Smith School In the News
Wiley Online Library – Nov. 27 – “Advancing Scholarly‐practice and Theory Through Participatory Inquiry and Prospective Theorizing” features new research by Associate Professor Toby Egan, including: “Our current situation as researches and scholar-practitioners leads us to questions such as: ‘How might we access a broad and informed understanding of [Human Resource Development (HRD)]-related problems and key issues?’ ‘Who needs to be at the table for such investigations?’ and ‘How might we arrive at practical, good theory, including those aimed at our greatest challenges?’ We suggest that the future of impactful HRD research, theory and practice will involve (a) the renewal of HRD as a participatory endeavor and (b) the importance of theorizing that is forward-thinking and prospective…”
Daily Mail (UK) – Nov. 24 – “Don't Get Stung on Black Friday! Experts Reveal How to Spot if an Online Sale is REALLY a Good Deal – as Many Products were LESS Expensive Earlier in the Year” quotes Dean’s Professor of Marketing Jie Zhang: ‘A tactic which is used pretty widely by a lot of retailers involves raising the regular prices of a product so you can then advertise it as a deeper percentage discount,’ [Zhang] told DailyMail.com. ‘It really plays into that consumer psychology and makes shoppers feel like they are getting a really great deal. I would advise people to always be cautious of percentage discounts.’ …Zhang notes that a host of companies – both in store and online – are guilty of rapid price fluctuations around sales seasons. ‘Several big-name retailers have had legal cases against them on these kinds of issues,’ she said. ‘But online is like a wild west, there are a lot more no-name retailers and sellers to be wary of.’
Daily Caller News Foundation – Nov. 23 – “These Four Key Economic Indicators Paint A Grim Picture For 2024 “ quotes Dean's Professor of Finance Michael Faulkender: “The two indicators that are most troubling are that (1) consumer expectations are low — this is a problem because consumption is 65-70% of national output — and (2) tighter credit conditions since income has not kept up with inflation and many households have exhausted their pandemic savings,” [Faulkender] told the Daily Caller News Foundation. “Therefore, they are reliant on credit to maintain their current consumption levels. Both of these point towards a pullback in economic activity, consistent with the reduction in retail sales that we saw in October.” … Interest on the U.S.’ sovereign debt cost the government $659 billion in fiscal year 2023 and could increase even more in 2024, according to The Washington Post. The sum was larger than the $476 billion spent on interest in 2022 and the $352 billion spent in 2021. “Based on these recent outcomes, I would not be surprised if we were (right now) on the front end of a recession,” Faulkender told the DCNF.
Associated Press (via MSN) – Nov. 22 – “Black Friday is Almost Here. What to Know About the Holiday Sales Event’s History and Evolution” quotes Dean’s Professor of Marketing Jie Zhang, including: Jie Zhang, a professor of marketing and the Harvey Sanders Fellow of Retail Management at the University of Maryland’s Robert H. Smith School of Business, points to a 1951 mention of “Black Friday” in a New-York based trade publication — which noted that many workers called in sick the day after Thanksgiving in hopes of having a long holiday weekend.
GARP – Nov. 21 – Professor of the Practice Smith Enterprise Risk Consortium Director Clifford Rossi discusses trends, threats and opportunities in the commercial and residential real estate markets in a “Real Estate Risk in Volatile Times” podcast produced by the Global Association of Risk Professionals. … Related from GARP: Rossi was part of a recent expert panel for an “Emerging Risks in Global Real Estate” webinar.
Washington Post – Nov. 21 – A Common, Illegal Tactic Retailers Use to Lure Consumers quotes Dean's Professor of Marketing Jie Zhang: They “mark up the prices and then offer seemingly deep discounts to make the deals look more attractive,” said Jie Zhang, a professor of marketing at the University of Maryland. “This is a form of deceptive pricing.” It’s a tactic meant to trick shoppers into thinking they’re getting a better price than usual. This usually involves a retailer raising the price on a particular item — say a flat-screen TV — for a short period, only to mark it down to the original price while marketing it as a limited-time, steep discount. Sometimes it’s more brazen, involving products never actually listed at the full price and only appearing with a supposed markdown. The tactic is done “pretty often,” Zhang said, and “it’s hard for consumers to detect.” … Related: “‘It’s To Trick Us’: Shoppers Slam Target Over Alleged Fake Black Friday Prices” at Bored Panda (and similarly on other consumer-information blogs) quotes Zhang from the Washington Post article.
New York Times – Nov. 20 – Associate Professor of Management and Organization Evan Starr comments in a column on Sam Altman’s firing by OpenAI and subsequent hiring by Microsoft, “What Happens When a Founder Leaves”: A downside of noncompete agreements is that they put smart people such as Altman on ice, Evan Starr, an associate professor at the University of Maryland, told me. That is bad for innovation and, he said, offsets the benefit of increasing the security of investment.
Expansion Solutions Magazine – Nov. 20 – Tej Anand, academic director for Smith’s MS in Information Systems programs, comments in “Health Care Challenges, Solutions Cross Vast Spectrum”: “This complex ecosystem consolidation is driven by the desire of stakeholders to garner a bigger slice of the health care spending pie and increase their negotiating power and leverage,” said Anand. “Larger health systems get bigger by acquiring smaller players and in many regions of the country there is now a concentration of only one or two such systems to serve all the health care consumers in that region.” Stakeholders are also “seeking to vertically integrate, with payment and benefit administrators acquiring health systems and vice versa,” he said, pointing out that Optum Health, a subsidiary of United Healthcare, acquired physician practices across the country; and CVS Health acquired Caremark and Aetna. Stakeholders are “also placing bets on the most likely places where health care spending is likely to increase and racing to grow in those areas,” said Anand, noting that this trend also encompassed Walgreens acquiring VillageMD and Carecentrix; CVS Health acquiring Signify Health to complement its Minute Clinics; and Amazon acquiring PillPack and OneMedical.
Maryland Today – Nov. 20 – Dean’s Professor of Marketing Jie Zhang explains how low inventories could affect Black Friday and holiday shopping in “Weeks of Black Friday Sales? It’s Not Your Imagination.”
Expansion Solutions Magazine – Nov. 20 – Professor Emeritus Charles Olson comments in “Strong Oil, Gas Markets, Cleaner Coal in 2024”: “One trend is that there is much more oil, gas and coal available to the market than we knew of in the past―at least 10 years’ worth, according to Chevron,” [said Olson], and “100 years’ worth” of coal, “which is being replaced to a degree by hydrogen, which has become more available via the Inflation Reduction Act.” He also added that’s crucial information in regard to manufacturing steel, since coal is often used to make it, though that course is changing. “Cleveland-Cliffs,” for instance, “is more often using hydrogen instead of coal, because coal is dirty and hydrogen is clean,” said Olson. “I think this approach will catch on, because it’s economical and there is much pressure from environmentalists and society, in general, to operate in a more efficient, cleaner way.” But he doesn’t think coal will go away altogether. “It’s still dirty relative to gas, but it’s cleaner than it was. And we’ve had to use more coal in recent years due to the Russian-Ukraine conflict and the market in Europe.” The production processes for oil have also become much more efficient due to the use of fracking to get product out of the ground. “It used to cost the oil companies $50-$60 per barrel to break even,” he said, “but today, that number is $30 per barrel.” There has been similar progress with gas. The oil companies don’t have to drill as far down to harvest the crude oil due to fracking, “which saves time and money. Refineries are cheaper, too, because they have also increased efficiency,” Olson said.
WTOP – Nov. 17 – Associate Professor of Operations Management Yi Xu comments in “Your Thanksgiving Dinner Should Cost a Little Less This Year. Here’s Why”: [Xu] noted that’s the biggest reason why dinner will be about 4.5% cheaper, on average, this year. “We have had a good season for turkey farms. We don’t have significant bird flu, those kinds of things going on this year,” he said. “Also, things like eggs, those things are down as well … Some milk products, dairy products are down as well. Those are also important items for Thanksgiving dinner.” … But overall, what you’re seeing now might be the new normal for the next several years. “Food prices depend on a lot of things in addition to general inflation in the economy,” Xu said. According to Xu, supply and demand is influenced by a lot of things besides just disease. “Factors such as geopolitical issues, those will impact the supply of food in dramatic ways, just like oil. But I think in the long term, as long as the general inflation rate is stabilized, probably the food prices will stabilize as well.”
GARP – Nov. 17 – Professor of the Practice and Smith Enterprise Risk Consortium Director Clifford Rossi, in his latest CRO Outlook column for the Global Association of Risk Professionals, writes: “Operational Risk Capital Proposal: Time to Hit the Pause Button.” Summary: The so-called Basel III Endgame could lead to significant amendments in operational loss estimation at big banks. But these recommended regulatory revisions could have unintended consequences, and all parties involved would be wise to reconsider B3E’s operational risk impact before pushing forward.
International Business Times – Nov. 17 – “Why High-Interest Rates Have Not Pushed The U.S Economy Into A Recession Yet”: quotes Clinical Professor of Finance David Kass: “The primary reasons high-interest rates have not yet pushed the economy into a recession are the historically low unemployment rate of 3.9%, David I Kass, Clinical Professor of Finance at the University of Maryland, Robert H. Smith School of Business, told the International Business Times. Professor Kass sees another set of macroeconomic factors that have helped American households keep on spending money, like a shallow average home mortgage rate of 3.8%; consumer balance sheets with large cash balances from the recent monetary and fiscal stimulus in response to the pandemic; relatively little consumer debt as compared to the Great Recession (2007-09); and the Consumer Price Index (CPI) and the Core Personal Consumption Expenditures Index (less food and energy) currently at 3.7% down substantially from 9.1% in June 2022 (CPI). He's also pointing out that previous recessions resulted from the Federal Funds rate being increased to much higher levels than the current 5 1/4% – 5 1/2%.
Phys.org – Nov. 16 – “Study Suggests Corporate Culture Thwarts Efforts to Hire Innovative Candidates” covers recently published findings co-authored by Associate Professor of Management and Organization Waverly Ding, Dean’s Chair in Organizational Behavior Debra Shapiro and Smith PhD graduate Hyeun J. Lee, now at the University of Toronto, including: Despite the rhetoric from CEOs about the importance of recruiting for innovation, entrepreneurs face an established hiring bias. According to a recent study in the Strategic Entrepreneurship Journal, recruiters are 23 to 29% less likely to rank a former startup founder as a top candidate against their corporate executive peers. The authors demonstrated that recruiter characteristics can have a lot to do mitigating this bias, as does the size of a company.
Carrier Management Magazine – Nov. 16 – Smith experts' insights are featured separately in “How Employees Can Help Cut ‘Quiet Cutting’ Out of Their Careers” (Professor of the Practice in Systems Thinking and Design Gerald Suarez) and “Analyzing the New Workday Dead Zone” (Assistant Dean of Experiential Learning Nicole Coomber).
FIND MBA – Nov. 15 – Graduate career consultant Adam Shpall comments in “Online MBA Networking: Unlocking Digital Connections for Career Success”: “Connecting online and arranging virtual meetings has the advantage of being able to reach a broader audience and is more efficient than meeting people in person,” [says Shpall]. “While many would say that nothing replaces face to face in-person networking, connecting online has become significantly more commonplace and if done effectively, will have a lasting impact.” Additionally, he points out that over the past several years, the degree of online networking opportunities has exploded, many lending themselves to the virtual environment. “Many programs which we used to offer in-person are now being conducted remotely,” Shpall says. “These virtual adaptations have the potential to reach a much larger audience of students, alumni and employers – and they are also easier to orchestrate and more cost effective. ”One example of an event the Smith School now more regularly conducts online is mock interviews in which alumni from companies coach current Online MBA students, including those headquartered far away from the campus in Maryland, such as Amazon and Microsoft on the US west coast…Indeed, the Smith School’s Shpall says that networking as an Online MBA graduate has enumerable benefits for one’s career. “When you go through a rigorous MBA program, you build strong bonds with classmates who are all going through the same experience as you,” he concludes. “These classmates come to learn to trust you in terms of the quality of work you can deliver, and these connections can be maintained for a lifetime.”
Maryland Today – Nov. 14 – “Congrats! You’ve Been Elected. Now What?” quotes Senior Faculty Specialist Sarah Wolek: The online toolkit offers guidance on building an inclusive team, encouraging public engagement, leading productive committee meetings, and creating a website and transition report. [Wolek] had a similar experience after being appointed last spring to represent District 16 in Maryland’s House of Delegates. “You have so many things that are coming at you, from relationship building and connecting with stakeholders, to learning the ropes of the institution you are going to be a part of,” she said. “You may be walking into an institution that has a storied history, culture and way of working that you’re not used to, and so as an outsider coming in, you're not only having to learn the work, you're also learning how the work is done so you can be most effective.”
International Business Times – Nov. 12 – “Stocks Roar Back Led By Technology Shares – Will Moody's And Inflation Spoil The Rally?” quotes Clinical Professor of Finance David Kass: “The Federal Reserve will be paying careful attention to the upcoming Producer Price Index and Consumer Price Index reports next week, as well as the Personal Expenditure Index, which will be released on November 30,” David Kass, clinical professor of finance at the University of Maryland Robert H. Smith School of Business, told IBT. “With the current unemployment rate of only 3.9%, the Federal Funds rate of 5 1/4%-5 1/2% may be increased by 1/4% at the next FOMC meeting on Dec. 12-13, 2023,” he added. “If these measures of inflation indicate that little or no progress is being made in reducing the rate of price increases.”
Daily Caller News Foundation – Nov. 11 – “Americans Are Increasingly Failing To Make Debt Payments AsInflation Continues To Put ‘Strain On Consumers’” quotes Dean's Professor of Finance Michael Faulkender: “Consumers pay for things three ways: income, savings and credit,” [Faulkender] told the DCNF. “We know that wages have not kept up with inflation over the last 2.5 years and that many households have spent all of the savings accumulated during the pandemic. Therefore, in order to maintain their spending levels, they have been adding to their credit card balances, such that aggregate balances have now eclipsed $1 trillion. Rising credit card debt in a rising interest rate environment with incomes not keeping pace will put more and more households into financial difficulty, resulting in delinquencies.”
IEDP – Nov 10 – “How Team Member Selection Goes Wrong”: (New Study Reveals How Perceptions of Competence Versus Interpersonal Skills Can be Inaccurately Judged When Choosing Team Members) features research by Associate Professor of Management and Organization Rellie Derfler-Rozin, with co-authors including Smith PhD graduate Hyunsun Park, and includes: The study’s key finding is that there is a marked difference in the accuracy of team members’ perceptions of a candidate’s competence and their perception of that person’s interpersonal skills. The competence aspect relates to task-related performance and providing task-related ideas and suggestions. The interpersonal performance in the team relates to behaviors aimed at supporting the team’s social and collaborative dynamics. Both matter and should be balanced when decisions are taken.
Maryland Today – Nov. 10 – Frank Goertner, director of federal and veteran affairs and director of the Graduate Program in Technology Management, and Dingman Center for Entrepreneurship Managing Director Michael Hoffmeyer are among veterans at UMD reflecting on their military service and how they carry it forward in their academic roles in “An Enduring Call to Serve.”
Harvard Business Review – Nov. 8 – Management and Organization professors Trevor Foulk and Vijaya Venkataramani co-author a summary of their recent research in “How Creative Collaboration Can Strengthen Relationships.” Summary: We know that creativity can lead to better products or services. But can it also help us get along with each other at work? A research study set out to answer this question and found that, indeed, when people are put in a position to be creative, they tend to view others more fondly because they recollect each person’s unique contributions to the process. This may only work in situations where psychological safety is present, however, as unsafe environments can lead to negative group outcomes and perceptions.
Entrepreneur – Nov. 7 – “Top 50 Best Undergraduate Programs for Entrepreneurs in 2024” highlights Smith’s Dingman Center for Entrepreneurship: Dingman Center: This award-winning hub, established in 1985, creates an inclusive environment to educate, empower and equip students with skills to be an entrepreneur and provides the resources to make their ideas a reality.
Business Insider - Nov. 6 - "Warren Buffett Swapped Cash for Bonds, Sold a Chunk of Chevron, and Sped up Buybacks in October. Here are 3 Tasty Nuggets From Berkshire Hathaway's Earnings.” quotes Clinical Professor of Finance David Kass: Berkshire previously disclosed that it sold HP stock worth about $500 million in September, which explains some of the cost-base decline in consumer products. As for the commercial segment, David Kass, a finance professor and Buffett blogger, suggested on X that Berkshire may have sold its $800 million stake in General Motors. The release of Berkshire's quarterly stock-portfolio update in mid-November will confirm or refute his suspicions.
TalkMarkets - Nov. 4 - Clinical Professor of Finance David Kass gives “5 Highlights Of Berkshire Hathaway’s 2023 Third Quarter Earnings Report” and the “2023 Percentage Returns To 5 Largest Stocks” (for Nov. 4).
Fox 5 DC - Nov. 3 - Accounting lecturer Samuel Handwerger discusses the Smith School’s Justice for Fraud Victims program and its collaboration with Prince George’s County law enforcement in "UMD Business Fraud Prevention Seminar Aims to Curb Online Financial Crimes.”
Fox Business - Nov. 1 - Dean’s Professor of Finance Michael Faulkender discusses the economy and economic policy in ‘Biden and Powell Differ on U.S. Economy’ Evening Edit segment, including: “…You’ve trapped people into renting for potentially the foreseeable future, because the price of houses hasn’t really moved all that much but interest rates have more than doubled. The result is that you have people unable to make the kinds of monthly payments. So instead of building equity and starting homeownership, they’re staying in rental properties for a much longer time period, and [President] Biden doesn’t want you to take that into account at all…” … Related: Faulkender comments in Axios’ “‘America First’ buzzsaw for the IRA,” including: Expect IRA changes to be a Day 1 issue, said Faulkender, the [America First Policy] institute's chief economist. "We are going to review every rule, every notice, everything the administration has done in its implementation of that statute…”
Maryland Daily Record - Oct. 31 - “UMD Smith School, Montgomery College Launch Pathway to Business Analytics Master’s Degree Program” announces: a ‘2+2+1’ track structured for students to complete the master's portion in one year, following two years each at the associate and undergraduate levels through which master's level credits are accumulated… Related coverage includes Yahoo Finance, which quotes Professor of the Practice and MS in Business Analytics Academic Director Suresh Acharya: “We took a very market-driven approach,” says Acharya, noting (according to Coursera-reported U.S. Bureau of Labor Statistics data) that business analyst jobs – collectively with those for management analysts and operations analysts – are on track for growth up to 25% by 2030. Much of this growth, he adds, is expected in the Washington, D.C. area, including Montgomery County.
The Economic Innovation Group - Oct. 31 - Associate Professor of Management and Organization Evan Starr produces a research brief “Noncompete Clauses: A Policymaker’s Guide through the Key Questions and Evidence.” Introduction: In the wake of growing anecdotal and empirical evidence, the centuries-old debate over how to regulate noncompete clauses has hastened towards a contentious resolution: ban them. These post-employment restrictions, known simply as “noncompetes,” prohibit departing workers from starting or joining a competing firm for a period of time and often in a circumscribed geographic area. Historically, most U.S. states have enforced noncompetes on a case-by-case basis, seeking to balance the harms to workers and society that stem from direct restraints on competition with the firm’s need to protect its legitimate business interests. The status quo, however, is on the verge of significant change. In 2023, the Federal Trade Commission proposed to ban noncompetes nationwide; for the first time in over a century, a state (Minnesota) has passed a ban on noncompetes, while another state’s proposed ban awaits the governor’s signature (New York); and the general counsel for the National Labor Relations Board declared that noncompetes violate the National Labor Relations Act. This recent policy action follows the many state policies passed since 2015 which have banned noncompetes for physicians, tech workers, and workers earning below specified thresholds. Why did this historic debate over noncompetes move so abruptly towards banning them? Alongside increased media scrutiny and hard-to-stomach anecdotes of noncompetes unnecessarily derailing the lives of workers, new empirical evidence on the prevalence and harms of noncompetes and their enforceability has tilted the scales.
The Mortgage Reports – Oct. 30 – Professor of the Practice and Smith Enterprise Risk Consortium Director Clifford Rossi contributes to “Housing Market Predictions: The Real Estate Forecast for the Next 5 Years,” including: “…Home prices have remained well above long-term fundamentals in many metro areas, with some areas seeing further pressure from pandemic-era demographic shifts that have occurred in certain high-cost densely populated areas to other markets in Texas, Tennessee, and Florida, for example. Financially vulnerable segments, such as low- and moderate-income and minority borrowers, are most affected by these headwinds. Little relief on either supply or mortgage rates is expected until inflation moves back to the Fed’s 2% target. Mortgage originators are under severe pressure financially with non-depository mortgage lenders most vulnerable. The mortgage market is experiencing a dramatic downturn with refinances at historically low levels, which if it continues, only puts a further drag on the overall economy in 2024 that will face several risks next year.”
Baltimore Banner – Oct. 30 – “New Grocery Store to Fill Void Left by Price Rite Closure in Southwest Baltimore” quotes Associate Professor of Marketing Bobby Zhou: “For a local grocery store, it cannot be opened in a neighborhood where the number of households is really small. If it’s really small, that’s just not going to be economically viable.”
Barron’s – Oct. 27 – In a “To the Editor” submission, Clinical Professor of Finance David Kass gives “The Case for Spinoffs”: Regarding “Big-Name Stock Spinoffs Are Going Mainstream. Here’s Why.” (The Economy, Oct. 18): In addition to the tax-free nature of these transactions to both the parent corporation and the recipient shareholders, this restructuring permits the spun-off company to make its own managerial decisions without having to go up a corporate ladder for time-delayed approvals. Further, these companies’ managers would probably have their interests closely aligned with shareholders through substantial stock ownership and stock options. Spinoffs, on average, have outperformed the market, including several associated with John Malone’s Liberty Media. One outstanding performer has been Chipotle Mexican Grill, which was spun off by McDonald’s in January 2006. Its compounded rate of return has been 28% a year, which has handily outperformed McDonald’s return of 15% a year over the past 17 years.
Maryland Today – Oct. 27 – Professor of Marketing Jie Zhang explains “shrinkflation” in a Halloween context, via “Honey, They Shrunk the Candy.”
TechTarget – Oct. 25 – Information Systems professor Balaji Padmanabhan contributes to “The Human Problem with Generative AI in HR,” including: But there will be pitfalls to HR's adoption of AI, including the risk of putting too much trust in AI recommendations, [said Padmanabhan]. The complacency risk “will never go away,” Padmanabhan said. “And once the comfort level increases, that risk may actually increase in time.” … One of the initial generative AI applications is writing job descriptions. Here, Padmanabhan can see how complacency might take over. He said employees might stop checking future job description outputs once the AI system correctly constructs the first 10 job descriptions. Padmanabhan said other generative AI risks include the “huge problem” of incorrect answers. LLMs don't understand the underlying knowledge in their data; instead, they learn how to connect words. “They're learning the structure of language, which is what they’re meant to do,” he said. Padmanabhan said generative AI needs verification systems to double-check any outputs. One model might be verification as a service, where humans with expertise in benefits, for instance, review an LLM’s responses.
Fortune – Oct. 25 – Research co-authored by Associate Professor of Management and Organization Evan Starr is a focus of “A Company’s Pro-choice Stance on Abortion is the Equivalent of a 12% Wage Increase, New Research into Job Seekers’ Interest Shows”: In We’ve Got You Covered: Employer and Employee Responses to Dobbs v. Jackson, my coauthors, Pawel Adrjan, Svenja Gudell, Allison Shrivastava, Jason Sockin, Evan Starr and I provide the first evidence on the impacts of a company making a public announcement to cover out-of-state abortion care on recruitment of new workers and job satisfaction amongst existing employees. The results we uncover are based on the analysis of data from Indeed and Glassdoor, consisting of 3 billion job seekers’ clicks on U.S. job postings and 6.5 million company reviews.
