Tuesday, November 25, 2008

Oh, Those Names and Acronyms We Choose

Those who know me know that I love nothing more than a joke or a one-liner that turns a word or a sentence into something else funny. My college friend Todd got so accustomed to it, that he could see them coming a mile away. As such, I am a cynic and many times a critic of naming conventions and acronyms. I go back to the days when Chevy released the Nova into Latin America. It was heard as "no go" (Should we have not seen GM’s problems even then?)I also cringed when I heard a United Airlines flight attendant say that their low-cost airline “Ted” was just “United without the U and I”. It also seems everything has to have an acronym or somebody doesn’t feel like they have done their job. American politics and programs are littered with acronyms and made up names, Fannies, Freddies, PACs, ACORNs, etc, etc. The most recent example that makes me giggle is T.A.R.P. Did the Treasury Department really need to come up with this and do they think that it makes me as a consumer feel any better about the program? I could argue that once again, someone wasn’t thinking. What does a tarp represent to most people? Yes, it is a temporary cover or shelter, which I can see where they were going with this, but for me a tarp is vulnerable and susceptible to strong winds and other flying foreign objects. It is only as effective as the stakes or lines that secure it in place and more often than not when we have to use a tarp we are worried about it blowing away and it does nothing but cause us more problems because we can't, or choose not to, fix the root problem. Maybe that is what TARP is supposed to do, but I know that its connotation has held up already that when the winds starting blowing differently about how to use the bailout monies, that Secretary Paulson was quick to change directions and stop buying loans and debt and instead focus on purchasing bank equities. Personally, I would have preferred not a TARP but rather a ROOF (Restructuring Of Opportunistic Financials) or a FLOOR (Federal Legislation Offering Opportunity & Restructuring) or maybe even some OOMPHS (Organization Offering Orderly Permanent Housing Solutions), and even better than a TARP would be the HAIL MARY! (Housing And Ill-Fated Loan Management And Restructuring, Yes-sir!). For the time being though, we have a TARP and as the USS TODAY said in last week's editorial, “Give TARP a Chance”. Sagging and blowing, hopefully not leaking, yes give TARP a chance.

Sunday, November 23, 2008

An Area of Growth!

It seems everywhere I turn I am hearing and seeing the shrinking of people who are leaving their homes to go to the theater, museums, ballets, operas, concerts, movies, sporting events, etc. It seems like leaving the house, and the associated costs of that trip, has become beyond discretionary, it has become prohibitive to many, if not most.

I sit on a number of non-profit arts and entertainment Boards and support other non-profit organizations so I see it first-hand. The thing call “subscribing” seems to be becoming a relic activity. And, getting people out to attend events, even when they are free, has become such a chore that organizations are shuttering these events and venues to save the productivity and overhead costs. So, it looks like an overall shrinking of audience, except in one place that I see. That is our church. For the past month plus, we have been seeing record number of attendees. These past couple of weekends, we have had people sitting everywhere we could find to be able and accommodate the crowds. Nothing has changed at the church. We haven’t changed the music or the message. What has changed, I believe, is that people are looking for more meaning in life and that the uncertain economic and world fundamentals are driving people back to their own fundamentals; the baseline quest for, and questioning of meaning and purpose. President-Elect Obama got slaughtered for his comments in San Francisco about what people do when they lose faith in their government and cling to their church and guns. I don’t know about the guns part, but he is more right than wrong about the first part and what is wrong with that? I like to say, “That when the going gets tough, the tough drop to their knees”. I personally, look to God and my faith to carry me in the bad times and I know I am not alone. I suspect that we are on the verge of a spiritual reawakening in America. We saw a short-lived one after 9/11 when people returned to their faith to cope and allay their fears. The same is happening again. I would also suggest that those non-profits and corporations who are looking for how to bring back their consumers find a way to delve and probe into what they can provide to help people feel meaningful and purposeful. At least until we are through the crisis, this will be top of mind.

