The world is changing fast and to keep up you need local knowledge with global context.
By Alec Hogg
In today’s business headlines:
- On Twitter last night anti-establishment politician Bernie Saunders announced his candidacy to become American President in 2020. He joins a large group vying for the Democratic Party nomination. Sanders, an independent minded senator from Vermont, is hoping to go one better after taking Hillary Clinton to the wire three years ago. He vows to take on “the powerful special interests that dominate our economic and political life” and is basing his campaign on a $15 an hour minimum wage, Medicare for all and free tertiary education. Sanders raised $1m from supporters in the first three and a half hours after becoming the 12th Democrat to announce his presidential candidacy.
- Retail giant Walmart yesterday calmed the nerves of investors worrying about a slowdown in the US economy, announcing a 4.2% rise in revenues for the three months to end December. This was its biggest fourth quarter sales improvement in 15 years and the second best of any quarter in the past decade. Investors were also happy to hear the company is starting to make inroads against its rival Amazon.com, with Walmart’s ecommerce sales rising 43% in the quarter and ending 40% up for 2018 as a whole. Amazon’s fourth quarter sales rose a more modest 20%. Walmart’s results were better than Wall Street had expected, and its share price rose 3% on the numbers.
- The fashion business is today mourning the death of Karl Lagerfeld, the pony tailed, dark glasses-wearing icon who dominated the industry for decades. He is credited with reinvigorating Chanel, which he joined as creative director in 1983, transforming the tired brand into a luxury empire with annual sales of almost $10bn. Lagerfeld was 85. Chanel’s chief executive Alain Wertheimer said “we have all lost an extraordinary creative mind…” LVMH’s Bernard Arnault said Lagerfeld helped make Paris the fashion capital of the world, calling him a creative genius whose inspiration will be missed across the fashion industry.
- In South African related news, we are witnessing another classic disconnect between the financial and real worlds. While Bloomberg reported yesterday that stockbrokers on Wall Street are encouraging clients to buy gold shares rather than the metal, a new threat is emerging to South African miners which are among the punters’ most favoured. The AMCU trade union yesterday called on its members working across the mining sector to join those who have been on strike for over three months at Sibanye’s gold mines. AMCU president Joseph Mathunjwa yesterday called on his members at the Sibanye platinum operations and at AngloGold Ashanti, Harmony, Lonmin and Impala to down tools in solidarity. This does not bode well for the new round of wage talks between AMCU and platinum producers. In 2014, agreement was only reached after AMCU members went on strike for five months, the longest ever mining stayaway.