Wednesday, June 10, 2009

U.S. Deficit Visualized

The New York Times has a fascinating graphic visualizing the sources of our $1 trillion national debt. More details from the article. This graphic would be great to read over a bowl of cereal.

Sunday, June 7, 2009

Creativity in the Time of Recession: A Filmmaker's Dilemma

Editor's Note: Gloom to Boom is pleased to welcome guest blogger and filmmaker Betty Teng, who explains how the downturn forced her to discard the status quo and embrace a new approach to realizing her creative vision.

“Your barriers are also your gates.”
— John Daido Loori
Abbott, Zen Mountain Monastery

It may be a bit of a stretch to quote a Zen master when writing about innovation during tough economic times, but when Gloom to Boom asked me to share my story of how I’m raising money for an independent feature film during the worst economic crisis in recent history, I saw no better way to talk about my experience than to reflect on the notion that hitting a wall can also mean encountering hidden opportunity.

My film, Maestro, Maestro is about the artistic struggle between an orphaned teenaged music prodigy and an aging composer-conductor with writer’s block. I budgeted the film at $2.5 million, and I started looking for private equity funds early last year.

That summer, as I was scouting locations and meeting with contacts in San Francisco (where Maestro is set), I met an investor through a member of my producing team. He was a media consultant who specialized in cross-platform marketing, and he had learned that the San Francisco Symphony was eager to expand its appeal, especially with younger audiences. Our film was an ideal vehicle for the Symphony’s objectives. The plan was to get the SF Symphony’s biggest donors to fund our project, and in exchange we would feature the Symphony and its performance space in the film.

Last fall, talks between our team and the Symphony progressed with a pace and fluidity that had even me, an inveterate pessimist, hopeful. There was even talk of Maestro becoming a special feature of the Symphony’s 100th anniversary program in 2011. Our liaison — a development director with the Symphony — was all set to present our plan at a wider Symphony board meeting in early October.

That week, Lehman Brothers collapsed.

As the banking crisis grew to epic proportions, its effect on symphonies and opera houses across the country was almost immediate. Cultural institutions nation-wide were forced to lay off staff and cut programming due to the massive loss in donors and endowments. Within a few weeks these problems hit the San Francisco Symphony, and all talks of their interest in Maestro froze.

Since October, I have been investigating ways to make my film for a significantly smaller budget without compromising its story. Initially, this seemed impossible. Its setting in San Francisco and our need for a full symphony orchestra prevented our budget from shrinking much below $2.5 million, a price which has become prohibitive for an independent film.

As I had done a couple of times in the past, I confronted the possibility of shelving Maestro for good.

Then in the early winter, a New York literary agent specializing in graphic novels contacted me. An illustrator friend had passed him Maestro’s script and the agent felt the story would translate well into a graphic novel. He saw its potential appeal with teen girls, the fastest growing audience in that market.

I’d never thought of my film as a graphic novel. Ironically, I had been researching comic book artists for the past few years for another project, but never considered writing one myself. After years of struggling to raise millions and garner the support of dozens for Maestro, however, the notion of working with just one illustrator (or at most, a team of 2-3 illustrators) was refreshingly simple — and cost effective. Telling the story in illustrations would also allow us to preserve the story’s San Francisco setting and include a full symphony orchestra without adding a million dollars to its budget. I agreed to the agent’s suggestion that we find an illustrator to create a proposal to shop around to publishers.

While it’s been freeing to consider Maestro in a 2-D illustrated form, I have felt one creative compromise. While I have no doubts the right illustrator will find a compelling way to express Maestro’s music with ink and paper, it is impossible in a book to deliver the actual melody which haunts the lead characters. My wish to hear the story’s music alongside expressive illustrations led me to consider a suddenly-obvious medium: Animation.

It’s a good time for animated films. Notwithstanding the popularity of Pixar’s most recent film Up, rapid advancements in digital technology have made animation an increasingly accessible tool for independent filmmakers. As a result, innovative and highly-acclaimed movies like Waltz With Bashir, Sita Sings the Blues, and Persepolis have proven that audiences are receptive to all types of stories told in this form.

As a live-action filmmaker and editor, I have a sense of how animated films are made, but really require the help of computer graphics professionals in this plan to convert Maestro into an animated feature. Turns out, I’m not having to look too far. As I’ve been talking to investors, colleagues and friends about my idea, a number of contacts into the animation world have surfaced, including a friend’s brother who heads the animation division of an established New York commercial house. After a couple of conversations, he asked me to consider him and his studio as my “go-to” resource as I explore how we might bring Maestro into the animated realm.

Eight months ago, I could not have predicted this scenario. I had conceived of Maestro as an art-house film along the lines of movies like Shine, Good Will Hunting, or Billy Elliot. But with systemic changes in the independent film market coupled with the current downturn in the global economy, viable funding and distribution models for films budgeted in the $2 to $5 million range are essentially extinct. While this has been a hard reality to face, I have been heartened to find, in the rubble of one plan, newer and fleeter possibilities for delivering Maestro to the world.

If recent challenges have taught me anything, they’ve confirmed the Zen master’s insightful statement above. Hard times force tough compromises. But they also cause one to clarify what matters most in a project, in a career — even in a life. Such answers don’t come quickly or easily, but when they emerge, they are, I suspect, keys to the hidden doors that exist within every barrier.

Betty Teng is a writer, filmmaker and film editor. Her script, Maestro, Maestro has been a grand prize winner of Francis Ford Coppola’s American Zoetrope Screenplay Contest. Check out her visual blog, ACROBATIC FLOTSAM + JETSAM at:

Friday, June 5, 2009

Next Week: A Filmmaker's Dilemma

On Monday, Gloom to Boom will welcome its first guest blogger Betty Teng, a writer, filmmaker and film editor based in New York. Betty will share a fascinating story about how the credit crisis forced her to become more innovative in her approach to producing her film Maestro Maestro. Even though the recession has challenged the traditional model for making a film, it has forced open new doors for Betty to realize her vision. Here's an excerpt:

With systemic changes in the independent film market coupled with the current downturn in the global economy, viable funding and distribution models for films budgeted in the $2 to $5 million range are essentially extinct. While this has been a hard reality to face, I have been heartened to find, in the rubble of one plan, newer and fleeter possibilities for delivering Maestro to the world.

Please join us on Monday to learn about Betty's story. Hopefully it will inspire you to take a second look at your plans.

Tuesday, May 26, 2009

Consumer Confidence Soars

This is great news. Despite the doom and gloom among economists and the media, the Conference Board today reported an unexpected surge in consumer confidence. In fact, the index reached its higher level since the collapse of Lehman Bros. in September that caused the credit market freeze.

For this month, the index reached 54.9, up from 40.8 in April. Expectations for the next six months rose to 72.3 from 51.0 in April. That's quite a leap.

While encouraging, the numbers are at odds with recent trends. Housing data in 20 major metropolitan areas declined in March by 18.7 percent, according to the Standard & Poor’s Case-Shiller Home Price Index that was released today. Earlier this month, the Commerce Department said retail sales fell 0.4 percent in April, following a 1.3 percent drop in March. Meanwhile the U.S. unemployment rate reached 8.6 percent in April.

Still, the Conference Board gave a rosy assessment of the state of the economy through the eyes of consumers:

"Consumers are considerably less pessimistic than they were earlier this year, and expectations are that business conditions, the labor market and incomes will improve in the coming months," Lynn Franco, Director of The Conference Board Consumer Research Center, said in a press release. "While confidence is still weak by historical standards, as far as consumers are concerned, the worst is now behind us."

Bold words. Let's hope she's right.

Tuesday, May 19, 2009

Fuel Efficiency Standards Take Shape (Finally)

After years of stalled legislation, federal neglect and successful industry lobbying, it appears there's finally agreement in setting a national fuel efficiency standard. The Obama Administration is modeling the regulations after California's effort, which was introduced in 2002 but stalled by auto industry lawsuits and Congressional debates. Now with the auto industry in bankruptcy protection and receiving billions of dollars from the government, lawmakers see a way toward a national fuel efficiency standard. If everything works out, cars will be running an average of 35.5 miles per gallon by 2016. That's more efficient than my Honda Civic Hybrid in the city.

