Things I've Noticed

Thoughts on the Financial Crisis One Year Later

It has been about a year since our world underwent a huge financial crisis and it has been a stressful yet valuable time. We’ve learned what makes people tick, how greedy people can be, how stupid they can be, and how we sometimes have to help people who didn’t necessarily deserve it for the sake of the rest of us. What’s ironic is that people who spent a lot or too much on “stuff” ended up often doing better. Stuff, (except real estate), didn’t really go down in value. And then people who bought this “stuff” on credit and went bankrupt were able to keep it for free. On the other hand, those of us who did “the right thing” and invested like good soldiers, were hit hard. Those who possessed things still had them, while values of our investments, (just ink on paper), vanished. It was very disheartening. Some of these losses have been recovered, but not fully. And many of us panicked by making stupid financial moves in case things would never be the same again. People who bought more than they could afford will be forgiven of some of their debt. Those who foreclose or file for bankruptcy received a discount at the expense of the government and the banks, (many of whom deserve it). But we had to help them out or we would have gone into a deeper crisis. Few people want to buy a house next to a foreclosed house, and they certainly won’t pay as much for one if they do. It’s also funny how the Chinese finance so much of our debt to buy all the stuff they manufacture for us, but if we never pay back our obligations, we’ll have the last laugh, (and the cheap stuff we bought from their factories).

Job losses have been staggering as employees have been treated more like numbers than at any other time in history. Apparently, some companies think work can get done without people. Well, at least they think they can squeeze every last drop of efficiency out of those who are still employed. When the market turns around and the pendulum swings the other way, employees will take advantage of the situation. Turnabout is fair play.

As far as consumption goes, this economic crisis has taught me that although it’s good to invest, remember to also buy the things you can cherish or hold onto, whether they are experiences or objects that mean a lot to you. And diversify like crazy, not just in the U.S., not just in stocks and bonds, but in commodities, foreign companies and other areas you might not have thought of before. And don’t get greedy. Nothing goes up forever so cash in as you need to as you get older. Nothing goes up forever! What’s great about saving money when times are good is that it allows you to buy and spend during economic downturns when the deals are great and nobody else is buying.

It appears that we’ve avoided a depression, (and I don’t think we’re out of the woods yet), but we should never forget the lessons we can take away from this last year of economic mayhem.

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Quick Quote on Visionaries

"Visionaries see too much possibility to ever be content."

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Not Being Tall Gets You The Short End of The Stick

The last time I checked, my height was 5’8 and some fraction of an additional inch. By American standards, this is slightly below average for a male. But I like my height. I’m tall enough that I can see over my office cube walls, I’m taller than most women, (except maybe here in the Twin Cities), I can fit in any car, feel comfortable on any plane seat, and I never hit my head on a door frame. To clarify, I have nothing against my taller friends, coworkers, and acquaintances. I’m not "heightist". But we live in a world that judges people on height. Society in general doesn’t share my affinity for not being tall. I and many others pay the price every day.  Research shows that taller people make more money, and get elected more often than shorter candidates. They’re often seen as better leaders just because of their physical stature. But, everybody knows that some short people, like Napoleon and Gandhi were great leaders while some tall people like George W. Bush were clearly not.

Heightism is especially apparent on the dating scene. I can understand that a woman would want a guy at least a couple of inches taller for that whole protector masculine male / feminine female effect, even though a lot of short guys can kick taller guys’ butts. And many of them want to wear heels without appearing taller than the guy, but I’ve come across women that are scarcely above 5 feet tall who only want to be with guys that are 6’0” and taller. That’s like being prejudiced against your own kind. Perhaps they’re just trying to compensate. Regardless, wanting a guy over a certain height constitutes filtering a potential mate over one purely physical trait. I thought women wanted nice guys that could make them laugh. I’ve been mistaken all along. Sociological research shows that height is the number one factor women use to judge a man’s suitability as a mate. I could ask for a minimum measurements of a certain female physical feature, (if you know what I mean), and that would totally not be OK. (For the record, I wouldn’t do that.) I’m not sure where this double standard came from. I know that not all is roses for tall people though.  In my research, I've found that shorter women are preferred by men.  Tall women have to compete with the short women who only want tall guys. (They must really hate that).  And to be fair, tall men can be discriminated against too. Certain jobs don’t have the space for too much height.

