Topley’s Top Ten – August 6th, 2019

Author

Matt Topley
August 06, 2019

1.China Allows Currency to Weaken.

China Uses Currency as Weapon in Trade War, Rattling Markets

Aug. 5, 2019

WASHINGTON— The trade war between the United States and China entered a more dangerousphase on Monday, as Beijing allowed its currency to weaken, Chinese enterprisesstopped making new purchases of American farm goods and President Trumpindicated he would look for ways to retaliate.

Theescalation shook world markets on Monday, as nervous investors looked for safeplaces to park their money. Wall Street suffered its worst day of the year,with the S&P 500 closing down nearly 3 percent. Selling was especiallyheavy in the trade-sensitive technology, consumer discretionary and industrialsectors. Yields on United States Treasuries, which fall as prices rise, droppedas investors sought safety in government-backed bonds. Benchmark indexes inAsia and Europe also fell.

OnSunday, the People’s Bank of China, the country’s central bank, allowed itscurrency to weaken past the psychologically important point of 7 to theAmerican dollar for the first time in more than a decade. In an unusually bluntstatement, the bank blamed the currency fall on Mr. Trump’s “unilateralism andtrade protectionism measures and the imposition of increased tariffs on China.”

Mr. Trump’s decision to impose additional tariffson Chinese goods also prompted Chinese enterprises to halt purchases ofAmerican agricultural goods, according to China’s state-run Xinhua News Agency,which called the president’s proposed tariffs a “serious violation” of an agreementreached in June with Chinese President Xi Jinping.

Yuan approaching 2017 levels.

2.Drop in Rates Inverts Yield Curve by 32bps.

Yield Curve Blares Loudest U.S. RecessionWarning Since 2007 By Emily Barrett

3.One Concern was Transportation Stocks Not Making New Highs with S&P and Dow…Heavy Truck Orders Fall for 9th Month in a Row.

Heavy-Truck Orders Collapse Stunning 81%. Lowest Since 2010

by Wolf Richter • Aug 3,2019 • 52 Comments • Email to a friend

Order backlog still feeds truck makers, but they don’t disclosefor how long.

Orders for Class 8 trucks – the iconic trucks that haul part ofthe economy’s goods across the country – collapsed by 81% in July compared toJuly last year, to 9,800 units, the lowest since 2010, according to FTRTransportation Intelligence on Friday. It was the ninth monthin a row of year-over-year declines. But “declines” is not the right word. Thisyear so far, these year-over-year “declines” ranged from -52% to -81%, whichmakes for a stunning collapse of the historic boom last year:

Dow Transport Stocks Never Made New Highs in 2019

4.Dividend Aristocrats Index During S&P Drawdowns.

5.Long-Term Treasury and Long-Term Corporates Spike to New Highs.

20+ year treasury ETF +26% rally off lows.

Long-Term Corporate Bonds +21% Off Lows.

6.16 Year Low Oil Service Stocks.

Oil Service ETF

7.Work-Force Participation for 55 and Older Workers Hits 7 Year High.

Zero-Hedge

8.Global Service Sector Healthy vs. Manufacturing in Recession Levels.

Global macro talks about thetradable and nontradable sectors of an economy, and it is not a surprise thatwhen you have a trade war, the tradable sector is not doing well. But it isvery surprising that after a year of constant deterioration in the tradablesector the global service sector is doing just fine, see chart below. Thisdivergence obviously has significant implications for asset allocation acrosscountries, across assets and within asset classes, and it is exactly thisnature of the shock, which is a challenge for quant models at the moment.

9.Mortgage Rates at 4% for 8 Consecutive Years.

10.A Harvard Study Found That 27 Top-Performing CEOs Use These 6 Strategies to Manage Their Time

Time is said to bespent or invested. But without time management, it can also be squandered.

By Tanya PrivePartner, Legacy TransformationalConsulting@TanyaPrive1

Is your to-do list constantly growing? Do you feel like thereare not enough hours in the day to meet your family, work, and socialobligations? 

For business leaders,time management isespecially problematic given the magnitude of their responsibilities and thelimited hours in the day. Not only is lost time never found again, but notmanaging time strategically harms the executive‘swell-being, effectiveness, and organizational performance as well.

My team and I had the opportunity to lead coaching sessions forexecutives of public and private companies worth billions. And one thing isclear–how you manage your time leads to success or failure.

This Harvard Business School study followed, around the clock,27 top-performing CEOs of publicly traded companies worth on average$1.3 billion. With the help of their executive assistants, over 60,000hours were tracked across a period of three months. In part, thepurpose of the study was to analyze the raw data of actual time allocationand to provide recommendations on how to increase time efficiency.

Arguably, the most important step to becoming an effectiveleader is through proper calendar management. Here are six findingsin the study to help you boost your efficiency.

1. Schedule downtime and regular activities.

Pencil in downtime throughout each day. We’re not super-humans.A 10-minute break here and there isn’t going to bankrupt your business. Theseshort gaps give you time to catch your breath, review what’s next, and centeryourself before moving forward. Warren Buffet schedules time each day just forreading. Your family may appreciate an occasional text, too.

Additionally, schedule all the regular activities you do, likegetting the mail, walking the dog, picking up the dry cleaning, going to thegym, or picking up the kids. These recurring tasks eat into your dailybandwidth and accounting for them will help you strategically allocate the timeleft in your day.

2. Include buffers between meetings.

Remember to add time between appointments to account for delays.Few meetings start and end on time. Sometimes an extended discussion is neededand useful in the moment. Plan for these situations so you’re not constantlylate for the following item on your calendar.

3. Master the art of delegation.

Get out of the weeds. CEOs who aren’t careful can find theirtime taken away by responding to questions from inside and outside theirorganizations. It’s an unavoidable part of being in a position where decisionsare required, but it’s not the only role a CEO has. Planning and creating avision forward for your organization is more important than overseeingday-to-day decisions.

You can tackle this problem in two ways: Empower your leadershipteam to handle the day-to-day operations, and regularly schedule uninterruptedplanning into your calendar. When you don’t make time to plan, yourorganization will likely operate on short-term goals, which leaves yourbusiness open to disruption. 

4. Set yourself up for tomorrow the day before.

Prepare for the next day at the end of each day. You’ll sleepbetter if you’ve already recorded your thoughts and agenda instead of allowingeverything to churn in your mind until morning. So schedule this as a regularoccurrence each day.

5. Include time to develop yourself and your team.

Now that you have your calendar under control, invest inleadership development. Start by identifying areas where you and your team canimprove. Maybe delegation has been tough because you don’t trust the judgmentof your team? Or you realize when you sit down to plan that you don’t knowwhere to start? Maybe hiring a coach is worth the effort because your own andyour team’s performance could improve. You’ll learn to recognize newopportunities and make plans to achieve them when you’re open to advice. 

6. Use email with caution.

If you didn’t notice already, I haven’t mentioned the 800-poundgorilla on the back of most executives every day⁠–email. It’s a huge timesuck. And being in a leadership position, people feel like they have to respondnights, weekends, from bed, the shower, etc. How you manage this should bealigned with your company culture, but the best policy for most internalquestions that arrive by email is to address them face-to-face or by phone,when possible. You’ll get much better results than writing an unclear, rushedresponse.

So how can CEOs make time to meet with people who email them?The best of the best schedule time to walk through their facilities as often aspossible. These are friendly visits just to let everyone know the communicationlines are open, while offering you a chance to get to know everyone on apersonal level.