Cockeyed Optimists
Apr 22 2009
Some market leaders won’t surrender to mass hysteria. They believe recovery’s coming—sooner than you think.
The Optimist
Hedge fund manager Bill Ackman wiped out nearly $2 billion in a bet on target’s stock. So why is he so sure he can fix his problems—and America’s?
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The world’s largest snack-food manufacturer saw shares drop 28 percent in 2008, but net revenue was up 3 percent. “We are entering the new year cautiously optimistic,” Nooyi said during a February conference call. The company has predicted rising profit in 2009, thanks to aggressive marketing and new logos.
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In boom times, the Fed chairman often acts as a market cheerleader, but sunny predictions are harder to come by now. During congressional testimony in February, however, Bernanke seemed hopeful about the country’s short-term outlook: “There is a reasonable prospect that the current recession will end in 2009, and 2010 will be a year of recovery.”
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Over the past decade, Grantham, whose firm manages more than $120 billion, was nicknamed Permabear for urging investors to avoid the market. Nowadays, he’s bullish: Not long after Lehman went bust, Grantham said, “You are looking at the best prices in 20 years. The last time I was this optimistic was in 1982.”
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In spite of pervasive worries about his firm’s health, Stumpf appears almost bubbly. “What started out 18 months ago as a credit crisis has turned into a confidence crisis,” he said in a February speech. “Things will improve. We’re a country of optimists. We’ve so much to look forward to. There are lots of opportunities out there disguised as problems.”
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Businesses related to internet infrastructure may be poised to better weather the recession. Spirent, which tests broadband networks, saw a 91 percent rise in its 2008 operating profit. In February, Bramson said that Spirent had entered the year “well placed to face the uncertainties of the market.”
