The timid that prefers to avoid risk, the snowflakes who melt at the first sign of risk, and the cowards who run from risk will be buried in the months to come.
According to the psychobabble of the New Age, we are all either “Alphas” or “Betas.” The Alphas are supposedly the ones who exert power and influence with the ability to take charge. Think of Conan the Barbarian and Xena: Warrior Princess. The “Betas” are the ones who sit back and are usually more insecure and nervous-minded than Alphas.
Both Alphas and Betas like staying in their lane because that is where they are most comfortable and gain the approval and admiration of the people around them. The next few months are going to be good times for the Alphas. Maybe.
But the best “personality” type for the New Normal that we are in is the “Omega.” The Omega could not care any less what other people think about them. Their confidence comes from the ability to adapt as necessary to succeed in any condition or in any situation. Nobody has to admire the Omega for them to feel good about themselves.
Take 2020, for example. The Alphas who thought they could brute force their way through the pandemic either in business or the stock market ended up bloodied and bruised by the side of the road. The Betas did better by simply pulling their heads in, like a turtle, and waiting for the storm to at least lessen in intensity. Of course, there were many more Betas than Alphas last year primarily because there are much fewer Alphas in all other aspects of life.
The Omegas are the ones who know when to shift to being an “alpha” and when to do “beta.” They are the ones that rapidly but efficiently shifted to home delivery in their businesses in the time of the pandemic. They are the ones who both got out of the stock market early and got back in early. Omegas know when to run and hide to fight another day and when to “take no prisoners; eat your dead.”
Omegas have no problem being wrong and changing direction to succeed. They just intend to be the last man or woman standing. In order to do that, a person needs to understand and be able to evaluate risk. Betas usually do everything to avoid risk. Alphas usually run headlong into risk. Omegas, on the other hand, circle around a risk looking for weak points and opportunities for exploitation.
The global pandemic has brought with it many different risks, not least of which is the health risk. Specifically, we are really talking about business interruption, market developments (like volatility, intensified competition/new entrants) and macroeconomic developments (monetary policies, deflation, inflation). Every company as well as every economy is going to have to deal with these issues. To those we can also add cyber incidents and political risk and violence.
However, 2021 is not going to be a good year for beta behavior. Already too many things have happened that required decisive action. It is not going to be enough to sit and wait for the storm to pass. More aggressive action is going to be necessary to prosper through the rest of the year.
Here in the Philippines not only do we have the same potential problems associated with the pandemic as everybody else, but in about four months the 2022 presidential election will take center stage. And if the current politicking both here and abroad is any indication, this may be one of the most contentious elections in memory.
In 2021, fortune will favor the brave but not the reckless.
E-mail me at mangun@gmail.com. Follow me on Twitter @mangunonmarkets. PSE stock-market information and technical analysis provided by AAA Southeast Equities Inc.