As I've written in the past, most projections show U.S. oil demand within the next 20 years outpacing oil production and current import levels. The most effective way to confront this problem is to reduce demand by either convincing consumers to drive less, or force fuel efficiency standards.

I'm glad the economic implosion has forced the auto industry to do what's right. Hopefully American cars will redefine the market by creating fuel efficient cars that people will love.

Monday, May 18, 2009

Jerry Yang on Recession and Re-Birth

(Photo by Ken Hupp)

Great quote from Yahoo! co-founder Jerry Yang during his commencement speech at the University of Hawaii at Hilo. An excerpt from

“I can promise you that great things are being started right now in this downturn in our economy. Yahoo started in an economic downturn in the early 90’s,” Yang said. “Other great companies, great ideas, products, even social movements have come about as people are throwing away the status quo and doing everything in new ways.”

According the KPUA, Yang added that "success doesn’t come from a high I.Q. or talent, but a willingness to work hard coupled with relentless preparation."

So true, Jerry. Reminds me of a gigantic billboard I saw last night coming off the Bay Bridge that read something along the lines of "Bill Gates started Microsoft during an economic recession" (from my memory). The next big idea is being conceived in cafes, universities and impromptu get-togethers. Nothing better than a downturn to force people to innovate and challenge the status quo.

Let's hear from you. Have you seen examples of people using their ingenuity in the face of unemployment or setbacks to challenge the status quo?

Friday, May 15, 2009

Retirees: "What recession?"

(Photo courtesy of ted.sali via Flickr)

Interesting report from the Pew Research Center. The study examines the recession's behavioral and psychological effects by age group, especially among older Americans. The conclusion: retirees are handling it much better than younger folk. Those surveyed who are older than 65 were less likely to have cut back on spending, suffered a loss on their retirement investments, or experienced greater stress in their families. Pew calls it a "kinder, gentler recession" for this group.

In contrast, people bucketed in the 50-64 age range feel like they're getting hosed. A large percentage of them reported greater investment losses, familial stress and spending cutbacks since the onset of the recession. This "Threshold Generation," as Pew labels them, is more exposed to Wall Street fluctuations and, not surprisingly, less confident they will build enough of a nest egg for retirement.

The study also points to other factors such as income and race that affect the results.

Maybe this is the reason why my parents are still so stinkin' happy all the time. Perhaps it's their longer-term view of the world and the acceptance that circumstances will bounce back despite the difficulties. My parents grew up during the height of World War II and still have vivid memories of hiding in bomb shelters in China. They decided to leave their families in their mid-20's and settle in a foreign country where they've lived for more than 40 years. They've lived through recessions, booms, busts, oil crises and drafts. And yet every weekend you'll find them singing, dancing and laughing with their friends.

Tuesday, May 12, 2009

Mochas and the Next Google

(Photo courtesy of Yelp)

On the corner of Castro St. and Villa St. in downtown Mountain View sits Red Rock Coffee, a local cafe where I believe some innovative and lucrative ideas are being formed. When you enter, the place looks like any other cafe with its small tables and clusters of customers waiting for their lattes.

Walk up a flight of stairs and you arrive in an open space where a decent sound system covers the tapping of laptops and the hum of conversations. Every time I'm up there working, I wonder if the guys sitting next to me are sowing the seeds for the next Google. Red Rock is just one of many local haunts around the world where big ideas are being created every day. It goes to show that despite unemployment, people are getting out there and taking risks to turn ideas into start-ups. I love the entrepreneurial spirit.

Wednesday, May 6, 2009

The Freelance Economy Is Growing

I stumbled upon some interesting data in this Wall Street Journal article (subscription required). It details the growth of the freelance marketplace based on the number listings posted on job boards geared for matching professionals to temporary projects. Some numbers according to the WSJ:

Between January and March, employers posted 70,500 of these work-for-hire positions on and 43,000 on, which represents increases of 35% and 105%, respectively, from the same period in 2008., which lists remote and on-site freelance jobs, says its average monthly postings have more than doubled to around 13,500 per month in the past year. In March, there were 750 jobs listed on, versus 400 in March 2008.

This is not surprising. From the people I talk to who are still employed, they face more work and fewer resources due to layoffs. Freelancing seems like a good opportunity for corporations who want to hire workers without paying them benefits. The article also profiles one woman who makes more money as a freelancer than in her previous salary job. Some good news for people looking to make some money while searching for their next full time job.

The article also gives tips on how to get started on freelance sites:

1. Be specific about your skills and expertise.
2. To set your rate, research how much experienced freelancers charge by looking at their profile pages. Then set your rate slightly lower if you're starting out.
3. Start small. Offer a few hours of work to prove yourself.
4. Negotiate your work with employers over the phone. The personal touch adds a level of trust.

Monday, May 4, 2009

Tapping the Skilled Volunteer Pool

I've been trying to volunteer more. So far this year I've hacked away vines and bushes along a San Francisco sidewalk, planted native shrubs in the Palo Alto wetlands, and distributed food to needy families in Daly City. I've learned a lot about ways to serve the community, and the experiences have made me think about the way non-profits are run. I've seen some effective non-profits and some not-so-effective ones too.

Based on my experiences I have developed an idea. Given the state of our economy and number of people out of work, non-profits can improve their operations by tapping the pool of highly skilled workers who are unemployed. There are scores of marketers, salespeople, designers, financial planners, consultants, programmers and engineers are out there waiting by their phones, scanning job boards and wasting away watching Tivo. While finding a job should be their top priority, I think unemployed professionals would jump at the chance to help non-profits if opportunities were presented the right way. Here are some suggestions:

1. Make them easy to find
There are some great online resources for people to find volunteer opportunities. In the San Francisco Bay Area, organizations such as Hands On Bay Area and One Root have searchable databases that allow people to sign up for an event online. Other national organizations such as USA Service are pretty good too. Most of these events are focused on unskilled, but essential, work to help their cause. What if non-profits posted needs for professional services?

2. Offer projects
Demand for professional services should be packaged as projects rather than one-timers or open-ended engagements. Unemployed professionals are afraid to make long-term commitments, fearing time away from focusing on their job search, and one-timers would offer marginal benefit to non-profits. A specific engagement with a clear idea of time commitment and duration would help people balance their schedules and manage their resources better.

3. Build skills
Many unemployed professionals don't realize volunteering can build skills that make them more appealing to potential employers. Let's say a non-profit needs help in building out a fund raising plan. Highlighting the skills one could develop (strategy, negotiation, marketing) offers a clear motivation for volunteers.

4. Give recommendations

Once the project is over, offer to write them recommendations on their Linkedin profile. It's a fair value exchange. They offer skilled professional services for free, non-profits offer an added bonus to the volunteer's online resume.

What do you think? Do you have any ideas about how non-profits can take advantage of this skilled labor glut to help them improve their operations? Write a comment below.

Tuesday, April 21, 2009

In Praise of Susan Boyle

For the past week I've been bombarded by references, Facebook badges, Tweets, news stories and raving blog entries about Susan Boyle, a contestant on the British equivalent of American Idol. Her not-so-attractive mug appeared everywhere I surfed on the Web. I avoided watching her clip, certain she was the reincarnation of William Hung. Sure, it's fun to laugh at people who suck. But we're in desperate times and need to see people triumph over the odds rather than succumb to their misfortunes. So on Sunday night, after finishing up some work and itching for some quick entertainment, I found a clip of Boyle's audition to figure out the fuss.

The video I embedded is the longer version containing the introduction to her audition. The clip sets up a storyline that I speculated: an unemployed, working class woman from a village searching for her 15 minutes of fame. I and everyone else who laid eyes on Boyle expected her to be a lousy singer, driven by delusional aspirations of stardom. Notice the expressions among the audience members and the judges in the packed auditorium. Simon Cowell visibly exhales his eyes when he sees Boyle, and bulges his eyes when she tells him she's 47 (skip to 1:28). People in the audience look around uncomfortably and whisper to their friends. The co-hosts mimic her when she shakes her hips. There stands a women, all alone, blanketed in the spotlight, facing a crowd sharpening their knives to shred her ego to bits.