HousingWire – Oct. 25 – Professor of the Practice and Smith Enterprise Risk Consortium Director Clifford Rossi writes “How to Avert an Impending Homeowners Insurance Crisis” (timed with the FHFA’s property insurance symposium in November) including: To ensure the vitality of both homeowners insurance and mortgage markets, a combined private-public insurance solution at a national level is required to distribute natural disaster risk more efficiently, thereby lowering the costs and access to insurance and helping reduce pressures from a housing affordability crisis already in full bloom. This could be attained by creating a new government-sponsored enterprise (GSE) under the regulatory purview of the Federal Housing Finance Agency (FHFA) that already regulates Fannie Mae and Freddie Mac. The existing National Flood Insurance Program (NFIP) would be restructured into this new hazard insurance GSE.
MIT Sloan Management Review – Oct. 25 – Dean’s Professor of Management Subra Tangirala co-authors “There Actually Is an ‘I’ in Team,” covering his research, with Smith PhD graduates Elad Scherf and Alex Ning Li. Summary: Research shows that when dealing with fundamental change, teams that retrain individuals before focusing on collaboration have better results.
AACSB Insights – Oct. 24 – People and Places includes (scroll down): The University of Maryland’s Robert H. Smith School of Business in College Park has launched a collaboration with Montgomery College, a community college in Rockville, Maryland. The partnership provides a pathway for students in Montgomery’s new Associate of Arts in Business Analytics program to earn a Master of Science in Business Analytics (MSBA) from the Smith School. Through the 2+2+1 track, students can spend two years at Montgomery, two years in the undergraduate program at Smith School, and one year completing their MSBA degrees. Students practice using Excel, R, Tableau, and SQL; learn to summarize, visualize, and analyze data; study ethical issues in data management; and take part in project-based capstone projects. … Related coverage via “UMD Smith, Montgomery College Initiate Pathway to a Business Analytics Masters” at Science Newsnet, Yahoo Finance, others.
Baltimore Banner – Oct. 23 – “Eddie’s of Roland Park Thrives as a Family Business Even as Other Grocers Close” quotes Associate Professor of Marketing Bobby Zhou: Local grocers have to be innovative in their appeal and approaches to keep customers, said one marketing expert. Focusing on hyperlocalized tastes is one good strategy, said Bobby Zhou, associate professor of marketing with the Robert H. Smith Business School at the University of Maryland. Zhou added that local grocery stores can also build personal relationships with their customers to stand out from larger chains. “When you go to Walmart and Target, consumers can hardly relate to the employees there, but if you buy stuff from people who are actually from the community, the psychological distance is automatically shortened. You feel good about supporting the community,” Zhou said.
WTOP – Oct. 21 – “Businesses are the Biggest Targets of Financial Crimes. Help is Being Offered in Prince George’s Co.” references the Nov. 3 Business Fraud Prevention Seminar at the College Park Marriott presented by Smith’s Justice for Fraud Victims and Prince George’s County Police Financial Crimes Unit and free with advance registration.
International Business Times – Oct. 19 – Clinical Professor of Finance David Kass comments in “What P&G Price Hikes Tell About Basic Consumer Goods Inflation And US Economy”: P&G's solid financial performance is a story of brand strength for must-have products and a resilient economy driven by robust consumer demand. “P&G has been able to raise prices as a result of both its pricing power on its well-established brands that are perceived to be of high quality, as well as the financial strength of consumers,” David I Kass, a finance professor at the University of Maryland's Robert H. Smith School of Business, told IBT. “As a result of the recent monetary and fiscal stimulus in response to the pandemic. Consumers with higher than average incomes have been relatively price insensitive and generally have had an inelastic demand for household goods.” Kass doesn't expect the tailwind from robust spending to continue, as consumers run out of accumulated savings and the government stimulus programs are depleted. “Consumers are likely to become more price sensitive, which should lead to the substitution of lower cost goods and, therefore, a reduction in goods inflation,” he added.
The National Desk via WJLA – Oct. 17 – “Fearing AI-induced Financial Crisis, SEC Chair Pushes for Guardrails” quotes Professor of the Practice and Smith Enterprise Risk Consortium Director Clifford Rossi: While Gensler framed the likelihood of a financial crisis as a certainty, that prediction is not universal. A broad financial crisis based on predictive models would require many of the country’s largest banks to lack human oversight of them and move forward without questioning the generated results. “I can't recall that any model that I'm aware of that has actually ever precipitated a financial crisis. I'm fond of saying that all models are wrong, some are useful, and they're only meant to be guideposts,” [said Rossi] who also worked in high levels of risk management for several large banks. “I can't imagine the industry just blindly implementing models and not having human intervention or overrides on those models.” The Consumer Financial Protection Bureau has cited issues about flaws in data sets to make recommendations in automated tenant screening programs. “The issue there is that there's a lack of transparency and explainability associated with these models, and that creates or invites a huge potential for fair lending issues,” Rossi said.
Psychology Today – Oct. 17 – Associate Professor of Management and Organization Trevor Foulk writes “Halloween Special: Why Do We Find Clowns So Creepy?”
Financial Economists Roundtable – Oct. 16 – Dean's Chaired Professor Lemma Senbet co-authors the newly released 2022 Statement of the FER, “The Controversy Over Proxy Voting: The Role of Asset Managers and Proxy Advisors.” From the summary: This discussion concludes with a set of policy recommendations, such as: (a) requiring disclosure of advisory firms’ other businesses, (b) increasing the transparency of the business model of proxy advisory firms, particularly around the rationale for their general guidelines for voting recommendations, (c) ensuring that the regulatory burden on proxy advisory firms does not discourage entry, and (d) increasing the regulatory oversight of the voting process with a view to incorporating investor preferences in proxy voting.
Business a.m. – Oct. 16 – “Surviving the Attention Economy: How to Keep Audiences Engaged” features research co-authored by Dean’s Professor of Marketing Wendy Moe and includes: Why do some articles captivate readers and encourage them to keep reading, while others make them lose interest after just a few sentences? And how does the content (i.e., the language used) shape whether audiences stay engaged? This study addresses these questions by utilizing natural language processing of over 600,000 reading sessions from 35,000 pieces of content, combined with controlled experiments.
WYPR Radio – Oct. 16 – Assistant Professor of Information Systems Lauren Rhue discusses her research as it applies to ‘Bias and AI Technology’ (16:35-25:37).
Daily Caller News Foundation (via MSN) – Oct. 15 – “Runaway Inflation ‘Unlikely’ To Be Reeled In Under Biden Administration, Experts Say” quotes Dean’s Professor of Finance Michael Faulkender, including: “We must continue to remember that it is not only monetary policy that determines inflation, [Faulkender told] the DCNF. “It is also fiscal and regulatory policy. Yes, monetary policy can get us back to 2% if the Fed keeps raising interest rates high enough. The problem is that the Biden Administration keeps pouring gasoline on the inflation fire by running $2 trillion deficits while imposing costly regulations that take supply offline.”
GARP – Oct. 13 – Professor of the Practice and Smith Enterprise Risk Consortium Director Clifford Rossi writes, for his latest CRO Outlook column, “How to Reduce Bank Failures: A Novel Approach. Summary: “Poor risk governance, culture and infrastructure have been responsible for many financial meltdowns, including this year’s SVB and Signature Bank fiascoes. Regulators keep trying to fix this problem by increasing capital requirements, but there is a better solution: a quality score that assesses the effectiveness of banks’ risk management.”
Poets & Quants – Oct. 13 – “The Favorite Professors Of Executive MBAs” excerpts Smith executive MBA grad Glen Martin’s 2023 Best & Brightest Executive MBAs profile: “At the Robert H. Smith School of Business, I had the pleasure of learning from some truly extraordinary professors. However, there was one professor who stood out to me: Dr. Cristian Dezsö and his macroeconomics class. His enthusiasm and humor made the class so enjoyable; not to mention his impressive professional insights on domestic and international economics. He had a unique ability to explain complex ideas in simple terms, all while tying in the bigger picture and showing us how it affects our society.”
Bloomberg Businessweek – Oct. 11 “Business Schools Seek to Build Entrepreneurs with New Programs” quotes Dingman Center Managing Director Michael Hoffmeyer and MBA graduate Jasmine Snead Ferguson, including: “As the market in terms of demand for MBA broadly has declined in recent years, I think business schools have become much less complacent and much more competitive in terms of really understanding, ‘What are the needs in the market?’,” [says Hoffmeyer]. … Jasmine Snead Ferguson had launched a business, Aurora Tights, before she started as a full-time MBA student at Maryland’s Smith school in 2019… At Smith, much of her coursework covered facets starting and running a business, specifically as a woman of color. And as part of Ladies First, an initiative to increase the number of women involved in entrepreneurship at the University of Maryland, Ferguson says she often received meaningful advice from a mentor, especially about how to frame seeming disadvantages as opportunities, when meeting with prospective funders and more.
Washington Post – Oct. 10 – The Fall Guide to Graduate and Executive Education extensively quotes Dean Prabhudev Konana including: “Universities Meet Demand as Adoption of AI Accelerates,” including: “AI systems, particularly Generative AI, have evolved fast and will get better and more ubiquitous,” [said Konana].“We should embrace, not resist, AI, and be aware of the strengths, weaknesses, dangers and opportunities.” … “We encourage faculty to embrace generative AI for its pedagogical value,” Konana said. “Students must learn to use AI to drive their creativity and recognize AI limitations on societal and ethical issues.” … For example, Konana said, students should learn to use ChatGPT for simple, low-level text while focusing on higher-level thinking—as they’re likely to do in their jobs someday. “You don’t use exactly what ChatGPT gives you; you use it like scaffolding and create on top of it. Any generative AI produces content based on past work,” he said. “It is not forward-looking. Students must learn to be forward thinkers, recognize ﬂaws in AI output, and understand limitations.” … At the University of Maryland-Smith, “We’re evolving our curriculum to address AI in the context of marketing, supply chain, finance, problem solving, and adoption strategy—including risk and algorithm development ethics,” Konana said. “To accelerate this, we hired information systems professor Balaji Padmanabhan, who specializes in contextual AI and designed one of the first technology-focused MBA electives while at the Wharton School.”
Washington Post – Oct. 7 – “Holiday Shopping Season is Here, at Least According to Retailers” quotes Professor of Marketing Jie Zhang: The start of the holiday shopping season has been inching back for years, long abrading the novelty of Black Friday, which got its name because the rush of sales the day after Thanksgiving could change the retailers’ books from red to black. Powerful retailers like Amazon usually set the bar for early promotions, forcing competitors to follow, [said Zhang]. Bookshop.org, an online platform for independent book stores, is offering free shipping to directly compete with Prime Day. And Amazon’s July Prime Day event coincided with big sales from Target and Walmart, boosting online retail sales by 0.6 percent, according to the U.S. Census Bureau. “It really is this vicious cycle,” Zhang said. “Everybody tries to beat their competitors, be the first to be on the market for holiday sales … and it just pushed everyone to be earlier and earlier.”
Wall Street Journal – Oct. 6 – Dean Prabhudev Konana describes Smith’s strategy to answer a ‘nationwide shortage of accountants’: Professors even waved students away from accounting, warning students that classes would be very rigorous. “Many students subsequently flocked to marketing and supply-chain management, said Prabhudev Konana, the dean of the University of Maryland’s business school, where the number of accounting majors fell by about 30% since 2018. Konana is now trying to integrate recently buzzy issues such as blockchain and cryptocurrency into the curriculum to broaden accounting’s appeal again. “Rather than start to teach about debits and credits in the very first class, get them excited,” he said.
Reuters – Oct. 6 – “US Would Struggle to Block Exxon's Politically Unpopular Megadeal” quotes Clinical Professor of Finance David Kass: It could not be learned how long Exxon and Pioneer plan to give themselves to complete their deal or whether the latter will negotiate a hefty break-up fee to allow for the possibility that regulators thwart their tie-up. David Kass, a finance professor at the University of Maryland and former FTC antitrust economist, said regulators would have to show they have conducted a thorough analysis of Exxon's deal for Pioneer given the key role the Permian basin plays in energy production. “(The basin) is a very significant factor in this case,” he said.
DataQuest – Oct. 4 – “The Poison is Not in a Dart. It’s in the AC Duct” quotes EY Alumni Professor of Managerial Accounting Lawrence Gordon: Data poisoning usually refers to situations where the training data used in ML models is intentionally corrupted by a hacker, if we see it from the gaze of Cybersecurity expert Prof. Lawrence A. Gordon, EY Alumni Professor of Managerial Accounting and Information Assurance, Robert H. Smith School of Business, University of Maryland. “Thus, in terms of the CIA (Confidentiality, Integrity, and Availability) triad considered in cybersecurity, data poisoning is a form of data Integrity cyber breach. Given the growing importance of ML models (which fall under the umbrella of AI), it seems (at least to me) that data poisoning should be a serious concern to organizations.”
Fox Business – Oct. 3 – Dean’s Professor of Finance Michael Faulkender explains implications of U.S. Treasury bond prices declining (beginning at 38-minute mark), via the Kudlow show: “[Further contributing] to the decline in bond prices today and the sharp increase in yields was the JOLTS (Job Openings and Labor Turnover Survey) report that came out this morning. We were not expecting an additional million job openings… and that really spooked the market because you have a Federal Reserve that believes that a strong job market means inflation and therefore increases the likelihood of future rate increases beyond what we were thinking about a week ago, and so that’s sending bond yields much higher, anticipating the Fed’s going to keep interest rates higher for longer. That’s going to destroy [home] affordability even more because the 30-year mortgage interest rate is set off of the 10-year bond yield and so expectations of more interest rate increases by the Fed are going to raise interest rates on mortgages and that’s going to send affordability to even worse levels…” Related: Faulkender discusses “Effects of Government Spending” via TBN Centerpoint (10/4).
TalkMarkets – Sept. 30 – Clinical Professor of Finance David Kass gives the “2023 Percentage Returns of The 5 Largest Stocks.”
Baltimore Sun – Sept. 29 – Accounting lecturer Samuel Handwerger explains LLCs and shell companies as part of “As the Archdiocese of Baltimore Faces Potential Bankruptcy, Untangling its Assets Proves Murky,” including: [Handwerger] said the practice of creating corporations to shelter assets is a “typical” strategy in the business world, and is practiced by for-profit and nonprofit companies alike. There is a difference between control of an asset and ownership of one, Handwerger said. Just because one person controls something doesn’t necessarily mean they own it — even if they have the final say over whether it can be sold. Such thin degrees of separation are legal, so long as the corporations actually function independently. If there’s commingling of assets, like bank accounts for the parish with the larger archdiocese, then it’s possible a judge could determine the assets aren’t in fact separate. “It’s unfortunate for the victims,” Handwerger said. “There are corporate formalities in order to keep that shell strong and protect those assets, and my suspicion is [the Baltimore diocese] probably did that.”
Daily Caller News Foundation – Sept. 28 – “Mortgage Rates Spike To 22-Year High As Houses Become Increasingly Unaffordable” quotes Dean’s Professor of Finance Michael Faulkender: “When the President[Biden] took office, the average interest rate on a 30-year fixed rate mortgage was approximately 2.7%,” [Faulkender] told the Daily Caller News Foundation. “Such a dramatic increase in house payments has not been accompanied by anywhere near that increase in paychecks. Over the time since inauguration day, real wages have declined approximately three percent, meaning an hour of working results in three percent less an American worker can purchase than just 2.5 years ago.”
Science Newsnet – Sept. 28 – In “How a Repatriation Tax Challenge Before SCOTUS Could Upend the Tax Code,” Accounting Lecturer Samuel Handwerger describes implications of Moore v. United States, a case before the Supreme Court that challenges the Mandatory Repatriation Tax provision of the 2017 Tax Cuts and Jobs Act.
Almanac – Sept. 26 – “Albert S. “Pete” Kyle: Wharton-Jacobs Levy Prize” documents Smith’s Kyle, Charles E. Smith Chair Professor of Finance, accepting the Wharton-Jacobs Levy Prize for his research on market microstructure, on Sept. 22, 2023, in New York.
Washington Post – Sept. 25 – “Their Podcast is in Trouble. A Biden-led Crackdown May Save Them” references research by Associate Professor of Management and Organization Evan Starr to add context to how a noncompete clause in a contract for two former sports-talk radio hosts could test new National Labor Relations Board guidance: Roughly 30 million workers collectively lose as much as $300 billion a year in wages because of noncompete agreements, according to the Federal Trade Commission. (The FTC has proposed its own ban on noncompete agreements, but it is not due out until next year and is likely to face immediate legal challenge.) Evan Starr, a University of Maryland economist, has found that as much as 18 percent of the labor market is covered by a noncompete agreement.
WalletHub Expert Opinions – Sept. 22 – Accounting Lecturer Samuel Handwerger, in essay form, gives “Best Student Credit Cards” advice.
Science Newsnet – Sept. 22 – Clinical Professor and Associate Area Chair of Marketing Mary Beth Furst describes “Why the UFC-WWE Merger is a One-Two Marketing Punch.”
Harvard Business Review – Sept. 21 – Dean’s Professor of Marketing Rebecca Ratner co-authors “Research: Consumers Choose Shared Experiences Over Quality Ones.”
International Business Times – Sept. 21 – Clinical Professor of Finance David Kass comments on recent Fed-related developments in “Stocks, Bonds, And Oil Under Pressure from Massive Headwinds”: David I. Kass, Clinical Professor of Finance at University of Maryland Robert H. Smith School of Business, provides further insight into the recent FOMC decision. “Although the FOMC voted 12-0 to maintain the target range for the federal funds rate at 5-1/4 to 5-1/2 percent as expected, its statement (“inflation remains elevated”) and Chair Powell's subsequent press conference was hawkish in tone,” he told IBT. “The quarterly economic projections of Federal Reserve Board members and Federal Reserve Bank presidents revealed that there was likely one more 1/4 percent rate increase this year and only two 1/4 percent rate cuts in 2024.”
HHS/Stockholm School of Economics – Sept. 21 – “European Quant Marketing Workshop” previews the next-day “Digital Customer Engagement” presentation by Dean’s Professor of Marketing Wendy Moe, including: In this workshop, Professor Wendy Moe will provide an overview of how metrics and models of customer engagement have evolved. She will then discuss recent research that examines how certain linguistic features affect consumers' engagement with content.
TechXplore – Sept. 21 – “New AI-Powered Analytical Model Tracks Baseball Players' Path to the Big Show” describes an analytical model from Associate Clinical Professor of Information Systems Adam Lee and graduate student Chung-Hao Lee that could help teams predict the likelihood of prospects reaching the majors. Republished from Maryland Today.
Fox Business – Sept. 20 – Dean’s Professor of Finance Michael Faulkender discusses the Federal Reserve pausing an interest rate hike and the potential federal government shutdown in “The Fed has a lot of Work Cut Out for Itself.”
The Messenger – Sept. 20 – “1 in 5 Americans Willing to Go Into Debt for the New iPhone 15, Survey Finds” quotes Professor of Marketing Jie Zhang: “Smartphones have become an essential tool for most people's everyday lives. They are also indispensable for how we stay connected with others and express ourselves to the public,” [Zhang] told WalletHub. “Not surprisingly, so many people feel the need to get the latest and greatest phones, even if they have to get into debt for it.”
Seeking Alpha – Sept. 20 – “Coca-Cola: Economic Castle Continues to Grow with $106.1B in Brand Value” quotes Clinical Professor of Finance David Kass’ blog notes on organizing a Smith-student-group visit with Warren Buffett in 2013: Based on these numbers, it is unsurprising that Coca-Cola has been able to maintain its robust economic castle, otherwise known as moat, with a leading market share of 43.7% in the global non-alcoholic beverage sales, as similarly expounded by Warren Buffett in 2013: I came up with this term 40+ years ago because in capitalism, you have these economic castles. You need 2 things – a moat around the castle, and you need a knight in the castle who is trying to widen the moat around the castle. How did Coca-Cola build their moat? They deepened the thought in people’s minds that Coca-Cola is where happiness is. The moat is what’s in your mind. (Professor David Kass, University of Maryland).
NSS Magazine (Italy) – Sept. 19 – “Why is Solo Dining Becoming More and More Complicated?” references extensively Dean’s Professor of Marketing Rebecca Ratner’s “Inhibited from Bowling Alone” research, including: The trend of bars and restaurants turning away solo patrons – a practice noted and criticized on social media as well – runs the risk of further discouraging people from going out and doing things alone. This is because the habit of giving up on something just because one is alone is already quite prevalent. [Ratner] explained to The Washington Post that people tend to believe they have less fun when alone, underestimating how enjoyable an experience going to a museum, theater, cinema, or a restaurant alone could be. In her study titled "Inhibited from Bowling Alone," conducted with marketing professor Rebecca Hamilton, Ratner found that people think they have less fun when alone, but in reality, this is not the case…
Yahoo Finance – Sept. 19 – “Business Fraud Prevention Seminar Forthcoming from UMD, Prince George's County” includes: The (Nov. 3) seminar will explore the latest financial fraud tactics against businesses and practical counter methods, says JFV director and Smith Accounting and Information Assurance Lecturer Samuel Handwerger. “The digital age is fueling financial crimes against the business community in several ways.”
U.S. News & World Report – Sept. 18 – “US News Best Colleges” shows UMD rising in the business category (as reported by Maryland Today): to 21st overall, and No. 11 among public institutions, improving in four top-25 specialties:
- Entrepreneurship: No. 21 overall; No. 9 among publics
- Management information systems: No. 6 overall, No. 5 among publics
- Management: No. 20 overall, No. 13 among publics
- Supply chain management/Logistics: No. 14 overall, No. 11 among publics
Pensions & Investments – Sept. 15 – “University of Maryland Finance Professor Wins Wharton-Jacobs Levy Prize” details Albert “Pete” Kyle’s selection for the prestigious honor for his research on market microstructure, based on his 1985 Econometrica paper, “Continuous Auctions and Insider Trading.”
Wiley Online Library – Sept. 17 – “Option Momentum” features new research co-authored by Professor of Finance Steve Heston and forthcoming in the Journal of Finance. Abstract: This paper investigates the performance of option investments across different stocks by computing monthly returns on at-the-money straddles on individual equities. We find that options with high historical returns continue to significantly outperform options with low historical returns over horizons ranging from six to 36 months. This phenomenon is robust to including out-of-the-money options or delta-hedging the returns. Unlike stock momentum, option return continuation is not followed by long-run reversal. Significant returns remain after factor risk adjustment and after controlling for implied volatility and other characteristics. Across stocks, trading costs are unrelated to the magnitude of momentum profits.
WalletHub Ask the Experts – Sept. 13 – Professor of Marketing Jie Zhang comments on results of WalletHub’s “2023 iPhone Survey (More than 1 in 5 Americans think that the new iPhone is worth going into debt).”
Newsweek – Sept. 13 – Actor Matt Damon’s co-authored op-ed “We're Working to End the Water Crisis—With the Right Kind of Investment” cites Dean’s Professor of Finance Michael Faulkender’s paper ‘Understanding the Rise in Corporate Cash’ (in The Review of Financial Studies): At least 2 million Americans don't have running water or a working toilet at home, costing the U.S. economy $8.58 billion each year. At the same time, U.S. companies are holding $5.8 trillion in cash on their balance sheets, more than triple their $1.6 trillion in 2000. That's one huge reason for them to join the growing momentum in balance-sheet ESG investments, which has helped make impact investing a trillion-dollar market.
Maryland Today – Sept. 13 – “Accolades: Faculty and Staff Awards and Honors” includes: Rajshree Agarwal, Rudolph Lamone Chair of Strategy and Entrepreneurship and Director of the Ed Snider Center for Enterprise and Markets, was named an Academy of Management fellow and was appointed to the Federal Economic Statistics Advisory Committee. It advises the directors of the Department of Commerce's statistical agencies (the Bureau of Economic Analysis and the U.S. Census Bureau) and the commissioner of the Department of Labor's Bureau of Labor Statistics.
The Guardian – Sept. 10 – “Going Solo: Why Eating and Travelling on my Own is Such a Pleasure” quotes Dean’s Professor of Marketing Rebecca Ratner: “When people do things alone, they enjoy themselves more than they expect to,” says professor of marketing Rebecca Ratner, who has studied how people feel about the idea of undertaking hedonistic activities alone, and then how much they enjoy actually doing them. “People also overestimate the benefits of being with someone else,” she says.
