miércoles, 30 de noviembre de 2016

Great Tech Entrepreneurs: Steward Butterfield




Great Tech Entrepreneurs:
Steward Butterfield

Steward Butterfield[1] (born 1973) is a Canadian entrepreneur and businessman, co-Founder of the photo sharing website Flick[2] and team messaging application Slack[3]. At age 5, his family moved to Victoria. A few years later, the Butterfields got a computer, which Steward fell in love with. He learned how to code, and at college made money designing websites. He is a Master of Philosophy from the University of Cambridge, specializing in the philosophy of biology, cognitive science, and philosophy of the mind.
In 2002, he co-founded Ludicorp in Vancouver with his wife Caterina Fake and Jason Classon. Ludicorp initially developed a massively multiplayer online role-playing game called Game Neverending. The game did not launch, but the company then started a photo-sharing website called Flickr. Filckr is a Social Media Network, that is designed for Sharing, Organizing, and Enjoying Photos. Flickr is the best way to share pictures, organize your photos adding tags, locations and descriptions. However, it is not the only one. In March 2005 Ludicorp was acquired by Yahoo!, where Butterfield continued as the General Manager of Flickr until he left Yahoo! on July 12, 2008. By incorporating Flickr, Yahoo! ensured itself a part of the photo sharing business.
After leaving Yahoo!, he founded a startup called Tiny Speck, which built a game called glitch. The game didn't take off, but Butterfield managed to create a communication tool he and his team had built to chat. He called this product: Slack. It grew so fast that he managed to get USD 340 million into a young company valued in 2.8 billion USD valuation. Today, Slack has 1.25 million daily active users, + 230 employees and 35 million USD in annual recurring revenue. Slack is changing the way we work[4] by software that helps groups of co-workers exchange instant messages and swap electronic files. It is the fastest-growing business application of all time.
Times have definitely changed. Who would bet on a philosopher to lead a tech company to the Top? What did philosophers do in the past, except for starving to death? In the article "That useless liberal arts degree has become Tech's Hottest Ticket"[5], we learn that software companies are discovering that liberal arts thinking makes strongest players. The creativity of the philosophers cannot be programmed. Let us TRUST Steward Butterfield's WORD: "I learned how to write really clearly. I learned how to follow an argument all the way DOWN, which is invaluable in running meeting. And when I studied the history of science, I learned about the ways that everyone believes something is true - like the old notion of some kind of ether in the air propagating gravitational forces - until they realized that it wasn't true.
Revolution 4.0 brings back the Age of Enlightment[6], an intellectual movement which dominated the world of ideas in Europe in the 18th century. This era included a range of ideas centered on reason as the primary source of authority and legitimacy, and came to advance ideals such as liberty, progress, tolerance, fraternity, constitutional government, and separation of church and state. Today, thanks to the Age of Information[7], data is close at hand. Before, Knowledge was difficult to access. But now it is at the tip of your fingers. Read a lot, watch videos, buy some books (physical version will always exist, regardless of digital versions), increase your level of culture and education in your free time. Learn as much as you can, but most important, get to KNOW THYSELF to unleash the full power of your CREATIVITY. And thy shall be... ENLIGHTENED!!!


