What we’re reading (1/14)
“Wage Inflation Has Arrived In A Big Way And Jamie Dimon Says CEOs ‘Shouldn’t Be Crybabies About It’” (CNBC). “Shares of JPMorgan fell more than 6% on Friday after the bank said that expenses will climb 8% to roughly $77 billion this year, driven by wage inflation and technology investments. Higher expenses will likely push the bank’s returns in 2022 and 2023 below recent results and the lender’s 17% return-on-capital target, according to CFO Jeremy Barnum.”
“Pandemic Profits Begin To Ebb At America’s Biggest Banks” (Wall Street Journal). “Banks have enjoyed unparalleled growth during the pandemic, buoyed by a deal-making boom, market volatility that supercharged trading arms and a housing market that made mortgage lending more profitable than ever. At the same time, the doomsday scenarios that banks girded against in the pandemic’s early days never materialized, which freed up additional profits. Bad loans remain near record lows, and consumer and commercial customers alike have weathered the pandemic with, on average, plenty of cash on hand. Now, some of the forces that pushed bank profits to new records are starting to weaken.”
“Texas Oil Ponzi Schemes Allegedly Funded Private Jets, Luxury Cars, And A Wedding On The Queen Mary” (Gizmodo). “A wedding on a cruise ship, investments in the jade industry in Guatemala, and a private jet: Those are just some of the things investors who thought they were getting rich in the oil industry paid for instead. Two Securities and Exchange Commission lawsuits filed last month against Ponzi-style scammers selling fraudulent investments in the biggest oilfield in the U.S. show how the American oil and gas boom really is the Wild West.”
“Bridgewater’s Return To Co-CEO Model Rekindles Management Concerns” (Financial Times). “‘I think he’s trying to figure out what to do. He’s either lost his mojo, or just doesn’t want to do it any more,’ said one senior former Bridgewater employee of Dalio. ‘He basically has a firm that is not really structured to be sustainable without him, but isn’t really sustainable with him either.’ The promotion of a youthful former Israeli soldier and a veteran insurance executive to lead what is the world’s biggest hedge fund raised eyebrows in the industry. Nir Bar Dea only joined Bridgewater in 2015, before which he was an adviser to the Israeli UN mission, and an entrepreneur. Although he has an MBA from Wharton in 2014, 40-year old Bar Dea had no experience in finance before starting at Bridgewater, having served in the Israeli Defence Force and risen to the rank of major.”
“The Subversive Genius Of Extremely Slow Email” (The Atlantic). “Every day, the mail still comes. My postal carrier drives her proud van onto the street and then climbs each stoop by foot. The service remains essential, but not as a communications channel. I receive ads and bills, mostly, and the occasional newspaper clipping from my mom. For talking to people, I use email and text and social networking. The mail is a ritual but also a relic. That relic is also the model for a new personal-communication app called Pony Messenger. Think of it as email, if email arrived by post: You compose a message and put it in an outbox; once a day (you can choose morning, afternoon, or evening “pickups”), Pony picks up your outbound dispatches and delivers your inbounds. That’s it. It’s postal-service cosplay. It’s slow email.”
