Please Listen to Nassim Taleb

He is BRILLIANT!

I really cannot believe he is making the television rounds. 

Please note the music played over his voice for the last 90 seconds:

The Economy's War on Children

I have been reading a number of interesting developments in regards to companies that service children and young adults.

Hopefully you have already had that talk with your kids about the New Economy, because if not, some of their habits are going to be broken for them.

From the obvious (you can't charge 55.00 for the right to walk in the door and expect to get away with it forever!)...

Ahead of the Bell: Six Flags bankruptcy fears grow

To the tragic (can there be a more telling sign of the times?)...

Sesame Street’ Producer to Reduce Workforce by 20%

To downright disastrous (careful, this is a very sore subject for me. How can this be an option?)...

Economy may force school for autism students to close their doors

To the unthinkable...

Police chiefs: Failing economy could lead to child abuse

The economy is having a big impact on the world our children have come to know.

But since there is no way I am leaving my first post on kids on a downer note, read this article and  know that we can do better and will be just fine:

Kids Market Sale Aimed At Helping Families Through Economic Slump

This idea is so inspiring, so New Economy, I hope we can see this instituted in communities across the country.

Let's make it happen America!

A Big Black Eye

This is a story you may, or may not, know about, but it is certainly something you should know is going on...and on it's way to your city (if it has not already arrived) once the weather breaks.

America is certainly better than this.

During the beginning of the Depression, several people wandering the nation in search of work started erecting, shanty-like, permanent shelters in large cities. These were comprised mostly of men, many of whom had left their families behind, with the understanding that once work was found, they'd be sent for.

As the Depression deepened, more shanty and tent communities started popping up all over the country, to the point where it was no longer looked upon as abnormal to see them. Because President Herbert Hoover was generally viewed (then) as the person responsible for ignoring the plight of the common-folk, thus allowing their situations to drift into such horrific conditions, these makeshift towns were named "Hoover-villes."

As more people started losing their homes and farms, ultimately being displaced from their longtime residences, the "cities" started to include entire families. 

Naturally the conditions in these camps were preposterous when compared with any standard of modernity. There were few schools, no plumbing, and mice, rats, cockroaches and mosquitoes only added to the miasma residents fought to overcome around the clock.

With this background in mind, I was floored when I saw this youtube clip:

The video you just watched was posted in January of 2008, who knows when it was actually filmed. 

Now, a year later, some major medias are starting to touch the subject. The only reason I want you to watch the following clip from the today show is to grasp how the subject is being dealt with. 

Any normal human being that viewed such circumstances probably wonders, first, "how did this happen", followed closely by "how can I help." The Today Show piece below focuses in on, well you make your own determination. I just cannot beliee Matt Lauer decided to end the piece, after looking at deplorable living conditions of his fellow countrymen, by saying (paraphrasing here), "people were living above their means"!?!?!

Well Matt, are they at their means now? And if so, does that make you sleep better at night?

Just a stupifying display of arrogance and indifference. It brings to mind a quote from the great architect and humanitarian, Charles Luckman"

"The trouble with America is that there are far too many wide-open spaces         surrounded by teeth."

Thousands of people saw the horror of this situation and decided to help, bringing food, money, bottled water and other goods to these unfortunate people, which is what I knew the American people would do. 

If you would like to send a donation to aid these people, the Fishes and Loaves organization in Sacramento has been assisting the residents of their tent city for months. 

Info for them is HERE.

This is development is not exclusive to Sacramento, California. Here are a few news articles I dug up on "Tent Cities" in other parts of the country if should you want to investigate the matter further:

Tent City In Pinellas Seeing More Recently Unemployed Homeless

Bad Economy = Many Living in RV's in Venice Beach

The more fascinating articles come form sources that may explain why this has been swept under the rug until very recently. These are from news sources outside of the country and they are writing in a more stunned, disbelieving tone. To the readers of these publications, America has always been more than a country, it has been an idea.

