mind-blown, mindful, or just thinkin' bout stuff. Some links

As I troll through some stuff for that Black Triangles follow-up post on managing innovators, the saved links are like a tsunami. Let us unspool some and maybe a pony or moonshot might pop out.

[Update: down-post, we reference the multi-tasking hydra in 2 links from the NYT and The Atlantic. Slackermanager.com has posted something cool on taming the beast: Multi-tasking Must Die: 5 Ways to Single Task

Here's something on how emotion and its cascade of neuro-chemicals is like a nail-gun for those post-it notes we call memories--Via mnemosyne:

Describing the brain as a big circuit board in which each new experience creates a new circuit, Hopkins neuroscience professor Richard Huganir, Ph.D. says that he and his team found that during emotional peaks, the hormone norepinephrine dramatically sensitizes synapses – the site where nerve cells make an electro-chemical connection – to enhance the sculpting of a memory into the big board.

Norepinephrine, more widely known as a "fight or flight" hormone, energizes the process by adding phosphate molecules to a nerve cell receptor called GluR1. The phosphates help guide the receptors to insert themselves adjacent to a synapse. "Now when the brain needs to form a memory, the nerves have plenty of available receptors to quickly adjust the strength of the connection and lock that memory into place," Huganir says.

Via Seed Magazine, about how we arrange what we know and perceive (what we've noted, experienced, and remember) affects what we can imagine: The Future of Science is... Art?

...[Niels] Bohr had spent time analyzing the radiation emitted by electrons, and he realized that science needed a new metaphor. The behavior of electrons seemed to defy every conventional explanation. As Bohr said, "When it comes to atoms, language can be used only as in poetry." Ordinary words couldn't capture the data.

Bohr had long been fascinated by cubist paintings. As the intellectual historian Arthur Miller notes, he later filled his study with abstract still lifes and enjoyed explaining his interpretation of the art to visitors. For Bohr, the allure of cubism was that it shattered the certainty of the object. The art revealed the fissures in everything, turning the solidity of matter into a surreal blur.

Bohr's discerning conviction was that the invisible world of the electron was essentially a cubist world. By 1923, de Broglie had already determined that electrons could exist as either particles or waves. What Bohr maintained was that the form they took depended on how you looked at them. Their very nature was a consequence of our observation. This meant that electrons weren't like little planets at all. Instead, they were like one of Picasso's deconstructed guitars, a blur of brushstrokes that only made sense once you stared at it. The art that looked so strange was actually telling the truth.

That's from Jonah Lehrer of Frontal Cortex blog. Leonard Shlain's book, Art and Physics: Parallel Visions in Space, Time, and Light predates it and covers lots more. Basically, how art, artists and imagery makers work in precognitive realms, paving the way for scientists to cognitively grasp, accept and explain previously abstract concepts like black holes or even fluid dynamics. In a way, it's the Overton Window at work -- an idea is "foolish" and "impossible" until someone finds a way to make it graspable and therefore viable. Applies to 30-minute pizza delivery guarantees or to Quantum Mechanics.

For more fearless scouts, IBM has a long but intriguing Dave Snowden/Cynthia Kurtz paper on The New Dynamics of Strategy: Sense-making in a complex and complicated world. A snip...

The Cynefin framework

The name Cynefin is a Welsh word whose literal translation into English as habitat or place fails to do it justice. It is more properly understood as the place of our multiple affiliations, the sense that we all, individually and collectively, have many roots, cultural, religious, geographic, tribal, and so forth. We can never be fully aware of the nature of those affiliations, but they profoundly influence what we are. The name seeks to remind us that all human interactions are strongly influenced and frequently determined by the patterns of our multiple experiences, both through the direct influence of personal experience and through collective experience expressed as stories...

We consider Cynefin a sense-making framework, which means that its value is not so much in logical arguments or empirical verifications as in its effect on the sense-making and decision-making capabilities of those who use it. We have found that it gives decision makers powerful new constructs that they can use to make sense of a wide range of unspecified problems. It also helps people to break out of old ways of thinking and to consider intractable problems in new ways. The framework is particularly useful in collective sense-making, in that it is designed to allow shared understandings to emerge through the multiple discourses of the decision-making group.

