What we see in 2024
Andrew here. Looking ahead to the new year, the DealBook team has identified about a dozen themes that are likely to become ongoing narratives that could define the business and policy ecosystem for the next 12 months.
Of course, the presidential election, perhaps one of the most polarizing in history, will infect every part of the business world. Pay attention to which CEOs and other financiers support candidates—and, more importantly, which remain silent—and how companies treat outspoken employees. Also: Look for some wealthy executives to avoid donating directly to candidates, instead donating to PACs as a form of protection from public scrutiny.
Another storyline that's likely part of the discussion about water coolers – er, Slack and, last year, a debate about free speech on campus (another topic that won't go away).
Here's more on what we're looking out for this year.
The US presidential election. The race appears to be headed for a repeat of 2020, with Donald Trump leading in opinion polls as the Republican candidate despite his mounting legal battles. The big question is how business leaders will respond. Will they rally around (and throw their money at) a non-Trump candidate? Former South Carolina Gov. Nikki Haley is leading this race, but she still has a long way to go to catch up with Trump. President Biden, who has made a series of momentous decisions on the economy, is hoping voters will sense an economic recovery that will reverse his declining poll numbers.
Personal loans could be hit by a wave of defaults. Just as 1980s-style leveraged buyouts were renamed “private equity,” “shadow banking” was renamed “private credit” and “direct lending” in time for the business to reach its highest level ever. Direct lending by investment firms and hedge funds has become a $1.5 trillion behemoth, and many companies are turning to companies like Apollo and Ares for loans rather than JPMorgan Chase.
But in 2024, the industry could face a test: Indebted borrowers facing looming debt maturities and high interest rates are already turning to personal loans for more loans, raising concerns that lenders will face a wave of defaulters could become. Skeptics worry that a series of bankruptcies could hit these lenders hard – leaving pension funds, insurers and other backers of private credit funds on the hook.
Media deal mania? Reports that Warner Bros. Discovery CEO David Zaslav was in talks last month about a possible merger with Paramount sparked a wave of speculation that 2024 would be a year of media consolidation. The industry has changed in recent years with the growth of streaming, changes in the way people consume media, and the inroads of big tech companies into sectors typically dominated by old-school media companies. Now the industry is on the cusp of the next big change with the advent of artificial intelligence.
A date to put in your diary: April 8, 2024, the two-year anniversary of the merger of Warner Media and Discovery to form Warner Bros. Discovery – and the first day the new company sells without the risk of a hefty tax bill can be .
Will the unions maintain their momentum? Organized labor had a record year in 2023, with major victories in battles with Hollywood studios and the auto industry. Whether this signals a lasting turnaround for the labor movement is up for debate. But the election will most likely be a key factor. Both Biden and Trump have tried to woo striking auto workers this year. So expect more efforts to win over blue-collar voters.
The money from the Middle East will continue to flow. Tensions with China and economic sanctions have made it increasingly difficult for companies to raise money from a place that was once at the top of the list. Investors from the Middle East have picked up the slack. Saudi Arabia, the United Arab Emirates, Qatar and others are spending money to diversify their fossil fuel-dependent economies. Sectors are broad and include sports, technology companies, luxury, retail and media. Critics say petrostates with dubious human rights records are trying to launder their reputations, but that hasn't stopped Western companies from pursuing their profits.
One trend to watch: the growing ties between China and Middle Eastern money. Beijing is seeking to deepen ties with countries outside Washington's sphere of influence, or at least those willing to play both sides.
Further antitrust disputes. A difficult year for regulators — like the FTC's Lina Khan and the Justice Department's Jonathan Kanter — ended with two victories after both Illumina and Adobe canceled multibillion-dollar acquisitions in the face of government pressure. Enforcement agencies may already be seeing some success by forcing dealmakers to weigh whether a big deal is worth pursuing, given the potential risk that they may have to spend months defending it in court. Don't expect Khan to ease the pressure; Expect more antitrust litigation.
New rules for climate disclosure. Public companies have been preparing for new climate-related disclosure rules from the SEC for years. In 2021, the agency signaled that climate change would be one of its priorities. About a year later, SEC Chairman Gary Gensler proposed new rules. The most controversial aspect of the draft regulation was the requirement for large companies to disclose the greenhouse gases emitted along their value chain. The new rules are due to be finalized in the spring. But the likely lawsuits could go all the way to the Supreme Court.
Another election to keep an eye on: the one in India. India, the world's largest democracy and an emerging superpower, will go to the polls in April and May. Prime Minister Narendra Modi is benefiting from the West's search for a regional bulwark against China. Businesses are exploring opportunities in India as companies work to diversify their supply chains and tap into a fast-growing economy. The election will also be a crucial first test of how AI can influence the spread of (mis)information during an election.
Restructuring in the workplace. At the end of 2022, the release of ChatGPT brought AI into the public consciousness. In 2023, companies were experimenting with new ways to integrate technology into their operations, but few had yet to overhaul their processes to cope. It's still not clear exactly what AI will mean for jobs, but in 2024 we may see more companies making decisions about using AI in ways that will have consequences for workers.
The other big issue facing workplaces is the response to the war in Gaza. Some companies are already considering changes to their workplace diversity, equity and inclusion programs, and executives are under the same pressure as university presidents when it comes to their statements and responses to war-related incidents.