Christ The Redeemer in Rio - We were there on a foggy day. Still looks cool!
9 weeks. Yes. Fortunately or unfortunately it is 9 weeks. As we head into Spring Break at Sloan it is impossible not to look ahead and wonder: “Wow, 9 more weeks”. My last semester at Sloan ends in the 2nd week of May. Graduation is on June 4.
After almost $150K (ok, lesser than that for me), Merton model, Modigliani-Miller, Marginal Cost/Revenue, “building off that”, co-branding, term sheets, “enhancing” a CEO, Convertible Preferred Shares, Redeemable Preferred Shares, Memo to Jeff Immelt on how to get GE back on track, trying to sell batteries to Chinese bicycle manufacturers, Direct approach presentations, Ad Networks, East Coast Vs West Coast in Private Equity, Five Lenses, 7S Models, Cialdini, and many more. It feels strange to be leaving this Business School bubble.
Sooooooo where were we? Ah yes, last time I wrote in this space I was in Sao Paulo. In January! Feb has passed and March is almost over – and I’ve not written in a while. Some things don’t change I guess. I’ll try to summarize Jan/Feb/March now.
If what I write does not make sense, it’s because I am on a Bolt Bus from Boston to NYC and the lady sitting next to me is wolfing down a delish bacon sausage breakfast sandwich. It is 10 am on Sunday morning, I am hungry, and I have Jay Z yelling in my ear “Yeah…I am at Brooklyn. Now I am down at Tribeca, right next to DeNiro. But I will be hood forever. I am the new Sinatra….” (btw Jay Z’s Empire State of Mind is my new fav tune.).
January 2010 – Brazil and Argentina
Three things that I remember from this trip:
1. Live Football match in Buenos Aires: Absolutely recommend it if you are in BA. One of the best live sports experiences I’ve had (if not THE best). Fans went crazy the entire duration of the match. And the opposing team’s fans were guarded by gun wielding police for the entire time.
2. Weekend (or a week) in Floripa, Brazil: This is a beach island to the south of Brazil. About 40 Beautiful beaches – lots of them for surfing. Try the Brava and Mole beaches. And make sure to hang out at some of the beach bars. People stay there for a while and start dancing and singing for no reason. The Brazilians are one happy bunch (at least on the beaches). Oh also, the women here are in super shape. Apparently they prepare for the summer by dieting for the entire year.
3. Ipanema Beach in Rio, Brazil: We got lucky and ended up staying at a sweet spot in Rio. ½ block from Ipanema and 2 blocks from the Lagoon. So I went running in the morning by the Lagoon and chilled on the beach the rest of the day. The Ipanema beach area is simply the best. You can walk to any grocery store to buy whatever you like, or go to an expensive restaurant. Very relaxing.
February and March 2010 – Back in the US
Needless to say it was a rude adjustment when we got back to a wintry Boston on Feb 1. Although I was actually ready to be back (30 days away from home is a bit much, especially without a certain person not being with you, even if it’s in nice and hot weather).
WARNING: If you are averse to reading about typical Business School stuff, please stop reading from here on.
This semester I am in two really good classes:
-CEO perspectives
-Global Economic Challenges
In CEO perspectives we have a Fortune 50 CEO address us (some of us get to go to dinner with the CEO too) for 2h every week. We are free to ask him/her any questions.
It may not seem like a big deal but if I sit back and think about it is an incredible opportunity to be in the same room with the following CEOs:
Jeff Immelt (GE),
Jim Sinegal (Costco),
Dan Mudd (ex-Fannie Mae, now Fortress),
Strauss Zelnick (ex-20th Century Fox, this dude became the head of Fox at age 32), Ray Elliott (Boston Scientific),
Nigel Travis (Dunkin Donuts, he introduced bacon-topped donuts to our class!).
We have about 5 more in the next few weeks including the
CEO of Sprint,
Boston Celtics,
Citrix,
NBC Universal,
Ford Motor Company,
and SAP.
No question is out of bounds. In general students ask expecting questions but some of my classmates asked very probing and insightful questions. Dan Mudd got asked real tough questions about why let things get out of control at Fannie Mae. Actually one of my classmates really pushed him – they got into a shouting match. For the most part Dan handled it well but it was clear that he was not super comfortable talking about it.
Most notable quote from these peeps so far in class:
Immelt: “Yeah you go home every night beaten up, tired, listening to complaints, and wondering why you want this job. But then you get up the next morning and look at yourself in the mirror and go “You are the man!”
Immelt (classmate asks him, what does he think about this Leno and Conan): "Look, I respect them both. At the end of the day, the TV business is small. CBS (top TV station) makes $400M a year. Margins are low. I can make that much by selling 2 aircraft engines and at a high margin! I dont worry too much about TV"
In Global Economic Challenges we have a professor who was in the George W Bush White House. She is a very good teacher. We learnt how to look at warning signs for financial and currency crises from a macro-economic point of view. We analyzed some of the euro area countries that are in trouble (yes, that includes you Greece). Will the euro survive. And just how credible is this Brazil and India taking over the world thing.
Bottom line from this class: we are in for a hard time in the US in the next 5-10 years. Slow growth, inflation, and high taxes are unavoidable. (we looked at hard numbers for this and I can’t imagine how this will not happen). Brazil, India, and China will experience a phenomenal growth period (unless something crazy happens). China is expected to take over the leadership in GDP by 2020 (on a PPP basis). India is not going to be far behind.
All signs point to focusing on emerging markets (BRIC or what are now called the Frontier bloc) for investing, business ideas, or natural resources. Let’s see how this turns out.
Until next time: laters.
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