Cristian Bøhnsdalen
CMO/CFO & Co-Founder @ITRevolusjonen


Publicado por en No hay comentarios:
Etiquetas: , ,

martes, 29 de noviembre de 2016

Great Tech Entrepreneurs: Larry Page & Sergey Brin



Great Tech Entrepreneurs:
Larry Page & Sergey Brin

Larry Page[1] (born March 26, 1973) is an American computer scientist and an Internet entrepreneur; Sergey Brin[2] (born August 21, 1973) is a Russian computer scientist, internet entrepreneur, and philanthropist (who moved to the US at age 6). He earned his bachelor's degree at the University of Maryland. He then moved to Stanford to get a PhD in computer science, where in 1995 he met Larry Page who would become his Co-Founder at Google[3]. The Economist has referred to Brin as an "Enlightenment Man", someone who believes that "knowledge is always good, and certainly always better then ignorance", a philoshophy that is summed up by Google's mission statement "Organize the world's information and make it universally accessible and useful", and an unofficial motto, "Don't be evil".
They had a dream of downloading the whole web. At that point the most famous Search Engine was Altavista[4], which did not provide orderly or proper results. Page and Brin run experiments by creating large datasets to look for patterns and better ways to search. They found a great formula, and came up with the name Google. Google had a different algorithm and helped the users explore the Wide Web, differentiating themselves from other Searchers. Google caught the attention of Venture Capitalists, who invested to take the project off the ground. They then came to an agreement with NetScape, which drove traffic into Google. They hired the best engineers they could get hold off. However, as always in Tech industry, monetization was a challenge. It was not so important at this stage, since the most important was to continue building the business and the brand. The homepage was designed by Sergey Brin and focused on the user-experience, and was built for speed. They were against advertising to keep the experience "clean". Eventually they had to accept some advertising to create revenue. Instead of pop-ups or flashing ads, they displayed the ads above and next to the search results in what they called "Google Adwords".
By the year 2000, Google was one of the largest Search Engines in the world. The VCs wanted a professional CEO and selected Eric Schimdt[5]. Page and Brin took positions as Presidents. Google kept spectacular growth while the other Search Engines faded. Google had millions of back-links to Websites and partnered with AOL to get even more customers. It went public in 2004, with an outstanding 23 billion USD valuation. Additional services were added, such as Google Maps, Google News and Google Earth.
YouTube began a as home page to display and search for videos. Google had a similar concept: Google Video, but it was too slow. Google understood that video was going to be a dominant for of content for the Media, and acquired YouTube for 1.65 Billion USD. Google also acquired a small company with software for cell-phones: Android. In this way, Google secured an open door into the mobile business. Google's main competition became Microsoft. From Browsers (Google Chrome vs. Internet Explorer), to online Softwares to process spreadsheets, participation in the mobile business (Android vs. Windows Phone), etc.  In a turn of direction, Google Street View[6] appears as an attempt to register every corner on Earth and include it in a unique database. The idea of diversification comes from the fact that Google is getting 95% of it's revenue from advertising. Google TV brings everything you love about the Web, to your Television. It is an attempt to deliver Online content to the TV set.
Google has changed the world by making information more accessible. The information has always been there, but by compiling it, making it easier to find, filtering and understanding it, it has made search much more efficient. Before, if you wanted to read a book, a newspaper, a magazine, you had to buy it at your local store. Now, all of this information can be accessed by the click of a mouse. The way we study, the way we work, the way we connect has changed drastically in the last decade. The Web presents itself as an infinite source of knowledge, which we have not yet learned to capitalize. Before, information was scarce. Now, it is too abundant. The Rise of Big Data refers to data sets that are so large or complex that traditional data processing applications are inadequate to deal with them. Google presents us an excellent example of the billionaire business of compiling information. If you wish to learn more about the "NeXT Industries", refer to my 4th Book "Where No Man Has Gone Before: the Road to the Fourth Industrial Revolution".


