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Hedge Clippings | 14 September 2023 After all the machinations which have surrounded Qantas over the past few weeks, and which have taken the focus of Hedge Clippings away from the real task of looking at economic issues and the performance of managed funds, it is probably time to get back to basics. Having said that, the trials (literal and figurative) facing Qantas, and in particular the new CEO, Vanessa Hudson, and Chairman Richard Goyder are far from over. Hudson of course can, and will claim - or blame - her predecessor, although it seems like she either endorsed his policies, or didn't or couldn't stand up to his overbearing style. She'll no doubt get away with that excuse, but Goyder has nowhere to hide as chairman, and one who was cheer-leader-in-chief for the recently departed Irish elf. Goyder either believed Joyce was the "best CEO in Australia by a length of a straight" as he described him, or he was fooled into thinking so. Either way, it was a massive character judgment failure on his part, as well as one of corporate governance. The upcoming Qantas AGM is scheduled for November 3rd, and should be a jam packed and fiery event. Qantas might even resort to selling non existing tickets to it, but even though it's scheduled just a few days before the Melbourne Cup, it's doubtful if the chairman will be referring to his previous racing analogy when farewelling his disgraced former CEO. What the whole Qatar / flightless tickets debacle has done is to call into question the level of overt, or maybe covert, influence membership of the Qantas Chairman's Club wields throughout the corridors of Canberra and beyond. Power corrupts: Absolute power corrupts absolutely, or so the saying goes. The issue in this case is not power, but undue influence, or the perception of it. Didn't we say it was time to get back to basics of the economy? The hard/soft landing debate continues, both here and overseas - at least in the US, as it appears the landing in the UK is unlikely to be anything but hard. China's landing is likely to be bumpy at best, but getting an accurate picture of the world's second largest economy is anything but easy, coupled with the centralised and authoritarian decision making process. Australia's tightening phase would appear to be over, although it looks like rates won't come down anytime soon, given the unemployment rate remains sub 4%. There are a few wild cards out there, as always. Saudi Arabia and Russia are in lockstep to reduce oil production and keep oil prices, and therefore inflation, high. Tensions around Taiwan remain, even if overshadowed by China's economic issues, and of course Ukraine remains an unknown outcome. Thankfully it's footy finals season to take one's mind off such issues, although you can always stay up late / get up early to watch the Wallabies trying to get out of their pool into the quarter finals of the RWC. Watch this space! News & Insights Cultivating change - Nestlé's leading approach on sustainability and creating shared value | Magellan Asset Management Quay podcast: How high rates are impacting REITs | Quay Global Investors August 2023 Performance News Bennelong Concentrated Australian Equities Fund Argonaut Natural Resources Fund Bennelong Long Short Equity Fund Delft Partners Global High Conviction Strategy Glenmore Australian Equities Fund |
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