Economic Stimulus idea: Brake the constant chase to multi-channel stimulation when possible. Memo to me: Stop pretending you can track, kill, skin and cook the bear. And the rabbit. And the deer. All at once. And well. First, The New York Times:

But the paper also found that “beyond an optimum, more multitasking is associated with declining project completion rates and revenue generation.”

For the executive recruiters, the optimum workload was four to six projects, taking two to five months each.

The productivity lost by overtaxed multitaskers cannot be measured precisely, but it is probably a lot. Jonathan B. Spira, chief analyst at Basex, a business-research firm, estimates the cost of interruptions to the American economy at nearly $650 billion a year.

That's a short sober piece on the modern illusion of busy-ness as good for business. Next, The Atlantic has a longer, more entertaining and personal view: Walter Kirn's odyssey through the nightmare of infinite connectivity begins when his girlfriend sends him a nude cellphone pic and he send his car through a fence while enjoying the, uh, stimulating composition.

...Much of the problem is the metaphor. Or perhaps it’s our need for metaphors in general, particularly when the subject is our minds and the comparison seems based on science. In the days of rudimentary chemistry, the mind was thought to be a beaker of swirling volatile essences. Then came classical physical mechanics, and the mind was regarded as a clocklike thing, with springs and wheels. Then it was steam-driven, maybe. A combustion chamber. Then came electricity and Freud, and it was a dynamo of polarized energies—the id charged one way, the superego the other.

Now, in the heyday of the microchip, the brain is a computer. A CPU.

Except that it’s not a CPU. It’s whatever that thing is that’s driven to misconstrue itself—over and over, century after century—as a prototype, rendered in all-too- vulnerable tissue, of our latest marvel of technology. And before the age of modern technology, theology. Further back than that, it’s hard to voyage, since there was a period, common sense suggests, when we didn’t even know we had brains. Or minds. Or spirits. Humans just sort of did stuff. And what they did was not influenced by metaphors about what they ought to be capable of doing but very well might not be equipped for (assuming you wanted to do it in the first place), like editing a playlist to e-mail to the lover whose husband you’re interviewing on the phone about the movie he made that you’re discussing in the blog entry you’re posting tomorrow morning and are one-quarter watching certain parts of as you eat salad and carry on the call.

Geez. After all that, the band's gonna take a break. Listen to Tom Chapin sing "Not on the test" to mellow us down a bit

Black Triangles

[updated x 2] Between the occasional inaguration and not a few meetings, it was a crazy week and so much to blog about. But it's Friday, I'm tired, so all I gots right now is Black Triangles.

All the dev team had after month of effort was a black triangle on a screen...but it was more than that.

Afterwards, we came to refer to certain types of accomplishments as "black triangles." These are important accomplishments that take a lot of effort to achieve, but upon completion you don't have much to show for it -- only that more work can now proceed. It takes someone who really knows the guts of what you are doing to appreciate a black triangle.

When working on complex projects, the black triangle moment is always the high point for me; it's when success occurs. Before you've got a framework built, there's significant doubt about how the project will turn out, if can even be done. After you get that first little result through the whole maze and it's clear how the whole thing will work, the rest becomes almost inevitable. (via migurski)

Truth spoken well, stolen verbatim, from Jason Kottke.

[update]Okay, I'm feeling guilty about the lifted post so let's at least add something to the mix: a mash-up from work in progress. Jason and others might identify with this, especially the hi-lited bit, and I suspect Johnnie Moore will not. Doesn't matter. It's not for them. It's to explain the difference between tigers and horses and dogs to those who have difficulty making the distinction.



[update some more 01-25-09] Got a facebook msg/question on this. The 4 cycles idea is from experience, and from conversations with people around the question of what makes people naturally comfy with change and others not. Handy stuff to be aware of if you're in the change/challenge status quo business. Maybe I should be less flip and explain better in a post. I'll link to it when it's done.

The Gig Economy - The New American Hustler

Tina Brown of The Daily Beast wakes up

Now that everyone has a project-to-project freelance career, everyone is a hustler.

No one I know has a job anymore. They've got Gigs.

Gigs: a bunch of free-floating projects, consultancies, and part-time bits and pieces they try and stitch together to make what they refer to wryly as “the Nut”—the sum that allows them to hang on to the apartment, the health-care policy, the baby sitter, and the school fees.

