The S&P/ASX 200 (ASX: XJO) finished Friday in the green, up 0.2%, achieving a weekly gain of the same amount.
As per usual, here are my three ASX takeaways from the week.
Leadership now key
The first takeaway this week follows on from Kogan.com Ltd’s (ASX: KGN) downgrade and the series of unexpected difficulties from other popular mid-sized companies, which is the growing importance of leadership.
With low interest rates sending all assets higher but particularly those delivering high top-line growth rates, the ability to execute and manage that growth is more important than ever.
Planning for a spike in sales that never comes or organising a difficult scaling up of a once small business requires a unique skill set.
Self-inflicted inflation
Following on from this is the current obsession with inflation, at least in the financial press, and the fact that this has been self-inflicted.
Companies naturally cut all expenses they could in 2020, which had a feedthrough down the supply chain of everything from consumer goods to commodities.
As demand now grows, many supply chains are still suffering from the pandemic and finding it difficult to restart and ramp up production – a key reason behind the likely short-term inflation spike we are about to see.
Austerity or deficits
Finally, this week was all about the Victorian State Budget, which was a stark difference to the Federal level, which has seen greater spending and less tax.
Governments of all levels around the world must be wary not to impose ‘austerity’ measures to ‘pay back the debt’ too soon and risk a decade of malaise not unlike that experienced by Europe post the GFC.