Cristian Bøhnsdalen
CMO/CFO & Co-Founder @ITRevolusjonen




Publicado por en No hay comentarios:
Etiquetas: , ,

Great Tech Entrepreneurs: Elon Musk




Great Tech Entrepreneurs:
Elon Musk

Elon Musk[1] (born June 28, 1971) is a South African-born business magnate, investor, engineer and inventor. He is the founder and CEO of Space-X[2], Tesla Motors[3], SolarCity[4] and founder of X.com, which merged with PayPal[5]. He has today an estimated worth of USD 11.5 billion and is the 83rd wealthiest person in the world. He intends to change the world and humanity, including reducing global warming through sustainable energy production and consumption, and reducing the risk of human extinction by making life multi-planetary and setting up a colony on Mars. They call him the "Real Iron Man", but he sounds more like Superman to me!!!
He was born in Pretoria, South Africa, son of a Canadian model and a South-African mechanical engineer. As a kid, he spend his time reading comics books, encyclopedias, etc. He has a photographic memory and can remember everything that he SEES. He took computer classes but was very much ahead of the teacher, so it was not worth it. He taught himself how to program and sold the code for a BASIC-based video game he created called Blastar. Elon Musk got a place at Queen's University in Kingston, Canada (where his mother is from), and then transferred to University of Pennsylvania, US, where he got his Bachelor of Science degree in physics. He then got a Scholarship to go to Stanford, but decided not to attend. He dedicated himself to create the first online City listing, together with his brother. He basically "transferred" the Yellow Pages to an online version and called the project Zip2[6]. In 1999, his company was bought for 307 million USD in cash and 34 million in Stock options.
At age 28, he joined the club of Silicon Valley millionaires. Instead of retiring Musk went into another project, a revolutionary one: PayPal. It became the leading payment system in the world, and was finally acquired by EBay for 1.5 billion dollars after only 2 years. Earth was not enough for him. With the idea that the private sector can energize Space Travel, in 2002 he established SpaceX[7], which he financed himself. It's goal is to manufacture vehicles, primarily rocket technology. The aim is to reduce the cost of space flight and the cost of expanding human life beyond Earth. He also established SolarCity[8], becoming the largest solar energy provider in the US. But Elon was much more ambitious: he wanted to get the world off fossil fuels and into electric cars. In March 2004, he launched Tesla Motors[9]. The goal was to introduce a high-end, high performance car which could be affordable to the general public. It was the first car designed and built in Silicon Valley, where it is easier to get hold-off technological competence than for example in Detroit. One of Tesla's big advantages are the batteries, which were built to last more than any other electric batteries before.
In 2007, Musk achieved an agreement with Mercedes-Benz[10] to provide them with electrical engines. Tesla Motors came up with a customized engine for Mercedes in only 4 weeks. Meanwhile, his company SpaceX was not clearing to deliver rockets to space. At the end of 2008, Space X, Solar City, and Tesla were all in free-fall. Not only that, but the crisis 2008 - 2009 crisis in the US meant a downturn in the automotive markets. Finally, the 4th rocket launched by Space X made it to Space, and the company was rewarded with a 6 billion dollar contract. He reinvested a large chunk of his money in Tesla. A unique concept, Tesla is actually a game changer for other car makers, since it introduces the concept of electric cars in a manner nobody has managed before. In 2010, Tesla went public allowing the company to have capital to launch it's model Tesla Model S[11]. The launch  was a success, and Tesla took off. In 2013, Elon introduced his latest invest invention: the Hyperloop[12]. It is a form of transportation that can send people from San Francisco to Los Angeles in 1/2 an hour by using pressurized tubes.
Elon Musk is a visionary and is working to take humanity to Mars. His goal is to disrupt industries and is one of the most brilliant minds of the century. He was named one of the 75 most influential people in the world by Esquire magazine. Most of his wealth is donated to philanthropic activities. Will his dreams of reaching the stars be fulfilled in this lifetime? How can such a GENIUS exist, especially coming from a 3rd World country like South-Africa? The World of Tomorrow is in full surprise for us, the people of Earth, as we approach the era of Space Exploration. Huge changes await us, the People of Earth, in the NeXT 20 years. If you want to know more, refer to my Release in Amazon: "Where No Man has Gone Before: the Road to the Fourth Industrial Revolution".


