Anyone who has forged a career in marketing will tell you it is a fast-paced, challenging and complex profession characterised by the art of problem-solving and understanding human behaviour – with the power of storytelling acting as its beating heart.

Here are four attitudes or factors that will help you to succeed in a marketing career:

1. Be curious: Marketing is primarily about solving problems, then  finding solutions and answers to these challenges. It is essential to do research and understand what the data are saying. That is how you can glean relevant and meaningful insights. Understanding current and emerging trends is also essential because it will help you leverage actionable insights and solutions. Curiosity underpins the ability to turn data and research into value for clients.
2. Be brave: One of the essential ingredients required of people to do work is bravery. This is especially true in a creative field. If you make a mistake on a billboard or in a Tweet, a large number of people are going to know about it – so you’ll need to be brave to be able to handle the pressure. Also, you will get continuous input on your work from different groups of people and stakeholders, so you need to take that feedback constructively. 
3. Be networked: Many jobs in marketing require influencing people’s behaviour and decision-making, and influence comes through relationships. One of the core attributes of a successful career in marketing is building and maintaining relationships and connections.
4. Be versatile: The broad range of skills that marketers require means that anyone working in the industry needs to be flexible and open to learning and growing their skillset throughout their career. A breadth and range of skills will stand you in good stead as you navigate a constantly changing field of media. 

My top tips for young Africans looking to pursue a career in marketing?

• Know yourself: It’s essential to have clarity about what you want, what makes you tick and, equally, what you don’t want – this is what made me switch from studying accounting to marketing while I was at university. I simply didn’t have the passion for accounting that friends studying it did, so I changed to marketing and have never looked back. 
• Have strong thinking partners: These come from mentors, coaches, friends, colleagues, siblings or parents. It’s critical to have people who will ask tough questions, offer feedback and help you achieve your goals.
• Learn and unlearn constantly: We live in a world of rapid change, and marketing is also rapidly evolving, so as you move through the industry and the different facets of marketing. You need to unlearn old habits and pick up new habits and skills to keep up with the pace of change.
• Find your passion: Marketing is a complex field with ever-shrinking budgets, and massive economic and industry pressures. You will need to get to grips with all of that, along with emerging technologies and tools, so it’s vital to love what you do and be energised by it to overcome the challenges in your path.

Above all, do it even if you are afraid. It is scary to figure out your future career, go for interviews and navigate your way through it all. But if you push through and stick to doing what you love, you’ll eventually reap the rewards.

 

Inc

Central Bank of Nigeria extended its longest phase of monetary tighteningto tame inflation, disregarding a call by President Bola Tinubu for borrowing costs to be lowered.

The monetary policy committee raised the benchmark rate by 25 basis points to a record 18.75%. The median of 17 economists surveyed by Bloomberg expected a 50 basis-point increase.

The meeting was the first presided over by acting Governor Folashodun Shonubi, who last month replaced Godwin Emefiele following his arrest on charges of illegally possessing a firearm. Tinubu, who has implemented several reforms including ending fuel subsidies and liberalizing the foreign-exchange market since he took office in May, has said that high interest rates are stifling economic growth and should be lowered to encourage spending.

The balance of arguments around the need to fight inflation, while also supporting investment and a recovery in economic growth, “leaned in favor of a moderate rate hike to sustain efforts aimed at anchoring inflation expectations, narrow the negative real interest rate gap and improve investor confidence,” Shonubi said in Abuja, the capital.

Nigeria Rate Hike Smallest in Current Tightening Cycle

CBN’s MPC has lifted rates in eight straight meetings

The yield on the nation’s 10-year dollar bonds extended an earlier decline after the decision, falling seven basis points to 10.65% by 5:40 p.m. in Abuja. The rate on the nation’s 2027 debt eased six basis points to 9.92%.

The MPC said it expects the economy to grow 2.66% this year, down from a forecast of 3% in May. Tinubu’s administration is targeting growth of at least 6% a year.

The decision to hike was split. Of the 11 MPC members who attended the meeting, four voted for a 25 basis-point hike, two favored a 50 basis-point increase and the rest preferred a hold.

Rising Inflation

The MPC has increased rates by 725 basis points since May 2022 to rein in inflation that’s been at more than double the top end of its 6% to 9% target range for over a year. Consumer prices rose 22.8% in June — the fastest pace in almost 18 years. The inflation rate has been kept high by rising food prices and is expected to remain elevated for some time.

Money supply rose 32% in June from a year earlier, compared with 14% in May, and gasoline prices have more than tripled since the scrapping of the fuel subsidy. The currency has meanwhile dropped about 40% against the dollar after the easing of foreign-exchange controls last month.

All MPC members also voted to narrow the central bank’s asymmetric corridor, which means the cost at which lenders borrow is at 100 basis points above the monetary policy rate, and the return on their deposits at 300 basis points below the benchmark.

 

Bloomberg

Central Bank of Nigeria (CBN) says plans to gradually phase out the old N200, N500, and N1,000 naira notes are ongoing, as new notes are still being issued.

Folashodun Shonubi, acting governor of the apex bank, spoke on Tuesday after the monetary policy committee (MPC) meeting at the CBN headquarters in Abuja.

In October 2022, Godwin Emefiele, former CBN governor, announced plans to redesign the N200, N500, and N1,000 naira bills.

Emefiele had asked Nigerians to deposit their old notes before January 31, 2023, when they would cease to be legal tender.

The CBN later said Muhammadu Buhari, the former president, had approved an extension of the deadline for the demonetisaton of the old notes.

But in March 2023, the Supreme Court invalidated the naira redesign policy introduced by the central bank, ruling that the old N200, N500, and N1,000 notes would remain as legal tender until December 31, 2023.

Providing updates on the demonetisation policy on Tuesday, Shonubi said the old notes would “slowly, and overtime be replaced”.

He noted that the old notes were being exchanged for the new ones whenever it was being requested by the commercial banks.