And then she sings.

In a split second her voice pulls everyone watching her-- in the auditorium, at home, on the computer-- onto the same level. All the labels about her status, her appearance, and her future are gone. Comparisons are meaningless. Within seconds the audience rises to its feet and every face is plastered with a guilty smile. Some sigh in relief. Simon, who plays the role of cynic but deep inside is a softie, beams with wonder and amazement.

Why am I writing about Susan Boyle? She's a reminder of how cynical I have become, and how universally refreshing it is to see someone so human and so brave. And there's something therapeutic about singing.

A few years ago while visiting my parents in Massachusetts, I came home to find my mom standing in front of the TV singing karaoke (I think she was singing Billy Joel). During a pause between verses she turned to me, in mid-hip shake, and declared into the microphone in Mandarin, "Chang ge zi bai bing!", which means "Singing cures a hundred illnesses!" Amen to that.

Friday, April 17, 2009

Check Me Out on

Here's a link to my blog post on about unemployment survival tips. If you've just arrived from Mint, hello and welcome to Gloom to Boom!

Monday, April 13, 2009

Everybody Loves Oil

As part of my ongoing quest for knowledge during the downturn, I started another course at Stanford called "What's the Real Deal with Oil, Gas and Coal," taught by Prof. Margot Gerritsen. A mathematician by training, her academic career has evolved towards studying ways to make energy extraction and production more efficient and environmentally friendly. An opinionated realist, she agrees in the need for alternative energy, but believes in a more immediate need to improve our management of fossil fuels.

I respect Gerritsen's perspective, especially when looking at the chart that she provided above. Yes, we must reduce our dependency on oil imports. Yes, we need to make up for eight years of lost time. Yes, I believe that American ingenuity can turn alternative energy into a viable option. But let's put the cart in front of the horse.

I've been noodling on this chart for the past couple of weeks because it's revealing. We hear policy wonks in the Obama Administration talking about a 10-year window to reduce the U.S.'s dependence on oil imports from the Middle East and Venezuela. Here's how the Obama Administration plans to reach that goal.

Very noble. But I wonder if, according to Gerritsen's chart, the American thirst for oil could nullify any policy towards greater fuel efficiency. I can understand the economic incentives, but I'll bet the policies required to make this work will move at a snail's pace through the political landmines in Congress.

The solution for now is simply to use less. Complain all you want about politicians and red tape. If you want to stop our reliance on foreign oil, you can either reduce your own oil consumption and/or consider new ways to extract oil in the U.S., which includes opening up ANWR, re-opening off-shore drilling, or selling swaths of the Rocky Mountain range to shale extractors.

Easy solutions, tough choices.

Friday, April 10, 2009

The Price of Marriage

Ah, the wedding industry. My fiancee and I are in the midst of this dance and dealing with the shock and awe of sticker shock. Despite the economy, we haven't seen a massive price reduction in the San Francisco Bay Area among venues, caterers or other services. You'd figure, given the 10% unemployment rate in California, that wedding services might show greater price flexibility. Here are my theories about why we're not experiencing bargains.

1. It's still the Bay Area
All those hills, beaches, forests and vineyards provide enough of a compelling backdrop that demand remains high. I spoke to a wedding coordinator yesterday at a local winery who said despite the bad economy, people still want to spend a lot of money getting married.

2. Expectations for a 2010 recovery
Some venues are giving deals 2009, but returning to their original prices in 2010. It's an interesting dynamic because both consumers and vendors anticipate greater spending next year. If you're desperate for a deal, throw a wedding in December 2009.

3. Maybe I'm just a bad negotiator?
This crosses my mind a lot. Maybe I'm giving in too easily. I should turn over my duties to Ellen, who negotiates for a living. I hope she's reading this. But, I bet the real reason why the wedding industry refuses to budge is because of the next point.

4. They're all in cahoots
Every month, a cabal of caterers, wedding venues and photographers meet to fix prices and gouge consumers. "This month we're going to double the price of halibut!"

On a separate note, this is a funny visualization that I stumbled upon the other day. It shows what kind of engagement ring people of various incomes can afford to buy based on two months of their annual salary. I had no idea lifeguards could afford such nice rings!

Tuesday, April 7, 2009

Why I Stopped Listening to NPR

I stopped listening to NPR because it's a downer. Let me rephrase-- it's a big Debbie Downer.

This is a big step for me because I've been listening to NPR since high school. I give money them money and I use their messenger bags: one from WNYC in New York and another from KQED in San Francisco. Sometimes if I wake up before my alarm, I turn on NPR and lie in bed half-asleep listening. I subscribe to their podcasts, blog about their shows, and scan headlines from their Websites on my RSS reader.

But as of a week ago, I stopped listening. NPR has become a Debbie Downer.

I understand it's important to report about unemployment, the economy and foreclosures given this unique moment in history. My issue is with their commentators and reporters, who sound like manic-depressive Chicken Littles. "Things are bad! They're getting worse! We're all doomed!!" In some ways I can't blame them. As a former news reporter, I can understand how reporting this financial crisis could get emotionally draining, especially if you're talking to people whose lives have been negatively affected by the downturn. But this tone isn't helping our recovery.

This blog was created on the premise that 1) what goes down must go up, 2) where there's crisis there's also opportunity, and 3) the first step to recovery is psychological. Maybe I'm naïve, but I do believe dread breeds paralysis, and paralysis stifles productivity and creativity. Pulling ourselves out of this recession means good old American ingenuity and optimism.

Goodbye NPR (for now). Hello classic soul and R&B.

Tuesday, March 31, 2009

The Government Wants YOU to Be Happy

Feeling gloomy about the economy? Never fear, the government is here! Yes, the government, which wants to fix every cog in our sputtering economic system, is here to help you deal with the stress and anxiety of your situation. The Substance Abuse and Mental Health Services Administration has put together an online guide called "Getting Through Tough Economic Times" to help people identify and deal with health risks associated with financial anxiety. The site is almost as fun to visit as the California EDD (EDD has an edge thanks to the reassuring portrait of Arnold). In case you were wondering about the signs of concern, here's SAMHSA's list of warning signs that you or your loved one is going through tough times:

* Persistent Sadness/Crying
* Excessive Anxiety
* Lack of Sleep/Constant Fatigue
* Excessive Irritability/Anger
* Increased drinking
* Illicit drug use, including misuse of medications
* Difficulty paying attention or staying focused
* Apathy - not caring about things that are usually important to you
* Not being able to function as well at work, school or home

Then the site provides some quick tips on how to cope. These are entertaining:

* Trying to keep things in perspective - recognize the good aspects of life and retain hope for the future.
* Strengthening connections with family and friends who can provide important emotional support.
* Engaging in activities such as physical exercise, sports or hobbies that can relieve stress and anxiety.
* Developing new employment skills that can provide a practical and highly effective means of coping and directly address financial difficulties.

Honestly, I think this is a good service. It recognizes that times are tough, and makes an effort to help people deal with an overwhelming sense of anxiety gripping the nation. I've written a couple entries on the things you should doand should not do during unemployment. Taking a step back, I believe the engine for our recovery is partially political, partially financial, and mostly psychological. For the majority of us watching and waiting for things to turn around, the psychological element is so important to manage.

Thursday, March 26, 2009

Layoffs at Google

UPDATE 1:05PM: Here's the blog post about the cuts, penned by SVP Omid Kordestani.

Changes to our sales and marketing organizations

3/26/2009 12:20:00 PM
Google has grown very quickly in a very short period of time. When companies grow that quickly it's almost impossible to get everything right—and we certainly didn't. In some areas we've created overlapping organizations which not only duplicate effort but also complicate the decision-making process. That makes our teams less effective and efficient than they should be. In addition, we over-invested in some areas in preparation for the growth trends we were experiencing at the time.

