Just thought I'd share a thought bubble on an otherwise dull morning....
I get that the market is taking advantage of Argentina's tax initiatives being "sprung" on it, but I think everyone needs to take a reality pill if they think this is a unique unnavigable situation.
Business reality 101: Nothing is constant or stagnant, especially when it comes to exchange rates, interest rates, royalties, duties, taxes, wages, overheads, profits, losses, etc, etc, etc.....
Anyone else around when the GST came in??? The consternation and uproar, the impost on business, the overheads required to overhaul accounting systems, retrain people.... and then the impact to the general public that things would cost 10% more... OMG!!
But guess what? The ripple of panic and uncertainty subsided, businesses got on with business, consumers got on with consuming. And today, it's just part of everyday life that we don't even think about.
Sure, those who handle change-management better then most, probably sailed through it easier, but that's the whole point.... this is about good management knowing how to maximise opportunity, minimise disruption, maintaining good fiscal management and focussing on doing what you do and doing that damn well and efficiently, ie you manage and control the things within your control, and you do risk-management planning and budget for contingencies for the things outside of your control.
So given that taxes, exchange rates, royalties, etc are outside of a company's direct control, what is within their control:
- Produce a high quality, desirable product via an efficient and cost effective method and process
- Generate revenue via spot-sales and longer term contracts (such as off-take agreements)
- Grow the company via asset growth and securing further investment (such as strategic investment for future stages
- Continue to exercise prudent fiscal management to maximise returns and outcomes
Ummm... I don't know about anyone else, but this sounds exactly like what AGY are doing!
My opinion.... this latest Argentinian tax is just another in a long line of issues that companies have to allow for and deal with, and it will soon be forgotten about and the world will continue on it's merry way without even a cursory look back.
Anyway - that's my thought bubble for what it's worth.... now back to your usual viewing program
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(20min delay)