Financial Times – Sept. 10 – “How the Masters in Management Brand is Building Abroad” includes: Digital tools and techniques that were widely adopted in teaching during Covid-19 remain important — although many younger students are keen to return to in-person learning. As we report, the Robert H. Smith School of Business at the University of Maryland is launching a new Online Master of Science in Management Studies this year, while Audencia offers students the option of taking one semester in its degree fully online.
GARP – Sept. 8 – In his latest CRO Outlook column for the Global Association of Risk Professionals, Smith Enterprise Risk Consortium Director and Professor of the Practice Clifford Rossi writes “SVB and Signature Bank Fallout: Why We Need a New Approach to Regional Bank Regulation and Risk Management”: Summary: Regulators seem intent on once again increasing capital and liquidity requirements for banks of a certain size – but data shows that mid-sized financial institutions remain less risky than larger banks. What’s needed, instead, is a more proactive safety and soundness strategy that addresses the root causes of recent bank scandals: poor governance and ineffective risk management.
Health Reporter – Sept. 7 – “Supply Chains of Crucial Drugs Threatened by Climate Risks” covers analysis by Smith Enterprise Risk Consortium Director Clifford Rossi and Master of Quantitative Finance students Matthew Rumrill and Harini Mantripragada. Related coverage in Maryland Today’s ‘Pharma Facilities Sit in Path of Tornadoes, Other Weather Disasters.’
Financial Times – Sept. 6 – Rellie Derfler-Rozin, academic director of the Master of Science in Management Studies Program comments in “Why Young Business Students Want to go Back to School”: Accordingly, the majority of MiM programmes are delivered full-time on campus, with only a few exceptions such as the Robert H Smith School of Business at the University of Maryland, which has launched a new online Master of Science in Management Studies this year, alongside its traditional on-campus programme. “Following the pandemic, we learnt we can do more things online,” says Rellie Derfler-Rozin, academic director of both programmes. As more degrees go digital, she says that business schools should reassess the role of the campus in the post-pandemic world. “As educators, we have a responsibility to be more thoughtful about the value of being in-person, and how to make those experiences even more meaningful.”
Bloomberg – Sept. 6 – Trump Plans Harsher Trade and Tax Policies for His 2024 Comeback Bid cites Dean’s Professor of Finance Michael Faulkender as chief economist for the America First Policy Institute and its role in shaping economic policy for a potential Republican-led administration in the White House.
TalkMarkets – Sept. 2 – Clinical Professor of Finance David Kass gives the “2023 Percentage Returns of The 5 Largest Stocks.”
Fox Business – Sept. 1 – Dean’s Professor of Finance Michael Faulkender discusses the August 2023 U.S. jobs report.
Newswise – Aug. 31 – Smith Enterprise Risk Consortium Director and Professor of the Practice Clifford Rossi and Smith Master of Quantitative Finance student Harini Mantripragada examine ‘Hurricane Risk Implications for Low-to-Moderate-Income Mortgage Borrowers.’
LeMonde – Aug. 30 – “The company will not be the place for resolving political conflict” reviews Associate Professor of Management Evan Starr’s co-authored study of post-Dobbs U.S. job trends.
CNBC – Aug. 30 – “Warren Buffett, who Turns 93, is at the Top of His Game as He Pushes Berkshire Hathaway to New Heights” quotes Clinical Professor of Finance David Kass: “He’s still at the top of his game. His mental acuity is sharp as ever,” said David Kass, a finance professor at the University of Maryland’s Robert H. Smith School of Business, who once held private lunches for his students and Buffett.” … “It’s groundbreaking in the sense that I’m not aware of any prominent investor, hedge manager investing in Japan,” Kass said. “The country is in a deflationary environment for decades, and these companies were just sitting out there being ignored.” … “His preferred holding period is, in his words, forever. He still has this infinite time horizon, even at the age of 93,” Kass said.
The Wall Street Transcript – Aug. 31 – Adjunct finance professor Joseph Rinaldi discusses “Increasing Exposure to High Dividend Utility Stocks and Bank CDs.”
Maryland Daily Record – Aug. 30 – UMD Smith School to host Customer Analytics Workshop” previews the Office of Executive Education’s virtual workshop, in Oct. 9-22 sessions, for professionals in business-to-business and business-to-customer settings … Also at the Daily Record: “UMD Smith School and Partners Launch Sports Management Program.” (Aug. 29).
MarketWatch – Aug. 28 – “September Is a Bad Month for the Stock Market. Why Gold Is a Different Story” references a ‘Seasonal Asset Allocation’ paper co-authored by Russell Wermers, Paul J. Cinquegrana ’63 Endowed Chair in Finance and Center for Financial Policy director, for evidence that: “seasonal affective disorder”(SAD) is the source of September’s poor stock market performance. …The authors of this recent study connected these monthly SAD changes with the stock market by measuring flows of cash into and out of equity mutual funds. After controlling for other possible factors that could potentially also explain those flows, the researchers found a high correlation between changes in the incidence of SAD and equity mutual fund flows. The month experiencing the biggest net outflow is September. Both a strong statistical and a strong theoretical case can therefore be made for why September may be a below-average month for stocks. While this doesn’t guarantee that the stock market will lose ground in this coming September, it does increase the probability that it will decline.
MBAGradSchools – Aug. 28 – Associate Dean for Strategic Initiatives P.K. Kannan discusses his research in “Utilizing Data-driven Approaches in Business: A One-on-One with Dr. P.K. Kannan.” It draws from his recent papers “Identifying market structure: A deep network representation learning of social engagement” (with Associate Professor of Information Systems Kunpeng Zhang) and “Measuring the real-time stock market impact of firm-generated content.”
TalkMarkets – Aug. 26 – Clinical Professor of Finance David Kass gives the “2023 Percentage Returns Of The 5 Largest Stocks.”
New York Daily News – Aug. 25 – “Hochul can End Noncompete Clauses: Noncompete Agreements are Pervasive and Un-American” cites research by Associate Professor of Management and Organization Evan Starr: One study by University of Maryland economist Evan Starr estimates that roughly 1 in 7 workers making $40,000 or less sign noncompetes.
Fox Business – Aug. 25 – Dean’s Professor of Finance Michael Faulkender explains ‘How the Fed can Stop Inflation’ Including: “...If instead what we have is a ‘pro-supply side’ kind of economic approach where we actually encourage businesses to come in and bring additional supply on line, we’d have that boost in quantity supplied that brings prices down, rather than thinking the only way to bring prices back to a two-percent inflation level is by continuing to suppress demand.”
Human Resource Development Quarterly (via Wiley Online Library) – Aug. 24 – Associate Professor Toby Egan co-authors “Reconsidering our Uneconomic Growth Model: Human Resource Development's Role in Advancing Sustainability.”
TechTarget – Aug. 21 – “Abortion Benefits Become Double-Edged Sword” quotes Associate Professor of Management and Organization Evan Starr: [Starr], one of the researchers on the study, said the findings "suggest that firms that announce that they will cover out-of-state abortions experience an increase in job seeker interest, but it is coming mostly from states where abortions are already legal." The abortion benefit is "more of a way to signal firm culture rather than provide an actual fringe benefit," Starr said. On the flip side, covering out-of-state abortions is a turnoff for others in the company, notably men, he said. Related coverage via Forbes’ “Companies Offering To Pay For Abortion Travel See Major Uptick In Recruitment.”
WTOP (via SoundCloud) – Aug. 21 – Dean’s Professor of Marketing Rebecca Ratner discusses her consumer behavior research related to shared memories in “Most would Reject Travel Upgrades to Stay Close to a Friend or Romantic Partner.”
GARP – Aug. 18 – Professor of the Practice and Smith Enterprise Risk Consortium Director Clifford Rossi gives a Q&A on ‘Building a Healthy Risk Culture’ for the Global Association of Risk Professionals. Intro: Banks with effective risk cultures are less prone to errors and more equipped to handle shocks. But what specific steps do they need to take to develop proper risk management values, and what are the traits CROs desire when they search for talent to support their risk management beliefs?
My Worst Investment Ever podcast – Aug. 18 – Clinical Professor of Finance David Kass joins host and award-winning stock market analyst Andrew Stotz for an episode titled “Don’t Invest in a Company Unless the CEO Owns a Large Stake.”
BetaNews – Aug. 18 – Chris Todd, MBA ’13, writes “What to Look for in a Third-Party Vendor While Cutting Budgets.”
The Economist – Aug. 17 – “Do Abortion-Related Benefits Help American Firms Recruit?” reviews research co-authored by Associate Professor of Management Evan Starr, who in previous Maryland Today coverage, says the findings “suggest that company-sponsored, out-of-state abortion care policies are unlikely to substitute for state policies sanctioning abortion.” Additional coverage via an NBC News segment, “How Decision to Overturn Roe v Wade Impacts the Job Market (and its follow-up coverage at Daily Caller), plus articles at Fortune, Bloomberg, MarketWatch, Jezebel, HR Brew and others.
USA Today – Aug. 16 – Consumer behavior research related to shared memories co-authored by Dean’s Professor of Marketing Rebecca Ratner is featured in ‘Who gets the seat upgrade if only one is offered? What most flyers do,’ including: Ratner said the idea of shared experience is a crucial one when it comes to travelers opting in or out of doing things or even sitting together. “Let’s say you wanted – while you’re traveling – you wanted to see a show that was available, but there aren’t seats together. Our research shows people will forgo the experience altogether,” she said. “They think they won’t have shared memories.”
The National Desk (via CBS Austin) – Aug. 16 – Professor of the Practice and Smith Enterprise Risk Consortium Director Clifford Rossi comments in “Banks Could Have Credit Ratings Downgraded as Fitch Sees Risks in Economy, Interest Rate Increases”: “It's something certainly to keep an eye out for when the rating agencies say something and want to at least kind of say, ‘well, what's going on there?’ But I would temper that conservative view that they're coming out with or pessimistic view somewhat on the future of banking,” [said Rossi]. “Everybody needs to take a deep breath and say, ‘yep, rating agencies are probably trying to be cautious in an environment where there is a lot of volatility.’ We've already seen some stumbles with some pretty sizable banks and that's not in the distant past,” Rossi said. “But is that a reason for the sector to be downgraded as a whole and/or a large number being downgraded from there?”
WalletHub – Aug. 16 – Distinguished University Professor and David Bruce Smith Chair in Marketing Roland Rust weighs in for the Ask the Experts portion of a Citi Double Cash Card review.
Newswise – Aug. 16 – Accounting Lecturer Sam Handwerger explains the “Safe Harbor [accounting method] for Crypto Fraud Victims and Relevance to the Celsius Network Case.”
National Mortgage Professional – Aug. 15 – “Why IMBs Don’t Need A CRA Cramdown” quotes Professor of the Practice and Smith Enterprise Risk Consortium Director Clifford Rossi: The reasons banks have retreated from mortgage lending, especially FHA programs, mostly stem from the 2007-2008 financial crisis, [says Rossi]. Many banks no longer had an appetite for volatile assets such as mortgage servicing rights. Banks were also getting burned on the origination side through non-traditional mortgages, such as alt-A and subprime loans. “Another big reason the banks got out,” says Rossi, “particularly around FHA lending, but even more broadly, in the years following the financial crisis there was an awful lot of uproar by banks in terms of the lack of transparency of repurchase demands that were being made by the GSEs [Government Sponsored Enterprises], private mortgage insurance companies, and also by the FHA.”
Financial Times – Aug. 13 – “ICE’s $12bn mortgage tech deal builds heft in US home loans” quotes Professor of the Practice Clifford Rossi: Financial risk specialist Clifford Rossi, a veteran of several large lenders and professor at the University of Maryland, suggested financial regulators could make a strong case for designating ICE as systemically important because of its expansive mortgage market reach — a label that involves additional oversight. “By concentrating the technology solution in the hands of, say, one or two providers, it puts more pressure on the [system] plumbing,” he said, adding: “If there is a hiccup in the origination or in the servicing process, that can have pretty significant adverse impacts on not just the companies, but also on the customers downstream.” Republished at the Business Telegraph.
Dialogue – Aug. 12 – “Global Enterprise 2030,” co-authored by Michael D. Dingman Chair in Strategy and Entrepreneurship Anil K. Gupta and Haiyan Wang (MBA ’95), examines the “structure and dynamics of the global economy in 2030 [as] dramatically different from those in 2010 or even 2020” and how “global enterprises that hope to stay or emerge as the winners in the new era must rethink and redesign almost all key aspects of their strategies and organizations.”
WTOP – Aug. 12 – Dean’s Professor of Marketing Rebecca Ratner discusses her recent research in “Most Would Reject Travel Upgrades to Stay Close to a Friend or Romantic Partner, Study Finds.”
77 WABC – Aug. 12 – Dean’s Professor of Finance Michael Faulkender discusses the U.S. economy including the latest Consumer Price Index (CPI) report from the Bureau of Labor Statistics, on the Larry Kudlow Show (also via Player FM).
Maryland Today – Aug. 11 – “Company-Sponsored, Out-of-State Abortion Benefits a Poor Substitute for State Policies, Research Finds” covers a new study co-authored by Evan Starr, associate professor of management and organization, including: While companies that offered out-of-state abortion travel benefits enjoyed a substantial rise in job seeker interest, they suffered a deterioration in employee satisfaction. Overall, the results published this week on the Social Science Research Network website “suggest that company-sponsored, out-of-state abortion care policies are unlikely to substitute for state policies sanctioning abortion,” [says Starr]. Related coverage at Indeed Hiring Lab.
Washington Business Journal – The Aug. 11-17 issue’s “Back Page” highlights a Dingman Center for Entrepreneurship-hosted startup bootcamp: PITCH THIS: The University of Maryland Robert H. Smith School of Business hosted the Junior Achievement of Greater Washington’s Entrepreneurship Summit at the Edward St. John Learning and Teaching Center on July 28. The “start-up bootcamp” hosted over 70 high schoolers from the D.C. area and Canada, where students pitched ready-to-launch, socially conscious businesses to a panel of business leaders. Winning students, from left, Erin Graham, Norah Brahimi, Kierra Hall, Sandy Iligan, Ayati Arggawal, Micah Smith and Nathaniel Asfaw.
Chief Investment Officer – Aug. 10 – “ICPM Gives Top Research Award to Paper Exploring Active vs. Passive Investing” highlights work co-authored by Professor of Finance Russell Wermers as receiving the top prize in the International Centre for Pension Management’s 2023 Research Awards: They used a proprietary database to explore the relationship between the structure and size of defined benefit pension plans and their choice of active vs. passive management, internal vs. external management and allocation to public vs. private markets. They found a strong role for economic scale in pension plan investments: large plans have stronger bargaining power over their external managers in negotiating fees as well as access to better-performing funds, relative to small plans. Large plans, hence, pay significantly lower fees.
Newswise – Aug. 10 – “Anil K. Gupta Recognized by Strategic Management Society for Scholarly Impact,” covers SMS’s selection of Anil K Gupta, Michael D. Dingman Chair in Strategy and Entrepreneurship, for its 2023 CK Prahalad Award for Scholarly Impact on Practice.
AACSB Insights – Aug. 8 – “People and Places” highlights focus areas to Smith’s Master of Science in Information Systems (MSIS) program – artificial intelligence, cloud computing and emerging technologies: The new focus areas are designed to provide students with the skills to use information technologies to solve complex business problems. The school also is adding a January 2024 cohort start date for the program as a way to offer more scheduling flexibility for candidates, including those who have just earned three – or four-year undergraduate degrees. The MSIS is a STEM-designated, in-person program.
GoBankingRates – Aug. 8 – “Warren Buffett’s First Job — and the Money Lessons You Can Learn From It” quotes Clinical Professor of Finance David Kass: “Buffett has said that having the right temperament is more important than any other quality as a predictor of investment success,” said David Kass, clinical professor of finance at University of Maryland’s Robert H. Smith School of Business. “It is not necessary to have an IQ greater than 125. He has said jokingly that if you have an IQ that is greater than 125, you should sell the extra points. His bottom line recommendation is: The best investment anyone can make is in themselves. This will provide you with the knowledge and skills to most likely succeed as the economic environment changes.”
Seeking Alpha – Aug. 8 – Clinical Professor of Finance David Kass writes “Berkshire Hathaway Is Undervalued by 6%.” Related: Kass gives the “2023 Percentage Returns Of The 5 Largest Stocks (for Aug. 12) via TalkMarkets.
Food Safety Magazine – July-August 2023 – PhD candidate in supply chain management Abhay Grover co-authors (with Smith Masters’ in Business Analytics student Geetanjali Menon and Clare Narrod at UMD’s Joint Institute for Food Safety and Applied Nutrition) “Digital Transformation of Supply Chains to Meet Foreign Supplier Verification Program Requirements,” which examines how digital supply chains are transforming the food industry, helping businesses achieve transparency, traceability, and accountability required for FSVP compliance. Technologies like Blockchain, AI, IoT, and AR/VR play a vital role in ensuring food safety and enhancing overall supply chain efficiency.
TalkMarkets – Aug. 6 – Clinical Professor of Finance David Kass gives “5 Highlights of Berkshire’s 2023 Second Quarter Report” and the “2023 Percentage Returns Of The 5 Largest Stocks” (Aug. 5).
ABC News Radio – Aug. 4 – Dean’s Professor of Marketing Rebecca Ratner draws from her research on shared memories to answer ‘Would you take a first-class airline upgrade or a spot closer to a concert stage if it meant leaving your friend or family back in the cheap seats?’
VoxEU – Aug. 4 – Associate Professor of Finance Cecilia Bustamante co-authors “Carbon Trade-offs: How Firms Respond to Emissions Controls” as “a framework showing that whilst carbon pricing mechanisms curtail firms’ carbon emissions, as it becomes costlier to comply, these mechanisms also tilt polluting firms’ investment mix towards short-term abatement and away from green innovation. Subsidies for innovation can partly offset this shift and, overall, can boost firms’ green investment.”
InvestorPlace – Aug. 4 – Clinical Professor of Finance David Kass comments in “Donald Trump’s Third Indictment Is a Death Sentence for DWAC Stock”: Dr. David Kass, a clinical professor of finance at the University of Maryland’s Robert H. Smith School of Business, sees Trump’s third indictment posing a negative impact on DWAC stock. A former member of multiple government offices, including the Bureau of Economic Analysis, Kass is an expert on corporate finance and health economics. He shared with InvestorPlace that he believes multiple events may be pushing DWAC down. In his words: “The indictment of former President Donald Trump with respect to the events of January 6, 2021, made the headlines and contributed to the 6% decline in DWAC on Wednesday. (The Nasdaq index declined by 2% on August 2.) Although the possibility of this indictment may have been discounted by the market, the news of the extent of the charges very likely contributed to DWAC’s negative performance.” The second factor that Kass highlights is the recent resignation of Marcum LLP, the accounting firm hired to audit Digital World. Bloomberg reports that the auditor has been dealing with regulatory problems of its own. While Kass notes that this news likely flew largely under the radar, he believes it could significantly impact DWAC stock as it puts the TMTG merger in even further jeopardy.
International Business Times – Aug. 4 – “Stocks Get A Boost From Amazon Earnings, Steady Bond Yields” quotes Clinical Professor of Finance David Kass: “Fitch's downgrade of U.S. debt will have only a very short-term psychological impact on stocks and bonds,” said David Kass, clinical professor of finance at the University of Maryland, Robert H. Smith School of Business. “With the S&P 500 up 20% and Nasdaq up 37% year-to-date, this downgrade will provide a convenient excuse for profit-taking in the equity market, especially as we enter the historically weak months of August and September.”
Poets & Quants – Aug. 4 – The “Best & Brightest Executive MBAs Of 2023” quotes Professor and Chair of Accounting and Information Assurance Michael Kimbrough and Associate Professor and Chair of Logistics, Business and Public Policy Cristian Dezso in profiles of Smith EMBAs Cietta Kiandoli and Glen Martin.
The Business Monthly – Aug. 1 – Associate Professor (Decision, Operations and Information Technologies) Jui Ramaprasad comments in Howard Board of Ed Sues Social Media Companies,” including: The shame of what’s transpired, [said Ramaprasad], “is that once-meaningful social engagement has turned negative. “Like any business, social media companies want to make money, and many do it through advertising. With a newspaper, content is curated,” said Ramaprasad. “However, when users are involved in creating content and there isn’t as much gatekeeping, it can often be negative or hateful. That draws more attention and drives up the advertising revenue.” So as social media platforms have grown, “It’s become a whole new ballgame,” she said. “It’s not just about bullying moving online. In previous generations, the issues stayed at school; now the kids bring it home (on their devices). And it can even be about people idealizing exercising habits, for instance, and everything looking perfect to a viewer who has an eating disorder.”
Maryland Daily Record – July 31 – UMD Smith School Adds January Start for MSIS Degree announces the new January cohort start date to accommodate applicants with three- and four-year undergraduate degrees for the Master of Science in Information Systems program and highlights newly designated focus areas including artificial intelligence, cloud computing and emerging technologies.
National Mortgage Professional – July 30 – “What To Do When Profits Bolt Down” extensively quotes Professor of the Practice Clifford Rossi, including: “Simply put, no matter what type of entity the mortgage company is, they need to be practicing good interest rate and liquidity risk management practices,” he said. … Rossi, who formerly held senior risk management and credit positions at Freddie Mac and Fannie Mae, says that mortgage institutions now are not as stable as they once were. “Due to structurally what’s been happening over the last 15 years, traditional banks have largely exited the origination and servicing sides of the industry, which led non-bank financial institutions to take that space over,” he explained. “Generally speaking, though, they suffer from certain characteristics that make them volatile: They’re thinly capitalized, they don’t have to adhere to certain risk requirements, have volatile liquidity and sources of liquidity, [and their] depositories are dependent on low-cost deposits.”
Forbes – July 30 – The Rise Of Master In Management, Master Of Finance And Other Business Degrees includes: Master’s programs are considerably less expensive than pursuing an MBA. …The opportunity cost of being out of the workforce for one year just after college is also considerably less than that of taking two years off work at a presumably higher rank and salary. Of course, the investment costs are only half the story! It’s important to remember that the returns are also higher for an MBA. Finally, some programs even allow alumni to return later for an MBA at their school—and apply the credit for relevant master’s courses to the MBA. An example is the Robert H. Smith School of Business at the University of Maryland.
TalkMarkets – July 29 – Clinical Professor of Finance David Kass gives the “2023 Percentage Returns Of 5 Largest Stocks.”
Thinkers50 – July 27 – “Harnessing Alternative Data for Competitive Advantage” reprises an article co-authored by Michael D. Dingman Chair in Strategy and Entrepreneurship Anil K. Gupta in California Management Review, addressing companies having “access to a tsunami of non-traditional data for creating and capturing value.”
Clear Admit – July 27 – Admissions director Maria Pineda describes Smith’s Full-time MBA Program for prospective students in an updated Admissions Director Q&A.
Fox Business – July 26 – Dean’s Professor of Finance Michael Faulkender discusses economic policy in a “‘Bidenomics' is a top-down government-controlled economy,’” segment of The Evening Edit. Related: Faulkender discusses “Treasury Secretary Yellen’s Visit to China,” via Newt Gringich’s Newt’s World podcast and “Central Bank Digital Currencies” with former Attorney General Matthew Whittaker on Whittaker’s Liberty & Justice podcast.
Reason Magazine – July 26 -"New Study Reveals Large Firms' Role in Innovation," quotes Serguey Braguinsky related to his NBER paper (Mega Firms and Recent Trends in the U.S. Innovation): “Mega firms, especially new mega firms…were small startups just some 20 years ago, and they became what they are today by winning in a competitive environment,” says the study's lead author, Serguey Braguinsky of the University of Maryland. …“I think this strongly suggests that free markets have a self-correcting mechanism built into it and should be able to keep the U.S. innovation engine running,” says Braguinsky. “Provided,” he adds, that “they are free from various distortions.”