....

A full one-third of our respondents are now working either freelance or in two jobs. And nearly one in two of them report taking on additional positions during the last six months.

Just as startling, these new alternative workers are not overwhelmingly low-income. They’re college-educated Americans who earn more than $75,000 a year.

Welcome to the age of Gigonomics...

There is a real poll: PDF

And a synopsis:

There are two kinds of new American hustlers:

• At the lower end of the salary spectrum, lower- and middle-class Americans are being stretched in ways they didn’t seek. Americans with incomes below $40,000 per year are more likely to hold multiple part-time positions, and the reason why they hold second jobs tends to be a critical financial situation: They’re behind on bills and need extra income (43%).

• At the top end, those with higher incomes and a college education are more likely to work freelance or multiple jobs as a way of expanding their scope. This upper-class population often has both a full-time job in addition to one or more part-time jobs, often freelancing. The top motivation for taking on additional work? A second job was actually a hobby that turned into a money-making operation (48%). Not surprisingly, this group is also more likely to feel stretched by their responsibilities.

Yup. Long after Unicornomics* has been settled on as a huge distraction and waste of talent and resources, there's still gonna be rasslin' over what to call the last 3 decades starting with Reaganomics and ending in Gig-o-nomics. Somehow, despite the indelible imprint of B. Boomer on the registration and paperwork, calling them the The Wonder Years 2.0 seems a longshot.

And, maybe, just maybe, there's an explanation within, and tying together, both sets of years.

----

* Q: How do you buy a unicorn? A: With imaginary money. Q: How do you buy 2 unicorns? A: Declare the first unicorn and the rides you give as an asset and revenue stream for your CapitalOne card application.

daily beast link via fimoculous

LandAmerica. From Sea to shining C-minus

Then on to BBB-minus, ending with an "F." Come on boys and girls, Fortune 500 companies are hard to come by and nice to have around. Richmond Times-Dispatch, today:

The chairman and chief executive of the bankrupt LandAmerica Financial Group Inc. is stepping down and the Henrico County-based company will sell its remaining business units, it said today.

...

What was once a top employer in the Richmond area and won "most admired" recognition from Fortune magazine for the past two years filed for Chapter 11 protection Nov. 26.

The Dirt Lawyer (a Chicago commercial real estate attorney who's worth keeping up with) gave us the name of the poison in November.

The skinny? LandAm apparently had a toxic exchange subsidiary that invested about $290 million in auction rate securities that may take forever to get rid of. And you need to access that money to faciliate the exchanges. In short? Liquidity crisis.

Yeah, something's all wet. Or maybe too cut and dry? Saying "liquidity crisis," as so many are, is like blaming the fork for your high cholesterol level. A quick Google offers us (via a Deloitte management guy no less) something [from 2006] that might be viewed as irony, what with all this gate-keepered "sudden news":

Fortune 500 blog project: #500 LandAmerica needs blogs

Oct 23, 2006 ... I love your explanation of why LandAmerica needs a blog (or multiple blogs!). I' ve said the same thing over and over of several blogless ...
it.toolbox.com/blogs/blogpotato/fortune-500-blog-project-500-landamerica-needs-blogs-12452 - 66k - Cached - Similar pages -

Come on Genworth, we're rooting for you!

Diller: Beating (Wall Street's) expectation of earnings is yesterday's game

Reuters Media Summit

Barry Diller: “It’s not that you don’t want to earn as much money as you can — it is your obligation, of course — but companies have obligations beyond that and they certainly have obligations beyond that at certain times, in the times in which they operate. And they also certainly ought to know that meeting and beating expectations is probably yesterday’s game and it will be increasingly so, which would be by the way very healthy for companies. Running a company that meets and beats expectations, and that runs their company accordingly, are companies that I would question why anyone would invest in.”

Here's a quick clips of Diller saying the above.



This second clip has Diller parsing the utility of saving 20, 30 or 40 million dollars (about what many job cuts aim for at mid-cap sized orgs) in a year "when nobody's counting."