Sacramento tent city is just one of dozens in an ailing America

America faces new Depression misery as financial crisis worsens

The credit crunch tent city which has returned to haunt America

If this economic downturn has not yet altered your habits, as well as your thinking, I hope this post has brought you one step closer to reality. Preparedness is not everything, but this is going to be a tough time for this country, so it cannot hurt any more by your being so.

The Coldest Winter Ever

"Habit is habit, and not to be flung out of the window by any man, but coaxed down-stairs a step at a time."

-Mark Twain (Pudd'nhead Wilson)

Americans, like all people, are creatures of habit. The greatest difference in the American habit and those of other cultures, is our national habit is shopping. We like to spend. What one owns, or wears, or drives, or goes to school, or lives, or vacations, or get their hair cut, or gets married, or goes to eat when dining out defines them in American Society. 

Oft times we make the mistake of believing it's how much money a person makes that defines them, which may be true to a small few. However, for the rest of us, that too is just a means to an end. We want to make money, so we can turn around and spend it. This is why Americans are the most debt-riddled people in Western Civilization. We know what great is and we deserve it, right?

This is the unshakeable truth that the financial markets have been faced with since late-August, when small fissures in the credit dam began to express themselves. Around the clock internal meetings ensued at most large banks around the world, as their leadership began to prepare reporting 3rd Quarter figures to the world. "My God, we will be the laughing stock of the banking community", they thought. For not even the sharpest of pencils, that means you Jamie Dimon, could have thought their situation was not unique.

As the reporting period began in early-September, the trickle of bad news began to emerge. Massive mortgage debt, record foreclosures, delinquent car loans leading to widespread repossession, individual credit-card payments slowing down, record personal bankruptcy filings, small business loans having to be renegotiated, large commercial real estate loans being defaulted on and massive insurance pay-outs from Hurricane Ike. For the trickle was now a full blown tsunami. 

The markets, being unprepared for such overwhelming bad news, and from so many different arenas, did what anyone would do in such situations, it collapsed.

While I cannot profess to have lived through the market crash that started "The Great Depression", I can say for certain, there were never less stable days in America, financially speaking, than those of September 15-17. That is, of course, excepting those of October 1-10 when they New York Stock Exchange (and thusly the American Investment community) lost 22% of it's wealth.

The uncertainty of those days in mid-September days produced a plethora of bad ideas as to how to fix the problem (hello $800 billion bailout). However, two main ideas that emerged are what now clearly going to have major negative, long-term repercussions for the American public.

The first idea was the focus by the Federal Reserve and the Treasury Department on how to stabilize the markets until Thanksgiving, a time when most Americans stop paying attention to affairs that do not involve their families. Usually, market "corrections" happen in October, which gave rise to this dandy from Mark Twain:

"October. This is one of the peculiarly dangerous months to speculate in stocks in. The others are July, January, September, April, November, May, March, June, December, August and February."

Every economist is trained as to how to deal with such problems and the entirety of their training matrix is based on the dreaded "October Surprise."

What threw Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke, was the "surprise" came not only in September, but early-September. This meant all their training on how to control a downturn for 4-6 weeks, was staring down the barrel of a finish line minimally 11 weeks away. This is what created so much uncertainty. And said uncertainty is what really rocked the market harder and harder as time wore on.

The Financial Market's hare is now coasting to certain victory, while the Economy's turtle plods along. 

Well, now that the hare is finally and exasperatedly near the "finish line", prepare for the fan to start kicking out a rather familiar foul odor. Bad news, even in great economic times, is saved and distributed, like so many secret santa gifts, for the period between Thanksgiving and Christmas. 65% of all lay-offs happen during this period, most companies that are going to change leadership do so, companies settle lawsuits that have dragged on for years and the like. All because they know that spirits are high and we are not paying attention. 

Unfortunately for most, attention will be payed like no time in our prior history a a nation. Hopefully, we can bear the weight of what is surely coming.