WalletHub – July 26 – ‘Ask The Experts’ section of “2023's States with the Highest Job Resignation Rates” features Clarice Smith Professor of Management Debra Shapiro with co-researchers, Professors Peter Hom and Wei Shen (both at Arizona State University), discussing the effect of leader departures on employee turnover. (They draw from a stream of research, among which is their 2016 article in Academy of Management Review, titled “How Do Leader Departures Affect Subordinates’ Organizational Attachment? A 360-Degree Relational Perspective,” with additional co-author Rajshree Agarwal, Rudolph Lamone Chair of Strategy and Entrepreneurship.)
FOX 5 DC – July 24 – Clinical Professor of Marketing Hank Boyd comments in “New Washington Commanders Owners Working to Rebuild Trust”: “The good times definitely look like they're coming back. This looks like a new era," said Hank Boyd, Marketing Professor at the University of Maryland. Boyd says personal stories from these new owners and an acknowledgement of the fans’ frustrations are the right notes. "What great marketing is all about is that you gotta put yourself in the shoes of the fans,” Boyd said. “I think as long as they're making meaningful steps, and it doesn't feel disingenuous, fans will get it and say ok, we can re-engage now. It's like that cloud is now gone and we can now come back,” Boyd said. Boyd also said showcasing diversity in ownership is important.
The EvoLLLution – July 24 – Office of Digital Learning Director Paul Walsh writes “Navigating Microcredentials and VFR (Visual Flight Rules).” Summary: A successful implementation of microcredentials requires sticking to your institution’s mission, specializing in areas in need and constantly evolving.
TalkMarkets – July 22 – Clinical Professor of Finance David Kass gives the “2023 Percentage Returns For 5 Largest Stocks .”
Barron’s – July 21 – Clinical Professor of Finance David Kass’ letter to the editor, “Higher Equity Prices,” is published: “As noted by Ben Levisohn, the dollar has recently been declining, and a weaker dollar should be good for risk assets (“Inflation Rarely Falls This Fast. What It Means for the Stock Market,” Up & Down Wall Street, July 14). One additional reason for this positive impact is that a weaker dollar will result in higher reported earnings by U.S. multinational corporations. When these companies report their financial results, they convert their foreign earnings into U.S. dollars. If the U.S. dollar weakens against the foreign currencies in which the earnings were generated, the translated value in U.S. dollars will be higher, leading to higher reported earnings. This in turn should result in higher equity prices.”
AACSB Insights – July 19 – “Research Roundup: July 2023” features (scroll down) “Training Employees to MYB (‘Manage Your Boss’)” co-authored by Dean’s Professor of Management Subra Tangirala and includes: In a paper published in Personnel Psychology, the researchers suggest that employees who are adept at MYB have better working relationships with their supervisors, are better able to foster trust in the workplace, and receive higher performance ratings from their managers.
Maryland Daily Record – July 18 – “Applications Open for UMD Smith’s Online Management Studies MS Program” includes: “The (30-credit) program (starting in fall 2023) will position students to excel as leaders in any industry — especially those that require adaptability, creativity and quick thinking,” says Associate Professor of Management and director of the program Rellie Derfler-Rozin. “Students further will learn innovative ways of handling workplace challenges, as well as have the opportunity to refine their strategic thinking skills and develop essential business acumen through designated experiential learning classes that feature mentoring from our MIM Advisory Council members.”… Also published at Yahoo Finance, others.
KSL – July 17 – “Cash In on Your App Idea” quotes Professor of Marketing Jie Zhang based on research co-authored with Distinguished University Professor and PepsiCo Chair in Consumer Science Michel Wedel: “Offering a paid version in an early stage can help generate sales revenue quickly to help offset the development and marketing costs of an app and fund the development of future upgrades and launching a free version," Jie Zhang, a professor of marketing, tells the Robert H. Smith School of Business at the University of Maryland. Zhang adds that there may come a time when you can stop offering a paid version and switch to a free version when it's "strong enough to make money.”
GOBankingRates via Yahoo Finance – July 14 – “$2.75 Billion From Just 3 Stocks: Warren Buffett’s Top Earners in 2023” quotes Clinical Professor of Finance David Kass extensively: According to [Kass], clinical professor of finance at University of Maryland, Robert H. Smith School of Business, the outlook for Apple for the rest of the year is very bright. “Apple, Berkshire’s largest equity holding, representing about 50% of its $300+ billion portfolio, has the largest U.S. stock market capitalization of about $3 trillion,” Kass said. “It is growing rapidly and enjoys an extremely loyal customer base within its ecosystem. In addition to its cash dividend, it is returning capital to shareholders through a very large share buyback program. Berkshire currently owns 5.6% of Apple. Warren Buffett is a big fan of Apple CEO, Tim Cook.” … Buffett has been steadily increasing his stake in the company and has now accumulated more than 224,000 shares, representing a 25% stake…And according to Kass, this is the result of Berkshire CEO, Vicki Hollub, planning to use its free cash flow to pay down its debt and reduce its preferred stock, buy back its common shares, increase its cash dividends, and invest in projects where its return on capital exceeds its cost of capital. “With oil prices likely to be stable in the months ahead, the outlook for Occidental is very good,” said Kass. According to Kass, Bank of America, under CEO Brian Moynihan, is a very conservatively run bank and is Berkshire’s second largest equity holding, representing about 10% of its portfolio. “It recently announced a 9% increase in its quarterly cash dividend and is also buying back its shares. Its outlook is also very bright,” said Kass. He added that although Buffett likes to receive cash dividends, he does not like to pay them to his shareholders. “He prefers to re-invest the cash flow generated by Berkshire. Berkshire has not declared a dividend since 1967,” Kass said.
Technical.ly – July 13 – “In Q2, DC-area Companies are Back in the Billion Zone” quotes Professor of the Practice Clifford Rossi: [Rossi] agreed that deals are likely going to stay small. In this environment, he said, investors are a little more hesitant to cut those large checks. But he sees the Q2 data as a positive in total and expects to see even more deals coming out of the third quarter than the region saw in the first half of the year. “A lot of that is accounting by how well the market performs,” Rossi said. “If we see continued moderation in inflation, and we see continued moderation and holding the line on raising interest rates, then I would expect to see maybe more of a positive end to the last half of 2023.”
U.S. Senate Committee on Banking, Housing and Urban Affairs – July 13 – A “Bank Mergers and the Economic Impacts of Consolidation” subcommittee hearing includes expert testimony from Dean’s Professor of Finance Michael Faulkender including through his opening statement (30:20-35:33) and describing (1:04:00-1:07:00) complexity in banking mergers and acquisitions and the disadvantage to small and community banks in competing with big banks on technology. Related: Faulkender discusses former President Trump’s economy versus President Biden’s economic situation on Fox Business’ ‘The Evening Edit’ (July 17).
eCampus News – July 12 – “Movers and Shakers” includes: Amid expanding its artificial intelligence and machine learning curricula — including for its recently STEM-designated MBA programs, the University of Maryland’s Robert H. Smith School of Business has hired Balaji Padmanabhan as a full professor of information systems. Related coverage via AIthority and Yahoo Finance.
WalletHub – July 12 – Distinguished University Professor and David Bruce Smith Chair in Marketing Roland Rust contributes consumer advice on car insurance in an “Ask the Experts” Q&A.
Pharmaceutical Engineering Magazine – July-August 2023 – Professor of the Practice Clifford Rossi produces “A Systemwide Approach to Managing the Risks of Continuous Manufacturing.” Opening: Advanced technologies such as CM have the potential to greatly transform pharmaceutical production processes by improving drug quality and supply continuity for consumers worldwide while benefiting the company’s bottom line. For much of the pharmaceutical industry, batch manufacturing (BM) processes that have been relied upon for decades remain the preferred approach for most oral solid dosage (OSD) drug products. Considerable uncertainty exists, however, among manufacturers regarding the costs and benefits of CM technology, including several risks that, so far, are holding companies back from making the leap to CM.
Pluribus News – July 11 – “Noncompete Contracts Face Fresh Scrutiny in States” quotes Associate Professor of Management and Organization Evan Starr: Studies suggest about half of U.S. companies use the contracts for some workers and a third use them for all workers, [said Starr], who has studied noncompetes extensively. “It just becomes a part of the onboarding material, and becomes standardized in the workplace,” Starr said. Employees rarely negotiate noncompetes and are often given them after accepting a job offer, he and his research partners have found. Noncompetes can hold down wages and prevent workers from quitting to start their own businesses, Starr and other researchers have found. The Federal Trade Commission estimates that eliminating all noncompetes could raise U.S. workers’ earnings by over $250 billion a year. ...A key question is how companies will respond if they can no longer use noncompetes, Starr said. Some may resort to suing over theft of trade secrets. Others may do nothing, he said. “Maybe noncompetes were just prohibiting moves [to a rival business],” he said, “and there was actually no competitive threat.”
Barron’s – July 11 – “After Spring Crisis, US Banks Face Subdued Profit Outlook” quotes Professor of the Practice Clifford Rossi: [Rossi] said the shift in monetary policy has also burdened banks with unrealized losses, which reflect the erosion in value of long-term US Treasury-linked assets due to interest rate increases. "I think there's still a liquidity risk for some of these institutions until we get past these interest rate issues," Rossi said.
GoBankingRates – July 11 – “Invest Like Warren Buffett With These 3 Passive Income Stocks” quotes Clinical Professor of Finance David Kass: “However, in a recession, the overall stock market is very likely to decline which would create buying opportunities. He seeks companies with growth potential that are reasonably priced and returning capital to shareholders through both cash dividends and stock buybacks,” said David Kass, clinical professor of finance at University of Maryland, Robert H. Smith School of Business. Kass noted that Apple currently represents close to 50% of Berkshire Hathaway’s equity portfolio, and at the 2023 Berkshire Hathaway annual meeting on May 6, Buffett described Apple as being Berkshire’s best business. “He began to accumulate his stake in Apple in 2016. Berkshire’s investment in Apple of $31 billion is worth about $175 billion today, representing a profit of $144 billion. Since Apple has a large stock buyback program, Berkshire’s 5.6% stake in Apple is likely to grow to 6% in the near future without Berkshire buying any additional shares,” he added. Kass noted that Louisiana Pacific is a relatively small position, which indicates it was likely purchased by one of Buffett’s portfolio managers, Todd Combs or Ted Weschler. “Over the past two years it has bought back between 10% and 20% of its shares each year.”
Sinclair’s The National Desk via WJLA – July 11 – “In Push to Protect Banking System, Banks Could Have to Hold More Cash” quotes Professor of the Practice Clifford Rossi: “Taking it to at least $100 billion makes a lot of sense. Then you're going to be looking at more of those kinds of SVB, Signature Bank risks in a much more scrutinized way than what we had coming into the first quarter,” [said Rossi], who also worked in high levels of risk management for several large banks. While more banks would qualify for tighter scrutiny, it is only a few dozen in a system made of thousands. “The additional dedication of resources, the examiners and others that have to go into those banks to do that work, it's incremental for the amount of risk, as we saw, to the system,” Rossi said.
International Business Times – July 10 – “Stocks And Bonds Take A Wild Ride On Conflicting Jobs Reports – What Is Next?” quotes Clinical Professor of Finance David Kass: David Kass, clinical professor of finance at the University of Maryland's Robert H. Smith of Business, sees the Federal funds rate rising by 1/4% later this month and another 1/4% before the end of the year as reported in the Economic projections of the Federal Reserve Board on June 14. “The stock market may experience a decline of about 5%-10% over the next few months before continuing its recent uptrend in November and December with the S&P 500 closing the year at 4600-4800.”
Seeking Alpha – July 9 – Clinical Professor of Finance David Kass publishes “2023 Berkshire Hathaway Annual Meeting: Summary of The 48 Questions And Answers.” Also posted at TalkMarkets (in addition to his “2023 Percentage Returns Of 5 Largest Stocks” posts for July 1 and July 8.”
Psychology Today – July 7 – Associate Professor of Management and Organization Trevor Foulk writes “Why You’re Not Very Good at Knowing How Common Things Are,” including: One of the little tricks our brains use when interpreting the world is to conflate the ease with which we can recall something with its frequency. Referred to as the "availability bias,” this means that if it’s easy for us to recall an example of something happening, our brain will interpret that ease as meaning that thing must happen often.
Fox Business – July 7 – Dean’s Professor of Finance Michael Faulkender joins a Kudlow show discussion on the jobs report and tightening of the U.S. labor market.
Study International – July 6 – “University of Maryland: Embracing AI in Business” profiles Smith’s Master of Science in Marketing Analytics program.
Irish Tech News – July 6 – Associate Professor of Management Science and Statistics Margrét Bjarnadóttir discusses data-driven strategies, and more, as part of a “Tackling Pay Equity Challenges” Q&A.
MIT Sloan Management Review – July 3 – “Amid Growing AI, Humanize Communication to Strengthen Relationships” cites research co-authored by doctoral candidate in marketing Sanghwa Kim: There have always been people who prefer to write business notes by hand, but it’s never before carried such a significant connotation — that a real person has taken the time to write out a personalized message rather than choosing an easier option. And a recent study shows how powerful that can be: Researchers from business schools at the University of Maryland and Yonsei University in South Korea found that “presenting a handwritten note has a positive and significant effect on customer spending” and that “warmth underlies the key findings.”
FIND MBA – July 3 – Assistant Dean of MS and MBA Admissions Shelbi Brookshire and Graduate Career Consultant Adam Shpall contribute to “Strategies for Maximizing Your Online MBA Experience,” including: An applicant’s biggest mistake is assuming that price point is the only aspect they should be assessing, [adds Brookshire]. “Instead, they should identify three-to-five extremely important aspects of what they want out of the experience, not just the degree. These factors include what type of faculty teach the courses and to what extent do students have access to career resources and the school's alumni population. …Further, the Smith School’s [Shpall] says that relationships are built on trust. “One of the ways to build strong relationships with peers is to go out of your way to assist them, whether that is learning about their career aspirations and offering to make a connection for them or going above and beyond in your deliverables on a project.”
Journal of Accountancy – July 1 – Adjunct Professor of Accounting Stacey Ferris contributes a guest piece on “A Taxonomy for Classifying Digital Assets.”
Becker Friedman Institute – July 1 – “Conference on Discrimination in the 21st Century: Fostering Conversations Across Fields” recaps a University of Chicago-hosted event including a presentation by Assistant Professor of Finance Agustin Hurtado: Several presenters shared research on the more subtle ways in which discrimination shapes peoples’ life trajectories during adulthood. Agustin Hurtado discussed how Asian, Black, and Hispanic-owned banks close racial disparities by expanding minority mortgage access. He also presented evidence consistent with superior information driving this effect, prompting a lively discussion among the audience about what, exactly, a minority-owned bank is. (Are the effects tied to ownership alone or additional bank features?).
Brookings – June 8 – Lemma Senbet, William E. Mayer Chair Professor of Finance, co-authors “Financing Climate-Resilient Infrastructure in Africa,” including: This Policy Brief proposes three mechanisms whereby the G20 [nations] can support African countries: providing grant funding and technical assistance to the Programme for Infrastructure Development for Africa (PIDA) to increase the number of high-quality bankable projects and mobilise financiers; strengthening the coordination of climate financing from the G20 countries to the continent; and unlocking financial technology and entrepreneurship to mobilise financing for bankable projects. This Brief further recommends that the G20 should use its technical capacity, financial muscle, and convening power to put African countries on the path towards climate resilience.
Forbes – June 5 – “Immigration Agency Report Shows High H-1B Visa Salaries” includes: Several economists have examined the topic and have concluded that H-1B visa holders earn the same or more than comparable U.S. professionals: … After examining the skills and compensation of over 50,000 IT professionals in the United States, University of Maryland researchers Sunil Mithas and Henry C. Lucas, Jr. (Robert H. Smith Professor of Information Systems Emeritus) wrote, “[C]ontrary to popular belief, non-U.S. citizen IT professionals are not paid less compared to American IT professionals.”
TalkMarkets – June 4 – Clinical Professor of Finance David Kass gives the “2023 Percentage Returns Of 5 Largest Stocks.”
MarketWatch – June 1 - Best New Ideas in Money podcast episode “Would $10,000 Convince You to Move to a New City?” features Associate Professor of Management Evan Starr discussing his recent paper for Brookings (‘Work-from-anywhere as a public policy’) including: “So if a locality wants to bring in a bunch of workers and jobs, historically, the main way to do that has been to try to bring in companies.” … “In this day and age where we have these remote workers who can work from anywhere who aren't tied to location, we can now separate the company from where they live. And so, we can have these municipalities competing for the location of the individual while simultaneously having employers competing over their labor. So, we've split this classic connection of where you work and where you live. And I think that kind of gave all of these programs, these work from anywhere as policy programs a boost.”
Yahoo Finance – June 1 – ‘Smith to Launch Enterprise Risk Consortium’ includes: “The consortium will position Smith "as an academic leader in applied risk management through thought leadership, education and outreach to industry and governmental organizations, and by formalizing industry ties to Smith students interested in careers in risk management," says Clifford Rossi, PhD, professor of the practice and executive-in-residence for the Smith School.”
Bloomberg Law - May 31 – Associate Professor of Management and Organization Evan Starr comments (16:20-17:00) on FTC-proposed ban on noncompete agreements, as part of Bloomberg’s Uncommon Law podcast.
American Banker – May 29 – Professor of the Practice Clifford Rossi writes op-ed “What's Needed to Prevent Future Bank Failures.”
CNBC – May 26 – Dean’s Professor of Finance Michael Faulkender and Isabella Weber of the University of Massachusetts Amherst discuss price hike feedback loops, the inflationary role of corporate profits, and insufficient supply for excess demand an episode of The Exchange archived as “Higher Corporate Profits Are an Outcome, Not a Cause, of Higher Prices, Says Michael Faulkender.”
Wall Street Journal – May 25 -“U.S. Regulator Vows Tough Line on Problem Banks” quotes Professor of the Practice Clifford Rossi: The too-big-to-manage issue is real, said Clifford Rossi, a former chief risk officer at Citigroup’s consumer lending group who now is a professor of the practice of the University of Maryland’s Robert H. Smith School of Business. “Anything can go wrong for an institution that large,” he said. “You think of all the operational processes, controls and systems—it only takes one issue to create some sort of a headline risk.
Citybiz – May 24 – “UMD Smith Names Michael Hoffmeyer as Dingman Center Managing Director” announces Hoffmeyer joining the center, that Smith School Dean Prabhudev Konana says is “pushing forth an ambitious strategic vision to create opportunities for UMD students, alumni and community by enhancing entrepreneurship opportunity that is inclusive and contributing broadly to the local, regional, and national entrepreneurship ecosystem.” Related coverage at PotomacTech Wire, Maryland Daily Record, others.
MedBound Times – May 24 – Professor of the Practice in Systems Thinking and Design Gerald Suarez explains “Pursuing Work-Life Balance Isn’t a Want, It’s a Need for Success."
Issues in Science and Technology – May 23 – “Materially Different” includes an extended critique by Associate Professor of Management and Entrepreneurship David Kirsch of an essay on the roots of the modern EV revolution by Matthew Eisler.
WUSA-9 – May 23 – Dean's Professor of Finance Michael Faulkender explains the debt ceiling.
MIT Sloan Management Review – May 23 – “Don’t Get Distracted by the Hype Around Generative AI” cites the book, "Bubbles and Crashes: The Boom and Bust of Technological Innovation," by professors management and entrepreneurship Brent Goldfarb and David Kirsch: Business leaders who don’t want to miss a great opportunity but don’t want to waste time and money implementing oversold technologies would do well to keep in mind some fundamental realities about tech bubbles. First, these phenomena rely on narrative — stories that people tell about how the new technology will develop and affect societies and economies, as business school professors Brent Goldfarb and David Kirsch wrote in their 2019 Unfortunately, the early narratives that emerge around new technologies are almost always wrong. Indeed, overestimating the promises and potencies of new systems is at the very heart of bubbles.
The Conversation – May 23 – Dean's Professor of Marketing Rebecca Ratner co-authors “Travelers will Refuse an Upgrade to Sit Near a Loved One – New Research into When People Want to Share Experiences” summarizing her research published by the Journal of Consumer Psychology and covered also at multiple sites including "Why Consumers Forgo Front-row Seats: Sacrificing ExperienceQuality for Togetherness" at Phys.org.
DS News – May 23 – “House Committee Examines LLPA Fee Structure” cites Professor of the Practice Clifford Rossi among experts testifying in the recent House Financial Services Committee Subcommittee hearing examining pricing changes implemented by the Federal Housing Finance Agency and the impact on the mortgage marketplace.
GARP Risk Intelligence – May 22 – Measuring Corporate Culture: It’s Complicated” quotes Clinical Professor of Finance Clifford Rossi: “Culture is important because it establishes whether or not risk management is viewed in a favorable way as a valued business partner,” [said Rossi]. “Any institution that does risk management well has a good risk culture – good risk DNA – from the board to the executive committee and on down the line,” Rossi insisted. “The tone is set from the top. It will provide that stature and credibility for risk management to be effective in this role.”
MiM Guide – May 22 – Suresh Acharya, academic director of MS in Business Analytics programs, comments in “ChatGPT Boosts Appeal of Masters Programs in Business Analytics”: [The Smith School] is also adapting its MS in Business Analytics program to ensure students are prepared to enter an AI-driven work environment. In the “Big Data and AI” course, the school encourages faculty to have a discussion on these emerging technologies to provide a reasonable grounding. “There are also co-curricular activities, workshops, guest speakers and virtual conferences, through which students are getting more exposure to these topics. AI will only continue to grow – we need to make sure our students are prepared for it,” [says Acharya]. Additionally, the excitement around the possibilities of generative AI appears to have boosted already-high interest in studying business analytics at the master’s level. “The demand for our MS in Business Analytics continues to be robust. Our students are getting internship offers that have turned into job offers. We have had students receive multiple offers, as well.”
Washington Post – May 21 – “The Man in Charge of Knowing When the U.S. Runs Out of Money” quotes Dean’s Professor of Finance Michael Faulkender: “I could not, to this day, tell you his politics,” said Michael Faulkender, who served as assistant secretary for economic policy during the Trump administration. Faulkender worked closely with Lebryk when Treasury was tasked with figuring out how to send tens of millions of stimulus payments during the coronavirus pandemic, an effort Lebryk helped lead. “He always seemed to be relaxed and under control.” … Related: Faulkender discusses economic policy including the debt ceiling via WABC radio’s Larry Kudlow Show.
National Mortgage News – May 18 – “More Disclosure on Fannie Mae, Freddie Mac Fees Needed: House Hearing” quotes Professor of the Practice Clifford Rossi: …[Rossi] also called for more disclosure in LLPAs, and suggested potentially rethinking them altogether. “While on the surface it can be argued that the LLPAs are transparent by virtue of pricing by risk attribute, the exact mechanics are murkier, thus setting the stage for second-guessing the new grids and the need for a new approach,” he said. “I actually propose eliminating the current [credit score/loan-to-value ratio/LLPA] grids altogether and updating the guarantee fees consistent with achieving a target rate of return taking into account the [Enterprise Regulatory Capital Framework].”
Baltimore Sun – May 18 – Dean’s Professor of Finance Michael Faulkender comments in “Baltimore’s CFG Bank has Grown its Own Way, Quadrupling in Size in Just a Few Years”: There is a balancing act at the core of nearly every lender. Any bank can tip into trouble if it has too many long-term assets and short-term depositors pull out their money, [Faulkender said]. Silicon Valley Bank, for example, failed in March because it purchased a large amount of U.S. Treasury bonds during the pandemic, when interest rates were at historic lows, Faulkender said. As interest rates rose, these long-term securities lost value, he said, spooking depositors who withdrew their money. In other words, there was a bank run. “That liquidity transformation issue is the fundamental challenge in banking,” Faulkender said. “Anybody could be caught in that dilemma if you are doing any kind of low-interest lending funded out of deposits.”
