Froth and fundamentals
From the Guzman IPO to Nvidia's record high and Dutton's nuclear policy, it was one of those weeks in both business and politics where showmanship overshadowed substance.
In both business and politics, there exist two competing realities: the fundamentals and the froth.
You can understand the fundamentals in the staid terms that make sense in a quarterly earnings report or policy document. But the froth – the showmanship, the narrative, the drama – often takes over.
This week has been one for the froth. Nowhere was that more evident than the Guzman y Gomez IPO, which left many investors scratching their heads and asking questions about leasing agreements and the marginal cost of production on a chicken burrito bowl, concerns that were brushed aside when the stock popped 36% on its first day of trading.
GYG CEO Steven Marks, the boisterous New Yorker who took it upon himself to revolutionise Australia’s relationship with fast casual Mexican dining, is a graduate of the P.T. Barnum school of business leadership – not uncommon in the United States, but less often seen in a market where comparatively buttoned-down bankers, miners, fundies and energy bosses dominate.
