How does that stack up against the broader Australian working environment?  According to the Australian Government Workplace Gender Equality Agency (did you know we had one?):

• Women hold 28% of Board positions
• 32% hold key management positions
• 38% of all full time workers are women and 68% of part time workers are women.

Based on above, Westpac are as good as there – a bit of tinkering around the edges and they can down tools.

Wages and salaries are harder to get a handle on though, and the Agency reports a pay gap that endures:

I have no doubt what so ever that Australia, and the world for that matter, would be a better place if we had a higher percentage of women in political positions of influence.  Politics is the quintessential art of compromise.  We need a different approach to get different and better results.

Some might argue the ABC approach to the LNP party his week may be a counter reaction to recent ABC budget cuts, but it would be hard to argue that a softer touch would not help get past the LNP old boys club reputation.  Bring back the dual Bishop death stare.

But good bankers are leaving the industry.  And like the buffalo herd theory, banks are getting collectively weaker for it – and you feel it in the quality of support and advice you are getting.

Many tell me they are leaving because they have hit a ceiling.  They suffer from:

1. Being middle aged
2. Not being gender confused
3. Having no clear disability
4. But most of all being male.

I would understand that many women would chuckle, and say stiff biscuits, or welcome to our historical experience.  Fair play, but these bankers apply for role after role as they look to climb that slippery pole, only to find the successful candidate is younger, less experienced but has been fast tracked through the “right” channels and just as a coincidence happen to be female.  Line management shrug their shoulders to the unsuccessful candidate and whisper that they had no real choice in the appointment.  Senior management of banks are now rewarded (or punished) via their hip pocket if agreed gender balance is not met.

Banks are massive machines, and a slightly different cog in this wheel or that probably doesn’t make a lot of difference. And many of the new appointments do go on and do reasonable jobs.  But this old swan is old school and believes both in meritocracy and time on the tools.

I don’t have the perfect solution.  Without a target, the chance of positive change is hit or miss (like Australia’s 2050 target…)

So you have a gender target, thus you have a quota system – even if it is not disclosed or declared.

Black Swan does not in any way condone predators or bullies in the workplace – they should get everything they deserve.

Possibly undoing the seriousness of the subject here, but that is what we do…

I would be interested in your thoughts – any good ideas or am I cocking my leg on the wrong tree?

What is Black Swan drinking?

Had a very pleasant Sunday afternoon – good music, food and friends.  As the weather warms up, the reds need to cool.

Not overly familiar with the label.  Grapes are from Tumbarumba on the lower slopes of the Snowy Mountains.  Like all cool climate pinots, I would describe it as delicate.  Not overly priced and worth a look.

On drinking – a mention for my old mate Gazza who had a problem with Adelaide from memory.  I chortled when I saw this on a bus shelter this week.  For you mate..

And listening?

The Heavy have been around awhile, but with storms lashing our east coast their dark broody song seemed to hit the zone.

Until next week.

Good to get some questions and feedback via FB messaging or FB direct.  Keep it coming and remember to subscribe.  Early adopters get the worm.

Cheers  BS