HousingWire – May 18 – “House Subcommittee Takes Aim at FHFA’s LLPA Policies” quotes Professor of the Practice Clifford Rossi from his related congressional testimony: “Today we have a sort of Frankenstein approach to credit pricing, cobbling together average pricing for ongoing fees with quasi-risk-based pricing for upfront fees,” he said in his written statement. “It is no surprise then that we have arrived at a place where so much heated debate has occurred on these fees. Fundamentally, the FHFA should immediately eliminate the FICO and LTV LLPA grids and request the Enterprises to update their guarantee fees to reflect that change while conforming to actuarial-based pricing.”
B Magazine – May 18 – “Mid-Atlantic B Corps Help Advance the Study of Business as a Force for Good” includes: We then heard from Nima Farshchi, from University of Maryland’s Center for Social Value Creation and Office of Experiential Learning, about how students are being engaged in projects, live case studies, classroom coaching, and direct interaction with B Corps and social entrepreneurship.
The FCPA Blog – May 18 – “Board-level ‘Risk Committees’ are Great, Unless they Destroy the Company” quotes Professor of the Practice Clifford Rossi: First Republic’s risk committee was notable because it was the board’s only standing committee with just three members instead of five, according [to Rossi]. And although the risk committee had an outside advisor, “none of the three members have direct banking risk management experience; their backgrounds are in health care, venture capital and academia, though they each are highly accomplished in their respective fields.” … Expertise is essential for a nuanced understanding of risk. Prof Rossi, who I mentioned above, says “while audit is critically important, the diversity and complexity of risks require a very different set of skills, balanced between quantitative and qualitative.”
TalkMarkets – May 16 – Clinical Professor of Finance David Kass details “Major Changes To Berkshire Hathaway’s Portfolio During The First Quarter Of 2023” and gives 2023 Percentage Returns Of 5 Largest Stocks (May 20). … Related: Kass discusses U.S. inflation the inflation rate and the potential for a recession, via Sina News (May 6).
GARP Risk Podcast – May 12 – In “Risk Management’s Latest Trial by Crisis,” Professor of the Practice Clifford Rossi discusses recent turmoil in the banking system, where risk management fell short, and the profession’s readiness for future challenges… Related: Rossi writes guest column, “What lessons can be learned from the recent banking crisis?” in American Banker’s May 2023 issue.
Poets & Quants – May 12 – “Best & Brightest Online MBAs: Class Of 2023” includes profiles of graduating Smith students McGeady Bushnell and Wing Pokrywka and references them in its main feature: Back East, the University of Maryland’s McGeady Bushnell has been serving as the Congressional and Legislative Liaison for the U.S. Navy’s Chief of Naval Personnel. Here, he assists in developing policies that support over 450,000 sailors and their families. … The Class of 2023 is packed with happy endings…Wing Pokrywka’s exposure to data-driven decision-making enabled her to hit the ground running when she was hired by Instacart as a senior marketing manager before finishing her final year at the University of Maryland’s Smith School.
FIND MBA – May 12 – Adam Schpall, career services assistant director and MBA career consultant, comments in “Life after an Online MBA: A World of Possibilities,” including: [Schpall] says employers are looking for skills related to leadership, strategic thinking, communication, the ability to work collaboratively and network, as well as analytical thinking, problem-solving and resilience. “You will notice that a lot of these skills are soft skills, as many of them can’t be farmed out to the bots,” he adds, in an apparent nod to artificial intelligence.
Maryland Daily Record – May 10 – “UMD Smith launching Doctor of Business Administration Program” announces the program “designed for working professionals to elevate their careers as leaders in business organizations and government agencies that utilize cutting-edge technologies and business analytics to drive growth and innovation.” … Coverage also via AIThority, Inside Higher Ed’s ‘Colleges New Programs‘ and others.
Wall Street Journal – May 9 – “This Strategy Beat the World’s Top Hedge Funds—Don’t Try it” cites Russ Wermers’ research (False Discoveries in Mutual Fund Performance: Measuring Luck in Estimated Alphas): In a sobering study released more than 15 years ago designed to weed out mere luck, academics Laurent Barras, Olivier Scaillet and Russ Wermers looked at thousands of mutual funds between 1975 and 2006 and determined that only 0.6% of managers had enough demonstrable skill to outweigh their funds’ costs.
CNBC – May 9 – “The 2023 CNBC Disruptor 50: How we Chose the Companies” identifies Michael D. Dingman Chair in Strategy and Entrepreneurship Anil K. Gupta as part of CNBC’s Disruptor 50 Advisory Board.
Wall Street Journal – May 9 – Some Airlines Avoid Twitter, Putting a Popular Travel Hack at Risk quotes Roland Rust, Distinguished University Professor and David Bruce Smith Chair of Marketing: Other social-media platforms are “not really set up for the same kind of response to individual comments as Twitter is,” [says Rust].
Maryland Today – May 9 – “UMD Risk Study Helps Maryland Homeowners Prepare for Weather Extremes” features Professor of the Practice Clifford Rossi’s newly created index to help homeowners, financial services firms and governments prepare for the increasingly volatile weather.
Food Safety Magazine – May 9 – Abhay Grover, PhD candidate and instructor in supply chain management, writes guest column, “Transforming Food Safety: How Autonomous Mobile Robots are Changing the Inspection Game.”
Hindu Business Line – May 9 – “Greening the MBA, Not Greenwashing it” includes: The traditional pedagogical approach in management education should be re-evaluated in favour of a more personalised and modern approach such as heutagogy. This learning approach, which is centred on self-determined learning, is more closely aligned with the demands of the modern workplace and the development of transferable trans-disciplinary skills that are essential for life-long learning. Incorporating heutagogy through self-directed projects and coaching, business schools such as the University of Maryland’s Robert H. Smith School of Business and the Faculty of Business at the University of Wollongong are embracing this approach in their MBA and executive education programmes.
National Mortgage Professional Magazine – May 2023 – Professor of the Practice Clifford Rossi produces op-ed: “Why Nonbank Mortgage Companies Bear Close Watching.”
CNBC – May 6 – “Warren Buffett on Microsoft-Activision Deal: Microsoft has Met the Opposition More Than Halfway” shows Buffett responding to a question from Clinical Professor of Finance David Kass during the 2023 Berkshire Hathaway Shareholder’s Meeting: CNBC’ Becky Quick: “This question comes from David Kass, who is a professor at the business school at the University of Maryland: ‘At last year’s annual meeting, Warren [Buffett] mentioned that Berkshire had taken a large stake in Activision Blizzard as a merger arbitrage play. Since the UK regulator has blocked its acquisition by Microsoft, has Berkshire reduced or sold its stake?’ Buffett (condensed): I think Microsoft has been remarkably willing to cooperate with governing bodies. They wanted to do the deal and met them – the opposition – it seems to me more than halfway. But that doesn’t mean that it gets done if a given country, in this case, the UK, wants to block it…
Marketplace Radio – May 5 – Associate Clinical Professor of Finance Elinda Kiss contributes to “Here’s Why the U.S. has so Many Banks”: In the last 50 years, deregulation has allowed lenders to operate across state lines, making it easier for them to merge when they’re in trouble. Alas, here we are with 4,000 banks. Elinda Kiss, who researches financial regulation at the University of Maryland, expects that number to shrink. “Yes, I think we will see more consolidation. I don’t have an idea what’s the perfect number of banks,” she said. She said no one really knows the magic number between too many banks and too few with too much market power.
The M Report – May 5 – “How Digitalization Changes How People Search for, Finance Housing” quotes Assistant Professor of Information Systems Lauren Rhue from her ‘Commentary on Digitization of the Housing Search’ paper: Carrying out these efforts requires more clarity about key values and goals, writes Lauren Rhue (University of Maryland, Smith School of Business) in her commentary on the papers. Illustratively, she observes, fairness in credit is relatively easy to understand: all borrowers with the same profile should receive the same amount of credit. In contrast, “societal disagreement about what fairness means for previously redlined neighborhoods and their residents” will hamper efforts to use digitalization to address discrimination in those neighborhoods.
CNBC – May 4 – “Berkshire Hathaway is Outperforming During Turmoil, but Warren Buffett’s Favorite Child Geico is in Trouble” quotes Clinical Professor of Finance David Kass: In 1976, Buffett invested at $2 per share in Geico when it was in financial trouble, and Berkshire acquired the rest of the company in 1995. “It was sort of Buffett’s first love,” said David Kass, a finance professor at the University of Maryland’s Robert H. Smith School of Business. “I think he has a strong emotional and sentimental attachment to it.” Kass recalled Buffett referring to Geico as his “favorite child” during a meeting with his students in 2005.
Maryland Today – May 4 – Dean’s Professor of Finance Michael Faulkender explains the urgency to raise the federal debt ceiling, in “That Absolutely Has to Happen.” … Related media appearances include Faulkender discussing issues surrounding the debt ceiling showdown via Fox Business’ The Evening Edit and interest rates in a Just the News segment on Real America News.
Wall Street Journal – May 4 – "Warren Buffett’s Formula for Success: One Good Decision Every Five Years" quotes Clinical Professor of Finance David Kass: David Kass, a finance professor at the University of Maryland’s business school, rattled off some more, from railroads (Burlington Northern) to razors (Gillette). But at the top of his list was the transformative investment that Mr. Buffett has called his first business love. This romance began in 1951, when Mr. Buffett learned that his professor and intellectual hero Benjamin Graham was chairman of Geico and rode the train from New York to Washington to visit its corporate headquarters. He arrived on a Saturday morning only to discover that Geico’s employees weren’t in the habit of working on Saturday mornings. Finally, a custodian heard Mr. Buffett pounding on the doors and not only let him inside but introduced him to the other person in the office, which is how the eager young student found himself receiving an education in the insurance business from the CEO. The compassion of a weekend janitor would alter the course of business history, as Mr. Buffett’s investment in Geico began his lifelong fascination with insurance… Related: The New York Post quotes Kass in “The fight for fortune and family who sold Warren Buffett Berkshire Hathaway”: “Buffett did it out of sheer vindictiveness…He bought the company (a failing New England textile company called Berkshire Hathaway) to get back at the guy (Seabury Stanton) who had been trying to cheat him.”
Washington Post – May 3 – Why Your Flight is Early, Even When it’s Late: quotes Distinguished University Professor Roland Rust: “You can’t really know if the flight is going to be on time because they put in this fudge time,” said [Rust]. “But if the plane takes off on time, it’s definitely going to be on time.”
Maryland Today – May 3 – “Study Suggests Fixes for Persistent Geographic Inequity in Liver Transplants” describes research into increasing equity in liver transplants for people from around the country while preserving the maximum number of viable organs for transplant, by Dean's Professor of Management Science and Operations Management Raghu Raghavan, Associate Professor of Marketing Liye Ma and Smith PhD graduate and Carnegie Mellon University faculty member Shubham Akshati.
American Banker – May 3 – “Renewed Volatility in Regional Bank Stocks Puts Pressure on Policymakers” quotes Professor of the Practice Clifford Rossi: JPMorgan's purchase of First Republic was intended to calm fears, but investors are thinking that the crisis “isn't behind us,” [said Rossi]. “We're in an environment where deposits are willing to move at a moment's notice at the first sign of panic,” he said, adding that banking executives and regulators may not have fully grasped the “instantaneous” impact of deposit runs in an era of digital banking. Related: Rossi writes, in his CRO Outlook column for GARP Risk Intelligence, “First Republic Fallout: A Call for More Effective Bank Board Risk Committees.”
Barron’s/Agence France-Presse – May 1- Professor of the Practice Clifford Rossi comments in “Relief at First Republic Sale, but US Banks Still Face Pressure”: SVB, First Republic and a third casualty, Signature Bank, were essentially “one-offs,” said [Rossi]. “Going forward, JPMorgan taking over First Republic does put that chapter behind the industry,” Rossi said. … However, the Fed has said new capital rules and other big changes “would not be effective for several years” following public comment, according to the central bank’s April 28 report on the SVB failure. But Rossi said that in the wake of the bank failures, the Fed will feel pressure to demonstrate it will be proactive in trying to get ahead of problems. … “Any time an event like this takes place, the regulators get much more assertive,” Rossi said. … Related: Law360’s “How RE Headwinds Shaped First Republic Risk-Sharing Deal” quotes Rossi, including: "We've seen it for some time — there were rising delinquencies on the auto and credit card side, a lot of rumbling going on about the commercial real estate market, particularly the central cities with the return to work post-COVID not going that quickly," said Rossi. "There are a lot of vacancies going and cash flows being left behind." … Rossi discusses the ‘Fed’s Review of SVB’s Collapse,’ via WTOP and comments in “In Review Highlighting its Own Failures, Fed Calls for Tighter Regulations on Banks,” for Sinclair’s National Desk.
HousingWire – May 1 – Professor of the Practice Clifford Rossi addresses recent changes to LLPA fees in op-ed: “Setting the Record Straight on Mortgage Pricing.” … Related: Inman News’ Fannie and Freddie’s Fees Going up Monday Despite Industry Objections quotes Rossi, including: But [Rossi said] the pricing changes “will increase the cost of borrowing for a sizable borrowing cohort that presents very low credit risk while greatly lowering the cost of borrowing for borrowers that pose significant credit risk to Fannie and Freddie,” Rossi said in a commentary piece Tuesday.
Poets & Quants – April 30 – Associate Clinical Professor of Marketing Mary Beth Furst comments on Smith MBA Philip (P.J.) Thomas in his Best and Brightest MBAs: Class of 2023 profile, including: As the President of the MBAA, he was a strong supporter of the STEM designation for the MBA program because he saw how it will improve the graduate experience for international students in the future. I believe his previous experience with Global Citizen’s Curtis Fellowship primed him to look for such opportunities. As program manager, he focused on marketing efforts to grow the fellowship program dedicated to developing professional and leadership skills in college-age South African students.
All Events In – April 28 – Previewed is “Henry Ford, Elon Musk, and the Journey from Genius to Infamy” – a lecture in Chicago on May 18, 2023, by Associate Professor of Management and Entrepreneurship David Kirsch, hosted by Neubauer Collegium for Culture and Society.
Science Newsnet – April 28 – Charles E Smith Chair in Finance and Distinguished University Professor Pete Kyle explains why the “Fed-Predicted Recession is More Likely Severe than Mild.”
Capital B – April 28 – Assistant Professor of Information Systems Lauren Rhue comments in “Black People Still Experience Racial Bias in the Hiring Process. Can AI Help?”: “If you can create a machine learning algorithm to make recommendations as opposed to a human making those decisions, you see more diversity just because the criteria is consistently applied. We can benefit from just having consistent criteria,” she said. But companies must have the “political will” at every stage of the process to minimize the bias, she added. “There’s cause for hope in the use of these technologies. We just need to have the will to try to increase diversity at every single stage,” Rhue said. “If we can get that political will, then a lot of the issues with AI bias will fall away, and a lot of the promise of the technology will come to the forefront.”
DS News – April 28 – “Collaboration Between Professor and Students Take on Mortgage Climate Risk” describes new research led by Professor of the Practice Clifford Rossi to quantify climate risk for homeowners and mortgage lenders, including: “This is not just about managing risk, it's also about managing uncertainty—a much harder game.” Rossi led a group of 11 students in Smith's Master of Quantitative Finance program in a recent experiential learning project with government-sponsored mortgage enterprise Freddie Mac. The students built a model that leverages machine learning to pinpoint the regions of the country with the highest climate risk and the implications for homeowners and the mortgage industry.
The Daily Caller – April 26 – “A Down Payment On Fiscal Sanity” op-ed by Dean’s Professor of Finance Michael Faulkender includes …“There is no prospect of Congress balancing the budget this year, and a default on the national debt would be both financially catastrophic and a source of national embarrassment. The debt ceiling must be raised. At the same time, the federal government has a spending problem…”
Maryland Today – April 25 – “U.S. News Ranks UMD Graduate Programs Highly” includes: For specific programs, the highlights this year include: The Robert H. Smith School of Business’ information systems program at No. 11 and part-time MBA at No. 21 (a jump from No. 25 last year)… The Smith School was ranked No. 12 overall for online MBA programs earlier in 2023, in addition to online marketing at No. 6, online MBA business analytics program at No. 8; online MBA programs for veterans at No. 10 and online general management at No. 11; online masters in business programs (excluding MBA) at No. 16.
Law360 – April 24 – Professor of the Practice Clifford Rossi comments in “Independent Mortgage Banks Face New Scrutiny,” including: With that money, the IMBs originate the home loans, which they then securitize or sell, typically to Ginnie Mae and the other government-sponsored enterprises, Fannie Mae and Freddie Mac. “Here's the problem with these kinds of institutions: They are thinly capitalized to begin with,” said Rossi. “In the mortgage space, they are what we call monoline entities, meaning they're at the mercy of the mortgage cycle. So feast or famine, basically.” Additionally, IMBs' liquidity is “highly dependent” on funding from commercial banks and other private sources, Rossi said. “But imagine, like what we had happen here with the recent bank failures ... if they have very few lines of credit, meaning their own funding sources are not diversified, they can evaporate in a moment's notice," he said. "And that is really problematic.”
Yahoo Finance Live – April 24 – Clinical Professor of Finance David Kass discusses the Fed’s 2019 decision to loosen rules for midsize banks, bank regulation, and the outlook for regional banks in “U.S. Banking: Smaller Companies ‘More Likely to go to Regional Banks,’ professor says.” ... Related: TalkMarkets (April 23) excerpts Kass’ comments in “Smith Experts React To Fed Recession Prediction”
Association for Talent Development – April 24 – Professor of the Practice Clifford Rossi writes “Avoiding Risk Events Through Better Training.”
Wall Street Journal – April 21 – “Fed Rethinks Loophole That Masked Losses on SVB’s Securities” quotes Clinical Professor of Finance David Kass: “One way of making banks safer for the whole economy is to ensure a larger capital buffer,” said David Kass, a finance professor at the University of Maryland’s Robert H. Smith School of Business.
New York Times – April 21 – Professor of Practice and the Academic Director for the MS in Business Analytics programs Suresh Acharya adds context to “Help! Spirit Airlines Left Us Behind in Guatemala City,” including: [Acharya cautioned that we should not expect all airlines to have equally deft, customer-friendly communications systems. “It may have just been a manual oversight,” he said. “With Spirit or another low-cost, no-frills airline, their IT infrastructure and integration are probably not that automated.” He noted that since delays are costly to airlines, often requiring overtime payments to crews and causing delays that can ripple across the system, airlines will jump on any chance to speed up departures even after delays have already been announced, although it sometimes means leaving passengers behind. This is especially true on international flights and at domestic “slot-controlled” airports where the F.A.A. has imposed limits on takeoffs.
Maryland Today – April 21 – “Faculty Member Appointed to Maryland House of Delegates” profiles Sarah Wolek, senior faculty specialist for the Management and Organization Department.
NBC News – April 20 – “Big Businesses Rally to Preserve Their Right to Limit Ex-Workers’ Job Options” quotes Associate Professor of Management and Organization Evan Starr: The outcome of the battle will affect large swaths of the U.S. workforce. Roughly 30% of private sector employers currently use noncompete agreements for all their workers, [said Starr]. Businesses that use the policies typically cite the need to protect trade secrets and other sensitive information from rival firms looking to poach talent.…In the five years after Oregon banned enforcement of noncompetes for employees earning less than the median U.S. family income for a family of four, hourly workers’ wages grew 6%, Starr’s research found, and their job mobility also rose 17%. “There are many things that firms can do to protect themselves without noncompete agreements,” Starr said. If the FTC adopts new limits, he said, “we’ll definitely see more of the reliance on nondisclosure, non-solicitation [agreements] and more of the kind of perks such as higher wages, better benefits, etc.” … Related: American Antitrust Institute announces Starr joining the AAI Advisory Board of experts in the fields of antitrust and consumer protection law economics, and business in the United States and abroad.
Maryland Today – April 20 – “Pitch Dingman Winner Closes the Hood on Labs’ Energy Waste” features Sustainabli, a UMD-student-led startup, which developed Sashimi Sash Manager—an installable lab sensor and digital dashboard— to reduce energy loss from fume hoods in laboratories, among multiple winners in the competition hosted by Smith’s Dingman Center for Entrepreneurship.
Sinclair’s The National Desk via CBS Austin – April 20 – Professor of the Practice Clifford Rossi comments in “Securing a loan more difficult after bank collapses, including”: “Banks are just generally becoming more cautious. In some senses, they’re a harbinger of what might be lying ahead, so they’re anticipating a slowdown,” said [Rossi]. “If that happens, then with higher rates still kind of out there, borrowers are going to be facing more difficulty in getting loans, qualifying for high-quality loans…We know the banks are well-capitalized, generally speaking, so they will be able to withstand when people talk about a mild recession and whatnot,” Rossi said. “We’ll see what that looks like, but I don’t think that the liquidity issues that we saw were necessarily at all related to economic weakness, or potential economic weakness as much as it was in part due to the market being spooked over the unrealized losses due to interest rates rising and that banks had perhaps not managed that interest rate risk exposure.”
WTOP – April 19 – “Maryland Grad Aims to ‘Change Generationally What Health Care’ Looks Like” profiles Aishwarya Tare (College of Information Studies ’22) and her transformative “Meridian Health” app, as a $10,000 prizewinner in the Dingman Center for Entrepreneurship’s Pitchman Dingman Competition (Audio version of story).
DC News Now – April 19 – Associate Professor of Marketing Bobby Zhou gives consumer advice via “Apple Launches High-Yield Savings Account, Why Shopping Around for Rates May Stretch Consumers’ Cash”: [Zhou] told DC News Now that consumers should review savings account deals regularly. “Just because you are attracted to a nice offering initially, does not mean that you can give Apples, and Googles and Amazons the right to lock you in for an extended period of time and then as a consumer you miss out on better opportunities elsewhere.” “The big takeaway here is that as long as consumers are being very careful, they are paying attention to their monthly statement credits, I don’t think they have significant worries [about signing up for savings accounts],” Zhou said.
VOA News – April 17 – Lemma Senbet, William E. Mayer Chair Professor of Finance, comments (0:42-1:15 in embedded video) in, “Event Brings Diaspora Together to Support East Africa”: “Those of us in the diaspora have left the region, but the region has not left us. So, this is a mechanism for us to give back – to give back not just money, but also capacity-building, technical assistance and get connected so that we help the world from where we came from and impact life there.”
WTOP – April 17 – “Did Your Flight Arrive Early? Airlines Plan it That Way” quotes Roland Rust, Distinguished University Professor and David Bruce Smith Chair in Marketing: “The airline apps have made it easier for passengers to keep up with potential delays. Sometimes the messages in the apps are ahead of what they know at the gate,” [said Rust] “Besides purchasing travel insurance and reading the small print on the insurance policies, there really aren’t many, or any, strategies that passengers can use to protect themselves from delays,” he said.
TalkMarkets – April 15 – Clinical Professor of Finance David Kass gives the “2023 Percentage Returns Of 5 Largest Stocks.”
GARP Risk Intelligence – April 14 – “Silicon Valley Bank: The Postmortems Came Fast and Furious” quotes Professor of the Practice Clifford Rossi, including: For Clifford Rossi and Sim Segal, risk management veterans and consultants now also in university roles, the latest crisis has re-exposed recurring managerial and behavioral weaknesses. [Rossi] perceived a “disconnect” between SVB’s public statements and filings – “they were making it sound like [they] had good practices in place” – and a “much less rosy” reality.
WTTG-FOX 5 – April 14 – Clinical Professor of Marketing Hank Boyd contributes to “Washington Commanders Stadium Decision Could be First Hurdle for Potential New Owners” … “And you want your team to be the local favorite, to have folks say I have an affiliation, I have a connection to this team, and it means something to me. And unfortunately, over the years, they were starting to separate. It’s not the way it used to be for the Washington Commanders…”
Maryland Today – April 13 – “Smith Professor, Students Take On Mortgage Climate Risk” features Professor of the Practice Clifford Rossi and his project with Master of Quantitative Finance students to quantify the risk of extreme weather, including: The students created an interactive dashboard of all 13 million single-family mortgage loans originated in 2021 and merged it with the Federal Emergency Management Agency's National Risk Index tool for all 78,000 census tracts across 18 different climate hazards, including earthquakes, wildfires, hurricanes, coastal and river flooding, tornadoes and drought. Then they randomly selected 1 million mortgage loans and used a battery of different machine learning models and performance statistics to analyze the data, looking for such effects as adverse selection against Freddie Mac and fellow GSE Fannie Mae, impact on low- and moderate-income borrowers and minorities, and other key effects.