Cristian Bøhnsdalen
CMO/CFO & Co-Founder @ITRevolusjonen


Publicado por en No hay comentarios:
Etiquetas: , ,

lunes, 28 de noviembre de 2016

Great Tech Entrepreneurs: Mark Zuckerberg




Great Tech Entrepreneurs:
Mark Zuckerberg

Mark Zuckerberg[1] is an American computer programmer, Internet entrepreneur and philanthropist. He is the CEO and Co-Founder of the Social Networking website Facebook[2]. He is today ranked as the 5th richest person in the world. Mark grew up in the Hudson River are an hour away from New York. As a kid, his favourite sport was fencing. But he soon discovered another passion: computers. He learned programming and networking using home computers, something very typical for kids his age, creating his own version of the board-game "Risk". He was clearly the most clever kid in his class. At age 16, Mark decides to leave his family to attend a prestigious school in Boston. After that, he was accepted into Harvard.
Like most successful Tech Entrepreneurs, he was a loner. The most successful people in the Tech field focus more on their own goals and ambitions than on partying or extending their social reach. They know they will have time for that AFTER they have succeeded. That doesn't mean they are unsociable or don't have friends, but it does mean that it's not amongst their top priorities. At campus, he meets Eduardo Severin[3], a Brazilian entrepreneur and economist who at age 20 already had made some thousands in the stock market.
In 2003, Mark has an idea that will change his life forever. Checking the University campus student database, he comes up with a way to compile all that information in one site, and to make it FUN, he decides to run a beauty contest. To obtain all the information he needed, he hacked the campus server. His first name for his concept was Facemash. He then made available the pictures to all people in the campus, and initiated a "who is hotter contest". The authorities at Harvard where not happy about this, and sanctioned him. He became very popular on campus, attracting the attention two rich kids that did not know anything about programming: Cameron and Tyler Winklevoss[4]. They already had their own concept: "Harvard Connection", with the goal of connecting students at Harvard and also with other Universities in the US. They hired Mark as their programmer, but did not sign him a contract. Mark worked for the Winklevoss brothers but started developing his own Social Network, which he would call "The Facebook". For Financing, he turned to his friend: Eduardo Saverin. Eduardo put up the money in exchange for a % in the company and together they launched "The Facebook". In a few months, the Facebook had expanded to 9 Universities. Mark then dropped out from Harvard to move to Silicon Valley. Eduardo Saverin, on the other hand, preferred to stay in New York to continue developing the Business and finish his University studies.
Mark decided to replace Eduardo with Sean Parker[5], who had created Napster[6]. A party animal, it was very easy for Sean Parker to attract investors. Meanwhile, the Winklevoss brothers heard about the Facebook and noticed that the concept was very similar to the "Harvard Connection". The brothers filed a lawsuit against Mark Zuckerberg. In 2008, Mark came to an agreement with the brothers for 31 million dollars. Eduardo Saverin was then cut out from the Facebook by a financial trick of increasing the capital and liquating his share. Severin came to an agreement and got a 2.5 billion USD package as compensation. Not so bad for a Business kid!!!
A simple guy, in 2011 Mark was worth 15 billions USD but was still renting a small house in Palo Alto, California! At the age of 27, Mark was named "person of the year" by Time magazine. In 2012, Facebook went public, being worth more than 100 billion dollars with 1.35 billion users worldwide.