I don't know what Diller's positions have been in the past when QVC or other outfits he's run have encountered the fainting spells of Wall Street analysts agog over his quarterly numbers. My guess is he's less than pure on this front if he's a pure-bred American CEO. Regardless, there's a whole bunch of epiphanies happening out there.

No doubt, much of what's coming to pass is thanks to the damaging effect of a singular idea of the last 30 years, when the spadework of doing, as our parents did, became unsexy and unfulfilling: Profit became "the product"--The Moonshot--of many companies and the near-myopic focus of many leaders and our network of value-measuring and dictating institutions. Any sense of the power of work--and profit as meaningful proof of any work's worth--long since went out the window as a passe mark of the goofy or unsophisticated person. Well, reality is back in vogue and, let's hope, not too late.

###

This reminds me of something from Shalom Schwartz and Amir Licht that's useful as an executive measure when pondering corporate governance and direction. I'll dig it up and post something on it later.

Powell recalibrates American Virtue, circa 2009. And none too soon.

Here's the picture Powell saw of Elsheba Khan at her son's grave. NYT has some background on Cpl. Kareem Rashad Sultan Khan.

He and three other soldiers, including a corporal from Washington Heights, were killed in Baquba after a bomb detonated while they were checking abandoned houses for explosives....

Mr. Khan graduated from Southern Regional High School in Manahawkin in 2005, and enlisted in the Army a few months later, spurred by his memories of the 9/11 terror attacks. “His Muslim faith did not make him not want to go. It never stopped him,” his father, Feroze Khan, told the Gannett News Service in a story printed shortly after his death. “He looked at it that he’s American and he has a job to do.”

Here's Powell endorsing Obama. Let's see how long it takes for him to become one of Michelle Bachmann's "anti-Americans."



And here's the delightful pseudo-patriot, Michelle Bachmann, doing her best McCarthy impression.



Yee-haw! We've been here before, eh?



The "Red Menace" is the primary Tsunami example in Moonshots and Tsunamis -- the kind of thing that makes us double stupid and susceptible to wild manipulations before we wake up and get triple smart and get on with living up to our resume's promise.



In other words, they don't "hate us for our freedoms." They laugh at us for our predictability and naivete. They laugh at us because we're a behemoth yet we scare so damn easy--at least, some of us do.

Here's to Colin Powell for finally saying "Snap out of it!"

Unicornomics - Thomas Frank gets it, Andrew Sullivan does not.

Thomas Frank, for the Wall Street Journal no less...

I asked Bill Black, a professor of economics and law at the University of Missouri-Kansas City and an authority on the Savings and Loan debacle of the 1980s, what he thought of the latest blame offensive. He pointed out that, for all their failings, Fannie and Freddie didn't originate any of the bad loans -- that disastrous piece of work was done by purely private, largely unregulated companies, which did it for the usual bubble-logic reason: to make a quick buck.

Most of the mistakes for which we are paying now, Mr. Black told me, were actually made "by four entities that under conservative economic theory should have exercised effective market discipline -- the appraisers, the originators of the mortgages, the rating agencies, and the investment banking firms that packaged the subprime mortgage-backed securities." Instead of "disciplining" the markets, these private actors "served as the four horsemen of the financial apocalypse, aiding the accounting fraud and inflating the housing bubble." It is they, Mr. Black says, who "turned a crisis into a catastrophe."

...

There is no way to measure the number of people who took out mortgages they knew they couldn’t afford, of course, but for what it’s worth, a 2007 report by the Mortgage Bankers Association reports that the FBI estimates “80 percent of all reported fraud losses arise from fraud for profit schemes that involve industry insiders.” That means the lenders, not the borrowers.

Just imagine the flights of fancy that the theory of borrower malevolence and Wall Street victimization requires conservatives to take: All these no-account folks, you see, got together and forced investment banks to engineer subprime mortgages into highly leveraged securities. Then they tricked all manner of hedge funds and pension funds and financial institutions into buying these lousy products. Just for good measure, these struggling homeowners then persuaded bond-rating agencies to misrepresent the risk associated with these securities.

Indeedy. And now, our patient, Andrew Sullivan, taking one of those flights of fancy, except it's really more a noisy tumble down a flight of stairs.