“When a currency is printed and sent out. It is expected that it will go through a number of cycles, and then over time, will become one and then be replaced. That’s what we’re doing,” Shonubi said.

“We had to put out or re-put out old notes. And as they’re coming in, they’re being processed and returned to us as not issuable. We are then bringing out and replacing them with the new notes.

“We believe that we have an optimal level of the currency out there and so much of what’s being done is replacement to keep the level, rather than just putting money out there.

“And that is seen by the fact that the banks, whenever they come to us for notes, we provide it to them. If it wasn’t enough, they will be asking us for more. If it was too much, they’ll be dumping that much more on us.

“So, we will slowly, and over time you will see the old notes replaced out of the system with the new notes that’ll be the norm.

“This will be out of practice, not fanfare, you’ll just see it slowly morph from old to new.”

 

The Cable

The Department of State services (DSS) has rearrested suspended governor of the Central Bank of Nigeria (CBN), Godwin Emefiele.

The secret police took custody of Emefiele shortly after a face-off with officials of the Nigerian Correctional Service (NSC).

Emefiele, who has been in DSS detention since June, was arraigned in court on Tuesday.

Nicholas Oweibo, the presiding judge, had granted the suspended CBN governor N20 million bail.

The bail condition includes producing a surety with landed property within the jurisdiction of the court in Ikoyi, Lagos, depositing his passport and also producing a Civil servant not below level 16 to perfect bail.

The judge had ordered that Emefiele should be remanded in prison pending the fulfilment of his bail conditions.

But rather than release the top bank chief to prison officials, the DSS attempted to take him away, a move that was resisted.

During the scuffle that broke out, the uniform of a prison official was torn, revealing the singlet underneath.

The DSS operatives who were well armed outnumbered the prison officials, leading to the arrest of a top official of Ikoyi Prisons by the secret service operatives.

The official who was rough-handled and shuffled into the DSS vehicle was later released.

Emefiele is standing trial on a two-counts charge bordering on possession of a single barrel shot gun, as well as possession of 123 rounds of live ammunition without licences.

However, he pleaded not guilty to the charge.

After his plea, defence counsel, Joseph Daudu, who led four other senior advocates, informed the court of a bail application filed on behalf of the defendant.

Daudu told the court that same had been served on the prosecution, adding that there is a stamp of the office of the Attorney General as proof.

But the prosecutor, Mrs N.B Jones, objected to the bail application on the grounds that she had not been served with a copy of the application.

She informed the court that her office had been on the look out for a possible bail application of the defendant but had seen none.

But defence counsel told the court that the prosecutor had no excuse not to proceed today in response to the bail application as the same had been duly served in the prosecution’s office.

He argued that the office of the AGF is a creation of statute, and so cannot exist in a vacuum.

In a short ruling the court agreed with the submission of defence counsel, and urged him to move the defendant’s bail application.

Moving the application, defence counsel urged the court to admit the defendant to bail as he is not a flight risk being, a reputable former Governor of CBN.

He told the court that the defendant had been kept in custody for long and had lost so much weight and so, requires medical attention.

Defence also informed the court that the defendant will be available to stand trial, adding that assuming the prosecutor had produced a witness, the defence would have been ready to proceed.

He therefore, urged the court to grant the defendant bail.

In response, the prosecutor informed the court that she was opposed to the bail application of the defendant as he was a flight risk.

She told the court that the defendant had refused to submit his international passport which indicates such flight risk.

Besides, she also told the court that being a very influential citizen of Nigeria, the defendant could also interfere with the case and evidences intended to be led by prosecution.

She urged the court to refuse bail

In his ruling, Oweibo agreed with the submission of the defence counsel on the grounds that the offence for which the defendant is charged is bailable.

The court held that bail can only be denied where any of the circumstances set out in section 162 of the Administration of Criminal Justice Act, is established.

The court held that the prosecution has not furnished such circumstances before the court.

The court consequently, granted bail to the defendant in the sum of N20 million with one surety in like sum.

The court adjourned the case until November 14 for trial.

 

Daily Trust

Nigerian Association of Resident Doctors (NARD) on Tuesday night declared an indefinite nationwide strike.

President of the association, Orji Innocent, said the strike will commence at 12 midnight on Tuesday.

He said the strike was declared during the National Executive Council meeting of the association in Lagos.

According to Innocent, the major demands of the association are : immediate payment of the 2023 Medical Residency Training Fund (MRTF), immediate release of the circular on one-for-one replacement, payment of skipping arrears and upward review of CONMESS in line with full salary restoration to the 2014 value of CONMESS.

It had in a communique issued after its virtual extraordinary national executive council (NEC) meeting decried government’s slow response to its demands despite giving it several ultimatums and embarking on a five day warning strike from  May 17th to 21st this year.

 It said, “The resolutions of the conciliatory meeting chaired by the then Minister of Labour and Employment were yet  to be implemented, seven weeks after, despite the set time lines for their implementation.”

NARD said the major demands of the association are: immediate payment of the 2023 Medical Residency Training Fund (MRTF), immediate release of the circular on one-for-one replacement, payment of skipping arrears and upward review of CONMESS in line with full salary restoration to the 2014 value of Consolidated Medical Salary Structure (CONMESS).

Others are payment of the arrears of consequential adjustment of minimum to the omitted doctors , reversal of the downgrading of the membership certificate by Medical and Dental Council of Nigeria (MDCN), payment of MRTF, new hazard allowance, skipping and implementation of corrected CONMESS in State Tertiary Health Institutions and payment of omitted hazard allowance arrears.

 

Daily Trust

WESTERN PERSPECTIVE

US military aid for Ukraine for first time includes Black Hornet spy drone

The U.S. Department of Defense announced $400 million in additional security assistance for Ukraine on Tuesday, including air defense missiles, armored vehicles and small drones, as Ukraine's counteroffensive against Russia grinds on.