Investopedia – April 13 – “What Is Black Thursday? History, Significance, and Aftermath” extensively cites Charles E. Smith Chair Professor of Finance Albert “Pete” Kyle’s paper, “Large Bets and Stock Market Crashes.”
Technical.ly – April 13 – Professor of the Practice Clifford Rossi comments in “In Q1, DC-Area Companies are Making a Venture Capital Comeback,” including: Rossi noted that although the economy is still “trying to find its way,” the numbers for DC are still pretty strong. He said both interest rates and cash burns are still high, and investors are on the hunt for quality companies that don’t need a lot of financial runways to get going. “They’re going to be looking for people that have good potential in a market that may become a little bit more suspect over the next six months to the one-year horizon,” Rossi told Technical.ly. He does think, though, that interest rates are approaching a peak, and with Q1’s strength, it might be time for founders to think about raising again since interest rates tend to signal where the economy is heading. “Given that, this might be a time to dip more than maybe a toe in the water and see if there aren’t some opportunities out there,” Rossi said.
Barron’s (Agence France-Presse) – April 12 – “US Banks Face Increased Scrutiny Of Q1 Results After SVB Collapse” quotes Professor of the Practice Clifford Rossi: While investors view the sector as having stabilized, industry watchers are expecting a muted or downcast tone as banks -- whose well-being is considered critical for the economy as a whole -- begin releasing their quarterly updates. "They're going to be setting expectations that their earnings are going to soften," [said Rossi].
AACSB Insights – April 11 – Robert H. Smith Chair in Organization Behavior and Associate Dean for Research Gilad Chen contributes to “Time for More Grant-Seeking in Business Schools?” including: Many academic leaders believe that funding agencies and business scholars are not on the same page when it comes to interests and capabilities. But whether this is true can depend on the school. At the Smith School, for example, “I think there’s actually quite strong alignment,” says Chen. “We have faculty who do research on climate finance or supply chain risk assessment. We have faculty who have been very successful at getting grants around healthcare, technology, and information systems.”
Maryland Today – April 11 – Associate Professor of Marketing Bobby Zhou comments in “As Streaming Surges Past Cable, Researcher Predicts New Changes in What You Watch,” including: The biggest factor playing into the new change lies in streaming’s personalization capabilities, [said Zhou]. “Each viewer can enjoy tailored content even if they are streaming on different devices in the same room,” he said. To Zhou, the companies best positioned for success through this shift are Netflix, TikTok and YouTube. All three are already capturing the attention of U.S. adults, and their gains will likely continue due to teenagers’ preference for social media and streaming.
Knoxville News Sentinel – April 10 – “Berkshire Hathaway launches new era of Pilot Company ownership with CEO change” extensively quotes Clinical Professor of Finance David Kass: “He will leave the business alone,” said David Kass, clinical professor of finance at the Robert H. Smith School of Business at University of Maryland, who studies Berkshire. Kass said it’s rare for Berkshire to bring in new management. But, when it bought a minority stake of Pilot back in 2017 with plans to own a majority in 2023, the deal hinted at a CEO shift. Haslam said his family plans to retain 20% ownership. Kass, the professor who studies Berkshire, said it’s likely the holding company’s preference “to own 100% rather than share ownership. (But) they will leave it to the discretion of the family.” Berkshire outright bought Maryville-based Clayton Homes for $1.7 billion in 2003, and the company maintains its corporate headquarters there. As for change within the company, Kass called Buffett “the preferred owner” for anyone looking to sell their business but maintain culture, stabilize employment and keep the company intact. “I would expect there to be minimal change in the culture and the atmosphere, the working conditions, compensation,” Kass said. “Whatever attributes are important to the business and the employees; I would expect to pretty much stay the same.” As for Berkshire’s future, Kass said Abel, the heir apparent to Buffett, 92, would maintain the legendary investor’s methods.
Maryland Today – April 10 – “UMD Study: To Close Gender Pay Gap, Use Analytics” features research by Margrét Bjarnadóttir, associate professor of management science and statistics.
MarketWatch – April 8 – “Gensler’s Meme-stock Reforms are Meant to Help Retail Traders. Some Investor Protection Advocates Aren’t so Sure” quotes Assistant Professor of Finance Thomas Ernst and cites his research: There are also concerns that the design of the auctions, as proposed by the SEC, could lead to worse prices for retail investors. [Ernst] authored a paper published last month with former SEC Chief Economist Chester Spatt arguing that such auctions could lead to a "winner's curse" that could lead to worse prices for retail investors. Currently, brokers route orders to market makers based in part on how cheaply they have filled orders in the past, Ernst said, while the SEC proposal would require brokers to submit each individual order to a competitive market process. "These auctions are actually less competitive than the current system," Ernst said. because market makers and exchanges would worry that they have less information about the order than their competitor, and therefore bid more conservatively. "The winner's curse is if you win the auction, it means that everyone else thought that you bid too aggressively," he said.
Neru Lending (via Finance Videos Network) – April 7 – Accounting Lecturer Samuel Handwerger gives advice on ‘Filing for a Tax Return Extension.” Previous, related segments cover crypto taxation and special advice for recent college graduates.
Expansion Solutions Magazine – April 5 – David Kirsch, associate professor of management and entrepreneurship, contributes to “EV: The Future of Mobility”: For many years, David Kirsch was contacted every December and asked, “If this was the year that EVs were finally going mainstream. It wasn’t until December 2022 “that no one called me,” said Kirsch, … “because it happened.” … “I tell people if they want to see the future of EVs to go to Norway, a small country where 80 percent of new vehicles that were sold last year were EVs,” Kirsch said. “That number is due in part to an unusual tax structure; they have high tariffs on imported internal combustion vehicles.” In Norway, he said, it’s easy to see how all of those EVs can be accommodated because a solid infrastructure is in place. “The change in mode of transportation in Norway has occurred because many seemingly minor infrastructure reforms have been implemented,” which can include making reservations for charge spots on highways and greater availability of chargers in apartment buildings. “That’s what we’ll eventually see in the U.S.” he said, while governments and industry “work out where to locate chargers and how to make sure everyone has access to them.”
TechTarget – April 5 – DEI initiatives hurt by budget cuts, hostile politics” quotes incoming Assistant Professor of Management and Organization Reuben Hurst and cites his research: Researchers worked with a tech company that was filling business development and software engineering positions. They sent invitations to qualified people to apply for openings, some of which described the company as having a flat hierarchy. Researchers also conducted a separate survey to gather more information about applicants' employer preferences. In a paper released last year, they found that women were least likely to apply for a job at a flat organization. "Women were disproportionately repelled by an employer that characterizes itself as having a flat hierarchy," Hurst said. Women perceived flat organizations as environments with less opportunity for career advancement, both in terms of promotions and pay raises, and with heavier workloads, Hurst said.
Business Insider – April 5 – Clinical Professor of Finance David Kass contributes to “Warren Buffett's Berkshire Hathaway Faces a Brutal Mix of Economic Headwinds. It Will Capitalize on the Chaos, 8 Experts Say”: David Kass, a Buffett blogger and finance professor at the University of Maryland: "Elevated inflation and rising interest rates are likely to depress operating earnings. But they may present investment opportunities for Berkshire if the equity markets decline substantially in the weeks ahead." … "Berkshire's cash position equaled $129 billion at the end of last year. I would like to see Buffett put more cash to work such as continuing to increase his stake in Occidental Petroleum at attractive prices and accelerating his buying back of Berkshire shares at current or lower prices." Related, Kass reports, via TalkMarkets: Berkshire Hathaway Has 30% Stake In Occidental Petroleum
Expansion Solutions Magazine – April 5 – “Headquarters Market Still Mired in Flux” quotes clinical professor Oliver Schlake: Another part of the location puzzle concerns how companies are allowing more remote work depending on how far away from the office workers live, especially since many people moved during the pandemic to where the cost of living was less when they discovered they could work efficiently at home. “There is a discount for the companies since they don’t have to [be concerned with the local costs of housing of] an employee and can sometimes pay an employee less,” [said Schlake], “since they are already saving money. An employee’s location is now part of the negotiating process.”
AACSB Insights – April 4 – Smith Dean Prabhudev Konana writes op-ed, “Everybody’s Business.” Summary: In a global, market-driven economy where social issues impact every aspect of life, business schools are more relevant than ever.
Pitchfork Economics – April 4 – Associate Professor of Management and Organization Evan Starr explains his recent study on the enforceability of noncompete agreements in a ‘Banning Noncompetes is Good – Actually’ podcast segment.
77 WABC – April 1 – Dean’s Professor of Finance Michael Faulkender discusses economic policy including Fed Chairman Jerome Powell’s effect on inflation, via the Larry Kudlow Show. Related: Kudlow, moderating an H.R.1 Energy Roundtable with Congressional leaders, recognizes Faulkender: [Faulkender] raised the point that if you look at refined petroleum products, they affect every part of American life and every part of the American economy. It’s really quite remarkable and that’s why this bill is so important because it permeates the whole economy. If you lower the cost of that, you not only promote economic growth, you reduce inflation, you help reduce interest rates, you help reduce life’s worries for middle income folks.” (Faulkender on April 3 noted: “OPEC cutting oil production speaks to why energy independence is so critical and why I worked on H.R.1.”)
TalkMarkets – April 1 – Clinical Professor of Finance David Kass gives the “2023 Percentage Returns Of 5 Largest Stocks.”
Minnesota Reformer – March 31 – Associate Professor of Management and Organization Evan Starr co-authors “Franchise Owners are Colluding to Suppress Minnesota Workers’ Wages.” Intro: In many Minnesota franchises, franchise owners within the same franchise agree not to hire from each other, keeping wages down and profits up. It is already illegal for non-franchise business owners to use this anti-competitive strategy to limit workers’ freedom. Minnesota legislators are moving to close a franchise-owners loophole…
IR Magazine – March 30 – Sean Cao, associate professor of AI, FinTech and sustainability, co-authors “From Man Versus Machine to Man Plus Machine: The Art and AI of Stock Analysis (Encouraging news for humans in the age of AI),” including: The superior performance of an AI analyst does not rule out the value of human inputs. If human and machine have different relative advantages in information processing and decision-making, then human analysts may still contribute critically to a ‘hybrid’ analyst: one who makes forecasts that combine human knowledge with the outputs/recommendations from AI models.
MarketWatch – March 29 – ‘Smith School and Foretell Reality Partner to Enhance Supply Chain Management Education Using Virtual Reality’ quotes Humberto Coronado, Master of Science in Supply Chain Management academic director: “I believe that VR technology is a game-changer in teaching supply chain concepts. The immersive experience goes beyond traditional classroom lectures and textbook readings, providing students with a higher level of knowledge and capabilities. With the help of VR technology, students will gain a unique advantage as they enter the corporate world.” (Related via Smith News: Smith Students Learn Supply Chain Management With Immersive VR.)
AACSB Insights – March 28 – “People and Places” announces MBA programs at the University of Maryland’s Robert H. Smith School of Business in College Park are now STEM-designated (scroll down).
Plat4Mation – March 28 – “Important digital strategy lessons learned from the SVB collapse quotes Professor of the Practice Clifford Rossi: Let’s start from the conclusion of Prof. Clifford Rossi (University of Maryland) in Newswise: “SVB’s stunning collapse is a reminder that despite our best efforts to regulate the banking sector following the 2008 financial crisis, banks can and will fail from time to time. In the case of SVB, an unusual confluence of events; over-concentration in a volatile sector, poor investment strategy, risk management practices and board risk oversight ultimately doomed this bank.”
Fox Business – March 27 – Dean’s Professor of Finance Michael Faulkender comments regarding and ahead of upcoming congressional hearings related to recent bank failures in a “SVB Collapse Should've Been 'Extremely Clear' to Regulators” segment, including: “If you don’t think the regulators are always going to stay on top of every single source of risk out there, then the solution is to have greater capital, so it can absorb whatever risk shock may come its way. My hope is that we move away from this idea that the regulators are going to micromanage all the banks and keep the risk out of the system and have all these banks do all the same thing, I instead would like to see a return to a discussion of what capital requirements are going to ensure that they can absorb whatever risk arises.”
American Banker – March 27 – “How Interest Rate Risk Sneaked Up on Dozens of Community Banks” quotes Professor of the Practice Clifford Rossi: “It was risk management 101,” [said Rossi]. “They need to be all over that.” … Rossi, the University of Maryland professor and former banker, agreed that looking at one metric never tells the full story. But he said it’s an “irrefutable fact” that a decent number of banks took on far more interest rate risk than they should have.
TalkMarkets – March 26 – Clinical Professor of Finance David Kass gives the “2023 Percentage Returns Of 5 Largest Stocks.”
Harvard Business Review – March 23 – Dean’s Professor of Marketing David Godes co-authors “Research: The Pros and Cons of Soliciting Customer Reviews” Many companies chase customers for online reviews by sending them solicitation emails. These emails aren’t always a good idea...
The Hill – March 22 – Professor of the Practice Clifford Rossi writes op-ed “Bank Failures are Wakeup Call to Address Widespread Bank Board Governance Deficiencies.”
Wall Street Journal – March 22 – “Bank Failures Train Spotlight on Shortcomings in Risk Management” references Professor of the Practice Clifford Rossi: But the board-level risk committees often don’t go beyond that single qualified member and can sometimes lack the expertise to stand up to senior management, [said Rossi]. The problems can be serious, Dr. Rossi says. His research found most of the failures of the previous financial crisis could be traced to deficiencies in risk governance. His paper proposed some policy solutions, including more scrutiny of risk management from regulators and insurers.
Global Association of Risk Professionals (GARP) – March 22 – publishes Professor of the Practice Clifford Rossi’s white paper, “Reimagining the Federal Home Loan Bank System,” that shows restructuring the FHLB can reduce systemic risk and create more competition in the U.S. mortgage secondary market.
FinanceBuzz – March 21 – Distinguished University Professor Roland Rust contributes to “Airlines are Padding Their Scheduled Flight Times by More than 10%” (Scroll down to the 'Ask our Experts').
Maryland Matters – March 21 – Sarah Wolek, senior faculty specialist and founding director of the Intentional Life Lab for the Ed Snider Center for Enterprise and Markets, is nominated for a vacancy to serve in the House of Delegates representing Bethesda-based District 16: Wolek said during the interview process that she would champion special education students and their families in Annapolis. She also wants to bring a focus to issues of mental health and well-being, pathways to home ownership, and reimagining education for a new economy to her work as a delegate.
Wall Street Journal – March 20 – Dean’s Professor of Finance Michael Faulkender co-authors op-ed “Want to Prevent SVB-Style Collapses? Scrap Dodd-Frank” arguing that Dodd-Frank makes individual banks more similar and therefore the system is less resilient… Individual banks will still fail. But if the objective is to curb failure of the system, more capital and operating model diversity are important.
MBA Crystal Ball – March 20 – Assistant Dean of MBA and MS Admissions Shelbi Brookshire contributes to “How to stand out as an over-represented MBA applicant,” including: “A candidate needs to understand where their background (i.e., years of experience, test scores, undergraduate degree and GPA, etc.) falls regarding their competitiveness for their schools of choice. Once they understand and narrow down the number of schools they are considering, the best advice is to engage with the admissions team. Every school hosts virtual webinars, invites students to engage with a recruiter and often offers the opportunity to digitally meet current students. It is equally important to understand why that school is a good fit for the candidate’s post degree goals (i.e., a finance fund, an entrepreneurship center, etc.). The more a candidate invests in a specific program, the more the program understands if that candidate is a good fit for their program’s value proposition.
Baltimore Sun – March 18 – Rudolph P. ‘Rudy’ Lamone, former dean of the University of Maryland Robert H. Smith School of Business, dies” pays tribute to Rudy Lamone, also professor emeritus of management science and founder of Smith's Dingman Center for Entrepreneurship. Republished by The Washington Post, others.
India Education Diary – March 18 – “University Of Maryland Expert Analyses Huge Loan Loads On Cars” features insights from Charles E. Smith Chair Professor of Finance Albert "Pete" Kyle.
Baltimore Sun – March 17 – “Will the Collapse of two U.S. Banks be Followed by More?” quotes Dean’s Professor of Finance Michael Faulkender: [Faulkender] blames Silicon Valley Bank’s failure on bad timing, bank mismanagement and insufficient Fed oversight. Silicon Valley Bank “had this massive deposit influx,” said Faulkender, who served as assistant secretary for economic policy in the Treasury Department from 2019 to 2021. “From a risk-management perspective, they incorrectly bought long-term bonds,” he said. “The massive increase in interest rates devalues the bond. They have to then sell the bonds to meet the needs of the depositors, and they took losses.” He added that “any bank that’s sitting on that combination is potentially also in trouble,” questioning why regulators weren’t more closely monitoring interest-rate risk at Silicon Valley Bank after raising rates.
Agence France-Presse via Barron’s – March 17 – “Interest Rate Risk: SVB's Nemesis A Well-known Foe In Banking” quotes Professor of the Practice Clifford Rossi: SVB's meager hedging operation "astounds me," said Clifford Rossi, a former risk management executive at Citigroup and a professor at the University of Maryland. Rossi estimates SVB's hedging program should have been twice its size. At the end of 2022, SVB reported $120 billion of these investment securities, or 55 percent of total assets, more than double the average of US banks.
Slate – March 16 – Associate Professor of Management and Organization Evan Starr co-authors op-ed “Companies Say They Need Noncompete Clauses. Here’s How WeKnow That’s Not True.” Related: Why Noncompetes Could Soon Be a Non-Thing via Maryland Today.
Lending Tree Expert Insights – March 15 – Clinical Associate Professor of Finance Elinda Kiss gives personal finance advice on credit card awards, via “Best Rewards Credit Cards in March 2023.”
Psychedelics Today (podcast) – March 15 – “Vital Psychedelic Conversations” includes Associate Professor of Logistics, Business, and Public Policy Bennet Zelner discussing a market system for the emerging psychedelic-wellness industry.
Washington Times – March 15 – Clinical Professor of Finance David Kass gives context to the Silicon Valley Bank collapse in “Bankers Put Focus on Woke Causes”: “The reason for the failure was clearly poor judgment, poor management and maybe lack of supervision by regulators,” said David Kass, who teaches advanced financial management and business finance at the University of Maryland’s School of Business. “The bank did not have a risk officer. That’s absurd. It was just very poor management at the bank for investment policy.” As for a connection between the bank’s woke policies and its collapse, Mr. Kass said, “I don’t see the link.” Mr. Kass said even some stock analysts at major banks were rating SVB shares as a good buy within one week of its collapse. He noted that JPMorgan and Wells Fargo rated SVB stock as “overweight” or worth buying on March 9 and Goldman Sachs rated it as “buy” on March 3. “A lot of people were asleep at the switch,” he said.
Marketplace Radio – March 14 – “Financial Meltdowns Often Spur Changes to Financial Regulation. So Where Do We Go From Here?” quotes Professor of the Practice Clifford Rossi: Banks themselves also need to take a closer look at their own internal regulation, including the expertise of their boards’ risk committees, [said Rossi]. “They’re like the first line of defense in knowing where the bodies are buried at these companies,” he said. “And if they’re just passively going along, you’re not going to change it, I don’t care how much regulation you heap on them.”
Related coverage featuring Rossi:
- Appraisal Buzz – Reflecting on the Collateral Risk Network (CRN) Risk Summit
- Chief Investment Officer – Federal Reserve Expected to Hike Rates Next Week, Despite Shaky Banks
- Global Association of Risk Professionals (GARP) – CRO Outlook: Silicon Valley Bank: A Failure in Risk Management
- Insurance Journal – Viewpoint: Silicon Valley Bank’s Failure in Risk Management
- Maryland Today – Op/ed: Silicon Valley Bank Failed to Manage Risk
- Think Advisor - SVB Had No Chief Risk Officer for Month
- Sinclair’s The National Desk (via WJLA) – What's in a bailout? Government's response to bank collapses under scrutiny
- WTOP Radio – Credit Suisse and recent bank failures in the U.S. have investors on edge (0:30-1:30)
American Banker – March 13 – “Four Days Into Banking Crisis, Questions Outnumber Answers” quote Professor of the Practice Clifford Rossi: Other industry watchers have crossed off the big banks. [Cliff Rossi] said he doesn’t anticipate banks such as Citigroup or U.S. Bancorp “coming out of the woodwork” and doing a deal. “There has to be some strategic value for taking on the assets of these companies,” Rossi said in an interview. “I don’t see a ready buyer that’s waiting in the wings.”
CNBC – March 13 – Dean’s Professor of Finance Michael Faulkender comments in a ‘Fed to Review Silicon Valley Oversight’ segment, including: Well, you know, the cause ultimately of SVB S failure was that as your report just indicated, they had quite a lot of long-term assets that were in the form of treasury securities, of course, then funded by short term deposits. And so, it's that asset liability mismatch and a significantly rising interest rate environment that ultimately led to their insolvency, right. They didn't have sufficient equity capital to absorb the losses… Related analysis by Faulkender via Fox Business’ The Evening Edit (second clip) and Newsmax.
Wall Street Journal – March 13 – “In Retrospect, Berkshire Hathaway Cut Its Position in Regional Banks at The Right Time” quotes Clinical Professor of Finance David Kass: David Kass, a finance professor at the University of Maryland's Robert H. Smith School of Business, said he could see Berkshire potentially eyeing other options as well. "Financial institutions are well within his circle of competence," Mr. Kass said.
Financial Times – March 13 – Business School Insider’s Research Round-up (scroll down) highlights research by Hui Liao, Smith Dean’s Professor in Leadership and Management: When the award goes to … someone else: When it comes to award announcements, do you feel sorry for nominees who didn’t win? Perhaps, you shouldn’t as in the long run, non-winning nominees collaborated with other employees better, according to a study in the Academy of Management Journal. Additional coverage of the study includes Forbes’ “What Happens To Unsuccessful Nominees In Employee Awards?” and Medscape’s “Losing an Award Can Affect Motivation and Performance.”
Insightful Accountant – March 13 – "Eyeing the Future of Accounting" Overviews Smith’s collaboration with the Deloitte Foundation in the Deloitte Foundation Accounting Scholars Program (DFASP) and quotes Assistant Dean of MS Programs Emanuel Zur: [Zur] calls the collaboration with the Deloitte Foundation a vital move to expand the opportunities for students who are underrepresented in accounting and tax to gain advanced knowledge extending far beyond the fundamentals in accounting. “In doing so, we are proud to enhance the Smith School's equitable environment to critically strengthen the pipeline of racially and ethnically diverse talent entering a CPA profession that is becoming more perceptive and sensitive to the changing landscape of diversity, equity and inclusion in the workplace.”
DC News Now – March 13 – Professor of the Practice Clifford Rossi comments in “Banking worries? How your money is protected by federal insurance”: Clifford Rossi, a business professor at the University of Maryland and a risk management analyst said, “We’ve had 40 years of relatively low-interest rates and I think now that we are seeing rates go back up, and they’ve gone back up quickly, that some institutions are going to be caught sideways. He added, “I don’t think that this is anything that the average consumer should at all be losing sleep over.”
TalkMarkets – March 12 – Clinical Professor of Finance David Kass gives the “2023 Year-To-Date Percentage Returns Of 5 Largest U.S.Stocks.”