Cristian Bøhnsdalen
CMO/CFO & Co-Founder @ITRevolusjonen



Publicado por en No hay comentarios:
Etiquetas: , ,

Great Tech Entrepreneurs: Bill Gates




Great Tech Entrepreneurs:
Bill Gates

Bill Gates[1] (born October 28, 1955) is an American business magnate, investors, author and philanthropist. Together with Paul Allen[2] he co-founded Microsoft in 1975. He is one of the best-known entrepreneurs of the personal computer revolution. Gates has been critized for his business tactics, which have been considered anti-competitive. Today Gates is pursuing a number of philanthropic endeavors, donating large amounts of money to various charitable organizations and scientific research programs through the Bill & Melinda Gates Foundation.
As a child, Bill was a curious kid. He always wanted to know more, and he had encouragement from his mom and dad. He was always competitive. Whatever he did he wanted to do it well, as good as the other folks that he was with. He enjoyed High Tech exhibits, he had a natural talent for math and science, but was also becoming a loner, showing signs of pre-teen rebelliousness. He was a smart, brilliant kid, lacking direction. His parents had a good economic situation, so he was sent to the best private prep-school in Seattle. He made a lot of friends and relished academic challenge, and he had a wide breadth of interest. In the beginning of the Space Age, his school happened to be one of the first ones to own a computer. Bill Gates became addicted to the computer, and shared his addiction with an upper classman named Paul Allen. They were very different, and engaged in the endeavor of writing Software. 
By 1970, when Gates was only 15, him and Paul Allen went into Business together. At the age of 17, Bill went to Washington D.C. to work as a Senate page for the summer, where he acquired exposure to politics and government. Upon return, he got a place in Harvard University, to head for a future in the computer world. He was always very focused and knew what he wanted, but his social life was not a priority. Since he was not the number 1 math student at Harvard, he kept his academic options open and picked up some new skills, outside of class. Meanwhile, Paul Allen had moved to Boston for a job. In December 1974, the announcement of the first mini-computer kit "Altair 8800 Computer"[3] marked the arrival of the day of the Personal Computer. Gates and Allen convinced the owner of the small company that they were the ones that could write the Software to run on his little computers. Gates and Allen worked none stop for 2 months, and came up with the "BASIC programming language" (Beginner's All Purpose Symbolic Instruction Code). That moment would change the technology industry forever. At age 19, and together with Paul Allen, they formed: Microsoft[4]. Bill had to drop Harvard to dedicate full time to his new company. 
Microsoft specialized in Software and expanded into new Software Languages: BASIC, COBOL, FORTRAN and Pascal, and Gates and Allen started to expand by selling their line to other computer languages. At the end of 1978 and surpassing 1 million USD in Sales, they moved to Seattle. Gates was in charge of Marketing and approached the customers himself. By November of 1980, IBM[5] approached Microsoft to talk about them coming up with an operating system, for their new line of personal computers. Despite his youth and his looks, IBM quickly discovered that Bill Gates was no amateur: he convinced them that Microsoft could DELIVER their new Software. First, he purchased an existing Operating system which he then adapted for the IBM personal computers calling it: MS-DOS[6]. IBM wanted to purchase the code, but Microsoft refused to give up the rights over the MS-DOS. By not owning the rights to the Operating System, IBM would now have to pay Microsoft a licensing fee for every copy of DOS installed in it's computers. Microsoft then sold the same operating system to smaller companies. 
Microsoft grew so large that by 1983, 30% of all world computers were running Microsoft software. In 1984, Microsoft Windows would become the company's signature program. It bore a resemblance to Apple's Machintosh Operating System. However, Apple was more interested in selling computers that Software. Microsoft took over the Software business by creating an Office package with Applications like Word, Excel, Paint, etc. In 1986, Microsoft was taken public, making Bill Gates a billionaire at the age of 31. In 1990, Microsoft Windows 3.0 was launched, a best seller. Microsoft became almost a Monopoly on Operating Systems for Personal Computers. 
The 1990s found a new industry ran mostly for people UNDER 30. Due to a form of cancer, Paul Allen retired from the day to day management at Microsoft. Fortunately, he recovered and continued his career in the Business World. Gates management style was very demanding, were he kept the creative process churning and sometimes set off heated confrontations. He believed that challenging ideas was required to stay on top in an ever changing industry. At the age of 42, Bill Gates became an Icon of the American establishment. The richest man in the World with a personal Net worth of more than 50 billion Dollars and the member of a power elite, which included figures like President Bill Clinton. Gates is committed to giving away the bulk of his fortune to good causes. 


