So sue me! It's been since last month to jump on and regale the web with my earnest wisdom...just a few things have been occupying my time...really...but with school starting and a big event that happened this past Friday..... and grading papers... and trying to keep my entrepreneur students awake after they eat lunch at the PLNU caf...it has been a busy few weeks...but there is much to talk about!
Yepper depper we had about 425 good folks for our Dealmakers of the Year Business Breakast last Friday at the Kona Kai on Shelter Island...and the morning sun was beautiful coming up over the city of San Diego and the boats in the marina looked great...and we spent a few hours honoring value creators in the community...good finalists and winners all...but I am very proud of the many students engaging and taking care of business...they looked great and presented the school very well...so nicely done to all of you...you can read more at...
http://www.sandiegometro.com/2008/sep/dealmakers.php and http://www.navycompass.com/content/view/809/321/ and http://www.pointloma.edu/News/Headlines/2008__DEALMAKERS_OF_YEAR__ANNOUNCED.htm
but onto other things...
SUCH AS WHAT IN THE &$?!#@ HAS HAPPENED TO MY RETIREMENT FUNDS! Arghhh!
I mean just the other day I was worth almost enough to get my 1975 AMC Pacer repainted...but now this is going to have to wait for another day...well...decade...until my accounts begin to recover...so what happened?
...it really is rather simple...we just spend too much...me included...and this country is up to its ears in debt...how much you ask?...try this on for size...
U.S. Financial Sector owes............................$16 TRILLION!
U.S. Households owe.....................................$14 TRILLION!
U.S. Non-financial business sectors owe......$11 TRILLION!
U.S. Federal Debt...........................................$5.3 TRILLION!
U.S. State and Local Governments Debt.......$2.2 TRILLION!
(reference SD Union Tribune, p. A1, 9/21/08)
We are approaching 50 TRILLION IN DEBT! And we are arguing about silly trivial things in our government...all the while other countries hostile to the U.S. are buying our debt up and...someday....someway....somehow...can act as a bully landlord to us...
....so at the end of the day we need to start blaming ourselves...for this awful mess...and yes there is plenty of blame to go around from inept SEC regulators who emphasize academic solutions over practical realities...and corrupt financial service firms and their leaders who bulked up on debt like heroin addicts...and greedy homeowners who watched "Flip This House" too many times...
WHAT TO DO?
...I really think we need to start rethinking this...and because I am a teacher I think that our colleges and universities have been failing our students miserably in this area...we are proficient at having them learn management principles and 18th century poets and attending chapel and articles of the constitution...
...but very few that I meet in college can balance a checkbook or have any idea what debt is doing to them...and why they need to wait until they have cash to buy the next thing they think they need (if we cannot persuade them that they don't really need it)...and we do nothing to emphasize the value of investing and saving and legacy creation over buying the latest X Box update...
...but we have to do this in creative ways...and I think business profs and entrepreneurs and small business owners and banks and financial institutions need to rethink this whole topic together...and develop better tools and approaches to explaing the value of delayed gratification to our youth...
...and parents need to pull their heads out of....errr...ummm....the sand...and stop modeling terrible financial habits to their families...
SO THUS ENDS THE RANT OF THE DAY!
I have posted a small article (400 words...sheesh! Tough to do!) that the PLNU newspaper asked me to write on the global crisis...I hope it helps in some small way...
We will talk later...I am going to stand by my mailbox and wait for my Schwab statements...probably postage due!
+++++++++++++++++++++++++++++++++++++++++++++++++++++++++
All of us—not just those involved in business either as students, academics or in practice—need to be deeply concerned about what is going on in the financial markets. What is occurring is the destruction of over 100 years of the financial system of the United States. This is no mere academic exercise, as I have heard the phrase used by several commentators this past week that we are “on the verge of a Depression.” Couple this market turmoil with the protracted California state budget deadlock and the issue is driven home even further, for grants, reimbursements and government services are drying up.
What caused this? While there are many nuances to the crisis there are several prime culprits including greed (not just on Wall Street but among all of us in accumulating entirely too much debt for homes, cars, vacations, etc.); lack of governmental oversight and leadership through the Securities and Exchange Commission especially as relates to trading abuses; woefully inadequate lending standards for home purchases through much of this decade with little concern for the ability of the borrower to pay the loan back; and the lack of fiscal transparency by some investment banking firms. All of this had led to a “perfect storm” of economic woes. None of us are even beginning to think about the slowing European economy and housing deflation and their own mounting woes. It is an escalating global crisis.
When the economy is in crisis this manifests itself in uncertainty among all of us. We will see this crisis play itself out on many fronts including a rapidly slowing job market, lack of loans retirement and investment accounts. There will be a rebound, perhaps sooner rather than later, but it is too soon to determine if we are at a solid bottom.
For the typical student, faculty or staff member of the PLNU community, what can we do in this time of turmoil? Here are some practical suggestions:
· Cut back on excess spending. Brew your own coffee. Use coupons. Car pool.
· If you are a junior or senior get busy now to prepare for graduation. Network. Attend events. Take advantage of career resources. Get an internship. Volunteer.
· If you have a job now, re-assert your interest and value in your position and the company. Stand out from the crowd. Excel. This will provide security.
· Vote for leadership. We are in an election year. Look for leadership and not pithy statements from candidates. Demand political accountability from all parties.
· Remain grateful and faithful. We are people who have a deeper calling. We must look beyond this moment and keep fixed on eternal things.
What caused this? While there are many nuances to the crisis there are several prime culprits including greed (not just on Wall Street but among all of us in accumulating entirely too much debt for homes, cars, vacations, etc.); lack of governmental oversight and leadership through the Securities and Exchange Commission especially as relates to trading abuses; woefully inadequate lending standards for home purchases through much of this decade with little concern for the ability of the borrower to pay the loan back; and the lack of fiscal transparency by some investment banking firms. All of this had led to a “perfect storm” of economic woes. None of us are even beginning to think about the slowing European economy and housing deflation and their own mounting woes. It is an escalating global crisis.
When the economy is in crisis this manifests itself in uncertainty among all of us. We will see this crisis play itself out on many fronts including a rapidly slowing job market, lack of loans retirement and investment accounts. There will be a rebound, perhaps sooner rather than later, but it is too soon to determine if we are at a solid bottom.
For the typical student, faculty or staff member of the PLNU community, what can we do in this time of turmoil? Here are some practical suggestions:
· Cut back on excess spending. Brew your own coffee. Use coupons. Car pool.
· If you are a junior or senior get busy now to prepare for graduation. Network. Attend events. Take advantage of career resources. Get an internship. Volunteer.
· If you have a job now, re-assert your interest and value in your position and the company. Stand out from the crowd. Excel. This will provide security.
· Vote for leadership. We are in an election year. Look for leadership and not pithy statements from candidates. Demand political accountability from all parties.
· Remain grateful and faithful. We are people who have a deeper calling. We must look beyond this moment and keep fixed on eternal things.
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