FT Business Book of the Year longlist

This is an audio transcript of the FT News Briefing podcast episode: FT Business Book of the Year longlist

Marc Filippino
Good morning from the Financial Times. Today is Friday, August 19th, and this is your FT News Briefing.

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Middle East states are looking at a windfall over the next several years. US retail earnings were out this week. What do they say about consumer spending habits?

Andrew Edgecliffe-Johnson
Inflation has not hit consumer spending as hard as it has hit consumer sentiment.

Marc Filippino
And our journalists are busy reading hundreds of books, one of which will be the FT’s business book of the year. We’ll tell you about the long list. I’m Marc Filippino, and here’s the news you need to start your day.

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Middle East states are looking at a windfall of more than $1tn in additional oil revenues over the next few years. That’s according to the International Monetary Fund, and that’s thanks to high energy prices driven by Russia’s war in Ukraine. That extra revenue will turbo charge the region’s sovereign wealth funds, including Saudi Arabia’s public investment fund. These funds have ploughed money into global stocks and other investments in recent years. Many have focused on sectors like tech and healthcare, both for the returns and to develop new industries that will make the region’s economies less dependent on energy.

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Many of the biggest US retailers reported mixed earnings this week. Walmart and Lowe’s did better than expected. Home Depot reported its highest quarterly sales and earnings on record. But Target missed expectations, and Kohl’s cut its guidance for the rest of the year. I’m joined now by the FT’s Andrew Edgecliffe-Johnson, who’s got more to say on all this. Hey, Edge.

Andrew Edgecliffe-Johnson
Hi, Marc.

Marc Filippino
All right. Let’s start with the retailers who had good news to report this week. What did they say about why they’re doing better than expected?

Andrew Edgecliffe-Johnson
What we found out this week is that inflation is not affecting all Americans equally. It is definitely true that the lowest income families are struggling to find room in their budgets after they fill up their cars and they fill up their grocery baskets. But middle income families and even wealthier families are often trading down to shops like Walmart and Target from higher end shops that they would have gone to before. So it’s balancing out quite well for these stores.

Marc Filippino
All right. Well, what about the Targets and the Kohl’s? Why aren’t they doing so well?

Andrew Edgecliffe-Johnson
Target, frankly, misread the inventory they would need. It’s been an incredibly confusing picture for all retailers trying to understand where consumer spending would be right now, trying to understand what they should actually be ordering at a time when supply chains are still pretty much all over the place. But some of these retailers, particularly Target, ended up just with the wrong stock on its shelves. The issue with Kohl’s, which has some bearing on both Target and Walmart, is that the category where Americans really are pulling back their spending is apparel. So if you’re heavily dependent on clothing, that is a very unpredictable market right now. And that is one area where a lot of Americans are budgeting as they try to find more room in their budgets, not just for gasoline, for petrol and for food, but also for the stuff they want to do after two and a half years of a pandemic, like going to restaurants and travelling.

Marc Filippino
I see. So all in all, what’s the takeaway from this week’s earnings reports? Is there one?

Andrew Edgecliffe-Johnson
I think the big takeaway is that inflation has not hit consumer spending as hard as it has hit consumer sentiment. We’ve seen very ugly pictures from consumer sentiment surveys recently, but actually most Americans are managing to carry on spending pretty much as before. I think some of the concerns about the potential severity of a recession, if we are heading into one, or indeed the potential likelihood of a recession, have come off a bit in the last few days.

Marc Filippino
Andrew Edgecliffe-Johnson is the FT’s US business editor.

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It’s August, a time for vacation, for beaches and beach reading. Dozens of FT journalists have been poring over stacks of business books as part of the selection process for the annual FT Business Book of the Year award. More than 600 entries came in, and our senior business writer Andrew Hill joins us now to talk about the long list of 15. Hey, Andrew.

Andrew Hill
Hi there.

Marc Filippino
So, Andrew, what were the common themes that emerged this year in the books that were submitted?

