We hear commentators speak of Terrorism as the New Normal not only impacting daily life; but presumably business. The fact is that acts of terrorism that have resulted in the deaths of thousands of Muslims, Christians, Jews, Hindus and non-believers have been going on for decades. The state of Israel has been dealing with terrorism, since is was founded at a Jewish state in 1948. Yet, the Israeli people have built a beautiful first world nation, while being surrounded by Arab Countries, including land in the West Bank and the Gaza Strip, controlled by the Palestinian Authority, where people live with pervasive corruption, poverty and misery.
Other Western countries too have been dealing with terrorism of one kind or another going back to the 1970's when airplanes were being hijacked and or the case of the Lockerbie 747 destroyed by Libyan terrorists, which resulted in the deaths of several hundred people over Scotland. In fact, this CEO Blogger was working in London for Merrill Lynch, two weeks after President Reagan ordered the bombing of Libya in retaliation. Just before I arrived, terrorists blew up the American Express office in London just down the street from our office.
So to be sure, terrorism is not new, so calling it the New Normal ignores the fact that Islamic Radicals have been at war with the West for many decades culminating in 9/11 that changed the world. And, with the exception of 9/11, which did cause a mild recession lasting about a year, business has continued as usual responding to economic fundamentals more than acts of terrorism. Again, with the exception of 9/11, the boom and bust cycles we have experienced in the last 35 years, including major recessions and stock market gyrations have had little to do with specific acts of terrorism and more to do with supply and demand, financial mismanagement and cyclical market forces. Sadly, terrorism may be a fact of life; but it is not new.
Tuesday, September 20, 2016
Terrorism & Business - The Old New Normal
We hear commentators speak of Terrorism as the New Normal not only impacting daily life; but presumably business. The fact is that acts of Terrorism that have resulted in the deaths of thousands of Muslims, Christians, Jews, Hindus and non-believers have been going on for decades. The state of Israel has been dealing with Terrorism, since is was founded at a Jewish state in 1948. Yet, the Israeli people have built a beautiful first world nation, while being surrounded by Arab Countries, including land in the West Bank and the Gaza Strip, controlled by the Palestinian Authority, where people live with pervasive corruption, poverty and misery.
Other Western countries too have been dealing with Terrorism of one kind or another going back to the 1970's when airplanes were being hijacked and or the case of the Lockerbie 747 destroyed by Libyan Terrorists, which resulted in the deaths of several hundred people over Scotland. In fact, this CEO Blogger was working in London for Merrill Lynch, two weeks after President Reagan ordered the bombing of Libya in retaliation. Just before I arrived, Terrorists blew up the American Express office in London just down the street from our office.
So to be sure, Terrorism is not new, so calling it the New Normal ignores the fact that Islamic Radicals have been at war with the West for many decades culminating in 9/11 that changed the world. And, with the exception of 9/11, which did cause a mild Recession lasting about a year, business has continued as usual responding to economic fundamentals more than acts of Terrorism. Again, with the exception of 9/11, the boom and bust cycles we have experienced in the last 35 years, including major Recessions and stock market gyrations have had little to do with specific acts of Terrorism and more to do with supply and demand, financial mismanagement and cyclical market forces. Sadly, Terrorism may be a fact of life; but it is not new.
Other Western countries too have been dealing with Terrorism of one kind or another going back to the 1970's when airplanes were being hijacked and or the case of the Lockerbie 747 destroyed by Libyan Terrorists, which resulted in the deaths of several hundred people over Scotland. In fact, this CEO Blogger was working in London for Merrill Lynch, two weeks after President Reagan ordered the bombing of Libya in retaliation. Just before I arrived, Terrorists blew up the American Express office in London just down the street from our office.
So to be sure, Terrorism is not new, so calling it the New Normal ignores the fact that Islamic Radicals have been at war with the West for many decades culminating in 9/11 that changed the world. And, with the exception of 9/11, which did cause a mild Recession lasting about a year, business has continued as usual responding to economic fundamentals more than acts of Terrorism. Again, with the exception of 9/11, the boom and bust cycles we have experienced in the last 35 years, including major Recessions and stock market gyrations have had little to do with specific acts of Terrorism and more to do with supply and demand, financial mismanagement and cyclical market forces. Sadly, Terrorism may be a fact of life; but it is not new.