Cristian Bøhnsdalen
CMO/CFO & Co-Founder @ITRevolusjonen
Publicado por en No hay comentarios:
Etiquetas: , ,

HR for Tech




HR for Tech

The role of HR has varied a lot over the last decades. As explained in my release in Amazon "Change Hard: Why Corporations Rise and Fade": "Human Resource Management (HRM) is the process of managing an organizations' human resources. It is about developing policies, practices and systems designed to influence employee motivation, behavior and performance. In addition to tracking payroll hours and processing benefit forms, HRM has a lot to do with attracting and maintaining a high performing workforce". But what does HR do, besides participating in the Recruiting process? In practice, HR does not really do an employee follow-up. They usually consult with the employees' Supervisors or Managers, who are of course biased and more interested in providing political support to their most loyal employees than to actually value, recognize or promote the best players. Quite the opposite, the best employees will represent a threat to them, and they will do their best to get rid of them. HR should most definitely take more responsibility for employee follow-up, and protect the organization's most valuable players, who will drive change and also add more value in a long term perspective. Instead of taking strange tests and profiles, they should sit down with them and hear the employees' version of the story. Worst case scenario, they can be reallocated to another department.
But who should HR make a bet for? Experience, experience, experience (three times), is a word that is repeated to death at work in any branch. "You are too green" (immature), is the favorite phrase from the older people to the younger generations. But how important experience really is? Let us take examples from sports. Older players, more mature, might be best for organizing the team. A strong experienced defense, or mid-field, will have a better overview of the game than an 18-year old. But what about superstars, does it matter how much experience they have, how many matches they have played? How old was Messi when he started playing for the Argentinian National team? And what about Cristiano Ronaldo? Should they have waited many years, until they where old, to have their first appearances? What about those outsider midfields that run up and down the field, up and down, since they have the motivation, stamina and energy of youth? Has there ever been a team of "oldies" that ever made it somewhere? If the players do not have experience, should there not be other players more mature, more experienced, or a coach, that is in charge of channeling and organizing that energy to productive uses in the field? And if the team loses, who has the most responsibility, is it one player, a group of players, or the coach?
Again it does not seem to be like that in the Business World. Experience really refers to politics, "the way to handle yourself". We can call it Street Smarts. It is more about Networks and Contacts than anything else. In that sense, experience really counts... But how important is it really in the Tech field, as we approach the Knowledge Based Economy? Mark Zuckerberg, CEO & Co-Founder of Facebook (32 years old): "I started the company (Facebook) when I was 19, so I can't believe that experience is really that important, otherwise I would have a hard time reconciling myself. We invest in people that are really talented even if they HAVEN'T DONE that thing before. That applies to people who are fresh out of University, as well as the CFO who took the company public but had never taken a company public before! Focus on really talented people. Even if you are 19 you have done side projects and interesting stuff. It is important not to believe that the person needs to specifically have done the job that they are going to do in order to be able to do it well. We have given the people in the company a lot of opportunity, so there are a lot of people that have grown with the company over this period of time".
Great leaders UNDERSTAND the benefit that comes with working with Smart people. Marissa Mayer (41, CEO Yahoo!) considers that: "It is wonderful to work in an environment full of Smart people. It challenges you to THINK and WORK in a different level. If you play with the best players, that will make you better and you will ultimately be able to grow and learn a lot. The same thing happens on an intellectual level as well. I was very lucky to work at Google, where there are tons of Smart people to learn from. Smart people bring their perspectives and interesting intellectual arguments that they make, and give you a whole new way of thinking about things. If you give them EMPOWERMENT, you don't need to have a lot of MANAGEMENT or bureaucracy in the organization". Marissa Mayer might not be one of the smartest people in the World, but she was Smart enough to understand who to surround herself with to make it to the TOP!
And last, by not least, why not cite the greatest one, Steve Jobs: "the greatest people are self-managing, they don't need to be managed. Once they know WHAT to do, they will figure out how to do it. What they need is a common VISION, and that's what leadership is. Leadership is having a vision, being able to articulate that so that people AROUND you can UNDERSTAND it, and given a consensus on a common vision, we wanted people that were insanely great at what they did. Not necessarily those seasoned (experienced) professionals, but those who had at the tips of their fingers or in their passion of where technology was and what we can do with that technology, and who wanted to bring that to lot of people. The most important job of someone like MYSELF is RECRUITING". 'Nuff said!!!