In the athletics arena, height is an asset in almost every sport. Us shorter people resort to playing soccer which still holds advantages for tall players when it comes to headers. One can make up for being short by running fast, or having good jumping ability or long arms, but it’s not the same. I always used to joke that if I was as tall as Shaq, I could be a great basketball player too, (and I would have a much higher free throw percentage). There’s also interesting research that shows that taller people are slower to react to their surroundings, so maybe we have one slight advantage. I tend to root for the underdog, so I’m often cheering for short people like Spud Webb and Muggsy Bogues who played professional basketball in the NBA and were 5’7” and 5’3” respectively. We need to develop a new sport where being shorter is an asset, one besides horse racing.

In a way, I’d like to congratulate tall people for having won a kind of genetic lottery. I envy tall people without wanting to have their height. Maybe guys should be the ones who wear shoes with taller heels.  Contrary to what one might think, I don’t have a complex about my height. But height is obviously an issue with others, so I have to be aware of what factors might be working against me.  I’m lucky I’m not shorter.  Perhaps I’m just jealous of the free pass tall people get in so many avenues of life.

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The Auto Industry Has Been Turned Upside Down and Twisted Around

With all the news about the hurting auto industry, loans from the government, bankruptcies and acquisitions, people tend to lose sight of the fact that the whole automotive world, (something which has been a big part of my life and the lives of millions of others), has been turned on its head.  Sure it may not seem like a big deal, but this is arguably the largest and most important industry on the planet.  The products people buy from it touch our lives daily, inspire us, and allow us the ultimate freedom, mobility.  Cars and trucks are aspirational objects that we often depend on do to just about everything else in life, we judge people by the vehicles they drive, and some people dedicate their lives to careers or hobbies revolving around vehicles.

From the corporate perspective, let’s put it this way, there is hardly a single manufacturer or automotive brand that hasn’t gone through substantial change in the last 5 years, and the pace has recently accelerated.  GM, the formerly largest corporation on the planet that sold almost half the cars we bought in the U.S. is a much smaller version of itself and in financial desperation.  There are a lot more competitors and other factors that made this happen, but that’s just the beginning in describing our upside down automotive world.  The second largest American car company, Ford will probably take over as first, the third largest is now mostly owned by Italian auto company, Fiat, part of which GM owned in the 90’s and sold at a major loss before turning it around.  Fiat, (or its Alfa Romeo division), hasn’t sold vehicles here in more than 20 years and now they have control over many of Chrysler’s old dealers.  Even crazier is the fact that GM used to own part of Subaru, and now Toyota owns part of them.  BMW used to own Land Rover, sold them to Ford and now Tata, (a huge company in India that sells everything from tea to telecom to steel), bought Land Rover and Jaguar from Ford.  So a company from a country that was a British colony now owns one of Britain’s historical car brands.  Had enough craziness?  Well, BMW owns MINI which was purely British, but even more importantly, they own the British ultra luxury brand Bentley while Volkswagen owns Rolls Royce.  Then there are the Swedish car companies.  Saab had been owned by GM for quite a while, but they just sold the brand to a small Swedish supercar maker Koenigsegg.  And now it’s reported that Geely, a Chinese company with a not-so-great safety record is looking to buy the Swedish brand Volvo which is known for safety.  In the last 10 years, we’ve lost the brands Eagle, Geo, Oldsmobile, and Plymouth.  What’s going on?  I feel like I’m in a blender.  GM has closed down Pontiac, also sold Hummer to a Chinese company, sold Saturn to Penske who’s associated with racing, Hertz, and AutoNation.  The latest news says they plan on selling cars from many different international companies under the formerly all-American Saturn badge. 

As if this wasn’t all enough, another Indian motor vehicle manufacturer, Mahindra and Mahindra is going to start selling cars here and Tata is planning on bringing the groundbreakingly low-priced Nano over.  GM’s European division Opel has been sold to both a Russian investor and Magna, a Canadian parts supplier.  Think about it.  A parts company owns a car company.  I don’t know whether I want to buy a Chinese Volvo, an Italian Chrysler, a Malaysian Saturn or an American Chevy.  I do know that I would rather support the U.S. auto industry to keep more jobs and profits in our country.  So, now that my beloved Saab brand is Swedish again and not owned by GM, I doubt that I will buy another new one.  I think I’ll be buying a Cadillac, Chevy, Ford or Mercury.  But those Fiats and Alfa Romeos do look pretty cool.  And I could support my home country a bit more by buying an Indian Jaguar, but Jaguar is not really my style.  Mercedes, BMW, and Volkswagen are doing alright with their government-sponsored health care and pensions that reduce costs to the company for vehicle production.  But there’s news there too.  Mercedes dumped Chrysler and Volkswagen is largely owned by Porsche.  Honda is doing OK given the circumstances while Toyota is hemorrhaging from perhaps trying to grow too fast.  At least the Japanese car companies can thank their government for not only health care and pensions, but for currency manipulation and trade restrictions.  All we need now are for the French to bring Citroens or Peugeots to the U.S. and the car market free-for-all will get more confusing.  As it is, I’m in an automotive daze.  I’m waiting for the dust to settle and I don’t know what to make of it yet.  Maybe I’ll just build my own car, (or buy a bicycle).

