Only in New York City - The Big (but shrinking?) Apple

I happen to be in New York City this week. It is not particulary hot here for September but there is a meltdown happening. 10%+ lost in the market in the last two days. It's not good. It is worse here than elsewhere being that the financial industry represents 5% of all employment in the city but 25% of all NYC payroll. That's a big number and this week's problems will have some real ramifications here in the city. But, only in NYC do you hear stories like this: When I am here on business and don't have dinners planned (which I don't like to do anyway), I like to find a local sports bar/pub, saddle up to the bar with my laptop, watch the local sports (Yankees losing this time of year) and catch up on email, etc. Tonight I was in a restaurant on 50th Street and while sitting here I overhear two guys who work in the financial industry. One of the guys was talking about what a terrible week he has had already. He stated that it started on Saturday with Ohio State being beat, then the Cleveland Browns got beat, then they broke in on TV and said that Lehman Brothers had filed for bankruptcy and then Monday through Wednesday market downturn. It was not a good week for this fellow. He then went on to say that the only good thing that happened to him this week was that his Ferrari won a gold medal in some car show in New Jersey on Sunday. What's wrong with this picture? It only happens in New York City.

The Unemployment Spike

We learned that last month's unemployment rate in the US spiked to over 6%. While this is not good we should be happy about this number because while it represents the overall unemployment rate in the US (made up mostly of the manufacturing and construction industry) it does not represent the whole picture. If this was 25 years ago, pre-outsourcing and offshoring, the unemployment number might be 9 or 10%. You see, when Mattel, or Revlon, or Nike has to cut back on production, they don't walk out in their backyard and layoff their workers, they send emails and long distance phone calls to China, India, southeast Asia and plants cut back on their schedule or shut down. Who loses their jobs are the workers in these countries. While not good for those workers, it masks what is really happening and the impact here is not as bad. So, there is a silver-lining in offshoring? Maybe. Although when it comes time to create jobs, productivity, efficiency, etc. what will we do? We can't produce any longer. The phones and emails will go off around the globe and workers will be put on the payroll in the far flung parts of the world. Potentially this global labor arbitrage creates a better leverage with these countries that depend on us to buy our debt and to import to us. That could be, but I can't figure those numbers out. What I do know is that things might be worse than they look and no one seems to be reporting or writing about how bad things might be right now. If I can see a rock that is uncovered then I suspect there are many more that I certainly can't see.

The Big Divide

This week we learned that our housekeeper has been evicted from her house after the house was foreclosed. My first question was, "how could this happen to her and her husband, they both work hard and are good at what they do?". She is a housekeeper and is limited in salary by the number of hours in a day and houses she can clean during a week. Her salary is capped. Her husband is a painter. He is in the same boat. You can only paint so many houses in one day and the market sets the rates for painters. Anyone who works with their hands, produces or serves based on their physical/hourly limitation, has the same cap on them. This is the problem with us having become a service industry country. We are capping ourselves just like our housekeeper and her husband. What really bothers me is that she and her husband got caught in the sub prime mortgage fiasco. They tool an adjustable loan three years ago and now three years later their mortgage more than doubled and they can't pay. I feel terrible for them. They are not freeloaders of the system. They were not real estate speculators. They were me coming out of school buying my first house. I remember it well sitting with the mortgage broker when I took out an adjustable loan. They loaned me the money based on my future earnings potential and the loan could change 2% per year with a 6% cap increase over the life of the loan. The broker told me that there was the risk that the rates could go up, but "when did that last happen...it was back in the 70's". I am sure my housekeeper and her husband heard the same story. But this time, it happened. And what are we to do about it? I worry about the haves vs. the have nots. We may lose our housekeeper because to raise her children, send her oldest to college, they have to move and rent another 30 miles away from us. Will we be able to keep her? Can she afford the gas to come this far? And if she can't can she get the same number of houses at the same rate in the area she will now live? I think the answer to all the above is no. They should not be "have nots", but the way things are going is forcing them into this category. Everyone talks about the divide being the class of living and spending. That is not what I worry about, I worry about that the divide will become so great that those who want to work won't be able and those who want to employ can't because there is no one available. It seems preposterous in a free market system but I can see a real life example staring us in the face and I don't like it.

Reentry

I returned from the east coast earlier this week. What was supposed to have been an easy reentry with lots of time open to come back up to pace easily. Instead, it turned out to be a a wild week with calls, meetings, events, etc. It made me think that I need to be sure I get the angle of reentry right so I don't 1) skip off the atmosphere, or 2) and worse, burn up on reentry. I could imagine that either could happen easily if one doesn't watch it and be aware. I found myself a few times this week wishing I had made my 100 Business Days Out, to 200 Days. :) Doesn't mean I can't it there just isn't a construct around that for me to live within for awhile longer. I will need to learn better to put boundaries and constraints around my time....much better than I have done in the past. As I write this I am readying to go into the mountains for a few days and come off the grid all together...the first time I think I have ever done this. So, the time for reentry is not totally upon me yet, but it will be soon. It will be all about the angle.

Ugly Americans

I'm disheartened by what I am seeing from the political process and this election cycle. The amount of pure cynicism and personal attacking and demeaning of the value of someones work and contributions to society is appalling. It's happening on both sides and it should stop. It's not right to look down on someones work experience and belittle it. What someone does with their time to serve our country and others whether it be as a Senator, a Governor, a Soldier, a Mayor, or a Community Organizer is special and should be celebrated and not demeaned. To listen to those who are supposed to be the leaders and role models to our country, the world, and most importantly to the leaders of tomorrow (who are looking for role models on how to behave), mock and belittle each other is nothing short of shameful. I get that it is politics but nothing absolves decency to each other. I have been in some heated discussions recently about the differences between the two parties and the leaders on both sides, but I ensure that I stop short of making a mockery of someones work. It's just not right. This political season was supposed to be about bringing out the best in us, to show the world and ourselves that we can operate differently and be better than we have been, and to bring in a new generation of voters who could look to their government and their leaders as positive influences on their lives. But, we are failing and sliding back into the ways of the past and we continue to earn that term "ugly Americans" from the rest of the world. Yesterday I was challenged on what political party was the party who welcomed in those of faith and moral values and which one was about trying to eliminate religion and moral values in our society. What I see is that that is not the core issue right now. That's a higher level of authenticity that we haven't even reached yet. It's still baseline fundamentals that need to be worked on first. What I see is that we need to make sure that both parties are living, talking and acting to the values they espouse. What I would like to see first and foremost from the candidates is that they treat each other like the way they want to be treated and start being decent and graceful in how they speak and act. Start with just being grateful of each other's service and work for the country. From there, I will accept whether or not they are being the person, or the party that they say they are. Until that happens, we can expect it to get worse and worse. We shouldn't stand for it and we should, with our vote, just make it stop.