Cristian Bøhnsdalen
CMO/CFO & Co-Founder @ITRevolusjonen


Publicado por en No hay comentarios:
Etiquetas: , , ,

domingo, 27 de noviembre de 2016

Trumponomics



Trumponomics

Few should I say or comment about the recent Presidential Election in the US won by Donald Trump[1], being that I am not an American citizen and as such do not have the right to vote. However, Presidential election in the US is the most important for the Western World being that it is the most powerful Nation. So it is always advisable to follow US news not only on economics but also on International Policy. Commerce, but also War, Defense, Diplomacy, many factors are defined at the White House. Consider though that US has a bigger impact in the Western Hemisphere (including Euro Zone AND Latin-America), whereas other Nations have more impact on other regions. China is clearly taking the lead in South-East Asia, whereas Oil Nations are the most powerful in the Middle East.
But back to Global Economics, one of the main focuses of this blog. When we hear news it is very important to read between the lines, and to assimilate or integrate them to understand the total impact.
- Economics: Trump promises to cut taxes for individuals and businesses and increase infrastructure spending. Now let me be clear on this. Right-wing governments (in this case Republicans), are usually more business friendly, but at the expense of the government. Now, Obama did a great job at lifting the US out of the worst depression since the 1930s. However, his government did print trillions of dollars and increased government spending, which is not sustainable in the long term. I am always in favor of 4 or 8 year periods when it comes to Government, shifting between left and right. Too little tax burden hurts government dependents. These are not just administrative employers, but teachers, policemen, hospitals, firefighters... Too much tax burden eventually hurts business... Quite clearly Trump will favor business, but will cut government spending. In the short term, jobs might be lost. The most important is that his administration manages to reactivate the private sector in a fast and efficient manner, to compensate for the loss of jobs in the public sector.
- Energy Policy: restrictions for production of shale, oil, natural gas and clean coal will be lifted. This will add to the creation of thousands of jobs, but will also put pressure on the Supply side. Consider the following article: "US energy independence look tantalizingly close"[2]. The US has embarked on a journey towards energy independence, which it might achieve by 2020. This means that they will stop importing oil to become and oil exporter. Consider how oil imports in the US have shrunken from 65% in 2005 to 28% in 2015, to a projected 11% in 2020, while domestic oil production has reached a 43-year high. Whereas the article states that energy independence will be easier if prices rise sharply to USD 100 a barrel, consider my view[3] that the Shale Revolution itself and a superpower like the US leaving it's position of Importer to become Exporter will hold the prices at bay (in a channel of 30 USD to 60 USD) for many years to come. In the Oil industry, cycles are long. On the other hand, lower Oil prices are pushing innovation in the technology field to become dramatically more efficient.
But it's not all about economics, politics play a major role as well. Whereas in the past the OPEC controlled the market, today there are many other players such as Russia and Canada. By becoming a major player in the industry, the US ensures that the Arab Oil Nations lose power, and  their positions weaken in the game of world politics. Squeezing the Arab Nations might be much more important for the US than the economic effects of the Shale, reason for which I believe America will do whatever it takes to lead the Shale Revolution.
- Trade: this is one of his most controversial points. Trump has identified that the biggest rival to the US when it comes to Global Trade is actually China. This is correct. By the year 2030, China will surpass the US as the world's largest economic player (measured in Nominal GDP)[4]. Donald seems keen on "punishing" companies that send jobs overseas and wants to get those manufactory jobs back to the US. He obviously missed John Travolta's speech in Primary Colors:

