Editor’s Note: Connecting the Dots is a series of monthly conversations with Michael Dominguez, President and CEO of Associated Luxury Hotels International. The series examines issues in the global economy in 2024 that will “connect the dots” to be helpful not only in business but in life as well. This installment is moderated by Ashly Balding, Executive Vice President & Chief Sales Officer at ALHI.
Ashly Balding: The markets are kind of wacky at the moment. How should we read into what is happening and what this means for the broader economy?
Michael Dominguez: What I find interesting is sometimes we react or overreact to the markets. When we're filming this at this moment, it's two weeks after craziness, with the Bank of Japan and our markets reacted. Every market around the world reacted to that. But then it becomes the narrative of, oh my God, the economy is going to slow down, and what are we talking about again? Oh, we're going to go to a recession again and not a soft landing. We're sitting here two weeks later and the markets are back to exactly where they were before they all moved to that. That's the volatility we're talking about, and I think it's an important time for everyone to understand. Take a deep breath. What's happening with investments is not necessarily indicative of what's happening with the overall economy. There's too much narrative right now that keeps reading into that. The perfect example to that is all that chaos that we saw, those were traders. Most of us invested in the market. We're investors, which means I care about the next decade. I don't care about tomorrow. What creates that kind of volatility is people trying to trade and then we start to read into it. We're in this time frame that we keep reading into things like two days ago, Home Depot was down and it's like, you see the consumer is suffering. This is what the market is telling us, yet today or yesterday, Wal-Mart reports record growth and you're saying, ‘Look at the strength of the consumer.’ Everybody just needs to slow down. There's a lot of noise in everything that's happening. Is Home Depot down because interest rates are high and nobody's moving into new homes because we don't have enough resale homes and everybody's waiting? Probably. But that doesn't mean that the consumer is overall down. We keep reading into too much of one story and saying, ‘look at what's happening.’ Nike was up, Gap was up, but others were down. It’s just an important time in the market because the volatility reading that they have, it's at a really, really high point, which means we're going to be dealing with this chaos more, and if you're dealing with it more, my advice to everybody, take a deep breath, stay calm. It’ll be okay and let the dust settle before you really try to figure out what it all means. I try not to react to one-day news. That kind of the message.
Balding: Sit calm in the chaos.
Dominguez: I like that, that’s awesome.
Balding: Thank you for connecting the dots. Your perspective is always valuable.
Dominguez: Thank you for the conversation. I appreciate it. Thank you all.