Thursday, September 15, 2016
Greatest Transfer of Wealth Coming In World History
By 2026, we will see the greatest transfer of wealth in world history. Baby Boomer Entrepreneurs that created this wealth, primarily by formation of private companies, will transfer about $3.9 Trillion in the US in inheritance to their Generation X and Millennial sons, daughters, grandchildren and perhaps other family members. On a world wide basis this transfer of wealth will be more than $30 Trillion. Of course, politicians and governments everywhere right now are scheming to confiscate their share of this hard earned wealth by various death and inheritance taxes, which is why Estate Planning is so essential.
The question is how many of these privately owned businesses will actually continue to be owned and run by family members. The answer is probably not very many because Generation X and Millennials are just as likely to monetize their inheritance by selling companies as keep them. There will always be bigger players in every industry more than willing to buy up successful smaller companies in their goal to grow by acquisition. Since 70% of employees in the US work for these smaller companies, when these acquisitions take place, their lives will be impacted as well and not always for the best.
Once the value of a company has been monetized, or converted into cash by family members, there is better than a 50/50 chance that the fruits of Dad's or Mom's years of labor will be gone forever. What a shame; but maybe it is the circle of life.
Not always, but it could be that people need to start with nothing to create the drive, ambition and very hard work needed to build something great creating wealth in the process. Very often wealth that comes too easy is taken for granted, which is never good. In any case, this wealth transfer will take place. The only question is will it result in a good or bad outcome; or most probably a little of both.
The question is how many of these privately owned businesses will actually continue to be owned and run by family members. The answer is probably not very many because Generation X and Millennials are just as likely to monetize their inheritance by selling companies as keep them. There will always be bigger players in every industry more than willing to buy up successful smaller companies in their goal to grow by acquisition. Since 70% of employees in the US work for these smaller companies, when these acquisitions take place, their lives will be impacted as well and not always for the best.
Once the value of a company has been monetized, or converted into cash by family members, there is better than a 50/50 chance that the fruits of Dad's or Mom's years of labor will be gone forever. What a shame; but maybe it is the circle of life.
Not always, but it could be that people need to start with nothing to create the drive, ambition and very hard work needed to build something great creating wealth in the process. Very often wealth that comes too easy is taken for granted, which is never good. In any case, this wealth transfer will take place. The only question is will it result in a good or bad outcome; or most probably a little of both.
Wednesday, September 14, 2016
Being Politically Correct in the Workplace
There is no doubt that the law prohibits any American company from discriminating on the basis of religion, race or sexual orientation in its business dealings. There are also definitive laws dealing with Sexual and other forms of Harassment, which are justified given past grievances. And, clearly though company management may have a specific political orientation be it Conservative, Moderate, Liberal, or even Socialist, that belief system should have no impact on company decision making other than making decisions that are in the company's financial best interests. It does however, seem that company's run by "progressives" can do, or say whatever they want without any consequences. All of this said, we seem to live in such a Politically Correct world that having different opinions, that are protected by the Bill of Rights in the US Constitution, are under attack.
To many, calling for smaller government, lower taxes, less regulations and adherence to free market capitalism, all Conservative Principles, are viewed by some as Racist, Xenophobic, Homophobic, Islamophobic and a whole lot of other names, which of course is ridiculous. On university campuses there is a call for Safe Zones, where only Politically Correct Thought is acceptable. Whatever happened to debating different ideas to develop critical thinking as part of a university education. In any case, the Workplace is fast becoming a sterile zone, as well, where employees cannot discuss differing opinions for fear of offending someone. And, those who adhere to religious principles are shunned.
It is very clear that while all companies must observe the law in all of our business dealings, we cannot and should not attempt to control what our employees think in a free society. Of course that does not include Hate Speech that all would see as offensive; but it does include the freedom to practice one's religion, or no religion and belief system. No employee should feel threatened by the PC police on the job, or anyplace else. The United States is still a free country, the last time I checked. Clearly, this is a situation where the rights of all must be balanced in accordance with the rights defined in the US Constitution.