So today we have informed Googlers that we plan to reduce the number of roles within our sales and marketing organizations by just under 200 globally. Making changes of this kind is never easy—and we recognize that the recession makes the timing even more difficult for the Googlers concerned. We did look at a number of different options but ultimately concluded that we had to restructure our organizations in order to improve our effectiveness and efficiency as a business. We will give each person time to try and find another position at Google, as well as outplacement support, and provide severance packages for those who leave the company. Finally, I would like to take this opportunity to thank everyone affected for all they have contributed to Google.

Posted by Omid Kordestani, Senior VP, Global Sales and Business Development

UPDATE 12:15PM: I just heard the layoffs are not huge and will affect primarily the online sales organization, which comprises Adwords and Adsense.

Here's something gloomy. I just got word from a source that Google is going through workforce reductions numbering in the hundreds. Not sure how many will be affected, but these changes will affect full-time staff. My source says some positions have been eliminated while others are being "reassigned," meaning they will have 60 days to find a new position within the company. If they can't find anything, they will lose their jobs.

Google has gone through a few rounds of cuts recently. Earlier this year Google cut 100 recruiters and trimmed down its radio advertising team. Late last year cut 10,000 contractors. It seems no company is recession proof.

Managing Time, Wasting Time

This is a great article from the Simple Dollar blog that contains helpful tips about time management. The world we live in is full of "productivity" applications that can easily turn into productivity destroyers. The immediacy and volume of emails, instant messages and Facebook posts can turn a good, productive vibe into a two-hour diversion with nothing to show in return. Check out some of the great tips in this blog post. It's a fun read.

Thursday, March 5, 2009

John Stewart vs. Rick Santelli

A few weeks ago I wrote an entry about CNBC personality Rick Santelli's rant against the government's plan to bail out homeowners (he called them "losers"). There have been a number of responses to Santelli's rant, such as the thoughtful piece by the New York Times's David Brooks.

Leave it to The Daily Show to take it to the next level. Note to self... if I ever become rich and famous I'll never dis David Letterman or John Stewart. Enjoy.

Hi Mom, All Is Well at Laid Off Camp (Part 1)

Unemployment is like summer vacation. The first day of liberation feels like you've broken out of prison. But in a couple of weeks you find yourself in a trance from too much sleep, too much TV and feelings of guilt for not doing more with so much free time. That's why the idea of camp for the growing number of pink slipped professionals is such a brilliant idea. Pry people away from the TV and throw them in an urban playground to run around with adults in a similar situation.

On Tuesday, I attended Laid Off Camp, a hastily organized, ultra-casual, all-day event in San Francisco. Laid off Camp was started by Chris Hutchens, a former consultant and banker who was laid off in December, as a way to bring people together to share survival tips, network, and maybe find the right business partner to start a company. Modeled after Bar Camp, attendees sign up to present on any topic of choice, such as networking techniques, budgeting, health care, freelancing, creating your own start-up, time management, and personal branding. Most of the sessions were informal and centered on discussions. Some were given by sponsors and were blatant attempts to acquire new customers.

While I was staring at the schedule (a hand-drawn grid with session titles written on sticky notes), I bumped into my friend Jackie Gu, who was laid off the previous week. In the spirit of spontaneous collaboration, Jackie and I decided to join forces to divide and conquer the event. She wrote about her impressions and insights on her new blog, called Unemployment Muses. Here are the top 5 things Jackie learned from Laid Off Camp (I'm still working on my list, so stay tuned):

Jackie Gu's Laid Off Camp Musings:

1. Whatever you're struggling with, know that you are not alone.
There were hundreds of jobless people just like me at Laid Off Camp and as I mingled among them, I realized we all feel the same desperation, face the same struggles, and deal with the same interferences such as self criticism, doubt, and self-defeating behaviors that prevented us from doing our best in the job search process. And as long as we are aware of what these interferences are and are forgiving toward ourselves, we can conquer the mountain by moving forward with each small step.

2. Networking is not about "What can you do for me?" but "What can I do for you?"
The most useful workshop I went to was held by network guru Edith Yeung. She told us to be specific in who we'd like to meet when networking, asking ourselves the "what do I want" question first before someone else does and we're at a loss for words. Most importantly, it's necessary to ask your contact how you can help them instead of asking them for help right away. Always be willing to be able to provide a service or value to your network leads, and be real and genuine. That's the kind of impression you want to leave your contact and being helpful goes a long way!

3. Clean up your online reputation & delete the junk from your profiles.
This may be an obvious one, but how many of us still have public Facebook profiles with borderline indecent photos from last night posted and visible for all to see? Perhaps you're not even aware what your Google search results are, but it's time to look, and do a mass clean up. You betcha recruiters and hiring managers Google you to see who they are dealing with. An old friend of mine went to an interview and the hiring manager already knew his blog handle and content and even asked him about my own blog handle as I was a frequent commenter. Scary right? Whatever you put out there is public so let's make sure each of your profiles reflect the professional image you want to portray. A good tip is to make each profile content (Linkedin, Facebook, Twitter, Blogger, Livejournal, etc.) consistent and update with the same photo of you.

4. Utilize the power of communication.
Each of us are individuals with unique needs, interests and hobbies. So why not communicate who we are during our job search too? Start a blog or Website about your passions, hobbies, and be a topic expert. Start commenting in forums and discussions. Twitter industry and career relevant news that turn heads. In the same token, if you have nothing of value to communicate, it's better to be silent than to status update everyone on what you had for breakfast. Okay, so I need to work on that last one too. Just remember, the Internet is very public and once you click submit, it's out there so what do you want 'em to read that's associated with your name?

5. Don't get discouraged.
Focus on the journey not the destination. Okay this really isn't a sarcastic remark, yes, we will all get discouraged along the way, but overall, we need to have faith that being unemployed is only temporary. It too will pass just like most things in life, so let's try to "enjoy" it as much as we can. Schedule naps, fun activities, and workouts during the day to break up the job search tasks. Go to network events and join a support group. Take a class you always wanted. Go out on a limb and dare to do something a little different because you can, now is the time to try something else and be adventurous. A job will eventually come and then you wish you made the best with your time off - so go make the best of it now.

Tuesday, March 3, 2009

Give Giving a Try

Last week I did something I've been telling myself to do for a long time. I spent an afternoon at a community center giving food to needy residents in Daly City, CA. It wasn't too labor intensive despite my empty stomach. And in this time of gloom, there's nothing more human than handing food to a family trying to make ends meet.

Volunteering hasn't come easy for me because I find many excuses not to do it. I'm too busy meeting contacts, rushing to prepare for interviews, or wasting time playing video games against my roommate (so lame). A couple weeks ago I decided it was time to stop talking and start doing. I contacted Second Harvest, a Bay Area non-profit that works with local community centers to distribute food to families in need. I found an opportunity and signed up to become a volunteer. Then I bit my tongue and resisted all temptations to bump it off my schedule.

The volunteer gig was located at Lawson Hall in Daly City, a small community center nestled next to the Cow Palace and Candlestick Park. San Mateo County supports centers like Lawson Hall to offer food assistance to residents working low-wage jobs and families affected by unemployment. Once a month, people who qualify for assistance can receive an allotment of food consisting of fruit, veggies, frozen meat, milk, pasta, rice and bread. Residents who volunteer at the center get first dibs at the food, and can take home any leftovers, which seems like a good deal.

When I arrived, an organizer named Jeff assigned me to a stations where I unloaded small cartons of milk and arranged them on a table. That's where I met a volunteer named Ada. She recently got laid off as an office worker with the county's park and recreation department. Losing her job was tough. Being away from her co-workers and the residents she served was tougher.

"I loved, loved, loved, loved that job," she admitted to me.

When we opened our doors at 4:30 I expected a mad rush to the tables and a quick destruction of my milk carton layout. Instead, families filed into the center with boxes and bags to collect their goods. At each station, volunteers handed a set allotment of food. Another volunteer at my station named Maria devised an efficient system where she grabbed the items at my station and loaded peoples' boxes and bags for them. By the time they got to me I just flashed a smile, murmured "los huevos," and handed them a dozen eggs. They got a kick out of hearing a few phrases of Spanish from the Asian guy, but would answer me in perfect English.

