The Next Recession May Come By Stealth
Markets have been blowing hot and cold regarding the prospects of a recession in the U.S. The Institute of Supply Management’s November survey shows that the index of factory activities in the U.S. fell to 48.1 from 48.3 in October (any reading below 50 is indicative of a contraction). This is confounding the expectation that America’s domestic industrial production would improve in anticipation of a “deal” in the U.S.-China trade war. However, the Department of Labor also reported that 266,000 jobs have been added to the economy in November, bringing unemployment rate down to a historic low of 3.5%. A confusing situation has just been made more confusing.
It has been said that generals are always fighting the last war. It’s not that different when it comes to fighting economic downturns. Since the global financial crisis a decade ago, we have been scouring the horizon for any signs of financial fragility, such as asset bubbles, that could plunge us into the next global recession. Despite mounting evidence of a weakening economy, there are no asset bubbles comparable to that of the pre-2008 period. And we won’t find any, even as we edge closer to the next recession. Since the last global financial crisis, the global economy has been reshaped by different forces, and the coming recession will be caused by factors totally different from those of the last one.
First off, the global economy today is mired in uncertainty arising from the trade war, an enfeebled Europe, Brexit and rising geopolitical tensions. An even deeper source of uncertainty is that the liberal global economic order, in place since the 1950s, is dying. Two trends are converging to kill it. The first is the West’s declining economic dominance relative to the rest of the…
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On a steamy May morning in 2013, Canva CEO Melanie Perkins found herself adrift on a kiteboard in the channel between billionaire Richard Branson’s private Necker and Moskito islands.
Her 30-foot sail floating deflated and useless beside her in the strong eastern Caribbean current, the 26-year-old entrepreneur waited for hours to be rescued. As she treaded water, her left leg scarred by a past collision with a coral reef, she reminded herself that her dangerous new hobby was worth it. After all, it was key to the fundraising strategy for the design-software startup she’d cofounded with her boyfriend six years before.
Canva was based in Australia, thousands of miles from tech’s Silicon Valley power corridor. Getting a meeting—much less funding—was proving tough. Perkins heard “no” from more than 100 investors. So when she met the organizer of a group of kitesurfing venture capitalists at a pitch competition in her native Perth, Perkins got to training. The next time the group met to hear startup pitches and potentially write crucial early-stage funding checks, she’d have a seat at the table—even if it meant having to brave treacherous waters.
“It was like, risk: serious damage; reward: start company,” Perkins says. “If you get your foot in the door just a tiny bit, you have to kind of wedge it all the way in.”
Such perseverance has long been a necessity at Canva, which began as a modest yearbook-design business in the state capital of Perth on Australia’s west coast. From those remote origins, Canva has grown into a global juggernaut. Twenty-million-plus users from 190 countries use the company’s “freemium” Web-based app to design everything from splashy Pinterest graphics to elegant restaurant menus. Besides an impossible-to-beat price (millions of… Read the rest