To many, calling for smaller government, lower taxes, less regulations and adherence to free market capitalism, all Conservative Principles, are viewed by some as Racist, Xenophobic, Homophobic, Islamophobic and a whole lot of other names, which of course is ridiculous. On university campuses there is a call for Safe Zones, where only Politically Correct Thought is acceptable. Whatever happened to debating different ideas to develop critical thinking as part of a university education. In any case, the Workplace is fast becoming a sterile zone, as well, where employees cannot discuss differing opinions for fear of offending someone. And, those who adhere to religious principles are shunned.
It is very clear that while all companies must observe the law in all of our business dealings, we cannot and should not attempt to control what our employees think in a free society. Of course that does not include Hate Speech that all would see as offensive; but it does include the freedom to practice one's religion, or no religion and belief system. No employee should feel threatened by the PC police on the job, or anyplace else. The United States is still a free country, the last time I checked. Clearly, this is a situation where the rights of all must be balanced in accordance with the rights defined in the US Constitution.
Monday, September 12, 2016
Free Trade - Winner & Losers
We hear a lot of talk about the good and bad of Free Trade in the current Presidential Election. Aside from what Donald Trump and Hillary Clinton are saying, there is no doubt that Free Trade has created winners and losers. American Consumers in particular are big winners as a result of Free Trade. All those flat screen TV's and thousands of other items, if made in the United States, would be considerably more expensive and out of reach for many people. So for people with good paying jobs, their standard of living has been increased by Free Trade. Certainly Baby Boomers, particularly those living in large cities, with college degrees and or marketable job skills have benefited from Free Trade. In a sense, many Baby Boomers have lived the good life because of Free Trade.
However, though American markets are generally open to all countries, we really have never had Free Trade because other countries have imposed tariffs on American goods entering their countries to protect their industries. And or, currencies have been devalued to make other country's goods cheaper in the United States and our products more expensive in their countries. This is particularly true related to China that makes it very difficult for foreign companies to do business in their country. Further, it is rare to see an American made car on the streets of Japan, though Japanese branded cars, many of them now made in the United States are all over our country.
Yes, Free Trade has benefited many Americans; but the dark side of Free Trade has been the millions of manufacturing jobs that have left our country in the past thirty years. Those jobs in the past provided Americans, with perhaps just a high school diploma, a middle class life style. In fairness, those jobs are gone not just because of Free Trade; but also because of automation and robotics. It just does not take as many people to produce any product in any country as it once did. In addition, private sector unions demanding higher and higher wages and benefits and global competition forced many American companies to ship those jobs overseas.
Clearly, four things need to occur so that everyone benefits from Free Trade. First, we need Smart Trade not just Free Trade. The US government must negotiate better trade deals to make sure other markets are truly open to American companies. Second, there must be significant job training programs implemented at the Community College level to retrain displaced workers to do the jobs of the future. Third, those people who can't find good paying jobs locally must be willing to move to where the jobs are happening in states with business friendly environments that attract companies. And, finally fourth, we need an all of the above Energy Policy that encourages the use of Oil, Natural Gas, Clean Coal, Nuclear Energy and Renewables to both create good paying jobs that can't be off-shored and to make the United States Energy Independent.
Unfortunately, states with high taxes and burdensome regulations are job killers, not job magnates, so they will continue to lose good paying jobs no matter what is done to stop it. As such, people that can't find work locally must vote with their feet for the good of their families. If government needs to aide in this migration with some financial assistance or grants, it would be cheaper than providing Unemployment, Welfare, Food Stamps. Most important, there is dignity in work, which is critical to family well being.
However, though American markets are generally open to all countries, we really have never had Free Trade because other countries have imposed tariffs on American goods entering their countries to protect their industries. And or, currencies have been devalued to make other country's goods cheaper in the United States and our products more expensive in their countries. This is particularly true related to China that makes it very difficult for foreign companies to do business in their country. Further, it is rare to see an American made car on the streets of Japan, though Japanese branded cars, many of them now made in the United States are all over our country.