The new aid package, which was first reported by Reuters, will include for the first time U.S. furnished Black Hornet surveillance drones made by Teledyne FLIR Defense, part of Teledyne Technologies.

The Norwegian-built Hornet is being used in Ukraine through donations by the British and Norwegian governments, the company said. FLIR Unmanned Aerial Systems was awarded a $93 million contract in April to provide the small reconnaissance drones to the U.S. Army.

In addition, the weapons aid package includes munitions for Patriot air defense systems and National Advanced Surface-to-Air Missile Systems (NASMS), Stinger anti-aircraft systems, more ammunition for High Mobility Artillery Rocket Systems (HIMARS), Stryker Armored Personnel Carriers and a variety of other missiles and rockets.

The assistance is funded using Presidential Drawdown Authority, or PDA, which authorizes the president to quickly transfer articles and services from U.S. stocks without congressional approval during an emergency. The material will come from U.S. excess inventory.

This is the 43rd security assistance package approved by the United States for Ukraine. More than $43 billion in U.S. military aid has been provided since Russia's invasion in 2022.

Commenting on the aid announcement, Secretary of State Antony Blinken noted Russia's attacks on Ukraine ports and Ukrainian infrastructure since withdrawing from the Black Sea Grain Initiative last week.

"Russia could end this war at any time by withdrawing its forces from Ukraine and stopping its brutal attacks against Ukraine's cities and people. Until it does, the United States and our allies and partners will stand united with Ukraine, for as long as it takes," Blinken said in a statement.

The Black Sea grain deal was brokered by the United Nations and Turkey a year ago to combat a global food crisis worsened by Russia's invasion. Ukraine and Russia are both leading grain exporters.

Russia, whose invasion of Ukraine has resulted in the deaths of thousands and the displacement of millions of civilians, denounced the new U.S. package.

"The actions by Washington ... are beyond morality and common sense," Russia's ambassador to the United States, Anatoly Antonov said in a post on the embassy's Telegram messaging app.

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Britain said on Tuesday it had information indicating Russia's military might start targeting civilian shipping in the Black Sea, while the European Union pledged to help Ukraine export almost all its farm produce via rail and road.

 

RUSSIAN PERSPECTIVE

Russian forces liberate Sergeyevka community in Krasny Liman area

Russian forces liberated the settlement of Sergeyevka in the Krasny Liman area over the past day in the special military operation in Ukraine, Defense Ministry Spokesman Lieutenant-General Igor Konashenkov reported on Tuesday.

"In the course of successful counter-attack operations by units of the 15th motor rifle brigade under the skilled command of Lieutenant-Colonel Builov, the settlement of Sergeyevka was liberated," the spokesman said.

In the area of the Serebryansky forest, Russian forces moved 1.5 km into the depth of the Ukrainian army’s defensive lines and their total advance in the Krasny Liman area equaled 4 km. In addition, Russian forces repulsed four Ukrainian attacks in that direction over the past 24 hours, the spokesman said.

"The enemy’s losses amounted to 190 Ukrainian personnel, six armored combat vehicles, five pickup trucks, two D-20 howitzers, one D-30 gun, two Gvozdika motorized artillery systems and a US-manufactured AN/TPQ-50 counter-battery radar station," he said.

In the Krasny Liman direction, Russian forces neutralized a Ukrainian subversive and reconnaissance group and also "destroyed ammunition depots of the Ukrainian army’s 44th motorized infantry brigade and 100th territorial defense brigade," the general reported.

 

Reuters/Tass

A central premise of neoclassical economics is that the consequences of the decisions of market participants can be known in advance and quantified as risk-adjusted estimates. As John Kay and Mervyn King showed in their 2020 book, Radical Uncertainty: Decision-Making Beyond the Numbers, such probabilistic reasoning has a long history. As applied in economics, it has operationalized the concept of “expected utility” – the desideratum that rational economic agents are defined to be maximizing.

As the author of a major analysis of the stock market sponsored by the British government (Kay) and a former governor of the Bank of England (King), both men are well equipped to examine the complex interaction between financial markets and markets for “real” things (goods, services, labor, patents, and so forth). In doing so, they have challenged the statistical methodologies and ontological assumptions that lead economists to regard the future as measurable and manageable.

Managing Expectations

From John Maynard Keynes at the University of Cambridge 90 years ago through Robert Lucas at the University of Chicago in the mid-twentieth century, economists have placed expectations at the core of market dynamics. But they differ on how expectations are formed. Are the data we observe the outcome of processes that are as “stationary” as physical laws, like those determining the properties of light and gravity? Or do the social processes that animate markets render future outcomes radically uncertain?

For a long generation starting in the 1970s, Lucas and his colleagues dominated economic theory, giving rise to different strands of Chicago School economics. While the Efficient Market Hypothesis asserted that prices in financial markets incorporate all relevant information, the Real Business Cycle Theory of New Classical Economics held that the macroeconomy is a self-equilibrating system whose markets are both efficient and complete. The system may be subject to external shocks, but it is not amenable to fiscal or monetary management.

This assumption of complete markets implies that we can overcome our ignorance of the future. It suggests that we could, at any moment, write contracts to insure ourselves against all the infinite possible future states of the world. But since perfect, complete markets obviously do not exist, the Chicago School’s Rational Expectations Hypothesis (REH) proposes that market participants will guide their forward-looking decisions by reference to a (generally implicit) model of how, on average, the world works and will continue to work. As a result, expectations will be tamed and aligned with efficient market equilibria.

For their part, Kay and King look further back to the pre-REH period, when Frank Knight and then Keynes correctly showed that our ignorance of future outcomes is inescapable. As Keynes famously put it in 1937:

“By ‘uncertain knowledge’ … I do not mean merely to distinguish what is known from what is merely probable. … The sense in which I am using the term is that in which the prospect of a European war is uncertain, or the price of copper and the rate of interest twenty years hence, or the obsolescence of a new invention, or the position of private wealth owners in the social system in 1970. About these matters there is no scientific basis on which to form any calculable probability whatever. We simply do not know.”