The second and more unfortunate idea to emerge is the unbelievably misguided theory of the core problem afflicting the economy, bad mortgages. That is a problem, but one that has been silently stalking us since late-2003, early-2004. Bad mortgages were a problem before they starting lending to sub-prime borrowers. Tales of bus drivers taking out loans to buy million dollar homes with swimming pools are greatly exaggerated. Bad debt was spread around in many directions.

Start-up small businesses were given billions of dollars in bad loans. The evidence is on display in every American neighborhood, expressed by the growing number of "Store For Rent" and "Commercial Space Available" signs on display. The unfortunate reality of their failure is a great many of these new small business owners leverage their homes to borrow for the new enterprise, making a bad situation into a crisis, all in one fell swoop.

Large Corporations were given massive loans to re-tool factories and invest in additional materials for a burgeoning market that did not, and does not, exist. This is the problem that expressed itself in the form of the trouble Ford and General Motors finds themselves in at the moment. Both have invested in infrastructure for 2009 model-year cars, when both have seen 2008 inventories balloon well beyond record levels.

These examples are just a small glance at the behemoth clogging the pistons of America's Economic Engine. However unseemly all these scenarios appear to be, the real core issue affecting everyone in this country, every company in this country, every trading partner with this country, is credit.

We are a credit society. We have been a credit society since at least the dawn of the 1980's, and a case could be made for earlier. Before then, people who wanted things, saved up their money and bought those things, or did well enough without them. Television re-runs of Archie Bunker yelling at Edith about her spending the family savings on a new dress, do not ring as credible or accessible to anyone under 40 years of age. Today's sitcom is more inclined to revolve around a wife hiding a credit-card bill for something she has already purchased. Herein lies the problem, fully and naked-as-can-be.

Americans have been resistant to living on a pay-as-you-go economy. Families forced to do so would surely have dramatic lifestyle changes. Older (I'm sorry, Certified "Pre-owned") cars would be di rigeur, hand-me-downs would a more familiar reality and, while I can't say they would not be as beautiful, family homes would be much, much smaller than they are at present. Think about it, when was the last time you met a kid that shared their bedroom with a sibling. How about the last time you saw a kid on television share a bedroom. Large is who we have become, in lifestyle and as individuals.

Businesses are in the same boat. When facing pay-as-you-go economics, the ability to adjust to a rapidly changing marketplace are fantastically diminished, almost to nil. Every bet, and I mean that literally, has to be a correct estimation, which pays off in expected dividends or beyond. The smallest misstep would create a cascading snowball effect, damaging the company in ways that would threaten it's existence. This would naturally lead to much more cautious leadership, less innovation and winnowing of options in the consumer marketplace.

This is a very realistic depiction of the American future should Financial Institutions continue upon the path of "correction they are on. The problem facing this country is the lack of available credit to the individual. Unsold housing inventory, as well as automobile inventory continue to swell, due to the Financial Community's decision to sit on it's hands and not loan money at present.

There is certainly a conversation in the offing for American's and American Business Leaders, about how to manage our existence within new boundaries. However, no is not the time.

This Holiday Season is going to be hard on a bunch of families, which means it will trickle up to have a tremendous negative impact on Retailers. This Thanksgiving weekend is the movie trailer to a new, terrifying Horror classic in the name of December.

Recognizing the "stakes" will not be enough for the Fed and Treasury. Identifying the problem on the ground and re-stimulating those at ground zero is the only way out of this economic morass. 

Turn the pipes back on!

News That's Fit To Print

This morning I spent the better part of 45 minutes walking around looking for a newspaper to purchase. There are normally plenty of copies of the Chicago Tribune, Chicago Sun-Times, Wall Street Journal and New York Times at the Starbucks just one block from my home in downtown Chicago. Today, I visited no less than 15 resources before successfully acquiring a newspaper of any kind. I tried every 7-Eleven, White Hen, Jewel, Dominick's, news stand and bookstore in the neighborhood before, in desperation, deciding to try a hotel gift shop. 

SUCCESS CAME AT LAST!