Many families that showed up were Asian, most from mainland China. A community organizer at the event named Jacki told me about that the growing number of Asians moving into Daly City has exposed a need for more volunteers with Asian language skills. I figure that might be a calling for me to get more involved.

By the time the last family trickled through the center, I thought of one word to describe the event—gratitude. As a newcomer and an observer, I could tell from the actions of the volunteers and the expressions of the families that gratitude flowed in both directions. The volunteers seemed grateful to give to their community, and the families received their gifts with open hearts. It's a concept that's so elemental to what it means to be a human, and something that affirms why we're here. So if you're sitting at home worried about your future or burdened by the pressures of the present, consider an act of gratitude. It's in your nature.

Tuesday, February 24, 2009

When Timothy Met John

Check out this great post by my good friend Ed Lee. It's a one-act play about an encounter between two economists grappling with the parallels of their respective eras. Presenting "Timothy Geithner Talks It Out With J.M. Keynes" in one act.

When he's not imagining quant jock dialogue, Ed's hanging out in Brooklyn living off the millions he made writing about Korean gangsters.

Friday, February 20, 2009

With Respect to David Brooks

In previous posts I expressed my distaste for the hyperbole spewing out of the news media. Such was the case when I highlighted Rick Santelli's outrage about Obama's mortgage plan. His point: Why should responsible homeowners help their neighbors (he calls them "losers") who over-extended themselves and are now buried in debt? "This is America!" he screamed. Then made some odd reference to pre-Castro Cuba when people lived in mansions and drove nice cars.

Santelli joins thousands of voices from the left, right, center and far-out are passing judgment and wagging their fingers to everybody else. "Shame on you." "No, shame on YOU!"

Then, out of the echo chamber, comes a voice of moderation that people probably won't hear. That voice is David Brooks. He's the "conservative" member of the New York Times op-ed team, although he's too moderate to be considered conservative. He he stands on a foundation of morality that believes society thrives when government functions with an enlightened purpose. Government isn't the solution, but it has a moral obligation to become a safety net in hard times. So when our systems fail from their complexity, governments must fix the system if consumers and businesses can't. Sometimes that means helping out the schmucks who messed it up.

Check out his op-ed piece today titled, "Money for Idiots." Here's an excerpt:

"The nation’s economy is not just the sum of its individuals. It is an interwoven context that we all share. To stabilize that communal landscape, sometimes you have to shower money upon those who have been foolish or self-indulgent. The greedy idiots may be greedy idiots, but they are our countrymen. And at some level, we’re all in this together. If their lives don’t stabilize, then our lives don’t stabilize."

Thursday, February 19, 2009

Santelli Gets Angry. Do You Care?

CNNC's Rick Santelli gets nasty during his stand-up at the Chicago Board of Trade. His target: the $275 billion Homeowner Affordability and Stability Plan that Obama announced yesterday. His basic gist: Screw the struggling homeowners who can't pay their mortgages to prevent more foreclosures! Screw the government for turning our country into a socialist state! We're angry because we shouldn't be forced to give a dime to other peoples' irresponsibility!

I'm all for fiscal responsibility. I'm all for capitalism. But watching CNBC these days is quite an experience. The financial world seems happy to point fingers at everyone but themselves, and blaming the guy who defaulted on his NINA loan falls on deaf ears, especially coming from an industry that invented the Collateralized Debt Obligation.

Fine, Wall Street. Blame it on the defaulters. Blame it on the government. Blame it on the Federal Reserve. We can empathize with your suffering.

The Meltdown Visualized (Break Out The Popcorn)

G2B reader Oy Polloi (is that you Pei?) just sent me this brilliant video visualizing the credit crisis. Yet another way to use simplicity to explain complex, systemic issues.

Part 1:

Part 2:

For those of you seeing a longer, more journalistic narrative of the crisis, check out Inside the Meltdown, Frontline's hour-long report that aired earlier this week. It's a piece that explains the financial, political, and emotional forces that nearly brought down Wall Street.

Say what, Mr. Greenspan?

Alan Greenspan, a devout libertarian from the church of Ayn Rand (that's her posing), gets in touch with his socialist side in this article from the Financial Times:

”It may be necessary to temporarily nationalize some banks in order to facilitate a swift and orderly restructuring,” (Greenspan) said. “I understand that once in a hundred years this is what you do.”


Here's a better quote from fellow Republican Sen. Lindsay Graham from South Carolina:

“We should be focusing on what works,” Lindsey Graham, a Republican senator from South Carolina, told the FT. “We cannot keep pouring good money after bad.” He added, “If nationalization is what works, then we should do it.”

I've been trying to keep up with this debate about nationalization. It means the government will take the leading role in identifying which of the big banks are insolvent and then stripping out their bad assets into a separate "bad bank". On the positive side, we can once and for all end the slow death spiral among these too-big-to-fail banks. On the negative side, shareholders of these banks will get hosed.

Wednesday, February 18, 2009

Washington and Silicon Valley Need Each Other

The Personal Democracy Forum, an organization that examines how technology and politics can work together for change, poses and interesting question. Can the government attract Silicon Valley talent? The piece references the use of technology during the 2008 campaign and the new Google office in Reston, Va. as a couple proof points for a cozier partnership. But the post misses a significant point. It's about infrastructure.

The latest stimulus package puts a huge emphasis on infrastructure, and politicians from both sides of the aisle have touted the benefits of "shovel-ready" projects to build roads and bridges. It goes beyond that. The real question to ask is whether Washington can reach out to Silicon Valley to help modernize our nation's systems. We are posed with a choice. We can build like we're in the 1930's or build like we're in the 21st century. If the answer the the latter, then Washington needs Silicon Valley, and it must come up with appealing ways to attract the Valley's spirit of innovation and creative problem solving.

Check out yesterday's piece in the Wall Street Journal called "Smart Roads. Smart Bridges. Smart Grids" (subscription required). Here's an excerpt:

It's time the U.S. got a lot smarter.

Federal, state and local governments are about to pour tens of billions of dollars into the nation's infrastructure. The big question: Will we simply spend the money the way we've been doing for decades -- on more concrete and steel? Or will we use it to make our roads, bridges and other assets much more intelligent?

Imagine highways that alert motorists of a traffic jam before it forms. Or bridges that report when they're at risk of collapse. Or an electric grid that fixes itself when blackouts hit.

This vision -- known as "smart" infrastructure -- promises to make the nation more productive and competitive, while helping the environment and saving lives. Not to mention saving money by making what we've got work better and break down less often.

But fail to upgrade, advocates warn, and the country may be locked into the old way of building for decades to come.

Friday, February 13, 2009

Why I Love "This American Life"

Leave it to great storytellers to educate us about the financial crisis. Ira Glass and his gang of radio reporters have done a stellar job explaining the crisis in plain English. Their first segment "The Giant Pool of Money" provided a vivid portrait of the people involved in and affected by the sub-prime mortgage meltdown. The sequel, called "Another Frightening Show About The Economy" jolted me to slash my budget by 25%.

Earlier this year, the team reported on a brief examination of how Keynesian economic theory is influencing the stimulus package (skip to about 40 mins into the program). A couple things stuck out:

First, today's economic conditions are so unique that monetary policy (aka the Fed raising or lowering interest rates) has run its course, leaving the government the only lifeline for human intervention.

Second, there's a school of thought that the recession itself is the cure to bring us back to normal. Left untouched, the crappy economy will lower prices and home values to the point of affordability again. Very Darwinian. I wonder if it would work. Doing nothing is suicidal for politicians, but is human intervention doing more harm than good?

Third, this is the first time that a major country like the U.S. will apply Keynesian theories to correct the economy. True, FDR increased spending on public projects, but he also raised taxes and tightened the economy (which apparently drove Keynes nuts). Obama will be known as the first president to truly use Keynesian principles to right the economy. It's never been tested, so buckle your seat belts.

