Power Sheet – April 5, 2016

For now we know little beyond the bare facts of Thomas Staggs’s surprise departure from Disney yesterday, where he was CEO Bob Iger’s heir apparent. So allow me to engage in some total speculation. Both Staggs and the Disney board could have formed doubts about the prospective succession based on the same fact: Disney has performed stupendously under Iger, especially in the past five years.

Iger has deployed lots of capital on major acquisitions – Pixar, Marvel, Lucasfilm – and then achieved the elusive goal of earning knockout returns on that capital. The stock has soared, and if you crunch the numbers, as the consultants at EVA Dimensions have done, you find that investors have priced more years of great performance into the stock.

So if you’re a Disney director, you might have doubted whether Staggs (or anyone) could keep that growth going, and mere doubts by investors would be enough to knock the stock down. And if you’re Staggs, even with complete confidence in your own abilities, you might have wondered if a nervous board would extend Iger’s contract beyond its current June 2018 expiration in order to reassure investors.

So did Staggs jump, or was he pushed? Whatever the story, the problem of sustaining turbocharged growth probably played a central role.

Will today be the end of Trump? Definitely not, if he scores a surprise win over Ted Cruz in the Wisconsin primary. But what if he loses, and maybe loses not just the state’s at-large delegates but also all those awarded by congressional district? It could happen, in which case the delegate math gets gnarly for him, as Reid Wilson explains at coins2day.com. Even if that should happen, though, leading to a contested convention that chooses some other nominee, we shouldn’t say that today was the beginning of the end.

That day was arguably last Wednesday, the worst day of a very bad week, when Trump made his gaffe about punishing women for having abortions if they were made illegal. Within hours he said that his position was exactly the opposite. Then on Friday he said that abortion law should remain as it is; almost immediately his campaign said he didn’t mean that either. Also last week the police charged his campaign manager with battery; Trump refused to rule out the use of tactical nuclear weapons in Europe; he again hinted darkly at violence if he isn’t given the nomination; and he committed assorted other blunders that, for him, don’t amount to much. See Tory Newmyer’s excellent fuller explication.

Now, a few days later, the whole tone of the Trump narrative has turned. Suddenly the overwhelming theme of media coverage is, “he’s vulnerable.” Polling has shown that the No. 1 or No. 2 reason Trump supporters like him is that “he speaks his mind.” But his dramatic decline in Wisconsin polling suggests that maybe his weather-vane stance on abortion is causing supporters to revise their view: Yes, he speaks his mind, but whatever is in his mind changes from moment to moment.

It’s true that CNBC’s Chris Matthews elicited Trump’s remark by deploying all his lawyerly interrogatory skills. But remember that Trump has bragged that as president he’d show how to deal with Vladimir Putin. Supporters might reasonably wonder how he’d fare with Putin if he can’t handle Chris Matthews.

As George Will so nicely put it a couple of weeks ago, those supporters may be having second, or perhaps first, thoughts. Not that we know where this is going. Trump could yet win Wisconsin and the nomination. But if it all unravels, March 30 was the beginning of the end.

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