Yes, Free Trade has benefited many Americans; but the dark side of Free Trade has been the millions of manufacturing jobs that have left our country in the past thirty years. Those jobs in the past provided Americans, with perhaps just a high school diploma, a middle class life style. In fairness, those jobs are gone not just because of Free Trade; but also because of automation and robotics. It just does not take as many people to produce any product in any country as it once did. In addition, private sector unions demanding higher and higher wages and benefits and global competition forced many American companies to ship those jobs overseas.
Clearly, four things need to occur so that everyone benefits from Free Trade. First, we need Smart Trade not just Free Trade. The US government must negotiate better trade deals to make sure other markets are truly open to American companies. Second, there must be significant job training programs implemented at the Community College level to retrain displaced workers to do the jobs of the future. Third, those people who can't find good paying jobs locally must be willing to move to where the jobs are happening in states with business friendly environments that attract companies. And, finally fourth, we need an all of the above Energy Policy that encourages the use of Oil, Natural Gas, Clean Coal, Nuclear Energy and Renewables to both create good paying jobs that can't be off-shored and to make the United States Energy Independent.
Unfortunately, states with high taxes and burdensome regulations are job killers, not job magnates, so they will continue to lose good paying jobs no matter what is done to stop it. As such, people that can't find work locally must vote with their feet for the good of their families. If government needs to aide in this migration with some financial assistance or grants, it would be cheaper than providing Unemployment, Welfare, Food Stamps. Most important, there is dignity in work, which is critical to family well being.
Sunday, September 11, 2016
Time To Look For A New Job - Not So Fast
Aside from many Millennials that are often job hoppers, more mature employees should think hard and fast before leaving a current job. This CEO Blogger has seen many employees, both within our company and outside, make disastrous career decisions thinking the grass was greener someplace else. The fact is that all companies experience good times and bad times requiring tough decisions that could impact current operations, so in the short term the grass may appear greener someplace else; but it can quickly turn to brown fields when bad times come, or management changes. As someone who has been in Senior Management for more than 30 years, I have managed through at least three Recessions, the highest and lowest interest rates in American history, real estate downturns, the dot com boom and bust, 9/11, the Fiscal Collapse that began in 2007 and general economic upheaval that has always had an impact on business and employees. It has never been fun; but it has been necessary.
And, many times when industries change, a complete company restructuring is necessary to reflect the new marketplace. None of these things are unique because change is a part of everyday business life that will impact employees at every company, or within any industry. So, if someone is leaving a job, specifically running from the change that is occurring, he or she will be sorely disappointed only to find that change happens at all companies if they are to survive. Ironically, it is those employees who deal with change, that often comes during difficult times and adapt to it seeing in change opportunities that are the most successful and valuable in business. They will have a long term future no matter where they work.
However, there are times when an employee should leave a company and seek another job; but not for the obvious reason, presumably more money. If and when a company, or its management, violates legal or ethical principles, it is time to find another job because there is nothing more important than corporate integrity. If the leadership of a company is blatantly incompetent and or only making decisions in its self interest, it could be time to look for another job. If the business environment at a company has for some reason become poisonous and ugly, it is time to leave. And finally, if and when the leadership of a company does not express a long term vision for success where in which learning can continue for its employees, it may be time to move on.
These are all the reasons, this CEO Blogger decided to move on to greener pastures in the four times in 42 years that I made a job change. And, while in the process it always benefited me financially, more money was never the primary reason I left one job for another. The bigger picture issues that I have identified were far more important in my personal career decisions.
And, many times when industries change, a complete company restructuring is necessary to reflect the new marketplace. None of these things are unique because change is a part of everyday business life that will impact employees at every company, or within any industry. So, if someone is leaving a job, specifically running from the change that is occurring, he or she will be sorely disappointed only to find that change happens at all companies if they are to survive. Ironically, it is those employees who deal with change, that often comes during difficult times and adapt to it seeing in change opportunities that are the most successful and valuable in business. They will have a long term future no matter where they work.