Friday, November 21, 2008

Stimulus Plan II To Bring Back Consumer Confidence

This surely looks like it is in the works. Stimulus One didn’t work, so let’s try again? In my opinion, if we feel that we need to put the power of stimulus in the hands of the consumer, which seems ill-fated since the first package didn’t work, then we need to provide the consumer with the tools to help right the ship. The two best ideas I have heard of to date, is first to let the consumer help shore up and fix the bank’s liquidity issues so that they will lend again more freely. This could be done by allowing consumers to buy short-term tax-free certificate of deposits from the banks and let the banks compete on what interest rates they will pay. All of those people who pulled their money out of the stock market need a better place than their mattresses to put the money, so give them 3-6-9-12 month tax-free CDs and when those mature the money made from those CDs will roll back into the consumers pocket and will be money to be spent. Part of the consumer confidence issue right now is that I won’t spend because we don’t know what is going to happen with our ability to make any money from our savings and investments. Bang, go remove that worry. Second, to set everything right with the housing market, the government can offer across the board 4% 30-year fixed mortgage rates. Making the interest rate low enough that those who are upside down can refinance and hold onto their homes and know that they are locked into a 30 year low rate mortgage will go further to return consumer confidence than anything else I know. If we no longer have to worry about the roof over our heads, then we may spend again. And, these should be offered to everyone at all levels. Those with wealth can refinance and that extra monthly money freed up will flow back into the economy to buy a car or take a vacation again. And for sure, the banks and lenders should get leeway to charge up on origination fees, etc. This would be a windfall for consumers, so why not let the banks and lending institutions also gain a bit from this. So, Congress, please consider these ideas. Don’t send another $1500 check out. It will only end up sitting in a pass book savings account to pay for heating or pay down credit card debt. Give the American people what they need, a way to regain their confidence. FYI, these ideas are not nearly as big of an idea as putting America back to work with planned infrastructure improvement projects, but since that is trying to eat the elephant/donkey all at once, let’s make some forward steps while we can to at least get true stimulus.

Wednesday, November 19, 2008

Did Mitt Romney just apply for the “Car Czar” job?

I read with interest this morning’s NY Times editorial from Mitt Romney regarding the auto industry bailout. I must admit that I share many of his sentiments and concerns. The most foundational is the fear that putting more money into the same old system would only result in the same old output. GM’s open letter advertisement, saying, “People don’t think GM has done enough” (which they go on to try and refute) is absolutely true. GM, Chrysler and Ford have not done enough. The people are correct. Romney’s cry that there needs to be more innovation in R&D, Marketing and Labor Relations is dead on. I have always been fascinated with the Labor Relations approach and attitude of Detroit on both the company and union sides. Growing up professionally and learning labor relations strategies and tactics and having negotiated a Teamster’s contract, I can tell you that if Labor and Capital see themselves, as Detroit has for too many years, as adversaries or at the least, mistrusting co-workers, then there will be no innovation or progress to be made. The trigger word “concessions” is what we continue to hear that workers must make. What is lost is where are the “concessions” that the automakers are making on the other side of the equation? It appears that the years of lack of concessions from the automakers to change their ways and thinking, has finally caught up with them. And now they want to be “bailed out”. I like what Mitt had to say. His open professed love of cars, being from Detroit, his history with his father as the CEO of American Motors, and his broad view of corporate structuring and restructuring, makes him the ideal candidate to shake things up. I somehow think that Chrysler might have been in a better place had they hired Mitt away from the campaign trail vs. Bob Nardelli from his unsuccessful run at Home Depot. So, if we put government money into Detroit, which I believe we will end up doing, then let’s be sure and have a caretaker over that money and let’s put Mitt’s hat in the ring to be that person. How about it Mitt? Could you take $25B and turn it into $250B and set the course for an American car industry resurgence that returns to be an international powerhouse? You’d get my, if we could choose, vote.

Friday, November 14, 2008

Wal-Mart Needs A Government Bailout?

Now, what if Wal-mart was going under and asked for a bailout, what would we do? They employ more people in America than anyone else and if they went under, what would we do? We might have to return to the mom and pop hardware, grocery stores, local pharmacies, pet shops, record/CD stores, department stores? You mean, if Wal-Mart went under we might have to fill all of those Main Street store fronts again with real businesses? Naw, we wouldn't bail out Wal-Mart would we? But, we are going to bail out car manufacturers who are in a world of hurt because the cars they designed, built and marketed like crazy, no one wants? Of course there is the argument that people want and need to buy cars but because they can't get credit, they are driving their current cars longer and fixing them up versus trading them in. So, if that is true, then heal the wound of the credit market, not put a band-aid on the car industry. if there are only two US car manufacturers left, will I be harmed any more when I go to buy my Toyota Prius, my Mercedes SmartCar, my Honda Hybrid, my Lexus Hybrid, or my BMW Mini Cooper? This is a war that was lost back when Halberstam wrote "The Reckoning". Let's not waste our hard-earned tax payer dollars bailing out a car manufacturer who has rested on their manifest destiny laurels since the energy crisis of the 70's. We have better things to spend our money on! If car workers need to be helped, then let's pass along the bail out money to retrain and move them to become wind engineers or solar panel manufacturers. Retool those defunct manufaturing lines for wind turbines. I'm all for helping those who can't help themselves or bailing out institutions that if they go down, we all suffer directly like what was needed for the financial industry. In fact, that said, if Wal-Mart was going under, I might support that bail out. At least they continue to use their heft and leverage to keep prices down and influence the rest of the world. Detroit stopped doing that the day the foreign car manufacturers started manufacturing their cars in Kentucky, Tennessee, Indiana and other places and brought real change to the American roadways and Detroit ignored the warning signs.