Five Bad Habits for Unemployment

Last week I blogged about the Five Principles for Surviving Unemployment. Thanks for all the feedback! This week, I'd like to take the opposite angle and explore the five things you shouldn't do when you're unemployed. Let's return to the mantra that a crisis is a terrible thing to waste. Unemployment is an opportunity for reinvention, albeit a painful one. Free time has been forced upon you, so you have a choice. You can make the most of it, or you can squander it.

Here are some ideas if you'd like to choose the latter route:

1. Live like you're still employed
Wake up. You're no longer a banker making bank. You're a yuppie without the "P". You and the gentleman sleeping outside Port Authority have something in common. That's ok. We've been living in an age where we've over-extended and lost our sense of smart, frugal living. It doesn't mean you have to eat beans every day, nor does it mean you have to sacrifice the things that make you happy. It's time to make tough decisions to prioritize your spending so every dollar gives you the most bang for its buck (pun intended).

Here's my tip. First consider what expenses are most valuable to you. Then test your habits by maintaining your employed lifestyle for another two weeks. Where's your money going? Does spending $150 a week at bars and clubs make sense? If you're single and prowling, spending your cash on booze may be a worthwhile investment. But in this environment, maintaining the important elements of your lifestyle requires sacrifices. Cut back on frivolous stuff and invest in what matters.

(Plug: Try using It's a service that helps you track your expenses and calculate your net worth. It's free and easy to use.)

2. Obsess over job boards
Some reasons why surfing job boards causes depression:

a) Every job posting makes you feel unqualified
b) Job search engines are labor intensive
c) Sifting through pages of job results leads to insanity
d) Posting resumes feels as effective as setting them on fire

In my previous entry "Five Principles for Surviving Unemployment," the first principle is to reignite your human network. Job boards are important and they do yield results. But I find one-on-one conversations more valuable because you get feedback and you can develop relationships that pay-off down the road. You should spend some time uploading your resume and writing cover letters. But spend more time developing face-to-face relationships with people who will help and encourage you.

3. Eat fast food
You're on a budget. Great. You're watching our expenses like a hawk. Smart. But your solution to cutting your food expenses by 50% is the McDonald's drive-thru? Hmmm. Sounds like a good idea until one night your date keeps complaining about that strange scent of McNugget. Oh, and that bike tire around your waist has become a radial. Look, you've got more time on your hands, so spend it on better habits such as cooking and buying healthier food. Saving money forces you to be creative, and there's nothing redeeming about munching on your fourth In-N-Out Double-Double in a week.

4. Succumb to your vices
I'm a sucker for video games. One Monday during my first month of unemployment I flipped on my dusty PS2 and popped in a video game I hadn't played in years. Time warp four days later and all I had to show that week was a body count of a couple hundred digital terrorists and a grouchy attitude from a lack of sleep.

With so much free time in your hands and the stress of unemployment, it's easy to turn bad habits into worse habits. Pay close attention to your vices. Sometimes they're necessary to blow off steam, but beware of the slippery slope.

5. Retreat into seclusion
Benjamin Franklin once drew a cartoon of a snake cut into pieces with the names of the colonies printed on them. The caption read, "UNITE or DIE." Franklin's wisdom rings true in these times, especially during these dark moments of unemployment, financial collapse, etc. The surest way to get whacked by this crisis is to believe you aren't good enough to emerge stronger. Being alone and at the mercy of your brain will keep you down.

We can learn a lot from Ben Franklin. He was a master at gathering people with similar interests. He started the first nation's library at the age of 27 by bringing his friends together to share their favorite books. If you have a lot of former colleagues in the same boat as you, get together with them over a meal or a beer. Earlier this week my roommate Alex kicked off a new series of boozing events called "Recession Doesn't Mean Depression Happy Hour." His tagline: "Yes we can!" I love that. Thumb your nose at the face of this crisis and celebrate for the sake of being alive.

Got some tips of your own? Feel free to comment below.

Thursday, February 12, 2009

Marx Predicted Our Crisis!!! (Or Did He?)

Fascinating buzz in on the blogosphere about a phony quote from Karl Marx that's making its rounds on Wall Street. In Nostradamus fashion, the ghost of communism portends an inevitable future:

"Owners of capital will stimulate the working class to buy more and more of expensive goods, houses and technology, pushing them to take more and more expensive credits, until their debt becomes unbearable. The unpaid debt will lead to bankruptcy of banks, which will have to be nationalised, and the State will have to take the road which will eventually lead to communism (Das Kapital, 1867)"

What's causing such a hissy? Some left-leaning bloggers think greedy capitalist bankers are using this as a rally cry against government regulation of their industry. Here are a couple posts if you're interested. You be the judge:

Faux Marx
By Meagan McArdle, The Atlantic

Did Marx predict the current economic crisis?
By Bryce Edwards, liberation

Wednesday, February 11, 2009

Feeding the Beast

I've been thinking about America's appetite for consumption. We love buying cheap goods from abroad. We're a country that runs a trade deficit that dwarfs the combined deficits of the next 9 countries ranked after us. But what does this mean for the developing countries that feed us?

Last night, my economics professor Jim Howell recalled an encounter with a Chinese official a few years back. He asked the official how long China could maintain selling low-priced goods to the West. The official replied, as long as Chinese workers are paid 42 cents a day.

My good friend Mo has been thinking about this too. Mo and I taught English to bored college students in Shanghai in the late-1990's. He went back a few years ago to finish his Stanford Ph.D., but discovered a different calling away from academia. He's now at the center of Chinese pop culture directing reality dating shows, and maintains a keen eye on Chinese-U.S. relations. Here's Mo's take on this subject:

"The fact is, people in the US and parts of Europe live in relative luxury because of the sickening exploitation of people in other parts of the world. The rich in every country benefit from this exploitation, and the US is the richest country in the world, per capita. As Philip K. Dick wrote, albeit entirely in a different context, the Empire never ended. In this case, I mean the British Empire which transitioned rather smoothly into the American Empire. How are the methods of companies like Halliburton different than the East India Company? Technology changed, faster than anyone could imagine, but infrastructures and economic behavior on a global scale hasn't yet matched that change.

And by the way, I'm not totally being down on the imperial system, I mean, it gives us great stuff like TiVo and iPhones and satellite radio and the NBA, etc etc etc. I like the stuff! I hate the system. It's a terrible moral quandary.

China is in a fascinating position because China has tried to position itself, in the post-Soviet world, as the alternative to American imperial power. China recognizes that the power of the British Empire, and that of the American Empire, is three-fold, and that the obvious element is the least actually important. 1. Military. 2. Economic. 3. Cultural. China tries to combat the US on all three points, but obviously lags far behind vis-a-vis American cultural supremacy. I mean, even the French, for all their great technical filmmaking personnel, have sort of given up to the Hollywood movie model in the past few years, because it makes money!"

Tuesday, February 10, 2009

How Barry Got His Groove Back

I'm watching President Obama's town hall meeting in Fort Myers, FL. He looks like Obama the campaigner. He's relaxed. He's joking around with the audience. He's walking with a swagger. He's in his element. In White House press conferences and photo-ops Obama looks dreary-eyed and sleep-deprived. I would too if I was forced to live in DC.

On one level he's being his usual long-winded self by trying to explain the macro-economic forces of our current crisis. But he succeeds by connecting the complex with the relevant.

While Obama isn't introducing anything new, this town hall meeting underscores his skill as a communicator. He boils down systemic issues such as energy grids and rural broadband access into singular outcomes such as jobs and commerce. He harnesses the winds of public opinion to power his message. He adds a level of accountability by asking his audience to judge him by his one success metric: job creation.

There's still a populist in him, and I worry he's just telling people what they want to hear. One woman named Henrietta Hughes could barely speak when she got up to the microphone. She begged him for help because she had no job and had lost her home. Obama walked down and hugged her. The crowd stood up and cheered. One woman in the audience looked like she was at the Kentucky Derby, shaking her fists as Obama walked towards Hughes.

Here's his most salient sound bite: "This is about turning crisis into opportunity." So true, given his set-backs since taking office (Republican rejection, Daschle tax evasion).