However, there are times when an employee should leave a company and seek another job; but not for the obvious reason, presumably more money. If and when a company, or its management, violates legal or ethical principles, it is time to find another job because there is nothing more important than corporate integrity. If the leadership of a company is blatantly incompetent and or only making decisions in its self interest, it could be time to look for another job. If the business environment at a company has for some reason become poisonous and ugly, it is time to leave. And finally, if and when the leadership of a company does not express a long term vision for success where in which learning can continue for its employees, it may be time to move on.
These are all the reasons, this CEO Blogger decided to move on to greener pastures in the four times in 42 years that I made a job change. And, while in the process it always benefited me financially, more money was never the primary reason I left one job for another. The bigger picture issues that I have identified were far more important in my personal career decisions.
Saturday, September 10, 2016
ObamaCare Is Collapsing - Now What?
It may not matter if Republicans are ever able to repeal ObamaCare because it is collapsing of its own weight. ObamaCare was predicated on smoke and mirrors, which assumed that healthy young people, not already getting health insurance from their employers, would buy health insurance on the ObamaCare Exchanges, with costly premiums and high deductibles to subsidize the older people with chronic illnesses, that are not already covered by their employers, that are buying health insurance on the Exchanges because they no longer have to worry about pre-existing conditions. Of course, even with threat of fines, a sufficient number of young people passed on the offer because they are not stupid, so the insurance companies were left with a high risk population that actually requires coverage on a regular basis.
The end result is that many large health insurance companies, across the country, are pulling out of the ObamaCare Exchanges, which means fewer choices and even higher premiums because of less competition. As such, ObamaCare is in a death spiral. This may have been the intent of Democrat Socialists all along, who rammed through ObamaCare without one single Republican vote in Congress because their real goal is Medicare for all, in a single payer Socialized health care system that would put insurance companies, selling health insurance, out of business. And, so that is exactly what they are proposing now as ObamaCare implodes.
Businesses, large and small and employees who already get health insurance coverage from their employers should absolutely opposed European Style Socialized Government Managed Health Care, which will lead to higher taxes, rationing of medical care and a lower level of care than exists in our private system. We already have Socialized Medicine for Seniors at 65 or older, heading toward insolvency, which is means tested and requires supplemental insurance to be effective. Vets are covered by the Veterans Administration and we have seen that story unfold as many of them have not been able to get quality care within a reasonable period of time because of the incompetence and corruption in that system. And finally, the poor and or low income Americans are eligible for Medicaid, paid for by state and federal governments, or more importantly the American taxpayer. Even if ObamaCare goes down in flames, these other systems are already in place. We cannot allow Democrat Socialists in government to destroy the Private Medical system, applicable to the rest of us because even though it is costly, it does provide quality accessible care.
The end result is that many large health insurance companies, across the country, are pulling out of the ObamaCare Exchanges, which means fewer choices and even higher premiums because of less competition. As such, ObamaCare is in a death spiral. This may have been the intent of Democrat Socialists all along, who rammed through ObamaCare without one single Republican vote in Congress because their real goal is Medicare for all, in a single payer Socialized health care system that would put insurance companies, selling health insurance, out of business. And, so that is exactly what they are proposing now as ObamaCare implodes.
Businesses, large and small and employees who already get health insurance coverage from their employers should absolutely opposed European Style Socialized Government Managed Health Care, which will lead to higher taxes, rationing of medical care and a lower level of care than exists in our private system. We already have Socialized Medicine for Seniors at 65 or older, heading toward insolvency, which is means tested and requires supplemental insurance to be effective. Vets are covered by the Veterans Administration and we have seen that story unfold as many of them have not been able to get quality care within a reasonable period of time because of the incompetence and corruption in that system. And finally, the poor and or low income Americans are eligible for Medicaid, paid for by state and federal governments, or more importantly the American taxpayer. Even if ObamaCare goes down in flames, these other systems are already in place. We cannot allow Democrat Socialists in government to destroy the Private Medical system, applicable to the rest of us because even though it is costly, it does provide quality accessible care.
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