The shockingly unanticipated Global Financial Crisis of 2008 brought this insight back to the fore.

The renewed relevance of Keynes’ economics reflected its core teaching: a monetary market economy cannot be relied on to generate full employment. This lesson emerged from the central position Keynes gave to the fragility of the expectations on which investment decisions are made. In 2008, investment expectations were smashed: such a massive market failure called for equally massive offsetting interventions by state institutions. Even Lucas conceded that, “Everyone is a Keynesian in a foxhole.” As Kay and King write:

“The advances in economic theory lauded by Lucas did not prevent a major downturn in the world economy, nor did they give policymakers the tools they required to deal with that downturn. The models he described assumed a stable and unchanging structure of the economy and could not cope with unique events that derived from the essential non-stationarity of a market economy.”

As the discipline of economics has evolved since the shock of 2008, Keynes’ theoretical stance with respect to inescapable uncertainty versus manageable risk is gradually being recognized to be as relevant as the policy prescriptions derived from his macroeconomics.

The central question remains: Where can we find guidelines for mitigating the consequences of radical uncertainty? What basis is there for purposive action in the face of “We simply do not know”?

I see three paths forward. The first two are defensive, and the third is proactive. All three reject an exclusive focus on efficiency in the allocation of resources. Thus, they stand outside what remains the dominant paradigm of mainstream economics.

Cash and Control

The first path is “cash and control.” This represents a toolset for hedging uncertainty in my own professional domain of venture capital, but its uses have been broadly recognized across the spectrum of financial institutions and markets.

I first came to appreciate radical uncertainty as an aspiring venture capitalist some 40 years ago. I had been prepared for what I would encounter while earning my doctorate in economics at Cambridge, under the supervision of Richard Kahn, Keynes leading student and intellectual executor.

As I recount in Doing Capitalism in the Innovation Economy, I learned a hard lesson when I led my VC firm’s investment in an emergent life-sciences company, Bethesda Research Laboratories (BRL). Owing to failures of management by the founders, as well as failures of governance by other investors and directors, I was forced to launch an operation to save our investment. Despite all the due diligence we had done to understand the company’s technology and potential markets, we discovered that we had invested in ignorance.

Reflecting on the experience decades later, I asked: “Could we … have hedged against our necessary ignorance?” The answer was yes, but if and only if markets were complete and we could have purchased precisely those kinds of securities that would have paid off in the unique situation in which we had found ourselves. However, as Kay and King document in exhaustive detail, markets can never be complete. So, with the benefit of hindsight, I improvised a retrospective hedge that later became the basis for my strategy of cash and control.

At the micro level of the VC investor, cash and control means that, when bad things happen, you will have unequivocal access to the cash you need to buy the time needed to understand the problem, and sufficient control to change the parameters of the situation. In the case of BRL, my partners and I had privileged access to more than enough cash from our institutional-investor clients (whose investment we were powerfully motivated to protect). But to obtain full control of the company, we had to use that access to prevail against other VCs and the founders – an arduous exercise.

The availability of cash and control is obviously context-specific. During the recent Unicorn Bubble, which had been inflated by years of ultra-loose monetary policies, cash was so abundantly available to entrepreneurs that maintaining control had become almost impossible. The balance of power had shifted to founders, many of whom secured entrenched control through ownership of super-voting shares.

This dual-class stock structure had jumped from the world of family-controlled media companies to Silicon Valley, starting with Google’s first venture funding in 1999. That deal was blessed by the two leading VCs of their generation: John Doerr of Kleiner Perkins and Mike Moritz of Sequoia Capital. In the years that followed, every entrepreneur aspired to the status of Google founders Sergey Brin and Larry Page. Most notably, Facebook’s founder, Mark Zuckerberg, followed directly in their footsteps.

The cost of accepting these terms was soon dramatized through public battles – at the board level and in the courts – to force out founders at Uber and WeWork. And now that the normalization of monetary policy has ended the Unicorn Bubble, cash and control again stands as a relevant guide for venture capitalists.

Market Power and Mercantilism

Beyond the world of startups, in the heart of the corporate economy, one major source of control is market power, or what the investor Warren Buffett famously described as a company’s “moat.” As he explained at Berkshire Hathaway’s 1995 annual meeting:

“What we’re trying to find is a business that, for one reason or another – it can be because it’s the low-cost producer in some area, it can be because it has a natural franchise because of surface capabilities, it could be because of its position in the consumers’ mind, it can be because of a technological advantage, or any kind of reason at all – that it has this moat around it.”

Since then, a substantial body of academic literature has emerged to theorize and quantify the observable increase in market power across industries, especially in the United States. Market power – and the monopoly rents that follow – confers an ability to self-insure at scale. Hence, the four most successful companies in the world, each backed by venture capitalists in their early years, tend to hold massive amounts of cash and short-term marketable securities. As of March 31, 2023, Alphabet’s (Google) holdings were $115 billion, Amazon’s were $69 billion, Apple’s were $56 billion (plus $110 billion in marketable long-term securities), and Microsoft’s were $104 billion.

Having accepted radical technological uncertainty in the development of novel products and services, along with radical commercial uncertainty about whether there were customers for their innovations, these companies have refused to accept any financial uncertainty.

The same pursuit of strategic financial autonomy also led Jamie Dimon to construct the “fortress balance sheet” that gave JPMorgan – perhaps alone among global banks – the means to survive the 2008 global financial crisis without emergency government assistance. Similarly, East Asian countries responded to the destruction wrought by the International Monetary Fund in the late 1990s by adopting aggressively mercantilist policies. By boosting current-account surpluses and reserves, they achieved cash and control, and thus robust financial security.