Andrew Sullivan

Finally, George Will puts in a column what I said on Bill Maher. Much if this crisis stems from rank greed and irresponsibility from ordinary Americans on a massive scale, who bought homes they couldn't afford on credit they couldn't repay, or who leveraged their property with loans they had no reason to take out. If this crisis hits Main Street hard, it will also hit a great number of people who also deserve their comeuppance. We need a fix to solve the credit problem. I understand that. But a little delay is important and salutary. And the real, long term fix requires weaning Americans off credit - and giving enough of them a taste of what their greed and recklessness can do.

Gracious me!

Does Sullivan realize the above is actually an indictment of a raft of sacrosanct conservative principles dating back 25 years? Hell, it's an indictment of modern consumer societies. What's more, he misses the actual culprit: Soullessness. That is is surprising given his "expertise" on the subject: The Conservative Soul: How We Lost It, How to Get It Back by Andrew Sullivan.

The last 30+ years of American growth have been predicated on revolving credit, medium-term loans for autos and durables and, yeah, the boutique products of Unicornomics like credit-swaps and various derivatives-based cleverness. AKA: you CAN have it now! That greed is the culprit goes without saying. What Sullivan and others just can't get their heads around is that we keep seeing this movie over and over. It always ends badly, predictably, and Andrew wants us to believe it's the audience's fault the movie got made because, well, because they bought tickets to the spectacle.

Later today, we'll take a look at things through the prism of William James and maybe through that of accidental behavioral economist, Otto Rank...

I mentioned the other today how ticked off I was to hear Republicans say that the Community Reinvestment Act was to blame. Well, I knew CRA. I worked with CRA. I marketed CRA alongside high wealth products. And, umm, Andrew, Rush, et al? This is no CRA probem.

Unicornomics vs. Mark-to-Market

Barry Ritholz @ the big picture gives us the halftone dots re: mark-to-market and touches on the real bugaboo of bullshit mark-to-model pie in the sky valuation...

That is one of the key elements of the current situation. A decision was made to bypass the broad, deeply traded traditional markets (Equities, Fixed Income, Commodities and Currency) and instead create new markets for new products. No one should be surprised that the net result was a flawed system of garbage paper, with too little room at the exits in case of emergency.

Let's puts this into some context:

"Accounting is a way of portioning economic results by time periods. It doesn’t affect the cash flows, but tries to allocate economic profits proportional to release from risk. If we were back in an era where the financial instruments were simple, then the old rules would work. But once you introduce derivatives, and securities that are called bonds, but are more akin to equity interests, you need to mark them to market."

-David Merkel

Exactly. Otherwise, you are left with public companies, who have made capital allocation and investment decisions that are hidden from their owners (shareholders) and the investing public.

Now that the garbage is on the books, no one wants to admit the original error of purchasing this class of assets. Its not just that the trade has gone bad, its the original buying decision was so flawed even if the trades were not such giant losers.

Fear and Greed or Hope and Seriousness. Today's the day.

Well, we just dipped 700+ points, faster than a feather tied to an anvil, in increments of 10 and 15 and 20.

The folks who've stood on their soapbox for years now--the conservatives, of both parties--bemoaning awful intrusions on the free market are now stuck. The laissez faire free market got us here, and now, as paid-for shills of psychedelic finance, they have no answers. None. Nada. Bupkis.

The cruel joke is a joke, one my older brother told me years ago in the midst of the last Gekko-like, junk-finance age gripping London as in New York: What happened to all the hippies? They're stockbrokers too, they just don't wear underwear.

"If it feels good, do it." It fits the times now as it did then. Remember that, and today, the next time someone makes a joke about hippies. Maybe ask them if it's cheaper for an unemployed investment banker to fill up a Range Rover or a Microbus?

On to today's business, the worst DOW point drop in US history. Proof that railing against evolution is a niche concern compared to the many who want to deny fiscal gravity. And, oh joy, my congressman, Eric Cantor, wants to cry that Nancy Pelosi hurt his feelings after his party's obtuseness and obstructionism today; called him out on the unhappy ending of his ideology's fairy tale. Impossible, I know, Eric, but grow up.

The bottom line, congresspeople, is you're screwed if you do, and we're screwed if you don't.

