Will Bush Get Amazoned?
Will a “Person of the Year” nomination turn into a curse for the new U.S. President?
January 22, 2001
President Bush and his fellow Republicans should be afraid — very afraid. No, not because of the closely divided Congress, faltering share prices or the slumping U.S. economy. The real bad news is coming from none other than — the editors of Time Magazine. It was they who decided to name George W. Bush their “Person of the Year.” Yes, they should have gone a little easier on the make-up for their pic which now adorns the January 1 issue of Time.
So what’s wrong with that, you may ask. It is certainly not the reasoning behind the decision. George W. Bush, after all, won what was arguably the closest and most hotly contested presidential election in the history of the United States. That makes him a great pick for Time’s annual award.
But what potentially bodes poorly for the new President is the fate of last year’s winner of the “Person of the Year” honors. Remember late 1999, when Time’s editors selected none other than Amazon.com founder and CEO Jeff Bezos?
Ever since being named Time’s Person of the Year, Bezos’ business fortunes — which had earned him the cover of this leading weekly news magazine in the United States — have gone straight down the tubes.
In December 1999, when Jeff Bezos was selected by Time, shares of Amazon.com’s stock were trading at more than $90 a share. A year later, when Time passed the “Person of the Year” mantle to the incoming President, Amazon’s stock was worth barely $20 a share.
And it dropped as low as $13 during the week Time’s “Person of the Year” issue featuring George W. Bush was on the newstand. As the stock dropped through the floor during the first three quarters of 2000, Amazon lost an astounding $866 million.
The question now is whether Mr. Bush’s political fortunes will experience the same kind of free-fall that beset Mr. Bezos in the year following his “Person of the Year” award. Of course, even in an era of lower growth, it’s improbable that the U.S. economy will ever look quite as grim as Amazon’s shrunken market capitalization.
But then again, the good news for Mr. Bush is that it wasn’t really Mr. Bezos who suffered from Amazon’s stock price crash. For despite losing nearly 80% of his net worth (or a cool $10 billion), Forbes magazine estimated his net worth in 2000 at a still impressive $4.7 billion.
No, the real losers in Time’s “Person of the Year” curse for Amazon were the investors who were gullible enough to buy into Amazon when its stock was at dizzying heights — despite the company’s record of losing huge amounts of money.
It is, of course, unfair to look at these stock price developments in absolute terms. A person should be measured against his peers — that is, viewed in relative terms. By that yardstick, since the Nasdaq fell almost 40% during the same time period that Amazon fell 85%, perhaps Mr. Bezos bears only about half the blame for Amazon’s losses.
The rest has to be attributed to the generally sour stock market. A U.S. President would probably be ecstatic to shoulder only half the blame for what goes wrong on his watch.
So, maybe it shouldn’t be George W. Bush and his party who have reason to worry about Bush becoming “Person of the Year,” but the American voters. But then again, it is entirely possible that this whole Time magazine cover curse business is as overrated as Amazon was at one time.