There is a good reason why such policies are called “protectionist” – whether they are implemented by means of an undervalued currency or through legislated tariffs and subsidies. They certainly serve the economic interests of those who export at the expense of the mass of consumers (who in turn suffer at the margin from the adverse shift in the terms of trade). At the extreme, they threaten to unleash the sort of trade wars that contributed to the Great Depression.

But the rhetoric of free trade masks the pragmatic political economy of international commerce. As Friedrich List observed 180 years ago, “Any power which by means of a protective policy has attained a position of manufacturing and commercial supremacy can (after she has obtained it) revert with advantage to a policy of free trade.” One is reminded, here, of Great Britain in 1846 or the US in 1945.

Holding cash reserves that are excessive in normal times and pursuing policies that will generate such reserves over time are both deviations from the efficient ideal. As economists have grappled with the reality of incomplete markets, self-insurance with uncommitted cash has increasingly been recognized as “rational,” though it comes with a visible cost.

Investing in Resilience

That brings us to the second path: investing in resilience by strategically allocating more capital than optimally efficient production chains would seem to require. Kay and King themselves emphasize the necessary trade-off between efficiency and resilience.

The Covid-19 pandemic laid bare the fragility of extended supply chains. Production networks that were optimized to minimize the deployment of working capital quickly collapsed as efficiency was revealed to be the enemy of resilience. And this happened just 12 years after the global financial crisis demonstrated that the efficient allocation of capital in the banking sector had radically reduced the financial system’s resilience.

Resilience in the banking system requires levels of capital that are excessive when measured against “normal” financial conditions, just as resilience in production systems turns on the maintenance of buffer stocks and alternative sources. In either case, the time series of data that define what is “normal” and what constitutes a statistically quantifiable deviation are misleading guides to unforeseeable shocks – the Fukushima tsunami, the Covid-19 pandemic, the Russian invasion of Ukraine, and so forth – that can stress the system beyond its capacity.

Working capital represents a firm’s investments in inventories and in the accounts receivable owed by customers who have not yet paid for their purchases. Firms do not control the level of their receivables, but they can decide to self-insure by holding more inventories than historical trends suggest are required to support current and planned levels of production. The necessary reduction in the realized return on capital is the price of this insurance. 

That said, contrarian behavior also can be punished. In financial markets, the literature on “the limits of arbitrage” has shown how liquidity on the right-hand side of an investor’s balance sheet (where the liabilities that finance asset holdings are listed) enable bank runs and constrain how long a manager can bet against the market. Berkshire Hathaway’s structure as a closed-end fund meant that Buffett could choose to sit out the great tech bubble of the 1990s without any risk of losing his funding base. The growth in private equity in recent decades has vastly expanded Buffett’s model.

The typical firm may not have this luxury. If its contrarian behavior reduces short-term financial performance, it could invite the attention of activist hedge funds or a determined acquirer. For the operating firm as for the investment manager, the crucial question is: “How long can you afford to be wrong?” Acquisition by private equity offers corporate managers insulation from such threats, at the expense of definitively transferring control to the new owners.

Toward a New Mesoeconomics

Taking production-network fragility seriously opens the door to a strategic extension of the economics discipline. From the classical economics of Adam Smith and David Ricardo through the marginalist economists of the late nineteenth century, whose mathematics paved the way for modern neoclassical economics, the discipline has been practiced as a bimodal subject.

While microeconomics addresses the behavior of individual agents (firms, consumers, workers, investors), macroeconomics addresses the behavior of aggregates (as measured by gross national product, gross domestic product, national income, and so forth). But the space between has largely been neglected.

Against the grain, there are two great economists who concerned themselves with this intermediate domain. One was the Soviet-American Nobel laureate Wassily Leontief, who constructed the first input-output tables to illustrate the flow of goods from primary resources to final output.

Today, the US Bureau of Economic Analysis produces national input-output tables on an annual basis, but these are necessarily static and backward-looking. They report on the changed structure of the economy, but they do not provide the theoretical framework and empirical information necessary to understand how shocks propagate through the system and how the economic attributes of different sectors interact dynamically.

Then there was the Italian economist Luigi Pasinetti, whose Structural Economic Dynamics sought to illuminate how the distinctive elasticities of demand and supply, with respect to price and income (along with industry-specific productivity growth), could animate a model economy. But Pasinetti’s work was purely conceptual, lacking both the data and the relevant mathematical tools to be operationalized.

Now that the digitalization of economic life and the availability of relevant computational resources have made operationalizing mesoeconomics possible, an international team of economists with a hub at Cambridge is picking up where Pasinetti left off. By looking out to the frontier of firm entry and exit and financial dependencies between market participants, this wide-ranging research program incorporates both theoretical and empirical advances in the analysis of networks.

Mesoeconomics promises to deliver guidelines for identifying and evaluating potential points of failure and channels of propagation, calling attention to where investing in resilience is likely to be more necessary and effective. The relevance of this approach is underscored by ongoing debates about the causes, nature, and alternative responses to inflation. Is it primarily the consequence of too much macroeconomic demand stimulus or of sector-specific supply shocks? How can we parse the complex interactions between shocks on both the demand and supply sides of the economy?

An alternative, comparably strategic use case is mapping the dependencies entailed by industrial-policy initiatives. For example, any effort to reconstruct a high-tech manufacturing base in the US will encounter many bottlenecks, and the responses to these will generate feedbacks that can mitigate the downstream consequences. Applied mesoeconomics can help anticipate where enabling co-investments should be targeted.

Of course, even when the network externalities of a complex, dynamic production system are visible, their evolution will be influenced by reflexive interactions and significant innovations along the supply chain. The outcome of these forces will necessarily remain uncertain. But the fact remains: it is both appropriate and necessary to maintain working capital above what one would need in a hypothetical, optimally efficient production system.

Experimentation and Innovation

The third path forward begins by recognizing that innovation, by definition, confronts radical uncertainty. As I wrote in Doing Capitalism:

“The innovation economy begins with discovery and culminates in speculation. Over some 250 years, economic growth has been driven by successive processes of trial and error and error and error: upstream exercises in research and invention and downstream experiments in the new economic space opened by innovation. Each of these activities necessarily generates much waste along the way: dead-end research programs, useless inventions and failed commercial ventures.”

