Many questions on this topic from our Tekedia Institute learners. Very happy to share publicly here. During Live class on Saturday, I will discuss in detail via a presentation titled Investment Portfolios and Personal Economy, and next week, we will deepen the lecture with scenario mapping.

Yours truly will wear his ex-banking cap and doctorate in banking & finance over the next two weeks. After that, we will return back to engineering.

#PersonalEconomy with Tekedia Mini-MBA

Comment on Feed

Comment: I have followed most of your postings on SVB and I think it can be added that as rates rises, future bonds cash-flows are discounted at higher rates which will make the price fall (hence the inverse relationship between bonds and interest rates) Also, the bank could have hedged their interest rates risk; when rates are rising, the ideal thing to do is to shorten duration. The market had expected Fed to raise rates long before they started to raise. I wonder what the bank’s asset & liability management were thinking-betting on fed not raising rates? Anyway just thought I should add that Keep up the good work

My Response: Great point but note another thing happened: startups were not raising money and decided to draw down from their money in the bank. That pushed SVB to look for capital, triggering the need to sell bonds before they could have liked to sell to boost liquidity. If the startups had not requested for their money, SVB would have just waited for a better time to sell.

On that video, I had a minor “mis-spoke” there. On the bond rate, I would have said bond price, not rate, on a sentence there.

The question of leadership invariably surfaces in virtually all forms and levels of human organisation. However, in corporate management, leadership goes pari passu with a functional management structure. The intersession of leadership and management informs strategic leadership. Strategic leadership encompasses the responsibility of the senior executives which involve making board, long-term plans and directing the organisational resources.

Strategic leadership has been defined as a practice in which ‘’executives use different styles of management to develop a vision for their organisation that enables the organization to adapt to or remain competitive in a changing economic and technological climate’’. Strategic leaders are able to use this vision to motivate employees and departments, fostering among them a sense of unity and direction in order to implement change within their organisation.

The inability to bring leadership together with good management technique has been largely responsible for the failure of many businesses. According to a report by Small Business Administration cited in investopedia.com, the most common reasons small businesses fail were due to lack of effective management system followed by lack of funding, inability to retain talents faulty business model, unsuccessful marketing initiatives etc. Even where funding and talents seem not to be the problem, some businesses have failed solely due to poor management of financial and human resources.

From the first industrial revolution to the fourth, corporate leadership has engendered new meaning impacted by socio-economic changes. Across periods of human evolution, the economic mode of production and the social relations of production have changed, and businesses and entrepreneurs have had to change or refine their leadership and management models at one point in time or another.

The continuing technological revolution and the increasing globalization of business and economic activity does not only cause intermittent market disruptions across ages but also dictates particular leadership and management style necessary for a firm to adapt to a new competitive landscape.

In the last twelve decades, corporate leadership and management have transitioned from ‘’command and control’’ approach to ‘’people-centric’’ model, and now managers have increasing demand to develop tech-skills and the capacity to transform in the cloud. Also, from the great financial crisis of 2008 to the outbreak of Covid19 pandemic in 2019 the global economy has been on its transition from web2.0 to web3, and corporate leadership has been centred on digital-data and blockchain.

Generally, business survivability and sustainability has been associated with the type of leadership and the management structure featured by the business relative to time. Therefore, strategic leaders are expected to be flexible and broadminded with regards to the design and implementation of the management structure.

This may be a time to pause that vacation or the purchase of that extra “goody”,  and focus on things which are absolutely necessary. Indeed, from the way things are looking, the world’s economy seems to be catching a bad cold. When Apple, Facebook and the broad banking sector are optimizing their workforce and expense lines, do not think they are guessing. Yes, data drives those decisions, and that data is sending a clear message: expect an economic reverse in months.

They say in natural philosophy that actions and reactions are equal and opposite. In socio-economic philosophy, that seems to also be the case, except that the reactions take months and years to show up. When your action is pumping economies with cash (excessive money), one day, you will get a reaction. We’re possibly getting close to that day.

#plan because the global economy is catching a bad cold.

Understand that planning could be as simple as scheduling a time with your bank account officer. S/he goes through your incomes, expenses, etc and develops a model. Sure, banking in Nigeria does not include that. But if you are in the US, call your bank. They offer those services for free. By having a bank account, you can get many advisory personal economy services for free.

U.S. stocks fell Wednesday, with the Dow Jones closing nearly 1% down, as the shockwaves from the collapse of Silicon Valley Bank reverberated around the world. Credit Suisse, one of Europe’s biggest banks, saw its stock drop more than 20% amid a flurry of withdrawals and a refusal by its largest shareholder to provide more funding. That in turn dragged down some major U.S. banks: Citigroup slid 5.4%, JPMorgan Chase 4.7% and Wells Fargo 3.3%. Midsize U.S. banks have also been impacted. First Republic’s credit rating was downgraded by four notches. (LinkedIn News)