Category: Decision Making

Buying & Selling a Company, Decision Making, Exit Planning

Times Are Good Now. But What Happens When They Are Not?

Gregory Pearl

The current economic climate is strong, with M&A activity being strong also. But what happens when the economic environment is difficult?  Challenging? Many business owners are thinking of selling in the next few years. What can they expect? Looking back at the activity in the last recession, which was a hum-dinger, gives us a clue. Despite the difficulty of the extremely challenging environment the last time around, business sales still happened. Activity was slower, deals were harder to close.  But still, it did happen. Whatever the economy, some baby boomers will want to retire. Some younger people will want to…

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Alternative Investments, Decision Making

Technology Trends in the Investment Management Industry

Gregory Pearl

Alteris LLC tracks trends in our client’s industries.  We work with firms in the Investment Management or Asset Management industry and therefore track trends there. Many firms in the Investment/Asset Management industry are experiencing substantial pressure on their margins and profitability. A factor pressuring cost reductions is consolidation among firms in the investment/asset management industry.  This started before the pandemic and continues.   Some industry observers expect that up to 20% of the mutual fund firms that are independent today will be acquired or go out of business in the next five years.   This consolidation will largely impact smaller firms. The…

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Decision Making

Survivor Bias is Everywhere

Gregory Pearl

Survivorship Bias is one of the most deceptive and common traps in decision making. It’s normal to examine the life stories of very successful people.  Not only is it interesting by itself, but maybe we think that there is something to learn about success from them. If they are successful, maybe we can imitate them? The concept of survivorship bias is easy to understand but maybe not intuitive.  Still, when a person does understand, it seems to be almost everywhere.  That’s because it is. There are so many examples. It’s very common in advertising.  Weight loss programs and diets feature…

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Alternative Investments, Decision Making

Consumer Products Industry Trends

Gregory Pearl

Companies in the consumer products industry are developing newer and bolder strategies to execute with the environment of a more stable US and worldwide economy. Among the latest trends are: Globalization continues. Companies that have the resources will try to capitalize on growth in emerging markets and seek opportunities to acquire or partner with companies to enable access to consumers, leverage marketing and access sources of raw material.  In particular, emerging markets represent a growth opportunity.  We believe this will remain true regardless of individual national efforts to protect markets or create trade barriers or the implementation of industrial policy…

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Alternative Investments, Decision Making

Business Services Industry Trends

Gregory Pearl

The business services industry consists of a very broad variety of services sold to other businesses. Companies from this sector help other firms focus on their core competencies.   These companies help benefit others by increasing their operating efficiencies and avoid spending resources on what is not the most important to them.. Business services companies provide support to other businesses, such as office administration, hiring and of personnel, security services, telecommunication,  travel,  cleaning and maintenance, waste disposal and so on.  The USA and Europe are the primary markets for these types of services. USA business services consists of about 400,000…

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Alternative Investments, Decision Making

Bank of America says “The greatest bubble in history is popping.” How did this happen?

Gregory Pearl

Obviously I’m not the only one that has noticed the bubbleistic traits of cryptocurrencies. Clients have been asking my opinion too.  So here goes. The Bitcoin cryptocurrency is tracking the downfalls of the other legendary asset-price bubbles in history. In less than one year since its record high.  This is what Bank of America Chief Investment Strategist Michael Hartnett wrote to his investors on Sunday. I’ve written before about the dangers of the more-or-less average (yet affluent) retail investor participating in this market. Average meaning less than, say, a few million in investable assets. The cryptocurrency has fallen more than…

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Decision Making

Warren Buffett just released his annual shareholder letter (Feb 2018). Here is my take-away.

Gregory Pearl

Here are some highlights (what I think are highlights, others may focus on other items) from Buffet’s usually iconic annual letter to shareholders. Last year was an eventful one for Warren Buffet.  A succession plan may be in the process of being implemented as two individuals were promoted to vice chairman in January 2018.  Natural disasters harmed the insurance business.  Plus, perhaps most importantly especially for the economy at large, Buffet joined with Amazon and Chase to start a health care program for employees. The new tax reform bill passed by congress helped Berkshire Hathaway in the last part of…

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