If the lowest-risk, most efficient allocation of capital dominates, the necessarily costly process of experimentation will not be undertaken. Nor will innovations with transformative potential be realized.

Experiments are how we map the contours of the unknown. In the VC world, every startup is an experiment, and most fail. Competition in the market economy liquidates the failures and confirms the winners. Without such “Schumpeterian waste,” the persistent, cumulative upward drift in productivity and living standards would not occur.

When scientific discovery supplanted mechanical tinkering as the basis for productive innovation in the late nineteenth century, the necessary research funding came from the giant corporations spawned by the Second Industrial Revolution (which gave us railroads, electrification, and mass production). Whether they owed their market positions to formal agreements with the federal government (AT&T), patent monopolies (RCA and Xerox), or a combination of innovative research and commercial dominance (DuPont and IBM), the leading corporate laboratories could afford to invest upstream in the basic science from which commercially significant technological innovations might evolve.

By allocating their monopoly profits to scientific research and development, these corporations extended their market power while also serving a larger, social purpose. But their market positions proved transient. Within the space of a generation, the monopoly profits available for funding R&D came under growing pressure, and the great tech companies of the post-World War II era succumbed to the forces of Schumpeterian creative destruction and federal antitrust enforcement.

Moreover, this trend was reinforced by the pressure to maximize shareholder value. Following a 1982 regulatory change, companies were allowed to reward shareholders through stock buybacks, which became a compelling alternative to investing surplus cash flows in radically uncertain experimentation.

Speculation and the State

The post-war era was also when the US state emerged as the dominant source of R&D funding. While the Department of Defense laid the groundwork for what would become the digital revolution, the National Institutes of Health played a similar role for biotechnology. By the 1980s, a professional VC industry had emerged to dance on the platforms created by the US state.

Long before the creation of the National Venture Capital Association, financial speculation had provided the funding for developing and deploying transformational technologies at scale – from the canals and railroads of the First Industrial Revolution through the era of electrification during the “roaring” 1920s. More recently, the tech/internet/dot-com bubble of the late 1990s not only funded the physical infrastructure of the internet; it also financed a vast array of experiments in what to do with digital and network technologies. Among the offshoots of these experiments were early e-commerce and social-media platforms.

Then, the prolonged period of “unconventional” monetary policies (in response to the 2008 financial crisis and then the Covid-19 pandemic) sponsored the Unicorn Bubble. Again, a wide variety of experiments gained funding: some, like machine learning, hold transformational economic potential (for better or worse); others, like instant delivery start-ups, seem destined for the scrap heap of history if they fail to finance their operations from the services they sell rather than from the speculative securities for which there are no longer buyers.

The magnitude of this latest bubble is apparent in the extreme reach of some experiments whose potential success will not come until after the lifetimes of the committed VC funds – as in the case of quantum computing or fusion energy. But when financial speculation is the source of funding for innovation, some investors will win by selling into the bubble before they know whether an experiment has succeeded.

The public sector can also pursue speculative bets on innovation and with greater long-term continuity. Program managers at the Defense Advanced Research Projects Agency (DARPA) are recruited from the private sector for fixed terms, and then empowered to fund projects to address some of the armed forces’ specific needs. With market risk eliminated, DARPA can fund extremely challenging technical experiments. A key to its historical successhas been its mandate to accept failure as a necessary concomitant of experimentation. That success serves as a compelling model for funding the innovations needed to respond effectively to climate change.

In all these contexts, an excessive focus on efficiency in the allocation of resources is the enemy of innovation, and sometimes the enemy of a firm’s survival. The reality of radical uncertainty inverts Cassius’s assertion: The fault, indeed, is in our stars. We are condemned to meet the future as best we can, without any hope of ever finding an optimal path forward. Against the efficient failure, let us value the effective (and necessarily wasteful) success.

 

Project Syndicate

The inner dialogue running through the minds of the most remarkable people.

Ever wondered why certain people appear so confident and assured of their path to success? They seem downright happy -- like they know exactly where they're headed.

Additionally, their success may come from being able to manage conflictwith ease when trouble comes their way; truth is, they're simply more emotionally intelligent than most.

While we have to acknowledge that we're all on different paths with different personality types pursuing different goals, one thing remains constant: the most successful people think differently.

Their daily thoughts help to influence their actions, words, decisions, and ultimate goals. Consider some of the inner dialogue of the most successful people:

1. 'I need to ask for help.'

There's a false belief that successful people don't, or shouldn't, ask for help or advice from others, especially their employees. After all, they're already successful, so they don't really need help, right? On the contrary, researchhas linked people who ask for advice to being perceived as more competent than they are, which is a huge draw if you're a leader of people. The most effective leaders I have studied and coached are emotionally present and ask for help when it's needed. By being real, humble, and emotionally honest -- and giving team members permission to be the same -- teams connect and collaborate better. That's a recipe for good business outcomes.

2. 'I have to focus on the smaller goals to get to that one big goal.'

Successful people focus on achieving those smaller goals to hit their big audacious goals. To hit your own big goal this year and avoid getting overwhelmed or discouraged in the process, do what they do: Focus on knocking one small chunk down at a time, then move on to the next one. As you break the big goal down into smaller chunks, each of those chunks should have its own deadlines. For example, if your big goal is one that will take many months or the whole year to reach, take action now by setting realistic target dates to reach your objectives in the immediate future. In other words, find something you can do this week to begin taking some type of action now for next week or next month. If the overarching goal is to save money, make a budget this week for the following week. If it's to lose weight, develop a plan to commit to losing two pounds the following week.

3. 'If I don't face my fear head-on things will only get worse.'

