John receiving certificate for Honorary Professorship at the Chinese Academy of Sciences. John will be giving a month-long seminar in June 2007
SPEECH TOPICS
Dr. John Rutledge speaks to groups of all sizes around
the world. From individual investors to CEOs, Dr. Rutledge delivers
complex material with passion, clarity, and humor. He tailors each
presentation to the issues that are important for the audience;
giving them what they need to take action and get results.
(right click and select "SAVE TARGET AS" for 300 dpi jpg in zip file)
Treasury Secretary John Snow, center, and John
Rutledge, right.
Thermoeconomics
The principal of arbitrage lies at the heart of economic analysis. Arbitrage, in turn, stands on the strong shoulders of thermodynamics, the most robust area in all of physics. Thermodynamics says simply that temperature differentials cannot persist over time between objects in physical communication. The end result is thermal equilibrium--the state in which there is no further tendency for temperature to change.
Almost all activity in life reflects the physical manifestations of thermodynamic processes. It is why the chemical reactions occur in our cells, sunlight leads to photosynthesis, and why volcanoes erupt.. And it is why weather systems form. Weather systems are the best and simplest metaphor for economic change. We all know what happens when high and low pressure systems try to occupy the same space--thunder, lightning, tornadoes, and hurricanes.
I think of investing as an exercise in meteorology. My job is to identify the thermodynamic events--usually changes in tax rates, government spending, regulatory policies, or monetary policy--that lead to localized temperature or pressure differentials. These set up the arbitrage situations we use to make money. See Storm Watch.
The Impact of Telecom Deregulation on Growth and Employment
The US Telecom industry stands ready to commit $90 billion in
capital to deploy high speed communications systems for small businesses
and the home. But invasive FCC regulations, forced access rules,
and price controls, have frozen capital spending plans like a fly
in amber. Dr. Rutledge explains the impact of deregulation on investment,
growth, and jobs, and discusses the outlook for deregulation and
growth.
Technology has become the weapon of choice in the battle for global competitiveness and the U.S. is losing the battle. Using his Asset Market Shift framework, Dr. Rutledge discusses the impact of technology on the economy and the necessary changes for the U.S. to be a leader again. The US used to be the world in technology. The US also led the world in productivity growth. This is not a coincidence. Dr. Rutledge discusses the factors behind the technology boom of the past 20 years and its effects on employment, inflation, interest rates, and asset prices. He highlights the role the Fed and regulators played in the tech boom and the bust of the last three years and discusses new developments in the telecom, technology, and media sectors.
Weather systems are the best and simplest metaphor for economic change. We all know what happens when high and low pressure systems try to occupy the same space--thunder, lightning, tornadoes, and hurricanes.
Dr. Rutledge thinks of global investing as an exercise in meteorology, identifying the thermodynamic events--usually changes in tax rates, government spending, regulatory policies, or monetary policy--that lead to localized temperature or pressure differentials which set up the arbitrage situations we use to make money.
The weather map metaphor reminds the investor of two important facts. First, extraordinary investments, like weather systems, are transitory phenomena. Second, investing, like meteorology and thermodynamics, is not an exact science, but it can help you to identify the storm systems that are going to make things happen.
The way to make money investing is to identify a storm system that is powerful enough and likely to be long-lasting enough to serve as an energy source for revaluing a portfolio. Then you move capital into position to take advantage of the implied prices changes.
The Reagan Legacy
In a town where no one does what they say they are going to do, Ronald Reagan shocked people by telling them just what he was going to do, and then doing it. Dr. Rutledge had the honor of helping the Reagan transition team put together their economic plan. When Ronald Reagan was elected in November, 1980 the American people were deeply discouraged. Inflation was 15%, the top federal income tax rate was 70%, the top tax rate on investment income was 91%, interest rates were 21%, the Dow was below 1000, the Soviet Union was a menace, the Berlin Wall divided families, and the Khomeini government in Iran was holding Americans hostage in Tehran. Today, inflation is below 2%, the top income tax rate has been cut in half, interest rates are below 2%, the stock market is above 10,400, the Berlin Wall has been torn down and our children learn about the Soviet Union in history class. The hostages were released on the very day Reagan was sworn in as President. These changes are the legacy of the Reagan Presidency. They did not happen by accident. Dr. Rutledge explains the economics behind Reagan's plan and discusses why Reagan's presidency made such profound changes to America and the world.
