Welcome to professors’ picks, offering a weekly curated selection of FT articles by and for business school faculty to connect classrooms to current events and to develop students’ critical thinking.
Read all submissions at www.ft.com/bschoolpicks. Save this link in myFT to receive emails alerting you to each new edition. Search the tags for relevant topics to illustrate teaching points.
Comments or contributions? Get in touch at bschool@ft.com.
Microeconomics
Soaring gold becomes top ‘Trump trade’
Tags: Commodities, gold, prices, supply and demand
Summary: The price of gold per troy ounce has risen to almost $3,000, hitting a new record. This marks a seven per cent increase since Donald Trump took office in January. Given that during the same period the S&P 500 increased less than two per cent and the US dollar slipped 2.4 per cent against a basket of other currencies, some argue that gold is the best ‘Trump trade’. Both UBS and Citigroup expect bullion to continue its bull run.
Classroom application: This article provides an opportunity for faculty and students to analyse the gold market in particular as well as the supply and demand framework in general.
Questions:
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What key demand-side factors have contributed to the recent surge in the gold price?
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What role do supply-side factors play in the price surge?
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How do US tariffs as well as the strength of the US dollar influence the price of gold?
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What roles do interest rates and central bank actions play in influencing gold prices from a demand perspective?
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Are there any speculative or behavioural factors driving short-term price movements in the gold market, and how do these interact with traditional supply and demand forces?
Stefan Legge, lecturer, University of St Gallen
Macroeconomics, International entrepreneurship
US companies falling behind on loans at fastest pace in almost a decade
Tags: Delinquencies, interest rates, Federal Reserve, corporate borrowing
Summary: Credit specialists are worried about the possible effects on the economy as US corporations are defaulting on their loans at the highest rate in over eight years. Recent tariffs are partially to blame for the trend, which could have an impact on the financial health of corporations. Analysts are concerned that these changes may portend more significant economic difficulties in the future.
Classroom application: This article provides an opportunity for faculty and student students to discuss the financial footing of US companies that do business internationally.
Questions:
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Do you believe that the recent increase in loan defaults is a passing problem or an indication of a more serious economic downturn? Why?
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Which sectors are most likely to be impacted by these economic difficulties?
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What possible reactions might various industries have?
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What signs would you look for if you were a financial analyst to determine whether this trend would continue?
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What potential effects would an increase in loan defaults have on investors, consumers, and general economic confidence?
Greg Stoller, Master Lecturer, Boston University Questrom School of Business
Strategic management, technological innovation
How small Chinese AI start-up DeepSeek shocked Silicon Valley
Summary: This article details how DeepSeek, a modest Chinese AI laboratory, built a large language model on a bootstrapped budget that can automatically learn and improve itself without human supervision. Unveiling a cutting-edge model at significantly lower cost has redefined the factors of competition in global AI. The company’s approach has challenged established tech giants’ business models, prompting a reassessment of competitive dynamics in the AI industry.
Classroom application: DeepSeek’s rapid ascent offers a compelling case study on ‘disruptive innovation’, illustrating how emerging players can challenge incumbents by reconfiguring the factors of competition (ie how players compete — and on what metrics — from a market side, such as cost, accessibility, and speed — and a resource side, such as sources for competitive advantage). This scenario provides rich material for discussions on strategic management, competitive advantage and the global competition for technological innovation. I have used this article for discussions with both my EMBA and DBA cohorts.
Questions:
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How does DeepSeek differentiate itself from global tech giants from a market side? That is, what, if any, factors of competition across the value curves does DeepSeek’s Language Model introduce to the global AI industry?
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How is DeepSeek’s entrance any different to the entrance of global tech players such as Meta and X? That is, does DeepSeek’s entrance introduce a capability enhancing, or capability destroying technological change?
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How should incumbent tech companies respond to emerging competitors like DeepSeek to maintain their market position?
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What are the broader geopolitical and economic implications of DeepSeek’s breakthrough for the global technology sector?
Luka Gebel, assistant professor, Global Business School for Health, University College London
Business and Societal Good, Innovation in Practice
The start-ups seeking to challenge China’s stranglehold on rare minerals
Tags: Innovation, technology, electronics, sustainability, manufacturing
Summary: Several UK and North American start-ups are pioneering the recycling of electronic waste to extract rare earth minerals. This represents a way to help meet growing demand for rare earth minerals, essential for low-carbon technologies, by diversifying sources and localising production. One of these start-ups, HyProMag, efficiently recovers magnets from discarded hard-disk drives. The company is expanding its operations with new plants in the UK, Germany, and the US, aiming to decentralise rare earth production and establish sustainable, domestic supply chains.
Classroom application: This article provides a platform for faculty and students to explore innovation in practice that is being driven by a combination of geopolitical tensions, increasing emphasis on sustainability, and market demand.
Questions:
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What is meant by the term “circular economy” and how do these start-ups’ technologies represent an application of that concept?
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Why is the UK government particularly interested in these developments?
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In what ways are the two recycling processes highlighted in the article similar and different?
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What entities have provided funding and/or investment in the two start-ups profiled in this article (HyProMag and Cyclic Materials)?
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What risks to their business models might both companies need to anticipate?
Tom Davis, Clinical Assistant Professor, Joseph M Katz Graduate School of Business, University of Pittsburgh
Work & Careers, Leadership, Management, Human Resources
Gen Z has turned against taking middle management roles
Tags: Careers, corporate ladder, middle management, Gen Z
Summary: Younger employees are increasingly shying away from middle management roles, preferring instead to progress in their careers by developing individual skills rather than managing others. Employees have come to associate middle management roles with long hours, endless firefighting, and tedious personnel management. They prefer control over their schedules and work-life balance and no longer trust that hard work and loyalty to the corporation will be rewarded with career safety and success.
Classroom application: This article provides a platform for faculty and students to consider the social contract between companies and their employees and to discuss ways of developing effective leadership within companies going forward.
Questions:
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How do Gen Z employees and younger workers view their relationship with their companies, and how has that social contract changed over time?
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What values and interests guide the behaviour of Gen Z and younger employees, and how can companies tap into these interests to motivate their workers?
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What can companies do to encourage younger employees to take on middle-management roles?
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Do companies even need middle managers, and how might middle management roles need to evolve to be relevant and viable for today’s workforce?
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What is the role of technology, and of AI specifically, in shaping middle management roles in the foreseeable future?
Moshe Cohen, Senior Lecturer, Questrom School of Business, Boston University
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