We Do So Much Because Other People Don't Do What They Should

First off, I want to say Happy New Year.  It's not belated though.  The new year is still taking place, (even if it will be over before we know it).

My first post of 2009 is about people doing what they're not supposed to do or not doing what they're supposed to do.  I'm not talking about New Year's resolutions.  Everybody talks about those.  Rather, I'm talking about actions that are taken every day, ones we must deal with because they lead to results that are undesirable.  They affect what society has to do.  I would say that many of the daily activities in which we partake are done as a direct consequence. 

If this was an ideal world with respect to how people behaved, there would be a lot more unemployment.  If people were honest and didn't steal, we wouldn't need locks, safes, computer security systems, or policemen.  Just think.  Life would be easier though.  You would never need keys, could move your friends car or take care of their house while they traveled without any prior planning.  We wouldn't have any security hassles at the airport, wouldn't need to sign when we used our credit cards.  You could have left your cookies un-licked at the school cafeteria table without worrying that your friends might eat them.  On the business side, contracts would be much shorter.  We would need far fewer lawyers.  (Such a shame).  Kids wouldn't have to be taught to not talk to strangers and parenting would be immensely easier.  Hitchhiking would be an interesting, stress-free experience.  My personal utopia angle on this is that we wouldn't need computer passwords, (which have ruined my life)!  Could you imagine?  The world would be so much more efficient. 

On the flip-side, we would have to find other jobs for all the people that design and manufacture security cameras or for any people whose duty it is to secure or protect someone or something.  On a different front, most people in white collar jobs have to do a lot of follow-up.  This is only because other people don't do what they're supposed to do as expected.  If everybody did their job like they're supposed to, there would be fewer managers to oversee what we're (not) doing.

But life would be a lot less interesting if everybody was forthright and did what they were supposed to.  There wouldn't be any funny criminal stories in the papers.  We wouldn't sharpen our senses in sniffing out spam.  We wouldn't have as much to complain about and we'd probably be more vulnerable to dangerous wild animals or aliens.  I say that it's good that there are people who don't do what they're supposed to.  It probably leads to innovation and great ideas both in trying to perform illegal activities and in trying to defend against them.  It probably accounts for a significant portion of our economy.

I'm not advocating that you don't do what you're supposed to do, but next time somebody steals your Garmin out of your car, maybe this post can help you laugh it off.  And in this bad economy, many of us should feel fortunate that we have jobs.  Many of them depend on human dishonesty.

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Advertising Because Times Are Tough, But What Should Be Advertised?

Times are tough with the whole financial crisis, job losses, and an auto industry on the edge of bankruptcy, (although they just got loan money today). Accordingly, I’ve started some major advertising on Things I’ve Noticed to help defray TypePad’s monthly fees for the blogging service. I use both Google text ads and Adify’s high-falutin’ animated ads. (Feel free to click all you want, especially if you’re interested in what’s in the ad.) I figured out that if traffic to Things I’ve Noticed goes from 40 visitors a day to 100,000 visitors a day, I could live off of my blog, but that will never happen unless the top 50 blogs in the world start linking to me. I don’t see that in my future, so I have to continue working in a real job.

I have been noticing what’s getting advertised in these spaces on my site. With Google, I have little control but with Adify, I can approve or reject campaigns. I consider whether I want to advertise products or services that aren’t in keeping with my philosophies, or are too cheesy, even for this blog. For instance, I didn’t want to advertise meat products, so I rejected the McDonald’s campaign.  The specific advertising on my Google ads depends on what I write about, but I can't single out companies, only topic areas.  Although, I’m a very very small time advertising venue without complete control, I will do what I can.

But I wonder about ads accepted by major newspapers, magazines, and websites. Sometimes they advertise things like police radar camera license plate blocking sprays or products that enlarge certain body parts even when they know that these products are illegal and/or don’t work. I’m surprised that they don’t want to protect their readers from fraud or their own image by rejecting such ads. They just look the other way as long as the advertising revenue is coming in. It would be nice if they would verify the credibility of the advertisers before placing such ads in their publications or on their websites. I guess, in the end, it’s all about the money. That’s why I’m forcing readers of T.I.N. to endure ads that take up significant screen space, and I apologize... but I gotta eat.

