Paper Chase: Powerful Women In The Boardroom
As predicted, Janet Yellen stayed on the course Ben Bernanke charted last year. After gaining approval from regulators, Comcast bought Time Warner for $45 billion in an all stock deal. This joins the two largest cable providers in the country serving thirty million customers. The retail sales number for the 4th quarter was down 0.4% as there was less spending less on cars, clothing and restaurants due to, you guessed it, the weather. This could prove ominous as consumer spending is two-thirds of the U.S. economy.
Overblown concerns over emerging markets have subsided. The Fed’s announcement that they would stay the course has brought stability to the markets. The question I always ask of Fed action is: “Will its efficacy be greater than its cost?” Markets are in equilibrium now as the long end of the interest rate curve aligns. Investors at the long end of the curve should certainly have confidence. While unemployment is a concern, solving it without the Fed printing more money is preferable.
Duress in emerging markets, slower growth domestically, and concerns about China were causing rates to drop; however, coming out of 2013 I feel that the market is just reaching a point of normalcy with the drop in rates being a part of that return. It is important to remember that quantitative easing (QE) has nothing to do with interest rate hikes or drops. The Fed has indicated that it will not raise rates for minimum quarters. In fact, I wouldn’t be surprised if it was for years. The Fed feels that QE has lost some of its efficacy, and rate changes will be more stimulative.
What I’m Doing
It’s tough to separate the effects of the weather from other factors affecting the market. There were more flight cancellations in January than the last four years combined. This slowed speed of commerce. The weather may cause the strong growth we saw in the third and fourth quarters to temper. I believe the huge collapse we see in manufacturing is directly due to weather. Conversely, the explosion we saw in utilities is also weather related. I can’t see how the weather won’t have an effect on the 1st quarter GDP, but growth is still expected at around 3%. Investors with six, twelve, and eighteen month time horizons (me) should buy the market now.
Surprise! Weather has affected producer income, but good crop production and strong income are still expected this year. The impact of droughts is not as severe in the U.S. because we meet our needs and export our surplus. Weather has the greatest impact on the individual producer who is at risk, which made the passing of the Farm Bill so important.
During times of crisis, people want to know that the government is paying attention and can offer support immediately. The Farm Bill allots $41 billion in crop insurance eliminating direct payments to farmers regardless of whether they have a good or bad year. While crop insurance does not help specialty producers (fruit and vegetable), improvements in other programs surrounding crop insurance will help those producers survive difficult times including a refurbished dairy support system.
The $700 billion allotted towards SNAP is a reduction. Eligibility standards in 17 states which use low-income heating assistance tightened from proving use of $1 in assistance to use of $20. States are coming up with pilot programs to match able bodied SNAP recipients with job training programs.
Yahoo CEO Marissa Mayer and GM CEO Mary Barra are CEOs of two of the most important companies in the world, and Fed Chairwoman Janet Yellen is possibly the most powerful person in finance. Still, only 15% of Fortune 500 CEOs are women, a number which has been stagnant for some time. These women had good fortune, unbelievable drive and are in the right place at the right time to make it at high-powered jobs with families, and particularly children.
Women In Leadership Positions
Women hold 14.6% of executive officer positions, 8.1% of executive top earner slots, and 16.9% of corporate board seats. Disturbingly, 10% of Fortune 500 companies have no women on their boards.
Nothing Has Changed
Many of the same barriers still exist for women who are high-powered corporate executives. Sure, there are many more women who are their own bosses and control their own time; however, it’s tougher to reconcile tension between families and work for women who don’t control their own time as corporate executives.
I preface my solutions by stating that this feminist is hesitant to even prescribe supposed answers as a man to what I interpret as women’s problems in high-powered corporate jobs. That being said, I spoke with some very successful women who gave me their approval to share.
Lengthen Your Career
Women should elongate their careers. A 22-year-old woman today will live to 86. If happy and productive, a woman should assume work until at least 80 and adjust accordingly.
Have A Good Partner
Women should also take time for children, but set aside 20 working years for eligibility for leadership positions. Their partners also need to elongate their careers where one is the lead caregiver and one is the lead breadwinner. It is almost impossible for women (or men) to have high-powered jobs and be the primary caregivers.
The existing pay gap is not justified unless women are producing lower quality results which is clearly not the case. Women can and should ask for flexibility for caregivers, and the fact that there is still a stigma around flexibility is indicative of the problem. Employers should recognize the value in diversity while understanding they are missing out on half the talent pool for leadership positions.
Disclaimer: Killing The Breeze is not a registered investment advisor or advisory service. It does not tell or suggest which securities or currencies should be bought or sold. The employees or affiliates of Killing The Breeze may hold positions in the stocks, currencies or industries discussed here. There is a very high degree of risk involved in the market. Killing The Breeze assumes no responsibility or liability for any trading or investment results. All content posted is for educational purposes only and independent advice should be sought from a professional to confirm validity and accuracy of any claim made.
The information should only be a starting point for doing additional independent research in order to allow you to form your own opinion regarding trading decisions. You should ask the firm with which you deal about the terms and conditions of the specific securities which you are trading and associated obligations. You should always check with your licensed financial advisor and tax advisor to determine the suitability of any investment.