Andrew Hill
Clearly, we’re in the middle of a world of interest rate rises, inflation, tight labour markets, and then the whole geopolitical and environmental crises that have converged on us in the sort of latter stage, still, of the pandemic. And a lot of the books tackle that, not directly necessarily, but we’ve got lots of heavyweight histories this year. We’ve got Brad DeLong’s book Slouching Towards Utopia, which is a sort of economic history of the long 20th century, as he defines it. We’ve got Gary Gerstle’s The Rise and Fall of the Neoliberal Order, which looks at the way in which, you know, the new left and the, and Reagan and others unleashed the sort of power of capitalism, but also some of the consequences we’re now living through. And we’ve got Helen Thompson’s book, Disorder, which is directly about some of the things that exploded this year in Ukraine. And then we’ve got a cluster of books about sort of big corporate situations. Bill Cohan with his book about General Electric. I mean, that’s a sort of flavour of some of the big themes.

Marc Filippino
Andrew, were there any books or writers who surprised you?

Andrew Hill
I was personally pretty struck by Gaia Vince’s book, Nomad Century. I think it’s unique in this year’s line-up. First of all, it’s the one book directly about climate change, which is obviously a vital issue on the minds of all businesses. Essentially what she’s painting is this bleak picture of the encroaching disaster. She takes the view that the climate emergency, as she terms it, has reached a point that it can’t be reversed in the short term and therefore, there are going to be large parts of the world that become unlivable, essentially. And she points to the fact that, although this is a disaster, we can prepare for it by migrating, essentially by getting ready for a grand migration northwards to the northern part of the northern hemisphere and some of the southern part of the southern hemisphere. And this is something that we could, if we have a united effort of politicians, businesses and society, that we could make provision for. And as a result, over a generation or two, when the technology catches up, and we’re able to cool the rest of the globe, we can prepare then for those people who’ve migrated to move back to the areas that they deserted. So it’s a radical, radical vision. And as I say, not a very positive one in the short term, but one that I found just very starkly revealing of something I hadn’t thought through, the way in which you could turn potentially migration to the benefit of the globe.

Marc Filippino
Andrew, another theme in the news this year has been supply chains. They’ve become so incredibly disrupted by the pandemic and then the war in Ukraine. Two books about supply chains made it on to the long list this year. Can you talk about them?

Andrew Hill
Yeah, that’s right. There’s a couple in particular. One is on the sort of general question of how we’ve ended up with this sort of dangerous growth of powerful middlemen and long supply chains. This is Direct by Kathryn Judge, and she goes into detail about the rise of the middleman economy, as she calls it. And this includes not just extended supply chains for manufacturers but also banks, retailers, even real estate agents, all the intermediaries who get in the way. And she makes a case for a return to a sort of more direct exchange system, which, she says, would improve accountability and resilience. And then there’s a second book, Chip War by Chris Miller, which is very much on the specifics of the semiconductor supply chain and just how complex that is and how vital to a lot of the digital and electrical products and services we use.

Marc Filippino
That’s a great snapshot of all the great business books out there, Andrew. And as a reminder to listeners, the FT Business book of the Year shortlist is out next month. We were just talking about the longlist, and then the winner will be announced December 5th. Andrew Hill is the FT’s senior business writer. Thanks so much for this, Andrew.

Andrew Hill
Thank you.

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Marc Filippino
Before we go, US scientists say they’ve discovered a way to destroy these things called forever chemicals. These are ubiquitous chemicals that have been used for decades in industrial and consumer products, everything from firefighting foam to non-stick cooking pans. They’ve been seen as indestructible, and they accumulate in the environment, posing serious health concerns. But yesterday, in a paper published in the journal Science, researchers from UCLA and Northwestern said they’ve developed a cheap and low-energy process that breaks down two of the most important classes of these compounds and turns them into harmless organic molecules.

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You can read more on all of these stories at FT.com. This has been your daily FT News Briefing. Make sure you check back next week for the latest business news. The FT News Briefing is produced by Sonja Hutson, Fiona Symon and me, Marc Filippino. Our editor is Jess Smith. We had help this week from Joanna Kao, Gregory Meyer, Michael Lello, David da Silva and Gavin Kallmann. Our executive producer is Topher Forhecz. Cheryl Brumley is the FT’s global head of audio, and our theme song is by Metaphor Music.

This transcript has been automatically generated. If by any chance there is an error please send the details for a correction to: typo@ft.com. We will do our best to make the amendment as soon as possible.