Washington Post – March 10 – “Noncompete Clauses are Everywhere, Even for Dancers and Hair Stylists” quotes Associate Professor of Management and Organization Evan Starr: A Labor Department study published in June 2022 estimated that 18 percent of Americans, or 1 in 5, are bound by noncompete agreements, but other research suggests it could be closer to 5o percent. [Starr], who co-authored the Labor Department study, says these agreements cause labor market “frictions” that can, among other things, suppress pay while imposing costs on firms wanting to hire… Nearly a dozen states restrict noncompete use based on salary thresholds, but the University of Maryland’s Starr argues that the state-by-state approach does not address a core issue: “Noncompete agreements themselves have chilling effects, and [firms and workers] have to spend a lot of money to try to get them voided,” he said.
FIND MBA – March 9 – Assistant Dean of MBA and MS Programs Shelbi Brookshire contributes to: Applying for an Online MBA: Do’s and Don’ts (In a buyer’s market, it pays to do your homework, demonstrate a keen commitment and clear career goals): When it comes to ensuring a high level of commitment, applicants should compile a list of approximately three criteria they want out of business school, [says Brookshire]. For instance, how important is it to be able to leverage robust career resources, or have access to quality faculty? Does the program have mandatory in-person residencies? How engaged is the alumni community? Brookshire says: “Do not assume all Online MBA programs are the same and understand why there are different price points. Invest time in understanding whether the school truly meets your criteria. One way to learn more is to ask for a connection to current students or recent alumni.”
USA Today – March 9 – “New lawsuit against Tiger Woods could get ugly after breakup with girlfriend: What we know” quotes Associate Professor of Management and Organization Evan Starr: “The Speak Out Act does not cover all alleged illegal activity – it only covers sexual harassment (and assault),” said [Starr] whose research aided the legislation. “By invoking this argument, she is implying something about sexual harassment (or assault) in this relationship.”
Wall Street Journal – March 8 – “Where Musk’s Twitter Gambit Stands Nearly Five Months In” quotes Clinical Professor of Finance David Kass: Mr. Musk, one of the world’s richest people, could continue making interest payments on Twitter’s debt by injecting more of his personal wealth or finding other equity investors. “To the extent the company does come up short in meeting their interest payments and he needs to raise perhaps a little more equity capital, I could see him contributing additional equity himself,” said David Kass, a finance professor at the University of Maryland.
AACSB Insights – March 8 – New Programs (scroll down) announces Smith’s new track in climate finance to students in the Master of Finance and Master of Quantitative Finance programs. Concurrent coverage includes Financial Times' B-School Insider (subscriber-only digital access): Climate focus The University of Maryland’s Smith school will offer a new track in climate finance to their Finance and Quantitative Finance master degrees, starting in spring 2024. This will include a consulting project related to climate finance and risk management with a corporate or government sponsor.
Stuff You Should Know – March 7 – Episode “Noncompete Agreements, Come on” of the globally popular podcast includes discussion (starting at 29:05) of research on the topic by Associate Professor of Management and Organization Evan Starr. Related: Starr discusses the proposed FTC rule on noncompetes via Slingshot (starting at 1:12 in embedded video), a podcast produced by The Sling, an economic analysis and competition policy news outlet.
Maryland Today – March 6 – Charles E. Smith Chair Professor of Finance Albert (Pete) Kyle describes the rising cost of auto loans as a troubling sign for the economy, via “Four-Figure Monthly Payments for Four Wheels.”
WalletHub – March 6 – Accounting Lecturer Samuel Handwerger contributes personal finance advice in the “2023 WalletHub Tax Survey.”
TalkMarkets – March 4 – Clinical Professor of Finance David Kass gives the “2023 Year-To-Date Percentage Returns Of 5 Largest U.S. Stocks.”
Poets & Quants – March 1 – Smith MBA programs’ recent STEM-designation is the focus of “Another B-School Goes ‘Super STEM,’ Giving All Its MBA Programs The Designation” and includes comments from Assistant Dean and Executive Director of the Office of Career Services Neta Moye and Assistant Dean of MBA Programs Rosellina Ferraro: “The Smith School STEM-designated MBA program prepares future business leaders to make better business decisions by offering a curriculum focused on technology and data analytics techniques and complementing them with skills in leadership and strategic thinking,” Ferraro says… “Our STEM designation signals to employers that graduates from our program understand how to uncover data-derived insights to drive value creation,” [says Moye]. “This is a skill valuable to any organization whose competitive advantage depends on data analytic capabilities, organizations well beyond the technology sector including consulting, finance, retail, and consumer products.” Related coverage via The Business Monthly's “Smith MBA Programs Now STEM-Designated.”
Baltimore Sun – March 1 – “Outlier or trend? As QB Lamar Jackson seeks new deal with Ravens, guaranteed money remains a question” quotes Clinical Professor of Marketing Hank Boyd: With so few top-end quarterbacks signing lucrative deals in a given year, one contract can have a large impact on others. [Boyd], who has consulted for the NFL, said he could see other players applying pressure to receive a Watson-like contract. “Once it gets done, everyone else says, ‘I want that,’” he said. The Ravens could also trade Jackson to a team more willing to pay the contract that he wants. An NFL quarterback is perhaps the most important position in American professional sports and there would be many suitors for Jackson — just as there were for Watson last year. Four quarterbacks are expected to be drafted in the first round in April, and there are few enticing free agents for teams that miss out on a top prospect. “I think most teams are on the hunt for a really good quarterback,” Boyd said.
Fox Business – Feb. 28 – Dean’s Professor of Finance Michael Faulkender discusses "Making the Trump Tax Cuts Permanent" in a Kudlow segment.
Consultancy.uk – Feb. 28 – “The crypto Industry is Still Reeling From the Effects of FTX” quotes Professor of the Practice Clifford Rossi: “The stunning collapse of FTX was an age-old story of financial mismanagement, excessive risk-taking and insufficient regulation and risk management.”
Finance Videos Network – Feb. 27 – Accounting Lecturer Samuel Handwerger gives ‘Tax-filing Advice for Recent Graduates.’ (Handwerger advises TerpTax, serving low-to-middle income tax filers in the UMD and College Park community and taking appointments through April 7, 2023.)
BusinessBecause – Feb. 27– “What Are The Best Online MBAs In Business Analytics?” highlights Smith’s program among those in the recent U.S. News & World Report ranking for this category.
Fox Business – Feb. 27 – Dean’s Professor of Finance Michael Faulkender discusses the U.S. economy and inflation, via The Evening Edit (starting at 2:00), including: “If you look at price increases net of wages, American people are worse off by 3.6 percent. Yes, wages have gone up, but nowhere near to keep up with inflation that has arisen from the Administration’s policies. When you impose this amount of spending when you run these kinds of massive deficits on the American economy, you are going to see this kind of inflation.”
TalkMarkets – Feb. 26 – Clinical Professor of Finance David Kass shares “6 Quotes from Warren Buffett’s Letter To Shareholders And Berkshire Annual Report” and “10 Highlights Of Berkshire Hathaway’s 2022 Annual Report And Warren Buffett’s Letter To Shareholders.” (Feb. 25).
LexBlog – Feb. 24 – Assistant Professor of Finance Bruno Pellegrino co-authors a summary of recent research in “The Great Startup Sellout and the Rise of Oligopoly,” including: Startup acquisitions by incumbent firms have been on the rise for the last few years. These acquisitions often allow larger companies to acquire new technologies or talent, while startups gain access to resources and a wider customer base. … In a new paper, we shed new light on this debate by documenting how venture capital exits have shifted from IPOs to acquisitions by incumbents and show evidence of how this might have affected competition in the United States.
Harper’s Bazaar – Feb. 24 – “Everything You Need to Know about Swedish Death Cleaning” quotes Assistant Dean of MBA Programs Rosellina Ferraro from a previous NBC News story: According to NBC, Swedish death cleaning fits into the psychology minimalism and can essentially make you happier. It stems from this idea that happiness doesn’t come from stuff or material goods but rather connection and relationships. Once you go through a process of possession slimming, you’ll ultimately identify what’s truly important and pleasureful to your life. [Ferraro] told the outlet of the practise: “If you pare down, the argument is that you can better focus on the really important things in life.” … “The idea of de-cluttering and streamlining our lives resonates because it may feel like it pushes back against this crazy chaotic world we live in.”
CNBC – Feb. 24 – Clinical Professor of Finance David Kass contributes to “Warren Buffett’s Must-read Annual Letter Arrives Saturday. Here’s What to Expect From the Investing Legend”: “We have a roughly 15-year period of abnormally and historically low interest rates. The short-term rates we have now are more normal,” said David Kass, a finance professor at the University of Maryland’s Robert H. Smith School of Business. “Interest rates are the main determinant of equity prices, to quote Buffett, so I think I’m looking for and expecting a discussion on interest rates.” … “One comment Buffett may make in his letter is that it’s not so painful to be sitting in cash. There is an alternative now and it’s called Treasury bills, or short-term Treasuries,” Kass said. The rising-rate environment could also benefit Buffett’s famous deal-making. Not only due to falling asset prices, but because he also has ample liquidity to tap into, whereas his competitors such as private equity firms have to borrow to make deals. “Private equity and others who are thinking of making acquisitions would have to go into the market to borrow [at] higher interest rates. This would confer a competitive advantage back to Berkshire,” Kass said.
Baltimore Banner – Feb. 24 – Dean’s Professor of Entrepreneurship Brent Goldfarb explains the function of business improvement districts in “Creating a more attractive and safer York Road with a business improvement district”: Such business districts are just another way for the city to supply services, [said Goldfarb]. And just like every other policy decision, there are “winners and losers.” The areas under business improvement districts tend to look more attractive, Goldfarb said, and businesses usually thrive and property values increase. On the other hand, these districts can also price people out with rent increases. The annual fees for the district could take a toll on businesses that were “barely making it” or if the clientele changes. “It’s just a question of how deliberate the City Council is in addressing that.”
Maryland Today – Feb. 24 – “Smith School to Offer Online Master of Science in Management Studies” highlights the new OMiM program that provides students with a broad set of business management knowledge to complement their passions, including how to lead effective teams, market products and make smart business decisions based on data.
Barron’s – Feb. 24 – Clinical Professor of Finance David Kass addresses “T-bills vs. Equities” in a Letter-to-the-Editor, including: Randall W. Forsyth cites several analysts who argue that Treasury bills currently yielding 5% are providing strong competition for equities (“Can the Stock Market Keep Rallying? Hopes Are Fading,”) Up & Down Wall Street, Feb. 17). But to determine the appropriate level of equities, one should also consider long-term interest rates. From 1960 to 2007, the 10-year Treasury averaged 6.84%. It is currently at 3.82%. Similarly, over the past 45 years, the 30-year Treasury has averaged 6.30%. It is currently at 3.87%. At a November 2016 meeting with University of Maryland students, Warren Buffett said, “Stocks are cheap if long-term rates [30-year Treasury] are at 4%, four or five years from now.” At that time, the 30-year Treasury was at 2.8%. Since equities are considered long-term investments, and most corporations borrow primarily long term to match the time horizon of their projects, today’s historically low long-term interest rates should not be ignored in equity valuations. Discounted-cash-flow valuations are calculated by discounting future cash flows by the weighted average cost of capital. This calculation would incorporate a company’s long-term cost of debt..
MIT Sloan Management Review – Feb. 22 – Associate Professor of Management and Organization Evan Starr gives an extended interview in “What an FTC Noncompete Ban Could Mean for Workers and Businesses” (Full-length version also via Tribune Content Agency). Intro: In January, the U.S. Federal Trade Commission proposed a ban on noncompete clauses in employment contracts. In addition to barring new noncompete agreements with employees and independent contractors, the rule would require employers to rescind existing ones. To understand what a federal ban could mean for workers and businesses, why it’s facing opposition, and how employers can prepare, we spoke with [Starr], who studies noncompetes at the University of Maryland’s Robert H. Smith School of Business. Related: Starr’s research is referenced in the Indianapolis Star’s “Eyeing Health Care Costs, Indiana Lawmakers Want to Ban Doctor Noncompetes (Feb. 22).
Knowledge at Wharton – Feb. 21 – “How ‘Strategic Silence’ Helps Employees” features research co-authored by Dean’s Professor of Management Subra Tangirala, including: Conducting a qualitative study and two field studies, the professors found that employees who use strategic silence most effectively consider three factors in deciding when and how to speak up: issue relevance, issue readiness, and target responsiveness. First, they determine whether speaking up would align with the goals of the recipient or the current situation (i.e., relevance). Second, they determine whether they are ready to talk or need to hold off until they collect more data, find a solution, or think through some other aspect of the problem or idea (i.e., readiness). Third, they wait until the recipient — usually a manager — is in the right cognitive (not too busy) or emotional state (not in a bad mood) to hear the message (i.e., responsiveness).
Inside Mortgage Finance – Feb. 21 – “Ohio Environmental Mishap Poses Housing Questions” quotes Professor of the Practice Clifford Rossi: Typically, in the event of a natural disaster, such as a flood or a hurricane, Fannie Mae and Freddie Mac issue press releases alerting borrowers and servicers to verify property damage and outlining the process for providing relief to those affected. In the case in East Palestine, because it’s an isolated incident and it hasn’t been declared a disaster by the Federal Emergency Management Agency, “it’s more of a wait-and-see situation,” Rossi said. Mortgage servicers could seek guidance from the GSEs, FHA and VA on how and when to offer forbearance and loan-modification programs to borrowers financially impacted by the train derailment and evacuation, Rossi said. Also, it can get trickier, Rossi said, if a borrower decides to not return to his home due to concern regarding health even after state officials have given an all-clear. “The issue in this case is if there’s no direct acknowledgment by a governmental agency that this is a bona fide existing health issue,” then there likely won’t be protections for borrowers who decide to walk away from their mortgage, he explained. “The protocols have to be rooted in some scientific basis,” Rossi added.
WalletHub – Feb. 20 – Clinical Professor of Marketing Hank Boyd gives insights on “Credit Cards for Groceries,” via “Ask the Experts.”
GARP (Global Association of Risk Professionals) – Feb. 17 – Professor of the Practice Clifford Rossi’s latest CRO Outlook column addresses “The Risk Appetite Dilemma: How to Overcome Obstacles and Enhance Risk-Adjusted Return,” including: Risk appetite statements can yield many benefits, but only when they adhere to established risk-tolerance levels and make use of proper metrics that consider threats across every profit center.
Maryland Today – Feb. 16 – “$30M in Grand Challenges Grants Awarded” introduces an “unprecedented UMD grants program” to support study into “society’s most pressing problems including pandemics, racism, threats to democracy and literacy deficits,” and including Smith researchers Vojislav “Max” Maksimovic, Louiqa Raschid, Debra Shapiro and Liu Yang, whose projects are featured in Smith Faculty Leading, Collaborating in UMD Grand Challenges Projects.
CNBC – Feb. 15 – “Watch Charlie Munger speak at the Daily Journal Annual Meeting” includes Berkshire Hathaway Vice Chairman Charlie Munger answering a question on stock buybacks from Clinical Professor of Finance David Kass, via moderator Becky Quick at 1:00:40 in the embedded video. The exchange (condensed and edited for clarity) includes: Kass via Quick: President Biden has proposed increasing the tax on stock buybacks from its current level of one percent to a new higher level of four percent. What are your views on taxing stock buybacks? Munger: I’m strongly opposed… A good culture has a lot of people that are good fiduciaries, and it’s like stealing to do something dumb with the corporate money, when you get more value for your shareholders by buying back your own stock… I like encouraging morality, decency, and honor and so forth in dealing with the people you’re the fiduciary for… I agree with our President on some things, but this is not one of them.
MetaNews – Feb. 15 – “Chat Fishing: How Artificial Intelligence Could Affect Online Dating” quotes Associate Professor of Information Systems Jui Ramaprasad: [Ramaprasad] observes, platforms have been using AI to improve user experience for some time. Ramaprasad has recently published research into a feature that reveals ‘who likes you’ (WLY) on dating apps. So it pays to listen when she says bots on dating apps could be a cause for concern. She explains: “Pushing the recommendation-algorithm path further, is using AI for the steps after an initial match on a dating site or a real estate listing site, i.e., chat-bots ‘making the first move’? This seems scary.”
Maryland Today – Feb. 13 – Marketing professors Hank Boyd and Judy Frels discuss commercials that flourished and flopped in “Super Bowl Ads 2023: Overindulging on Food, Drink and Celebs.”
Financial Times – Feb. 13 – “MBA Ranking 2023: Business School Profiles” describes Smith’s climb to 57th globally and No. 31 among US programs: The Robert H Smith School of Business in the US is one of two equal highest climbers, up 28 places to 57th. The school improved its performance in several categories including its careers service, ranked 42. One graduate commended the “amazing” careers support: “I could never have gotten myself that many interviews and they even helped me negotiate my offers to get me an even higher salary.”
Fox Business – Feb. 13 – In an Evening Edit segment, Dean’s Professor of Finance Michael Faulkender comments on Blackrock CEO Larry Fink’s advocacy for government action for $50 trillion of investment toward net-zero carbon emissions by 2050, including: “You’ve got the White House and a number of regulatory agencies imposing this ‘woke capitalism-ESG’ approach sacrificing long-term for America’s population in order to fund these green initiatives. So, we’re putting national security at risk and energy security at risk and we’re putting retirement security at risk.”
Maryland Today – Feb. 13 – Associate Dean for Culture and Community and Clinical Professor of Information Systems Zeinab Karake contributes to “How to Turn Your Office Chair Into an Opportunity for Exercise.”
The Diamondback – Feb. 13 – “Some Companies in Maryland Could Transition to a Four-day Workweek Under New State Bill” quotes Associate Dean for Research Gilad Chen: [Chen], who conducts research on organizational effectiveness and employee motivation, said the four-day workweek is only one part of an ongoing conversation about balancing employee productivity and well-being. Working from home or telecommuting could be other possible solutions with even better environmental benefits, Chen explained.
TalkMarkets – Feb. 11 – Clinical Professor of Finance David Kass gives the “2023 YTD Percentage Returns Of 5 Largest U.S. Stocks.”
Wall Street Journal – Feb. 10 – “U.S. Government Borrowing Costs Rise as Debt Ceiling Fuels Partisan Clash” quotes Dean’s Professor of Finance Michael Faulkender: But the Fed has raised its benchmark interest rate much faster than the CBO had expected, pushing the key rate to between 4.5% and 4.75% at its most recent meeting, a level last reached in 2007. The Fed’s actions has in turn pushed up yields on Treasurys, which were at roughly 3.6% on the benchmark 10-year note this week, an increase from around 2% a year ago. Those increases in yield gradually filter into U.S. interest costs as debts roll over. “I could not say definitively where the line was” for too much borrowing, said Michael Faulkender, a Treasury official during the Trump administration. “Finding out where the limit is, is catastrophic because it means we’ve had a bond market failure. That’s a depression.”
Global Association of Risk Professionals (GARP) – Feb. 10 – Professor of the Practice Clifford Rossi is the primary source for “What Do CROs Look for in a Risk Manager?” including: For entry-level positions, Rossi believes a good CRO doesn’t micromanage the process, instead offering guidance to underlings and trusting them to make good hiring decisions. When he held the top risk management post, he says his staff would occasionally ask for his help in evaluating young candidates to determine their communications or problem-solving skills. “When hiring junior risk managers, I sometimes did a 30-minute interview with promising candidates and tried to sell them on working for us,” Rossi recalls.
Katie Couric Media – Feb. 10 – “A Behind-the-Scenes Look at How Super Bowl Commercials Are Really Made” quotes Professor of Marketing Amna Kirmani, including: But the research continues to show that for emerging businesses like the handful of cryptocurrency companies that bought spots during last year’s game and even for big, legacy brands like Anheuser Busch, Frito-Lay, and Coca-Cola “the return on investment is very high,” she says. A splashy commercial creates brand awareness and signals to consumers that these companies are thriving with money to burn. “For some companies, they blow their entire year’s advertising budget on this because they can make such a splash,” Kirmani says.
Bloomberg – Feb. 9 – “Brazil’s Richest Man Loses Billions as His M&A Machine Breaks Down” quotes Clinical Professor of Management and Organization Paulo Prochno: [Prochno] says there’s an additional aggravating factor in the 3G playbook: Executives are often given contracts loaded with outsize bonuses for hitting profit targets. “That really gives strong incentives for people to not be ethical,” says Prochno, a Brazilian native who’s followed Lemann’s overseas expansion for years. Like Gulbrandsen, he says he doubts that Lemann and his partners, Marcel Telles and Carlos Sicupira, knew about the accounting irregularities, but says that matters only to a degree. They created “a system that leads to this behavior,” Prochno says.
The Atlantic – Feb. 9 – Clinical Professor of Marketing Hank Boyd comments in “The Tech Giants Want What the NFL Has”: Buying game rights ratchets up the companies’ platform to sell us things, in part because the very thing we’re watching on is something they’re selling us. Google could use the very existence of Sunday Ticket to plug YouTube TV subscriptions: After all, everyone knows Google, but not everyone might know YouTube TV. “Now, believe me, they’re gonna know YouTube TV, and they’re gonna be searching for it because of that access to the Sunday Ticket,” Hank Boyd, a marketing professor at the University of Maryland’s business school who has previously consulted with both the NFL and companies that work with it, told me. And while Google can’t replace national commercials during games that broadcast networks still produce, it will have what would normally be local advertising slots to sell, which it can use to boost all kinds of Google products.
Forbes – Feb. 7 – “New USCIS Data Show H-1B Denial Rates Remain Low” cites research co-authored by Hank Lucas, Robert H. Smith Professor of Information Systems Emeritus: …[Lucas] examined the skills and compensation of over 50,000 information technology (IT) professionals, and found, "[C]ontrary to popular belief, non-U.S. citizen IT professionals are not paid less compared to American IT professionals.”
InvestorPlace via Business Insider – Feb. 7 – “Should You Invest In Reg A+ Startups?” quotes Associate Professor of Management and Entrepreneurship Brent Goldfarb: But successfully marketing to brand enthusiasts is one thing, and making good on the promises of a return on investment is another. [Goldfarb] has his own reservations about the sorts of companies found on equity crowdfunding sites: “Crowdfunded companies are very high risk, and, as is the case with most entrepreneurial ventures, are more likely than not to fail. Hence, as such, companies in aggregate should only comprise a small percentage of their investments. This thinking sits behind the SEC’s crowdfunding rules, as well as the rules that determine which investors qualify as accredited. In general, investors who invest broadly in the public markets by buying index-based securities will outperform investors who invest in startups, including crowdfunded startups. Admittedly, investing in startups on crowdfunding platforms or otherwise is more fun.”
Phys.org – Feb 6 – “Retailers can Gain from Reducing Food Waste, Study Finds” overviews research by research published in the Journal of Sustainable Marketing by marketing professors Jie Zhang and Michel Wedel.
Fairly Competing (podcast) – Feb. 6 – “Guest Starr Discusses The Research Behind the FTC’s Proposed Noncompete” Ban” features Associate Professor of Management and Organization Evan Starr. Segment intro: The FTC’s proposed ban on noncompete agreements (and other “de facto” noncompetes) relies in large part on the research of [Starr]— one of the leading scholars in the field. Join John, Ben, and Russell as they talk with Professor Starr about the strengths and weaknesses of his research…
Food Industry Today – Feb. 6 – “Retailers Can Gain From Reducing Food Waste” covers research in the Journal of Sustainable Marketing by marketing professors Michel Wedel and Jie Zhang, including: Even as higher food prices make Americans think twice about what goes in the grocery cart, nearly 40% of food in the United States is wasted—mostly by shoppers who don’t eat what they bought and by retailers who fail to sell their goods. Large retailers are the main link between farmers, producers, packaged food manufacturers and consumers, so they can play a big role in reducing waste. And they stand to benefit from doing that. ... Also published by Maryland Today.
The Observer – Feb. 6 – Clinical Professor of Marketing Hank Boyd comments in “So Mickey Mouse Is About to Enter the Public Domain. Can Anyone Actually Make Money Off Him?”: “People mockingly refer to it as the Mickey Mouse protection act,” says Hank Boyd, a lawyer and clinical professor of marketing at the University of Maryland’s Smith School of Business. “But even Disney I think realizes you can only go to the well so many times.” … Then there is also old-fashioned market power. “You have an image of Steamboat Willie, and you decide to do something really far afield,” says Boyd. “Let’s say there’s a small market out there that says it’s pretty cool.” If it gets big enough, Disney can come in and compete. Who’s more likely to win?”
