Have we reached a bottom? That’s the question everybody has been asking for a year now, and there’s still no consensus. Some have sworn all along that full economic recovery is just around the corner. Meanwhile, no matter how bad things on the markets get, there are those who insist things will only get worse.
Investors are grumbling: earnings warnings abound, dividends are at an all-time low and falling share prices have caused a decline in household net worth for the first time since World War II. To top it all off, George W’s much-heralded tax cut isn’t what it was cracked up to be. The natives are getting restless.
The stock markets seem desperate to have the Fed bail everyone out. But Alan Greenspan says he will not play that game. He maintains the stock market doesn’t determine when the Fed cuts interest rates, and yet when he does cut rates he uses the stock market as his rationale. Go figure. The co-dependency developing between the Fed and the markets has each watching the other’s moves and reacting accordingly. Despite the sophisticated dance, the markets’ dismal performance continues. And the natives are still restless.
Enter the IRO. Through all the signs of recession, the earnings warnings, the volatility and market uncertainties, investor relations is more important than ever. Angry investors are always more challenging to deal with than content investors. OK, well maybe investors are never quite content, but you get the point.
This month’s issue strikes a good balance between hard facts and encouraging examples. Our cover story applies to practically every company operating within the bear market. It looks at how IROs work to raise irate investors’ spirits and keep those spirits up. We also focus on accounting crises – what causes them and how to handle them.
And there’s some good news unencumbered by the bear’s gravity. From north of the forty-ninth parallel we have news of the Canadian awards winners, as well as a spotlight on IR education in the New York area and some promising findings for companies doing business in Europe.
Instead of worrying about whether or not the markets have bottomed, many IROs prefer to stay the course. After all, they can’t change the volatility, but they can explain how their companies are reacting to it. In the end, that’s really what everyone wants to know.
