ARBOR OUTLOOK: Springsteen, Travolta, Shark Tank and WhatsApp

Published: Thursday, April 3, 2014 at 04:12 PM.

Some historical economic context is helpful. Henry Sherwin and Edwin Williams ventured into the paint business in 1866, one year after Lee surrendered to Grant at Appomattox . Consolidated Edison traces its roots back to 1882. William Harley and childhood friend Arthur Davidson partnered in motorcycle design in 1901. 

Tyson Foods employs 115,000 people. Hertz has some 41,000 workers. Dr. Pepper employs 19,000 across North America .

“The companies (previously listed) are storied brands, many of which have slogged along for years and years, inching up their market caps basis points at a time,” says Calao.  “In a blink, they’ve all been matched or surpassed, in terms of market value, by a no-name startup in Mountain View , ( Calif. ).”

WhatsApp may be the face of the future of U.S. employers. The company’s value lies not in its profitability, but in the number of eyeballs that it can attract. And it employs shockingly few folks.

Whose cutting edge business concept will debut on “Shark Tank” and make them the next billionaire? This type of business model may be exceptionally profitable for a few successful entrepreneurs, but bad for those in the labor market seeking long term employment and security. The model doesn’t promise to sustain a viable middle class that can drive consumer spending, power GDP and grow the economy.  

Margaret R. McDowell, ChFC, AIF, a syndicated economic columnist, chartered financial consultant and accredited investment fiduciary, is the founder of Arbor Wealth Management, LLC, (850-608-6121 — www.arborwealth.net), a “fee-only” and fiduciary registered investment advisory firm located near Sandestin. This column should not be considered personalized investment advice and provides no assurance that any specific strategy or investment will be suitable or profitable for an investor.

 



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