The Spokesman-Review – Feb. 5 – "Airlines’ Many Challenges Leaving Flyers Feeling ‘Worse and Worse’" quotes Distinguished University Professor Roland Rust: “The pandemic threw everything into reverse and then threw everything into accelerating forward again, and there was no way the system could manage that,” said Roland Rust, a professor who studies consumer service in air travel and other industries at the University of Maryland. … Rust said that the “just in time” nature of the system – with flights and connections closely interlocked – means that any single airline’s delay or cancellation can ripple through the entire country. ... For Rust, it’s a symptom of a system in which consumer service has had just one trajectory: “Worse and worse.”
MDPI Open Access Journals – Feb. 5 – “Fanbois and Fanbots: Tesla’s Entrepreneurial Narratives and Corporate Computational Propaganda on Social Media” by Associate Professor of Management and Entrepreneurship David Kirsch and Mohsen Chowdhury is published by World Electric Vehicle Journal and accessible via MDPI, a Switzerland-based academic open access publisher. The study was previously summarized here.
TalkMarkets – Feb. 5 – Clinical Professor of Finance David Kass gives “The Rotation from Value Stocks (2022) Into Growth Stocks (2023 YTD).”
77 WABC – Feb. 4 – Dean’s Professor of Finance Michael Faulkender discusses the January jobs report on the Larry Kudlow Show, including: “Normally in January you lose about three million jobs because of the temporary hiring that takes place during the holiday season. So instead of three million layoffs, there were only two-and-a-half million layoffs, so it looks as though we gained over a half-million jobs. My hypothesis about the jobs market, recently, is that we're suffering from a labor shortage, so a lot of the historical ways of thinking about jobs reports perhaps are not accurate.” … Faulkender co-authors a Feb. 3 op-ed in the Indianapolis Star, “Protect Indiana's Pension Plans by Keeping 'Woke' Politics Out;" discusses the U.S. economy, via Fox Business’ The Evening Edit; and co-authors "The Federal Government Is Dining Out On Your Dime" at the Daily Caller.
American Banker – Feb. 3 – Professor of the Practice Clifford Rossi co-authors, with Robert Brammer and Matthew Lightfoot, “Fed's Climate Scenario Pilot is a Waste of Time and Resources,” including: Modeling the physics of climate change has improved significantly in the past decade. However, the socioeconomic models underpinning bank climate scenarios at best provide regulators with a false sense of security that climate scenario results are credible and at worst may lead to suboptimal policy and investment decisions over time. We present a case for a robust simulation-based approach that regulators and large banks should adopt that would significantly improve results.
Maryland Today – Feb. 3 – “A UMD Podcast-Palooza” highlights Future of Humanity hosted by Anand Anandalingam, Ralph J. Tyser Professor of Management Science: Can we cultivate lab-grown meat that’s both climate-friendly and humane? Will AI enhance, rather than overshadow, human endeavors? Anandalingam trains his lens on these and other potentially life-changing technologies of the next 20 to 50 years.
Finance Videos Network – Feb. 2 – Accounting Lecturer Samuel Handwerger discusses “Crypto Taxation.” … In a separate segment, Dean’s Professor Emeritus of Leadership and Motivation Edwin Locke discusses his books "A Theory of Goal Setting and Task Performance," “The Selfish Path to Romance” and "The Illusion of Determinism: Why Free Will is Real and Causal."
Washington Business Journal – Feb. 1 – ‘Deloitte Foundation, Smith Collaborate on Scholarships for Master’s of Accounting Students’ highlights Smith’s new Deloitte Foundation Accounting Scholars Program “supporting a racially and ethnically diverse student population and to strengthen the pipeline of diverse talent entering the CPA profession.” … Related coverage via Poets & Quants and The Business Monthly.
MIT Sloan Management Review – Jan. 31 – ‘Salary Transparency Laws [will] Change Employee Compensation?’ quotes Rajshree Agarwal, Rudolph Lamone Chair of Strategy and Entrepreneurship: “This will occur not only because of the law but also because of competitive dynamics among firms in human capital/talent markets." (Viewable scrolling down and clicking top, left-corner square.)
Associated Press – Jan. 31 – “Elon Musk’s Tesla Tweet Trial Delves into Investor Damages” quotes finance professor Steve Heston as a an expert witness in the class-action lawsuit on behalf of Tesla shareholders: Heston, reviewed an even denser report analyzing the impact of Musk's tweets on more than 2,000 types of Tesla stock options, drawing largely upon a formula known as the Black-Scholes model widely used by companies to value executive compensation packages. When pressed by a Musk lawyer about the reliability of his model, Heston acknowledged: “All models deviate from reality, which is why they are models.” … Related coverage quoting Heston via BNN Bloomberg.
Bloomberg Law – Jan. 31 – “FTC Noncompete Proposal Breathes New Life Into Lawmaker Efforts” quotes Associate Professor of Management and Organization Evan Starr: Lawmakers, activists, and academics opposed to noncompetes in the workplace have warned for years of the paralyzing effects of such agreements, which they say hamper social mobility. Workers are passionate about the issue even as it has been largely off of Congress’s radar, [according to Starr]. “Those workers on the back end realize they can’t take another job in their industry for two years or they have to move their whole family. It’s very jarring for workers who realize that they can be held to these restrictions,” [said Starr]. “It evokes very, very strong feelings among workers about fairness, about their ability to provide for themselves.”
Technicall.ly – Jan. 30 – Professor of the Practice Clifford Rossi comments in “How should founders be preparing for a recession?” [Rossi explains a recession] as follows: The unofficial definition is two consecutive quarters of negative GDP growth. Per this definition, we actually experienced one last year. But whether or not we’re officially in a recession is up to folks at the National Bureau of Economic Research, who say they also explore factors like unemployment — meaning that we can experience a recession’s effects without technically being in one. Rossi currently predicts a mid-2023 recession but anticipates nothing near the tumult of 2008. “We’re certainly seeing numbers that, on days, seem like they’re relatively strong; the economy still seems to be hanging in there pretty well,” Rossi told Technical.ly. “But at the same time, there are these warning signs, particularly with rates as elevated as they have been relative to where they were in the past, that seem to suggest that we could be in for a bumpy ride.”
Harvard Law School Forum on Corporate Governance – Jan. 30 – Lemma Senbet, William E. Mayer Chair Professor of Finance, co-authors as part The Financial Economists Roundtable, “The Controversy Over Proxy Voting: The Role of Asset Managers and Proxy Advisors,” as an analysis, with policy recommendations on “the future of shareholder rights and corporate governance with a focus on the role played by large asset managers and proxy advisors.”
FIND MBA – Jan. 30 – Assistant Dean of MBA & MS Admissions Shelbi Brookshire comments in “Why an MBA is a ‘Safe Harbor’ in a Recession”: [Brookshire] spells out the reasons for MBA applicants to be optimistic; the factors leading to the current fall in competition. “A significant portion of the US population are aging out of pursuing an MBA with fewer than 20 percent in the traditional age range,” she says. “In addition, the economic and workforce volatility of the pandemic has made prospective students more risk averse and have less appetite for incurring large amounts of debt,” she adds, particularly with interest rates increasing from historic lows. ... “There are also a number of substitutes ranging from industry specific certificates to specialty master’s programs that employers are recognizing as value-adds when considering a new employee,” Brookshire says, suggesting there are more ways to upgrade credentials.
CGTN America – Jan. 30 – Clinical Professor of Finance David Kass discusses factors behind Southwest Airlines’ Q4 losses and the economic state of the airline industry more broadly in “Southwest Reports Q4 Net Loss of $220M.”
Focus on This (podcast) – Jan. 30 – 'Avoid Repeating Mistakes' includes Clinical Professor of Management and Assistant Dean Nicole Coomber discussing data-driven strategies for increasing personal productivity (Starting 15:08 in embedded video).
Los Angeles Times – Jan. 26 – “Column: The FTC is Pushing New Rights for Workers. Big Business is Pitching a Fit, of Course” cites research by Associated Professor of Management and Organization Evan Starr: Academic studies cited by the FTC, the White House and the Treasury Department have found that as many as 38% of workers have labored under such a clause at some point in their working life. Only 1 in 10 workers negotiated over their noncompete restrictions, and about one-third were presented with the clause “after having already accepted their job offer,” researchers at the University of Michigan and the University of Maryland found. On average, noncompete clauses reduce hourly wages by anywhere from 2% to 21%. A 2008 Oregon ban on noncompete clauses for hourly workers in Oregon, according to a study by Michael Lipsitz of the FTC and Evan Starr of the University of Maryland, “improved average occupational status in Oregon, raised job-to-job mobility, and increased the proportion of salaried workers without affecting hours worked.” ... Related: The National Law Review’s “Potential Impact of the FTC’s Proposed Rule to Ban Noncompetes Nationwide ” cites Starr's research, and the Seattle Times' “Seattle-areaMan Says NoncompeteAgreements Cost Him a New Job” (Jan. 30) quotes Starr: “There’s been a push from policy policymakers, state level and federal, to go after attempts to limit labor mobility and hold wages down,” says Evan Starr, a University of Maryland economist who studies the issue.
FIND MBA – Jan. 26 – Director of Graduate Career Coaching Dori Jamison comments in “Ready to Switch Careers? How an Online MBA Can Help” (Summary: Online students are keen to explore wider opportunities, prompting business schools to ramp up career services.) Most business schools are ramping up the career support they offer to Online MBA candidates, as they switch roles more often. “There are more resources available for these programs around career coaching,” [says Jamison]. There are big benefits associated with career transitions. “Changing careers provides the student with an opportunity to find their passion and do what they love,” says Jamison. “They typically have previous experience where they are learning more and more about what they want out of their career and the MBA is a great vehicle to leverage their previous experience to do something they are excited about. Changing careers can also provide more growth potential.” … Like Imperial College, the Smith School is seeing a rise in Online MBA students seeking coaching support to help them transition into new careers. “We have seen appointment requests for topics like ‘career targeting’ triple in the last three years,” Jamison says. What has led to this change in employment outcomes? “It can be said that there is less risk,” she continues. “With more competition and options in the MBA space, online degrees are becoming more popular and have less stigma around quality. The online environment is also becoming a more acceptable platform for networking and building relationships, so students are finding they may not be missing as much compared to a traditional degree,” adds Jamison.
US News & World Report – Jan. 25 – “8 Best Warren Buffett Stocks to Buy in 2023” quotes Clinical Professor of Finance David Kass: Oil and gas giant Chevron is another large Berkshire holding that investors should consider, says University of Maryland finance professor David Kass. It is "an extremely well-managed international oil company," he says. … Another oil and gas producer in Berkshire Hathaway's portfolio that Kass likes is Occidental Petroleum. It is also very well managed, he says. Plus, Berkshire may make a friendly acquisition of the company at a premium of at least 25% over its current market price, he adds. … If the Fed raises its key interest rate to the 5%-to-5.25% target range this year as the central bank projected in December, consumer staples such as Coca-Cola should perform relatively well and be less sensitive to interest rate hikes than the industrial and financial stocks in Berkshire Hathaway's portfolio, Kass says. He also points out that KO should only experience a minimal decline in sales if a recession hits because of its status as a consumer staples stock. … Related: Kass gives the 2023 Year-To-Date Percentage Returns Of 5 Largest U.S. Stocks By Market Capitalization (for Jan. 29) via TalkMarkets.
Expansion Solutions Magazine – Jan. 25 – Center for Social Value Creation Director Nima Farchshi comments extensively in separate pieces, “Going Green: The Only Way to Grow” and “Plastics: Projections Rising with Demand for Biodegradable,” including: As far as changing perceptions about the need to recycle, “Many ESG funds have already been successful, though several southern states, such as Texas, Kentucky, Louisiana and others, are in the process of rejecting it,” said Farshchi. He noted, however, that ESG funds “performed well during the pandemic.” ... Farshchi added to that observation and also suggested following the lead of the European Union, which is setting requirements for plastic waste in an effort to reduce the amount by around 20 percent by 2030; and total greenhouse gas emissions by 55 percent by 2030 from where they stood in 1990. Apparently, those efforts in the EU have been noticed in Washington. “Also, the Biden administration is pushing for a House Resolution for the Environmental Protection Agency to increase regulations on plastic since the 2022 United Nations Climate Change Conference a few weeks ago,” he said, noting the next conference is set for Nov. 30, 2023, when world leaders will again discuss shared metrics to reach goals.
Expansion Solutions Magazine – Jan. 25 – Dean’s Professor of Operations Management Wedad Elmaghraby comments in “Data Center Sector to Expand Exponentially” including: Businesses today are “devouring data in their effort to create positive monetary outcomes that often require big data capabilities. That’s why we continue to see the rise in the number of data centers,” said Elmaghraby. “More and more of what businesses do requires the services of data centers, whether it’s managing emails, human resources or capturing and processing big data that is critical to their business’ competitive advantage.” To do that successfully, they need to process a large number of transactions and data in a timely manner, she said. “Quick answers, quick analysis and quick touchpoints. Nobody wants to send an email and have it get to their customer two hours later.”
Maryland Today – Jan. 25 – “Pitch Dingman Competition 2023Expands to USM Schools” means Smith’s Dingman Center for Entrepreneurship “has introduced a fourth track to its signature competition, as a trial run for a larger competition in the future. This pilot will include students from nearby schools with similar pitch competitions: Bowie State University, the University of Baltimore and the University of Maryland, Baltimore County.”
Fast Company – Jan. 24 – “IPOs Decline as Large CompaniesGobble up More Startups. That’s Bad for Innovation” references and quotes from research by Assistant Professor of Finance Bruno Pellegrino, including: But a new paper … shows that despite a relatively recent uptick in IPO activity, what we’re witnessing is actually a longer shift: Fewer companies are going public, more are being acquired, and that’s likely part of a big-picture strategy by established companies to insulate themselves from would-be competitors. The study’s authors—economist Florian Ederer from Yale School of Management and assistant professor Bruno Pellegrino from University of Maryland’s Robert H. Smith School of Business—conclude that the trend is “accompanied by” an increase in the opportunity costs of going public, and the result is an increase in oligopoly power. “Dominant companies that are disproportionately active in the corporate control market for startups have become more insulated from the pressures of product market competition over the same period,” the study reads. “These facts are consistent with the hypothesis that startup acquisitions have contributed to rising oligopoly power.”
Business News Daily – Jan. 23 “Simplicity Is Key to Effective Online Advertising” overviews eye-tracking research in the Journal of Marketing Research co-authored by Distinguished University Professor Michel Wedel.
TalkMarkets – Jan. 21 – Clinical Professor of Finance David Kass gives the “2023 Year-To-Date Percentage Returns Of 5 Largest U.S. Stocks.”
790 KABC (Los Angeles) – Associate Professor of Management and Entrepreneurship David Kirsch discusses the history of the electric vehicle and its implications on the environment moving forward, in “A Climate Change with Matt Matern.”
USA Today – Jan. 19 - “How Noncompete Agreements Harm Women and People of Color: 'Consequences can be Devastating’” quotes Associate Professor of Management and Organization Evan Starr: “There are now several studies which suggest that noncompete agreements more strongly affect women and people of color.”
Additional, same-week coverage quoting Evan Starr and-or referencing his research on noncompete agreements:
- Bloomberg via SFGate - “Noncompete Ban Holds Out Promise of Better Pay Without Inflation”: That spate of high-profile layoffs has added to concern about the risk of a U.S. recession, even though labor markets remain broadly strong. In that event, widespread noncompete agreements could hamper the economy’s ability to bounce back, [according to Starr]: “Noncompetes would prevent workers from finding a job in their industry” when they get laid off, he says, “and as a result, drag out a recovery.”
- Financial Times - “In labour markets, the devil is Often in the Detail” (Non-compete clauses buried in contracts stack the deck against workers): The story starts in the US, where economists and law professors such as Evan Starr and Orly Lobel have mapped out the extent to which employment clauses traditionally associated with top executives have actually spread across the workforce... Non-disclosure agreements; non-disparagement clauses; non-compete clauses — many American workers are now tangled in a thicket of the stuff. One study by Starr found that 70 percent of employees with unenforceable non-competes mistakenly believed they were enforceable.
- The Nation – “The FTC’s New Rule Against Noncompetes Could Raise Wages by $300 Billion”: The FTC has estimated that its proposed ban, if enacted, will raise wages by nearly $300 billion a year. [Starr], who has studied noncompetes, argues that this is a low estimate, because when firms can no longer game a patchwork of state laws to keep using them, the impact may be even larger than past studies have found.
- Wall Street Journal video - “Why the FTC Says Noncompete Clauses Are Hurting the Economy.”
Fox Business – Jan. 19 – Dean’s Professor of Finance Michael Faulkender joins the Kudlow program for a live in-studio panel discussion on “Restoring Prosperity in America."
DC News Now – Jan. 19 - Clinical Professor of Finance David Kass explains the economics of “Consumers to Start Paying for COVID Shots, Feds Poised to End Free Vaccine Program.” … Kass, via Al-Araby TV, discusses economic implications of more than 20,000 Americans losing their jobs in the technology sector during the first week of this year, representing 20% of those who lost their jobs in this sector during the entire year 2022. The segment (in Arabic) also is accessible via Facebook and a full-length video download.
TalkMarkets – Jan. 14 – Clinical Professor of Finance David Kass gives the “2023 Year-To-Date Percentage Returns Of 5Largest U.S. Stocks By Market Capitalization”
Fox Business – Jan. 13 – Dean’s Professor of Finance Michael Faulkender discusses, on Kudlow, the potential for global recession in 2023 including: “The first half of this year is going to be into a recession, because of the activity the Fed has engaged in. You see the pullback in activity around home purchases and households starting to run through some of the money they accumulated during the pandemic. The savings rate is at one of lowest levels we’ve seen in a long time. The consumer sentiment number is still way down. So, indications suggest that at some point consumers are going to run out of money or certainly curtail the amount they have, and that’s going to lead to a mild recession in the beginning of this year.”
GARP – Jan. 13 – In his latest CRO Outlook column published by the Global Association of Risk Professionals Professor of the Practice Clifford Rossi writes “Reducing Operational Risk with Systems Engineering.” Summary: What are the underlying problems behind the operational failures that have plagued large banks? Should they consider a systems engineering approach to either supplement or replace the flawed project management processes that are currently in place?
Lipstick Alley – Jan. 13 – The women’s interest blog focused on social issues, quotes Associate Professor of Management and Organization Trevor Foulk among other academic experts in (Tips on being Resilient & Cultivating Spaces To Build Yourself Back Up. Having hobbies, passions, and a positive mindset about the Future): Trevor Foulk, who researches organizational behavior at the University of Maryland, told the Washington Post that rudeness is sort of like the common cold. It’s easy to catch and pass on to others. “When it comes to incivility, there’s often a snowballing effect. The more you see rudeness, the more likely you are to perceive it from others and the more likely you are to be rude yourself to others,” he said.
Technical.ly – Jan. 12 – “Q4 was the DC Area’s Lowest Quarter for VC Activity Since 2016” quotes Professor of the Practice Clifford Rossi: All that said, why are Q4’s numbers so low? Clifford Rossi, professor of the practice and executive-in-residence at the University of Maryland’s School of Business, attributes the figures to investors being a bit more conservative as of late. “My sense would be that investors are being a bit more circumspect given the potential for some deterioration in the economy,” he told Technical.ly.
CFO Dive – Jan. 12 – Associate Dean of Research Gilad Chen comments in “Quiet Hiring Dos and Don’ts”: One potential downside to quiet hiring exists when it is poorly managed, [Chen said] in an interview with CFO Dive. “Employees who are sent to new positions may feel their current position is in jeopardy, and it may be threatening to employees,” he said. However, if managed effectively, this concept could be motivating for employees, and become a part of their job rotation and career development opportunities, he said. For example, Google uses quiet hiring as a recruitment tool. “You bring in people for temporary positions, but it’s almost like a trial period, and that’s actually very motivating to those employees,” said Chen.
New Books Network – Jan. 11 – “Understanding Technology Bubbles” reprises a discussion with Smith management and entrepreneurship professors David Kirsch and Brent Goldfarb discussing their book Bubbles and Crashes.
US Army – Jan. 11 – “Soldier Finds Balance with Sikh Faith and Army Service” profiles Maj. Simratpal Singh (MBA ’20) whose career has included instructing West Point cadets on economics and principles of finance (“Smith prepared me to be an instructor at West Point by exposing me to the wonderful faculty who used creative ways to teach students,” said Singh in a separate article).
The New Yorker – Jan. 10 – In a Q&A, Associate Professor of Management and Organization Evan Starr discusses: “What a Ban on Non-compete Agreements Could Mean for American Workers.” Related coverage via Maryland Today’s “Management Professor’s Research Spurs U.S. Proposal to Ban Noncompete Agreements.”
Phys.org – Jan. 9 – “How the Experience of Almost Winning Impacts the Performance of Nominees” summarizes research by Smith Dean’s Professor in Leadership and Management Hui Liao ... Related coverage includes posts at Today’s Chronic and Science Newsnet.
Marketplace Radio – Jan. 9 – Associate Professor of Management and Organization Evan Starr comments in “The FTC’s Proposed Noncompete Ban Could be a Boon for Lower-Wage Workers: But noncompetes hardly ever go to court, according to University of Maryland economist Evan Starr. “They tend to be enforced informally in exit interviews, in threatening letters to workers,” he said. A few states, including California, have stripped noncompetes of any legal teeth; others have banned them for lower-paying positions. But workers don’t always know that, Starr said. Sometimes just the threat of a lawsuit is enough. “Low-wage workers generally don’t have the wherewithal to finance litigation even for a frivolous noncompete agreement,” he said. If the FTC’s proposed ban goes through, Starr said those workers will have a lot more leverage. As for their employers, he said there are alternatives — like nondisclosure agreements that protect sensitive information without limiting workers’ mobility. Related: Starr comments extensively in MarketWatch’s “FTC Wants to Ban Noncompete Agreements. This Man was Forced to Sign 4 Noncompetes. ‘It Just Doesn’t Feel Right,’ He Says.”
Advantage Biz Marketing – Jan. 6 – “Top Online Courses to Get Ahead in Dynamics Marketing” cites Smith MBA marketing courses.
Baltimore Sun – Jan. 6 – Hank Lucas, Robert H. Smith Professor of Information Systems Emeritus, writes op-ed, “Lessons for CEOs from Southwest Airlines’ Meltdown,” including: Much of the blame for this disaster has been assigned to Southwest’s network operating model: Southwest planes follow routes from one city to another, rather than operate from a hub where planes fly back and forth between two cities. The network model provides greater utilization of planes and less time on the ground, but it is highly sensitive to disruptions, like those from major storms. Southwest managers failed to fully understand the weaknesses in their operating model and failed to mitigate them, and much of this failure came from massive under-investments in information technology.
New York Times – Jan. 5 – "U.S. Moves to Bar Noncompete Agreements in Labor Contracts" quotes and references research by Associate Professor of Management and Organization Evan Starr: The agency estimated that the rule could increase wages by nearly $300 billion a year across the economy. Evan Starr, an economist at the University of Maryland who has studied noncompetes, said that was a plausible wage increase following their elimination. Dr. Starr said noncompetes appeared to lower wages both for workers directly covered by them and for other workers, partly by making the hiring process more costly for employers, who must spend time figuring out whom they can hire and whom they can’t. … Dr. Starr said that noncompetes did appear to encourage businesses to invest more in training, but that there was little evidence that most employees entered into them voluntarily or that they were able to bargain over them. One study found that only 10 percent of workers sought to bargain for concessions in return for signing a noncompete. About one-third became aware of the noncompete only after accepting a job offer. … Related: Starr is quoted in both TechTarget’s “FTC Proposed Ban on Noncompetes seen as Boldest Possible” and Business Insider’s “Ditching Noncompete Clauses Would be a Win for Workers' Rights and Employees in Low-Wage Jobs.”