Friday, February 6, 2009

5 Principles for Surviving Unemployment

Take it from a guy who got whacked twice in 2008-- unemployment is scarier when you're employed. The threat of being let go, the insecurity of being below the cut-off line, the paranoia of every passing glance from your boss is paralyzing. But once the axe has fallen, the experience of unemployment can be liberating. It's pretty nice to wake up at 9:00 and blog in your sweats (ahem… cough).

Sure, unemployment can suck because the ego blow makes you feel like a schmuck. But this is no time to be a Debbie Downer. To quote our diminutive White House Chief of Staff Rahm Emanuel, "You never want a serious crisis to go to waste." Once you deal with the setbacks of unemployment, turn your attention to the opportunities because they're everywhere. Here's my list of the top 5 ways to make the most out of your unemployment.

1. Revive your human network
You've amassed a database of friends, acquaintances, business partners and former colleagues. Take some time to consolidate your phone lists, refresh your social networks and sift through your back-log of Facebook and Linkedin friend requests. Find any means to connect with the people you've been meaning to catch up with for years, but never had time. Then meet up over a meal or a beverage to to pick his or her brain for career guidance. Three things usually happen over a casual meal: 1) Your contact will chatter away because people love spreading career wisdom, 2) You get new ideas about your career, and 3) You get a free pity meal (especially if you talk about the experience of being unemployed).

2. Learn to manage your money
Throughout most of my career I thought budgeting was for those goodie-goodies who studied on Friday nights in college. Now I've become a number-crunching, nerd. After my first layoff, I poured my attention into learning the essentials of personal finance and disciplined budgeting. Keeping daily track of my spending opened up new and creative ways to save money and to prioritize the value of each dollar spent. It also revealed how much useless crap I was buying. Thanks to my change in behavior, I created a strong safety net to deal with my second layoff.

3. Feed your brain
A mind is a terrible thing to waste. Feed your brain new meals. After years of sitting in front of a computer for 10 hours a day stale offices, you'll fall in love with your brain's ability to absorb new information. Explore new ideas. Read books. Watch artsy films. Take a class in a topic that you wish you took in college to get your gears spinning.

4. Get fit
This is crucial. Stagnation is the greatest enemy of the unemployed. Yes, it's great to sleep 10 hours a day, but lunch shouldn't be your first meal. To keep your body moving you need to move it. If you're not an exerciser start with modest stretching and introduce a daily walk around the block. For me, exercise is a welcome hiatus to recalibrate and gain perspective on my day. My afternoon run helps remove clutter from my deluge of to-dos. You've got time on your hands, so you might as well improve your health before plugging into your next cubicle.

5. Serve others
There's no better way to gain unemployment enlightenment than pouring your energy into something selfless. It's an innate human quality to give without expecting something in return, and it brings perspective on what really matters in life. On a personal level, I volunteer at a homeless shelter a couple Saturdays a year (not much). Having a conversation with people who are down on their luck is humbling and I learn a lot from every conversation. Here are some good sites as a starting point: Hands On Bay Area, Volunteer Match, One Brick, USA Service.

Thursday, January 29, 2009

Don’t call it a stimulus

The more I read about Obama’s $819 billion stimulus plan, the less I’m inclined to call it a stimulus plan. And that’s ok.

Call it the Long-Term Investment Plan of 2009. Or call it the State Safety Net. Better yet, how about the We’re Democrats, We’re In Control Plan.

But it’s not the short-term jolt that many lawmakers and economists are asking for. If that’s what Obama wanted, he would’ve taken the Bush approach by sending more affluent households a check (although a good portion of the Obama plan comes in the form of tax cuts for lower-income families).

Nevertheless, I’m a big supporter of the long-term uses of the money, especially on education, technology and energy. Let’s face it, our current economic situation represents a painful spring cleaning. And if we invest our money wisely in programs that provide a long-term competitive edge, we could emerge from the ruins as a more productive nation built on a foundation of ingenuity and innovation. That comes from investing in our skills and smarts.

I'm still processing all these moving parts. If you're also processing, check out some of these great resources:

American Recovery and Reinvestment Act of 2009
If you're planning on locking yourself into seclusion for a few days, you can read the plan in its 647-page entirety.

NY Times economic stimulus guide
For the rest of the working world looking for a less wordy breakdown, this guide provides a great explanation set against context and history. Highly recommend.

Pelosi's breakdown of the plan's main points
You can even watch her flaunt the Democratic party's majority rule. Beware, Madam Speaker. Tom Delay's hubris still haunts the halls of Congress.

Obama's benchmarks for success
Keep the administration accountable with this cheat sheet.

A fair and balanced proposal from an ex-Bushie
Lawrence Lindsay provides a rebuttal in the form of a greater payroll tax cut. Subscription required.

Tuesday, January 27, 2009

A stimulating look at past recessions

The New York Times Web site posted an informative series of audio narratives from three economists about how U.S. presidents have used Keynesian ideals in their stimulus plans (although some won’t admit it). The discussions show an interesting dynamic. Presidents want to make their mark on the economy by pumping money into the system or cutting taxes, but oftentimes it’s the Federal Reserve’s actions that make a bigger impact.

This is a good history of the relationship between monetary policy (via the Federal Reserve) and fiscal policy (via the government) in solving U.S. economic problems. Check it out.

Monday, January 26, 2009

Stimulus and swine

As I’m following the debate around Obama’s economic stimulus package, the aphorism “one man’s terrorist is another man’s freedom fighter” keeps ringing in my head. In this case, is one man’s stimulus package is another man’s pork?

The front page of this morning’s Chronicle raises this question. Check out the handy chart at the bottom of the article that shows where the $825 billion in taxpayer money will go.

Much of the money could yield longer-term returns through greater energy efficiency and more better computer systems. But $200 million in renovations for the National Mall, $44 million for repairs at the Agriculture Department, and $426 million to construct facilities at the Centers for Disease Control and Prevention seem weird, and only beneficial to D.C. construction companies.

At first blush, I am echoing Republican concerns that most of this money will do little to stimulate the economy. Obama’s throwing money at federal agencies that starved during the Bush administration. He also runs the risk of picking industry favorites, such as construction and health care, rather than providing relief to middle class Americans. But I’m not convinced that the Republican approach of giving a few hundred bucks in tax cuts for Americans to spend on useless stuff will help us invest for a better future.

I want to see an America that can apply its innovative spirit to fix the inefficiencies of our nation’s critical systems such as energy, food, health care, and transportation. And as a product of Silicon Valley, I’m idealistic that technology can play a big role in building a society that runs on more brains and less fuel than other countries. In order to make this work, government and the private sector must collaborate. Progress cannot be a solo venture.

Thursday, January 22, 2009

What’s up with TED?

Since the credit market hit the fan in September I’ve become an armchair economist. That’s because following our economy is more exciting than following sports. It’s unpredictable, erratic, and paralyzing even to the most brilliant policy minds in our nation.

Along the way, I’ve learned about a bunch of data points and indices, but one that’s a favorite of mine is called the TED spread. It’s not a household name, but it’s nonetheless a window into the soul of capitalism. The TED spread measures the difference between the three-month London Interbank Offered Rate (LIBOR) and the return on interest rates from the three-month U.S. Treasury bill. During normal times, the TED spread is less than 1, meaning banks are lending to each other at a similar rate to what the government pays out on interest. But these aren’t normal times.

In September when Lehman Bros. collapsed and AIG’s near-failure required government intervention, the TED spread went haywire. It shot up to 4. The chain reaction was quick. Banks didn’t know who to trust, so they stopped lending to each other. Capital stopped flowing, which meant the pool of money available to businesses dried up. Without capital, businesses had to make tough decisions by trimming jobs, paring away unprofitable initiatives or just closing shop.

Here’s the good news. The TED spread is back at the pre-Lehman levels of around 1. While it doesn’t mean we’re out of the woods, it does show things are moving again, albeit slowly. So keep your eye on TED. Where it goes, tangible action is sure to follow.

