9 July 2020
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Look for the good news.

Saudi purge, a smart kid and the Oz economy says expect the unexpected!

Peter Switzer
6 November 2017

By Peter Switzer
A night of purging of princes in Saudi Arabia, a young man buying in Walmart and selling on Amazon and an improving Oz economy makes me advise you yet again that to win in business and life, regularly ask: “What if the opposite is true?”

I always say that the smartest guy I’ve ever interviewed, Edward de Bono, explained that standout winners think laterally, or outside the square, to get a competitive advantage and that can often come about asking the question: “Is the opposite true?”

The big news from stock markets this morning is the corruption crackdown in Saudi Arabia, which has seen 11 princes, four current ministers and tens of former ministers arrested! The Saudi stock market lost 1.5% in the first eight minutes, as Crown Prince Mohammed bin Salman put his stamp on power, even locking up Prince Alwaleed bin Talal, who owns investment firm Kingdom Holding.
Reuters tell us:  “News of the purge came in the early hours of Sunday after King Salman decreed the creation of an anti-corruption committee, chaired by his 32-year-old son Prince Mohammed, who has amassed power since rising from obscurity less than three years ago.

“The new body was given broad powers to investigate cases, issue arrest warrants and travel restrictions and freeze assets.”

"The homeland will not exist unless corruption is uprooted and the corrupt are held accountable," a royal decree said.

Who would have thought this was possible? Well, none of the people arrested but the winner in all this — Crown Prince Mohammed bin Salman — who’s doing the locking up and who’s showing who’s going to be boss going forward.

Meanwhile in the US, Ryan Grant is making millions by buying at clearance prices and then selling it through Amazon! And what started out as part-time ‘business’, which Americans call a “side-hussle”, has now turned into a $US8 million turnover business!

Who would have thought a business could grow out of one smart guy who decided to use two business killers — Amazon and WalMart? But for Ryan, the opposite was true.

And this brings me back to my favourite topic — the health of the Aussie economy.

Why is this important? Well, if the economy grows faster than expected next year, then Aussies get jobs, their wages rise faster, their confidence as consumers lift, business profits spike and so do share prices.

In the past few weeks we’ve seen:

  • Business leaders in an AICD survey say they expect notable wage rises next year.
  • The same survey saw the business leaders’ take on the economy to be the best in seven years.
  • Employment was up for the 12th straight month in a row in September, with unemployment at 5.5%, which is the best reading in four years.
  • The Westpac consumer sentiment survey saw optimists outweigh pessimists for the first time in 10 months and it comes as the ANZ/Roy Morgan weekly take on this reading was firmly positive. The confidence rating rose by 0.1% last week to 113.4, after rising 0.8% in the prior week. Confidence is above the average of 113.2 since 2014. The estimate of family finances hit a 4-month high!
  • And despite the silly citizenship crisis in Canberra, business confidence is above its long-term average and business conditions are at 14.3 but the long-term average is 5.2!
  • Business profitability is now at a 9 and a half year high of 16.9 points.

I could go on but if you think our economy is going down the tubes, think of the Saudis, the smart kid in the USA and the data I’ve just shown you and maybe ask: “What if the opposite is true?”

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