President Franklin D. Roosevelt famously said, "The only thing we have to fear is fear itself." It's this fear that paralyzes you before you make that super important call, walk on stage for a keynote the first time, or introduce yourself to the girl of your dreams. The anticipation of fear kicks in and you turn to Jell-o. But after you pull it off, you realize you're not in danger and things actually get much better. The solution? Train your brain to accept that there's no threat will help you to switch off the fear response. You'll soon realize that it's the fear of fear that you fear, nothing else. And that will eventually become easy to manage.

4. 'Why am I feeling this angry?'

Emotional intelligence is a strength of many successful people. They realize the reason for their anger may run deeper than what they're experiencing on the surface. They probe, process, do a deep dive, and ask themselves, "What's really beneath my anger?" By stepping back and looking at root causes, you'll soon realize that your anger is really a reaction to whatever is disturbing you, usually something unresolved at the bottom of your pile -- feelings of anxiety, worry, fear of failure, etc. These are the primary emotions you need to deal with as you contemplate how to make payroll when cash isn't flowing. Anger is always the trigger and a secondary emotion. So what's really bugging you? Get honest with yourself after some processing. Then tell yourself with brutal honesty, "The real reason I'm really angry is ... "

5. 'What am I accountable for here?'

Accountability is often demanded from others but rarely from ourselves. It's why accountability tends to get overused and misinterpreted. Instead, it's being responsible, taking ownership of something (good or bad), and communicating honestly with transparency.

6. 'How can I understand this person better?'

The best way to strengthen relationships at work is through more communication, especially with your ears. Successful people intentionally spend more time with their colleagues and customers to learn more about them -- their personal lives, their interests, their goals. This takes the skillful art and science of active listening. You do so by listening intently, with the other person's needs in mind. You listen to the other person's story, searching conversations for depth, meaning, and understanding. The upside for you? You may identify opportunities for deeper connections, business or personal pursuits aligned with mutual interests, and, if you're a manager, opportunities for your employees to contribute more to other projects.

7. 'I need to be willing to listen to feedback on this issue.'

Many successful people choose to cut themselves off from listening, growing, and developing self-awareness--for fear of what they'll hear. It's extremely hard being exposed to ideas, opinions, and constructive feedback from others when you've been operating in an ego system for so long. On the other hand, people who actively listen to various perspectives are the ones who are open, humble, and accountable. They find the facts in order to respond appropriately to serve the needs of others.

8. 'I have to learn this so I can make myself better.'

Successful people are lifelong learners; they never stop learning, and never assume they know everything. That's why they show interest in basking in the wisdom of others. This is what initiates the best conversations -- learning about what other people do, how they do it, why they do it. People love to talk about themselves, and successful people are smart enough to let them! They are the type of people who show up with the humble gesture of "I want to learn from you."

 

Inc

Groanings occasioned by the removal of the fuel subsidy grew louder on Monday as the  Nigerian Labour Congress said it was ready to fight the economic pains and hardship caused by the Federal Government’s decision.

Also, university workers under the aegis of the Senior Staff Association of Nigerian Universities, the University of Lagos chapter of the  Academic Staff Union of Universities, Congress of University Academics and protesting members of the Edo Civil Society Organisations lamented the subsidy removal and it attendant pains. The varsity unions decried the situation, saying the subsidy was ’unintelligently removed.’

National Assistant Secretary, NLC, Chris Onyeka, said the Central Working Committee of the congress would hold an important meeting today and take a position.

He said all issues around the suffering of the masses because of the recent price hike in PMS price would be addressed at the meeting.

“We are going to give the Federal Government an ultimatum. We have given them enough leverage to take care of Nigerians and make amends, but they have refused to make amends. Let them prepare themselves because we are preparing. We are ready to fight back,” he said,

Meanwhile, the Trade Union Congress has faulted plans to allow state governments to roll out palliatives to citizens to cushion the effects of the hardships caused by the removal of fuel subsidy.

President Bola Tinubu had during his inaugural address on May 29 announced the end of the fuel subsidy regime which instantly shut up the pump price of Premium Motor Spirit popularly known as petrol from N165 per litre to N540. The product currently sells for between N568 and N617 per litre.

Speaking on the economic pains brought about by the fuel hikes, National President, Senior Staff Association of Nigerian Universities, Ibrahim Mohammed, in an interview with our correspondent on Monday, explained that no specific progress had been recorded since the fuel subsidy was removed, adding that Nigerians were in anguish and distraught.

He noted, “The government removed the subsidy very unintelligently; now that they have removed the subsidy, nothing has changed except that people can’t feed, we can’t pay our children’s school fees, and people are committing suicide.

“We lamented the way the government handled this idea of subsidy removal; we welcome the removal if that will be the solution to Nigeria’s problems. But the government is not strategic with the removal, you have thrown people into anguish, into the wild forest and people are scampering.”

Elaborating on the impact of the fuel price hike on university workers and students, he said, “Most university campuses are located on the outskirts and people have to commute 15km to 20 km. How can work be done when a full tank can no longer last a week?”

He lamented that the government had yet to settle four months’ salary, stressing that none of its promises had been fulfilled.

Mohammed added, “Salary not reviewed and other promises made by the past government are not being fulfilled. They are owing us four months’ salary; the revitalisation funds have not been paid.

“If they feel the plight of Nigerians and of university staff, they will fulfil all their promises and meet up with the commitment of Earned Allowance and review salaries so that people can face their jobs. All civil servants have been exposed to hardship, so how can they stop corruption?”

Also speaking, Chairman, ASUU, University of Lagos chapter, Kayode Adebayo, revealed that due to the fuel subsidy removal, living in Nigeria was now tough for lecturers as it was for every Nigerian.

He called on the government to galvanise the system and put smiles on the faces of the citizens.

Adebayo added, “All lecturers are paid peanuts; this was part of the reasons we fought against the government about the 2009 agreement. We tried to negotiate; no need to pretend, the situation is still the same. Just as it is tough for ordinary Nigerians, so it is tough for us too.