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The U.S. Government Must Provide Loans to Assure The Survival of GM, Ford, and Chrysler

We’ve heard a lot of news from the press lately about the dire situation the American automobile industry is in. In part due to the “financial hurricane” that the credit crisis has created, the Detroit 3, (D3), including GM, Ford, and Chrysler are on the brink of going bankrupt or closing up completely. As a former GM employee who loves cars, and cares for Detroit, my friends who work in the auto industry and our whole country, I believe that the government must provide loans to the Detroit 3. Blame can be laid on many things but a negative spin about the Detroit 3 has gotten out of control to the point that people have a grudge beyond reason, one that could lead to our government making a horrible decision. I don’t mean to dismiss mistakes of management and the possibly unreasonable demands of the unions up to this point, but the issue is not who we should punish but what we should do now to prevent a catastrophe.

I’ve written on countless numbers of website comment sections and based on what I’ve written, I want to address all the claims others have made as to why they think the Detroit 3 shouldn’t get support in the form of a loan, (not a bail-out). Please don’t quote me on the exact numbers as these are estimates, but read this with the understanding that I do know a lot about the auto industry from experience and interest. Feel free to research some of my general figures.

Here are claims and suggestions listed, with bullets beneath them addressing why the suggestions aren’t feasible, the claims are overstatements or just aren’t true.

The Detroit 3 don’t make cars that people want to buy:
- Ford, Chrysler and GM sell nearly half the vehicles purchased in our country. 50% of the customers are not nobody, and many of these customers are loyal repeat ones.
- The Detroit 3 had fewer competitors in the 70's than they do now, so some market share attrition is bound to occur by virtue of there being more choice.
- GM sells the most mid-sized cars of any manufacturer, but they are spread out amongst many models with different styles but the Honda Accord and Toyota Camry get all the credit for their manufacturers

The D3 only make gas guzzlers and SUV’s:
- They did profit from the SUV craze but so did/do all the other competitors. Consumers tended to equate value with size and the D3 couldn’t get its typical consumer to buy small cars at prices that would be profitable.
- Admittedly, they should have started making hybrids earlier but that’s a small slice of the market. - For the segments that sell the most, American car company vehicles are amongst the most fuel efficient in their segments such as the Chevy Malibu, Saturn AURA and Ford Focus...
http://www.freep.com/article/20081117/COL14/811170379

The quality of vehicles from the Detroit 3 is not nearly as good as that of the Asian and Europeans:
- The quality gap has narrowed significantly and in some cases, D3 products have better quality than Toyota and Honda, (Chevy Malibu and Ford Fusion are prime examples in JD Powers studies.) http://www.freep.com/article/20081117/COL14/811170379
- Toyota recalled more vehicles last year than GM did http://forums.motortrend.com/70/6495664/the-general-forum/recall-numbers-for-2007-honda-toyota-numbers-highe/index.html

If the Detroit 3 go under, the import competitors will just sell more cars and provide just as many jobs:
- The Detroit 3 employ far more people in our country than foreign-based companies. It’s not just at plants but at headquarters white collar professional, engineering and technical jobs.
- If any one of the D3 go under, then many suppliers will go bankrupt leading to more job losses and parts will stop flowing to the Toyota, BMW, Honda plants here. That would lead to (at least temporary) layoffs at the transplant company plants.
- No other company is going to take up slack in our industrial base by starting a large, new auto manufacturing company as the major investment, expertise, low profitability, and economy would be inhibitors. Small companies like Tesla and Fisker will take tens of years to become mass market manufacturers, (assuming they succeed).

Questions to Ask Yourself Before You Even Consider Voting for McCain and Palin Instead of Obama and Biden