Monday, November 10, 2008

Chinese Democracy

No, this is not about the elusive Guns ‘n Roses album, although I do wish Axel would get the darn thing out and let’s be done with it. No, this posting is about the $586B Chinese Stimulus Plan that was detailed today in the news. The Chinese government is starting their version of the Works Progress Administration. They are putting their talent to work to build things that last; infrastructure, dams, transport systems, buildings, etc. Hmmm, wonder where they got this idea from? I tend to think that they are on the right path. We have learned over the last few months that putting money in the pockets of Americans doesn’t translate to the economy being stimulated. What has occurred is that we have taken our fear and uncertainties and let those force the stimulus money into savings accounts and mattress stuffing. And, why wouldn’t any of us do this if we were worried about our job being lost tomorrow? It’s actually quite rationale and I’m surprised that the economists didn’t think that this is exactly what was going to happen. So, here we sit wondering what would stimulate our lagging economy and the Chinese reached the economic moon before we did. Of course, stimulus starts with job security and job creation. This really isn’t that hard is it? And, as we drive on crumbling roads and bridges, send our children to antiquated school buildings, drive our cars because there is no viable national transit system, we are arguing over the next check amount that should be handed out. How about we take that money and we create jobs to lead us to energy independence? Last week we passed in California Proposition 1A to fund $10B of development for a west coast high speed rail system. Now we find out that the project needs another $10B injection from the Federal government (yes, those are earmark funds and depending upon how they are structured, pork) and the project won’t even start until 2020. That’s 12 years from now. Our roads will be long over-crowded and we will be that much further in the hole with our dependence on oil for travel. Come on, let’s take this project and start creating jobs to clear the way for the rail program. Let’s put people to work now and shorten the time frame to build the railway. Let’s get people excited and galvanized around progress programs. Let’s get people off of the streets and worried about where they will work tomorrow and let’s really stimulate America. If the Chinese can get the joke, so can we! It’s just a shame that we have to follow versus lead.

Friday, November 7, 2008

There’s Time To Be Sad Later…

Last week, Patti and I received the call that we all dread as children of aging parents. Patti’s father has been diagnosed with kidney cancer. With that one phone call, we were snapped back into the real perspective of life. That is, that the fragile nature of our lives, we once again were taking for granted. One day, things are smooth and the next day they are choppy and potentially spinning out of our control. And we are so not alone in this. Here we sit in the middle years of our lives with the expectations that tomorrow will be just like yesterday. Nothing will change, right? It can go on forever like this can’t it? Duh. Why is it that we allow this fragility to sneak up on us? It seems that each and every time we get to this point we stand a this place with regrets and “ifs”. How do we in our human nature wake up ourselves earlier in life when we are invited to make the most of every moment, instead of waiting for the situation to snap us into the reality? Are we not just built this way? I wonder. Last week, I got dragged into another of Patti’s Oprah programs. On the program was the couple who created, “99 Baloons" on YouTube. ( I guarantee you will cry like a baby if you watch this so be forewarned - http://www.youtube.com/watch?v=th6Njr-qkq0). On the show, after Oprah collected herself, she asked the couple how they made it through. The mother of Eliot said something that was so profound that I don’t think it will ever leave me. She said, “we just knew that we had time to be sad later”. Right then, she and her husband were in the moment with Elliot and each other. They were celebrating life every day and making the very best of it. While they were also snapped into a reality that they hadn’t bargained for, their attitude was the right one. So, as I write this, Patti’s father is a few days from surgery and then we will know what comes next after that. In the meantime, there is time to pray now and to be sad later and today we celebrate a life and what has been given to us through him and we live in the moment, savoring each as we pass through each of them.