“Government is responsible for the security of the citizens. The citizen welfare has been compromised. The government needs to put a smile on the faces of Nigerians. Nigerian citizens are hardworking and understanding and that is why we say Nigerians are the most docile people in the world.

“The government needs to look at the plight of the citizens. We have what it takes to build a country that everybody will be proud of, not people who will finish (graduate) here and be looking abroad for greener pastures.”

He also said that the Federal Government was indebted to ASUU, saying it had refused to settle the seven and a half month’s salary incurred when the union members went on a strike last year.

Adedeji Oyenuga of the Department of Sociology, Lagos State University, Ojo, said, “I have been spending more, a lot more. For my children’s car, I bought N7,000 (fuel) per week. The first increment made it N15,000 per week, but now, I do N18,000 per week with no guarantee that it would last the week. I used to fill my car tank with between N12,000 and N13,500 fuel. It rose to about N40,000, but is now N50,000.”

In Benin City, Edo State, citizens took to the streets on Monday to protest the increasing hardships imposed by the fuel subsidy withdrawal which had led to sharp hikes in fuel pump prices as well as an increase in prices of goods and services.

But expressing concern over the planned rollout of palliatives by the states to cushion the subsidy removal, the Trade Union Congress said it did trust state governors to manage the process well.

He was speaking against the backdrop of plans by the National Economic Council comprising 36 state governors and Vice President Kashim Shettima to allow state governments to implement the cash transfer programme for N12million Nigerians using state-generated social registers.

Addressing journalists in Abuja on Monday, TUC President, Festus Osifo, stated that the governors had not been specific about what they intended to do.

He said, “The Nigerians Governors Forum invited us for meetings and we made our case known to them. There is nothing specific about the palliative,  they said each state should go back and look at what they could do. There is nothing concrete, there is nothing we can hold them accountable for.

“If you are coming out to say each state should pay a certain amount of money as wage award or each state should give some categories of workers tax relief, we can hold you accountable on that and not say each state should go and do according to their purse. That is not it. What they must bring to the table must be specific and measurable and must be done transparently.’’

Continuing, he noted, “For us, anything called palliative must be things we can verify and not something that you will promise us and at the end of the day you will not implement. We all remember during Covid-19 when palliatives were in warehouses and people were dying on the streets.

“We do not trust the process. The Governors’ Forum should do better. They are talking about mass transits, how many are they bringing up, let them tell us and we will empower our state councils to follow up.“

Condemning the hike in tuition fees, he cautioned the government against any policy that could render workers’ salaries useless.

He added that the student loan, which according to him had stringent provisions,  should not be a yardstick to increase tuition fees.

Osifo said, “Also, we understand that our tertiary institutions are in a sorry state. We call on the government to be mindful of policies that would erode the take-home pay of Nigerian workers by introducing all manners of tuition fees from the Unity Schools to tertiary institutions.

‘’We understand there is a student loan but if you look at the provision of the law, students of any household where the parents are earning the N30,000 minimum wage cannot qualify for it. It clearly shows they are not willing to give the loan to anybody. There are other stringent conditions attached to it. For us,  this should not be a yardstick to start increasing fees drastically.“

Osifo further rejected the proposed 7.5 per cent Value Added Tax on diesel, adding that affiliate unions had been placed on alert to monitor the activities of the government in that regard.

He said, “We also say no to the proposed 7.5 per cent VAT on AGO. It has been deregulated and the market forces are what determine the price. Today, if you introduce the VAT on AGO,  we should be ready that this similar VAT will be introduced to PMS.

“As of today,  they are listening but we have communicated with some of our affiliates that are directly responsible for this to continuously monitor if the government wants to introduce this through the backdoor.”

He also called on the government to ensure that the planned increase in electricity tariff does not see the light of day.

He warned that Nigerians’ endurance level was getting to the limit, advising the government to be mindful of the timing of some of its policies.

“You will be adding salt to people’s injuries if you increase the electricity tariff. Nigerians’ endurance level is getting to the limit. It may get to a point that Nigerians would not be able to take this anymore.  When you are bringing about policies even when the policies are the best, you must look at the timing and how to phase them out for you not to make the citizens suffer,’’ the labour leader cautioned.

While commending the president for suspending the proposed excise duty on telecommunications in the country, he called on the president to scrap it.

He also called on the National Assembly to remove the item from the Finance Act.

Osifo, however, called on the government to come up with policies that would support the country’s exchange rate.

 

Punch

Civil Society Groups flooded major streets in Benin City, Edo State on Monday, to protest the recent increase in price of petrol and nationwide hardship.

The groups under the aegis of the Edo Civil Society Organisations lamented the high cost of governance exhibited by politicians, at the expense of the poor Nigerians.

According to the groups, the federal government ought to have provided palliatives that would cushion the pangs of fuel subsidy removal before implementing it.

Recall that the Nigerian National Petroleum Corporation Limited, last Tuesday, increased the prices of petrol to N617 per litre in Abuja, while other places like Lagos are selling at N550 above.

In his inaugural speech, President Bola Tinubu had declared an end to subsidy of fuel, and this jerked the litre of petrol from N197 to above N500 across the country.

Tinubu, in his bid to ameliorate the sufferings of Nigerians, proposed to give N8,000 to 12 million households for six months, a measure that was suspended after a barrage of criticisms.

Reacting to all of these, the protesters took to the streets in Edo, carrying several placards bearing different captions like ‘FG Fix Our Refineries’, ‘Kill Corruption, not Nigerians’, ‘Poor Nigerians Lives Matter’, ‘We Say No To Constant Increment In PMS’, ‘How Did NNPCL Become Fuel Price Requlator’ ‘N8,000 Palliatives, and ‘What An Insult’ among others.

Nigerians are faced with hardship currently as the increment in the prices of petrol has adversely affected the cost of living including transportation, food, and other goods and services.

 

Daily Trust