1. Wasn’t Iraq supposed to have weapons of mass destruction? When did America start caring about Iraqi freedom?
2. Cheney’s Haliburton has made and still makes how much money off of the war in Iraq?
3. Do people making over $250K per year really need bigger tax cuts than the rest of us? Isn’t that “spreading the wealth” upward?
4. Remember when the Republicans wanted to privatize Social Security? How much has the stock market, (on which it would have depended), dropped?
5. Should the richest nation on earth let any of our people suffer without health care? Should people have to go bankrupt to pay for it?
6. Given the recent financial crisis, should people have more freedom or should corporations?
7. If McCain becomes president, do people who have spare cash to buy stocks outside of their retirement plans deserve to pay less tax on this income than many of us pay for sales tax?
8. Do you really want a vice president who apparently doesn’t read the news?
9. Do you really want a president who chose such a vice presidential candidate?
10. Should we be involved in an endless war?
11. Will the terror threat ever go below orange if we keep using the military to kill and lead to the formation of more terrorists?
12. Is it good that we’ve become more dependent on foreign oil than ever before because we haven’t cut consumption?
13. Will drilling for more oil solve our energy dependence on other countries?
14. Where was the movement to support environmental technologies over the last eight years before it became popular? What was our energy policy again?
15. Isn’t it supposed to be “Country First” and not “Me First”?
16. Should we reward a political party that has overseen our national debt to run up to $10,586,391,263,630?  Is that good for future generations?
17. Is it a good thing that other countries own so much of our country by having bought our debt?
18. Do you want a president who would rather attack his opponent than talk about solutions?
19. Is allowing corporate consolidation a good thing when larger giants fail and cause huge impact to our economic systems?
20. How many real jobs have been lost over the last eight years?
21. Is it good that our manufacturing output is the lowest it has been in the last 23 years?
22. Have we really left “no child behind” with our education system?
23. Has trade been fair for US industry when they try to sell goods and services to other countries?
24. When’s the last time you went shopping for stuff and didn’t buy something that was made in China?
25. When’s the last time you bought something made in America?
26. Can you think of anything that’s going right with our country over the last eight years of a Bush and the Republicans in control for most of it?
27. Don’t you agree that we can do a lot better?

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MORE ON THE ELECTION FROM THINGS I'VE NOTICED BELOW...

My U.S. Presidential Election Prediction Using NPR's Website

Tis The Season For Political Advertisements – The Quandary of Their Necessity

Quick Quote on McCain

A Sign of Desperation

Don't Underestimate The Impact of The Year You Were Born

To put it simply, you can’t control when you were born.  And that makes sense.  We just accept it because we have to. What we don’t consider often enough is how much of an impact the timing of our birth has on our lives.  It’s a product of fate and your parents’ friskiness. Independent of birth order, not only is the generation of your birth critical, the exact year is too.  Generationally, some people were born and brought up during the depression.  These were kids who were raised with next to nothing so they appreciated everything.  Then there were the kids who grew up in the relative economic prosperity of the 90’s.  They had it all, (at least materially), even though that didn’t necessarily make their lives much better.  Kids who are born with a lot and then must sacrifice have it rough, especially when they took things for granted.  On the other hand, those who grew up with nothing and found themselves becoming prosperous may be more cautious about giving in to spending temptation.

I was born in one of the many Gen X years and Gen Y followed right after.  I had a tough job market when I came out of college, but people a few years later hit a boom.  They received many offers out of school and their salaries leap-frogged ours.  And we never really caught up unless we took drastic action like changing employers.  I do feel fortunate now.  At least with grad school, you can choose when you start.  I have found that many of the benefits I received from my prior employers were taken away for new hires that started a few years after I did.  I was also lucky enough to have access to student loans to finance my private university education.  With the current economic crisis, there is more limited loan availability and fewer jobs.  College-aged kids' parents have little money in their stock portfolios or home equity to fund a college education.  Also, the later a kid is born, the longer they have to work before they can retire to collect Social Security.  (See image pop-up).  This counteracts the fact that the kid can expect to live longer.

Think of the implications of being born thirty years too early.  Perhaps you were genetically cut out to be a computer programming whiz but computers weren’t invented yet. Working a calculator doesn't make a person much money.  And what if you were born a hundred years earlier?  I would say that if you were born that long ago at least in a middle class family, the higher the chance you had of succeeding or becoming famous.  There were just less people then and the odds of becoming a success were better.  There was less competition for available resources. It was a lot easier to start a business and everything hadn’t seemingly already been invented yet.  On the flip-side, people used to die of colds or catch polio and have to live off iron lungs.

So when you look back on your life and wish you had things easier or feel fortunate, perhaps you should attribute much of that to the timing of your birth.  It's the one thing that we have no control over and that has so much control over our whole lives.  There may be an optimal year to be born based on all the things I mentioned.  I would say it was some time in the 1950's.  I just don't know whether being born in a "good" year is due to luck or fate.

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Quick Quote on The Financial Crisis and Investments

"Given the instability in the stock market, I'm going to start investing in pennies."

+ Atul
Click on the link that says "pennies" and you'll see why.