While walking back to my home, I was stopped no less than 15-20 times by people inquiring where I had found the newspaper. Everyone seemed to be in the same predicament I had been in just minutes before.

The reason was both transparent and obvious, Barack Obama is the 44th President-Elect of the United States of America. And seeing as though I reside in his hometown, which was the site of the biggest election night rally in history, I can clearly understand the enthusiasm.

However there is a MUCH bigger story here. A retailing story, no less. A story being missed by the large conglomerates that run most of the media we have access to in this country. 

It was the theme that catapulted President-Elect Obama to his primary and general election victories. The story is about ...inclusion!

The fact is, young people and old people, rich people and poor people, whites, black, latinos women and men wanted to read a newspaper because they were certain to see articles representing their interests within the pages.

  

Newspapers have seen massive declines in readership across the country for the last 6-10 years, and at a much more rapid rate lately. Television viewership numbers that would have left Peter Jennings, Dan Rather and Tom Brokaw in tears 20 years ago , is now cause for chest-thumping by the likes of Charles Gibson, Katie Couric and Brian Williams. 

We are told this flight from old media is due to people having "more options for news." This, however, is an excuse, served up by media executives stuck thinking in the Hillary/McCain mold. They are looking at the "classical" ideas of media and not seeing multitudinous opportunities that lie at their feet for the taking. 

"Classical" media looked at the landscape of all that happened in the world and decided to pick and choose, for us, what was fit to print or report. The "new" way is to show the entire landscape and allow the individual to decide what is important to them.

Let me be clear. This is not another article about how the Internet is better, faster, more comprehensive and revelatory than television or newspapers,though I agree they are. It is more about the growth potential that lie in both of the latter mediums. Something that can help to stem the tide of massive lay-offs happening  within these important American institutions.

Inclusion requires that you not only talk about the full spectrum of people, places and events, but that you reflect the full spectrum with who covers such things for your organization. Last night, for instance, a night full of historic achievement,  there was much talk of the broad coalition of various ages, races and sexes responsible for the Obama victory. The reality of who reported that news did not directly reflect the viewing audience or those reveling onscreen in the possibilities of a "new tomorrow."

The age of the principal anchors handling Election Night coverage on each major news outlet were as follows:

CBS

Katie Couric (51) and Bob Schieffer (71)

NBC

Brian Williams (49) and Tom Brokaw (68) 

ABC

Charles Gibson (65) and George Stephanapoulos (47)

PBS

Jim Lehrer (74)

CNN

Wolf Blitzer (60) and Anderson Cooper (41)

MSNBC

Chris Matthews (63), Keith Olbermann (49) and David Gregory( the oldest 38 you'll ever find)

Fox

Chris Wallace (61) and Brit Hume (65)

All of them White. All but one, male. Two septuagenarians, six sexagenarians, four at or hovering near 50 and two other rather marginalized figures hovering near forty years of age.

I genuinely believe each of them brought a wealth of perspective to the evenings events and did their best in covering what was a momentous night. However lack of perspective is what stood out most. They all talked of JFK, RFK and MLK. There was discussion of the 60's and 70's. However, there was little talk of the impact of the Internet on this election. No chronicling of the Obama fundraising juggernaut done primarily online. No discussion of the continuous evolution of the blogosphere, now used for both information and independent fundraising. Little, if any, discussion of Obama's digital "Get-Out-The-Vote" operation that overwhelmed his rival. Most anchors chose to discuss, only, the more familiar (to them) door-knocking operation. All in all, after a while it became that story your Uncle tells to the new person every Thanksgiving. Partially true,  mildly interesting and thoroughly embarrassing. They were literally, just one glaring example of why there is a massive flight from their medium as a source for staying informed 

Are we to believe it would take a search party to find an anchor of Latino, Asian or African descent? Are we to believe there are no souls under 40, or hell even 30, capable of anchoring or co-anchoring the "Big News" desk at any of these companies? Are we to believe that Katie Couric is the only woman with the requisite qualifications and experience to be a part of the "Boy's Club?" I think not.

