Although There Are Many Inconsistencies, There Is no Immediate Cause For Concern
Throughout my career, I have consistently adopted critical stances and viewpoints. As a child of the 1980s, I witnessed an incredible upswing in the ’80s and ’90s, which culminated in the ‘peak freedom’ of the early 2000s.
Since then, we have experienced 9/11, the financial crisis, the eurozone crisis, a severe commodities price recession from 2012 to 2018, the Coronavirus pandemic, the wave of inflation triggered by the war in Ukraine and, most recently, the trade war initiated by the US MAGA movement and the ‘America First’ policy. Since 2001, we have essentially been in a ‘downward spiral’ with mounting risk. Apart from events such as 9/11 or Fukushima, I can claim that I recognised all major movements early on and wrote about them at a time when hardly anyone else was thinking about them. I reached adequate conclusions about the consequences of 9/11 and Fukushima shortly after the events.
Starting in 2001, the list could identify me as a permanent pessimist. Time and again, I found myself facing stressful situations. However, by overcoming the problems that arose, I now consider myself to be a talented risk manager. Identified risks are not problems, but solvable challenges. That is also what I aim to achieve when approaching companies. In practice, however, it is not always easy to implement procedures that seem sensible and logical to me. For the companies I advise, these often do not seem effective enough. The problem is that, in 95% of cases, companies are at a disadvantage if they do not listen to me. Given this, it makes sense for me to provide my services. Their implementation is justified. Failure to implement my recommendations is a risky move with negative consequences. I am old enough to have gained this insight, even if it is not universally popular. It’s not just about making my expertise available; I also want to contribute to the sustainable profitability and prosperity of Austrian and European companies.
I am considering not only a way to hedge the business, but also a lever to increase cost control and earnings, whether it’s interest rate developments, stock price developments, exchange rates, or the offer to hedge material prices through proxy hedging.
With 26 years’ experience in asset management, I can demonstrate that I am able to report on and deal with market conditions constructively (see supplement). As with hedging, the important thing is not to be in the best position at all times, but to outperform others in the long term while taking less risk.
Make the most of the opportunity to make decisions based on facts, even if some conclusions may seem bold; generally speaking, they are accurate. Ignoring the issue won’t help; developments follow clear and recognisable paths.
A high degree of adaptability is required in order to cope with developments that never remain one-sided for very long. Adaptability must be practised. Those who do not will not be able to cope with the pressure of volatility.
I am writing so emphatically here for a serious reason:
I don’t anticipate any significant problems in the coming year, but I am certain that they will arise because I am forward-thinking. Those who do not prepare for the challenges ahead risk failure. I want to help prevent that.
Wishing you a wonderful, peaceful holiday season and a happy New Year!