The key to predicting the direction of the economy, interest rates,
and stock prices is understanding the impact of policy on asset
prices. Dr. Rutledge shows you how to become your own economic forecaster
by understanding the massive restructuring of the US economy in
the 1980s and 1990s, the tech boom and bust, and the impact of terrorism,
the Iraq War, global deflation, and the dividend tax cut on growth,
inflation, interest rates, stock prices, and the dollar.
A Credit Crunch Imperils the Economy, November 2, 2001
The Heat-Seeking Investor
Dr. Rutledge focuses on how the investment markets work and what
people should do to build wealth in today's erratic markets based
on the simple, timeless principles of thermodynamics. Dr. Rutledge
describes the factors that determine a company's intrinsic value
and tells the audience how to be successful value investors. Some
of the topics he covers are: the 19-year Bull Market of falling
interest rates and rising stock prices; the role of regulation and
the Fed in the dotcom boom and bust; the impact of 9/11; governance
scandals; the Iraq War; and global deflation. Dr. Rutledge explains
the importance of controlling Intrinsic Risk rather than volatility.
He will outline which sectors, industries, and companies remain
undervalued and why, and the role of real estate, private equity,
and hedge funds in allocating assets.
Dr. Rutledge knows what it feels like to own and run a business.
Over the past 20 years, as the founder of two private equity funds,
he has been owner, investor, chairman, CEO, or board member of more
than three dozen companies. This experience served as the crucible
of his Forbes Business Strategy column for more than a decade. The
result is a set of principles to help the owner or manager of a
private company build, manage, own, and harvest value for their
families. Dr. Rutledge shares these principles and his personal
experiences to help business owners and managers think through where
to take their companies in today's economy.
For more than a decade, Dr. Rutledge wrote his Business Strategy
column in Forbes to teach managers how to preserve and grow the
value of their businesses using lessons he learned while advising
hundreds of public and private companies over thirty years. Topics
include creating and managing brand equity, pricing for growth,
managing foreign operations, controlling cash flow, incentive compensation,
stock options, working with lenders, raising capital, how to conduct
a value audit, governance, the role of the CEO, and how to be a
good director.
The dividend tax cut is the biggest event to hit US asset markets
since the Reagan Plan. We can expect still further cuts over the
next five years. As a White House advisor on the impact of the dividend
tax cut on the economy and stock market, Dr. Rutledge helps an audience
understand how tax cuts will impact their businesses and investments.
The tax cuts will pressure companies to pay out cash, increase dividends,
and pay down debt, pushing stock prices up by 20-30% and creating
$2-3 trillion in net worth by forcing a gap between after-tax returns
on stocks and real assets. Dr. Rutledge addresses the budget deficit
and sunset issues. He also explains which sectors, industries, and
companies offer the greatest gains and the impact of the tax cuts
on bonds, real estate, and alternative investments.
As an advisor to the White House task force on rebuilding Iraq
as well as a longtime advisor to a number of institutions in the
Gulf, Dr. Rutledge knows the US can't afford to get this one wrong.
Dr. Rutledge shares his inside view of the scope of the work underway
in Iraq, including: property rights; currency and banking systems;
security markets; real estate; and oil. Dr. Rutledge discusses what
we can do to make the plan more likely to succeed and the impact
of the new Iraq on OPEC, oil markets, and the security of the region.
John Rutledge and Irish Prime Minister Bertie Ahern
Global Perspectives on Business and Investing
Dr. Rutledge draws on the lessons and observations of 15 million
miles of travel over 30 years to help the audience understand doing
business and making investments in a global economy. He discusses
economic growth, inflation/deflation, interest rates, stock prices
and currencies around the world, and managing foreign operations.
He includes the role of emerging markets in global investing and
the appropriate asset allocation for a global investor.
In thirty years of advising business and investors around the world,
Dr. Rutledge has seen true leaders succeed while others fail. Dr.
Rutledge uses the lessons he has learned from these experiences
to help people take control of their businesses, their investments
and their lives.
Failing is a necessary part of success. It's failing small first,
and winning big later, that makes a real winner. In this lecture,
Dr. Rutledge draws on his own experience, from short-order cook,
to truck driver, to advisor/investor, illustrated with recent advances
in cognitive science, to help people understand why taking risks
is necessary for growth, and how to teach young people which risks
are worth taking.
Dr. John Rutledge is a leading economist who has advised several presidents, including the current administration. He also advises multinational corporations, financial institutions, and investors.