How can I know? Barack Obama just proved it, that's how. His campaign was run by a diverse coalition of people, and as mentioned previously, won by a diverse coalition of people. 

MSNBC showcased Luke Russert on several occasions during this election cycle, using him to flesh out stories specifically relating the youth vote. These reports were generally well-received because of the freshness of the subject matter and, importantly, the depth and understanding that resulted from the person reporting the story being of  the same generation. What struck me was how many times they cutaway from his report to find an utter lack of professionalism, not by the 23 year-old reporter, but by the in-studio host. Each time after a generally routine "back to you in the studio" from the young Russert, there seemed always time enough to discuss "how proud of him" they were, how "they wish his Dad (their recently deceased colleague, Tim Russert) could see" him, or all-around head-nodding of "how well he is doing". 

We are all proud of how this young man handled the passing of his father, who was a lion in the media world. His transition into his father's line of work has seen a few kinks, but nobody with sense can say that he has seemed forced. Luke Russert is a fine professional, but it took tragic circumstances to get him on air. There are many other Luke Russert's out there waiting to be discovered. But they are being told to, "Go start in Iowa, Idaho or Montana. Then come back when you get seasoned." Like when you are in your 50's or 60's and you can no longer relate to the rest of the population.

The limitations of those currently sitting in the anchor chair are being projected onto the anchors of tomorrow, I mean TODAY!

Newspapers are not immune from the same line of thinking. The best example I can draw from is the continued slide in readership of the Chicago Tribune newspaper (down 5.8% Sundays, down 7.8% Weekdays) at a time when there is continued growth in the Tribune Company's RedEye tabloid newspaper (now up to over 200,000 copies per day, from 0 in 2002).

The RedEye is an inferior product, as far as journalistic content, when compared to it's bigger sister, the Chicago Tribune. However, RedEye drives great advertising revenue for a company that had seen it's readership literally continue to die off over the past two decades. 

RedEye is viewed as a young persons alternative to newspapers. Not an alternative to the Tribune, but an alternative to all newspapers. 

The RedEye meets most standards of a young news reader in today's society, delivering news in small "bursts." An article is rarely more than 3-5 paragraphs long, and many are just an one inch summation of a news story, accompanied by a screaming headline. Additionally, the RedEye discusses topics and people that relate directly to it's audience. While you can expect to read wide coverage of bands like U2, or television shows such as Desperate Housewives in the pages of the Chicago Tribune, RedEye is more likely to feature recording artists like T-Pain on it's cover and dish news on Gossip Girl within it's pages. They are ahead of the curve now, but the goal is clearly to become the curve. One gets the idea the journalist and editors are young or, at very least, young at heart. 

Readers can decide, quickly, if this is a story they should look into more on the Internet once they get where they are going, or if they will take a pass. Once again, you can no longer tell consumers what news is, they decide for themselves.

The Tribune, and other newspapers, could easily boost readership by borrowing the inclusive themes that come with skewing younger, and without sacrificing it's seriousness. Shorter articles that drive readers looking for more to the TRIBUNE website, where fully fleshed out material awaits. PBS does this for every piece of it's original broadcasting. Instead of leaving it to the  reader to investigate their own choice of web news provider, all the sourcing for the article can be delivered at Tribune.com.  This seems a simple solution, held back only by a nasty word that's been the death knell to many organizations, institutions and even civilizations, "tradition."

Big Media has a question to ask itself in the coming months, if not weeks. Do they dare to be at the forefront, skewing younger and more inclusive with their talent? Or will they continue this prolonged blood-letting  by having sexagenarian talking-heads try to explain the merits and intricacies of FaceBook in vain while the most dramatic cultural and generational shift in our nation's history is taking place on the screens around them?

The way forward is to trust in the profound talent that resides in the many cultures and youth of America. Ask of them that thing which has not been asked before, save service in the military during times of war. Let us ask them to take a seat at the table and be a part of developing solutions to the many obstacles that plague us all.

Being inclusive is not only the rational thing to do, it's the profitable thing as well.