Wednesday, January 14, 2009

Three things I learned in econ class

"Many people say this is the end of capitalism as we know it."

This comment came from a woman siting in my economics class sitting three rows in front of me. This economy has created a Chicken Little in all of us (myself included). The end is near! Dooms for all of us! The worst economy since the Great Depression (I use that one a lot)!

I'm taking this class because I want to separate facts from fear. This class at Stanford Continuing Studies (only $285!) has been great. Some facts from my soft-spoken professor Jim Howell:

1. The rise and fall of the economic system always corrects towards an equilibrium of 2-4% growth. In other words, what goes down must come up.

2. The average time span for an economic recession has narrowed in recent decades, while periods of economic expansion have increased. According to the National Bureau of Economic Research, there hasn't been a recession lasting more than 16 months since the early 1980s. The most recent recession in 2001 lasted only 8 months, followed by 73 months of expansion (fueled by the easy credit that got us into this mess). On average, recessions between 1945 and 2001 have lasted 10 months, and expansions spanned 57 months.

3. The stock market is not a leading or lagging indicator of the economy. It's more of an emotional reaction to what's perceived to be true.

Maybe this recession, which started in December 2007, will buck the trend and put us in a deep freeze for more months than the historical average. But let's remember that everything that goes down in the economy always finds a way back up.

Here's the question: what are the variables that will fuel our recovery?

Battle Mode

I’m not an economist. I don’t play one on TV. I’m just a guy who’s been on the wrong side of two layoffs in a year.

Luckily I’m also a media junkie and an addict of This American Life, whose outstanding reports about the housing collapse and the credit meltdown jolted enough fear into my system that I adopted an aggressive savings plan. I remember vividly driving down 101 one Saturday afternoon listening to TAL and learning about the implications of the commercial paper market stalling. That’s when I realized my company wasn’t immune and would need to make some tough decisions. Such a beautiful day, such sobering reality.

I went into Battle Mode. I cut my spending by 25% and allocated that amount directly into savings. I reawakened my weekly budget spreadsheet and started to report every expense. I reinstated my left pocket, right pocket system (more on that some other day). I began considering options for my condo. I’m one of the fortunate ones because I reacted soon enough to build decent safety net. Some of my other colleagues were not so lucky—they had families to feed, mortgages to bear, debt to pay off.

I’m blogging about the economy because there are rays of sunlight that can break through these cloudy days. The worst thing for us to do now is to give in to the perception that we’re screwed. We’re not.

Monday, January 12, 2009

Six heads talk about Obama's stimulus plan

Some more specifics about Obama’s pending cash avalanche—also known as the American Recovery and Reinvestment Plan— through the voice of his policy team. Yesterday the administration released a video of Christina Romer, who spent 9 rambling minutes explaining how they’ll create up to 4 million new jobs through this plan. Today’s video is different. I have a better idea what his team is trying to do. I see their faces (cool… lots of minorities!). Their talking points are more focused, but some of the ideas are still vague.

Here’s a breakdown:

Mona Sutphen, Incoming White House Deputy Chief of Staff
Main point: The plan will create millions of jobs and at the same time place a down payment on our economic future.
Notes: Similar sympathetic vocal tone as a Save the Children commercial

Carol Browner, Assistant to President-Elect for Energy and Climate Change
Main points: Train workers for green jobs in wind farms and solar. Create a green economy by making fed buildings and lower-income homes more weather-efficient.
Notes: They have a point. I spent $3 to weather strip my front door and it made a difference. But how does a lower fed energy bill help the economy?

Madhuri Kommareddi, Economic Policy Team
Main points: Filling potholes creates jobs, Bush administration didn’t do jack, build more labs, expand broadband footprint.
Notes: I should’ve taken shop in high school. Who needs calculus in times like this!

Tom Daschle, Secretary-Designate Health & Human Services
Main points: Help states who are trying to provide Medicaid and childrens’ insurance assistance. Modernize healthcare IT systems as a preventative measure.
Notes: I smell a bidding war between IBM, HP and Oracle. Love the glasses, Tom.

Melody Barnes, Director-Designate, Domestic Policy Council
Main points: Fed will help schools facing budget issues. Superintendents don’t have to lay off teachers, they can keep their programs and maintain their reforms.
Notes: Do these policies give under-performing teachers a lifeline too?

Lawrence Summers, Incoming Director, National Economic Council
Main points: War on wasteful spending. Greater accountability of government through a Web site that monitors investment projects and a new board of officials.
Notes: Check out Summers’s remarks on monitoring the bailout plan from last fall.

Mona (encore)
Main points: One thousand dollar tax cut!
Notes: I know, I’ll invest it. No, I’ll put it in my savings and earn 0% interest. I know—I’ll pay of a percentage of my mortgage with it.

Sunday, January 11, 2009

Lots of data, little substance

Perception is critical in the early stages of the Obama presidency, especially when it's about economic policy. It's a tough proposition. How do you engage the public without putting them to sleep with wonk speak? People want answers, and they won't settle for platitudes about what The American People want.

It's a good idea, in theory, for Obama to communicate his policies through the voices of his big-brained advisers. Or is it?

In a posting on Obama's Web site today, Christina Romer, the chair-designate for the Council of Economic Advisers talks a lot but explains little. How will they plan create 4 million new jobs (couple weeks ago it was 2.5 million)? What does weatherizing government buildings have anything to do with the economy? How will pumping money into state coffers stimulate spending? Why will it cost an estimated $775 BILLION (some say $1 trillion)? After 9 minutes of rambling, I'm still confused.

Friday, January 9, 2009

The reality of renewal

After more than a decade of beating up flailing companies as a member of the media, and then working as a strategist for flailing companies being beat up by the media, I’m convinced that the clique about perception breeding reality is true.

No matter how much we try to fight popular perception, it has a way of transforming speculation into a nearly truthy state.

I’ve been thinking a lot about this idea in the context of our financial crisis. Last weekend as I was driving across the Bay Bridge with my fiancée, a piece by NPR’s Guy Raz hit a nerve. He was talking about some indicator revealing crappy data about the economy (big surprise). Guy asked his interviewee whether it was time for us to really panic about our sorry state of affairs, and continued to wonder whether there was any chance for recovery.

I tapped off the power button and mumbled a bunch of expletives. I was upset this doomsayer was ruining my admiration of the brilliant sunset over the San Francisco skyline. Telling people to panic, to roll over and give up, to shame them for poor spending decisions in the past, will do nothing for our country’s recovery.

Back to this perception versus reality truth-ism. There’s a halo effect to doomsday soothsaying that I’d love for someone to quantify. At Yahoo! I watched it happen before my eyes beginning in July 2006 when management announced they’d miss their deadline to launch the Panama search monetization upgrade. The story in the press and blogosphere evolved from “management messed up,” to “Terry Semel doesn’t know what he’s doing” to “Yahoo! is dead in the water versus Google” to “Terry is dumb and Yahoo! needs a new leader who’s as tech savvy as Eric Schmidt.” Down went the stock, out went Terry, in came Jerry. We know how that ended.

You can argue that public perception is a leading indicator of future issues. But maybe it just exacerbates the problem or adds a new negative narrative to the storyline.

Here we are in 2009 and I wonder where we are in the arc of perception. Are we still driving ourselves down with more negative interpretation of data? Sure, the facts are still gloomy. The Labor Department reported unemployment rose to 7.2 percent in December, up from 6.8 percent the previous month. Meanwhile President-elect Obama keeps reminding us that things will get worse before they get better, almost to make people as miserable as possible before he’s sworn into office.

I get it. I get it!

But damn it, I’ll be one of the few optimists in the blogosphere and I'll insist there’s a silver lining to this. Let’s look to the phoenix, that mythological bird that emerges from the ashes of ruin. America was built on people looking for a second chance. We love the comeback story, the beauty of renewal from defeat. Immigrants left their Old World to make a new life in the Zion that’s America to find greater prosperity through the lessons learned from their homelands.

Let’s hope the phoenix that rises is the Harry Potter breed, not the one from X-Men.