https://www.youtube.com/watch?v=lIHasecz5d0

According to Economic Science Nobel Prize winner Paul Krugman "No matter what Trump does, manufacturing jobs are not coming back to the US"[5]. I could not agree more. According to Krugman: "the manufacturing sector hasn't added jobs to the labor market in years past. Instead, improved equipment and automation has allowed US manufacturers to increase output. Thus even if manufacturing came back to the US, most of the plants would be automated anyway, producing a lower number of jobs than one might hope for" (...) "The service sector is the future of work, but nobody wants to hear it". YES!!! Finally some sense to it. It is through automation and technology that value is added to the private sector. Low end jobs will disappear anyway, and do not add so much value to the economy. In my 4 books and this blog, I start with Economics from a historical perspective, to conclude that the focus should be on developing technologically as we gaze at the beginning of the Fourth Industrial Revolution. Nothing will be gained by fighting against that, and it is important to understand that it is best to stay in the lead, even if that means sacrificing some low end positions in order to develop those high end value adding positions that the economy needs.
Trump's external trade policy will lead to restrictions to import to the US, which will impact all their trading partners. Quite clearly the US has all the power, so there will not be so much negotiation there. In Argentina, some concerns from the Agribusiness are already arising, since the US is the main market for their products. It is advisable to strengthen ties with other countries as well, to diversify risk and mitigate the impact of change at the White House. In the case of Argentina, whose main markets are Brazil and the US, more efforts should be done to align positions in World Commerce with China. This has worked very well for Australia, that takes advantage of it's geographical location to do Trade with BOTH the US and China. Hopefully there should not be a need to "choose" when it refers to simple Commerce Agreements. Europe might want to strengthen ties with the US though, in the "pie of World Commerce", it seems to be the European Union the one that will be "eating" less and less...
- Interest Rate: Trump has critized the Fed (an independent economical entity responsible for setting the US Treasury Interest Rate), by saying it is creating a bubble with low interest rates. Now, the Fed has done a great job under the Obama Administration. Lower interest rates make it cheaper and easier for the private sector to finance itself, at the detriment of investment (currency weakens, but exports are more competitive). Lower interest are advisable in contexts of recession or weak economies, to encourage taking debt. However, with the recession already behind and thousands of jobs being created in the Obama Administrations, the US economy might be strong enough to raise the interest rate. A stronger interest will attract investment, strengthening the US dollar. Job creation will continue, but must not be driven by cheaper cost but by higher value added positions. But how will a raise in the Fed's interest rate impact Europe? Consider that Europe's interest rates follow policy making in Berlin. However, all the stock markets are at some point linked to the Dow Jones. A raise in the Interest Rate in the US will obviously impact Europe as well (since it has impact on the US dollar, which would strengthen), but European Central banks might have some sort of margin of maneuver.
- The Wall with Mexico: I have not much comment here, except that Mexico is actually part of the North-American continent and should be treated as such. As children learn at school in the US, the American continent is divided in two: North America and South America (divided by the channel of Panama). I agree with migration laws, but the best solution is to integrate with Mexico and look for a way to increase productivity for Mexico as a country, or for Mexican communities that are living in the US (mainly in the Western Coast, that was actually part of Mexico until the year 1847). In the same manner that Argentina has to target increasing the productivity of Bolivians, Paraguayans and Peruvians (their latinos), the US has to work to increase the productivity of the Mexican people in efforts for Regional Integration. Remember, if your neighbors are poor, you will eventually be impoverished yourself.
The election of Donald Trump means great news for the US. Compared to other Republicans like Richard Nixon, Ronald Reagan or the Bush family, Donald seems a much more "center-right" choice. He is really a Business man who turned to politics and not a typical politician. He will surely be more concentrated on Business and job creation, and less on warfare. Consider that when Republicans take office usually bad things happen: War in Afghanistan, occupation of Kuwait... Investment in Defense will surely rise, but I do not believe this Administration will engage in meaningless warfare. How the rest of the Nations manage to adjust to his "rules of the game" remains to be seen. He is a strong leader and an even stronger negotiator. Americans surely have 4 fantastic years ahead of them.



Cristian Bøhnsdalen
CMO/CFO & Co-Founder @ITRevolusjonen

Publicado por en No hay comentarios:
Etiquetas: , ,
Suscribirse a: Entradas (Atom)