The bottom line, voters for said congress-people, is that the fairy tales reanimated since Reagan are now a box. It finds you worried about payroll and receivables and yet also makes you send calls and emails to Washington DC, 100 to 1 against calming the world's markets. The antidote, thanks to laissez faire procrastination, is anti- everything that so many supposedly "stand for." Well, there's nothing laissez faire nor Invisible Hand about the need for a heart needle or a crash cart and some paddles.

No, it's not fair that taxpayers are gonna have to be the grownups and bail Junior and Cissy Smitherington-Farqhuar out of jail. You didn't ask for this, but you ordained it.

As others much smarter than me are coming to realize, this is a crisis of a now non-operational ideology more than one of finance. The Freeze of Credit is a consequence of this failure, not cause. Trust is dead. And Greed is the fickle new bastard-son King.

Many are saying they can't "aid and abet American Socialism." Newsflash: You've been doing that for years. When you allow private sectors and their industry lobbyists to write laws in their profitable favor, such as the repeal, with Gramm-Leach-Bliley, of major solvency safeguards in Glass Steagall--itself a result of the hard lessons of 1929, you are explitly socializing risk--laying bare a swath of the economy to unfettered myopia and mugging called the Crisis of the Commons.

And when you firewall consumers/voters from remedies for their own small financial crises--either from foolishness or, far more statisitically likely, from bankruptcy due to crushing catastrophic healthcare debt--well, what you do there is a weirder, crueler perverse and un-American version of Socialism called Corporatism. The fruits of their PowerPoints™ and K Street working lunches? The 2005 Bankrupcty Bill, more accurately labelled the Financial Services Foolishness and Greed Do-over Act.

Voting for that pre-emptive bailout bill were 229 Republicans and 73 Democrats. Opposing were 125 Democrats and one independent, Vermont's Bernard Sanders. Ironic that the Congress' one socialist voted against a unique form of Corporate Socialism. Maybe he wasn't paying attention.

That Act was explicitly written NOT because Wall Street or Hartford was stupid. On the contrary, they knew exactly how far they were leaning over the edge on their exposure and risk-models. And they wanted a safety net for the crap--dodgy mortgages, credit cards, auto loans--they knew they were peddling to keep their quarterly numbers botox-pretty. That was Phase One. Paulson's and Bernanke's POS cash-grab first offering last week was Phase Two.

They knew today was very likely coming, and they gambled that since nobody knew for sure--that since no one could offer dead solid perfect proof trhat derivative WEREN'T magic--they'd keep moving forward with their fantastical Unicornomics. They'd dig their spurs in and shout "What's in your wallet?" or "Better call DiTech!"



But the CGI special effects in those crap commercials isn't the only technological advance. The creep of IT also brought "super-genius" powers of "knowing things." A big-shot financial services executive once described it to me as, "the ability to see around corners!" "Yes," I asked, "but can you bend light?" He didn't get my sarcasm. "Soon!" he said, "Soon!" he said.

It's not news to many, I'm sure, that this silicon-augmented power tends to make you at first awed, then confident, then embarrassingly, arrogantly ignorant of your vulnerability. They knew that their vast databases and instantaneous tracking thanks to tech advances meant they could "monitor" known iffy credit risks at point-of-purchase right up to the line of "yes" or "no" on a half tank of gas or a full one. That these risks (some call them people) were living paycheck to paycheck in an increasingly shock-prone economy was 'backstopped' by the program "to reduce the downside."

And there was Joe Dokes, taunted to "Go for it!" by ads made by guys like me. Get that HELOC or 3rd refi -- shop till you drop and to Flip This House! The fees, the fine print, the floating nebulous and changeable rules of their contract with us were all designed to render the "customer" into a commodity to be squeezed, harvested, pandered-to. Until it wasn't useful to do so anymore. It's a weird existence living in the parallel universe of pretend public care (Customer Advocacy™) and jeering private disdain.

Except now, the disdain is leaking out.

These are folks--parallel in their desires to Wall Street's appetites, much more limited in their means--that suddenly Big C conservatives are calling crass, greedy, irresponsible consumers. They just followed the program. Told to "go shopping," post 9-11, they're "un-American" dolts today. Or, and this gets my viens popping, Talk Radio clowns are now suddenly trying to float the minority and low income beneficiaries of Community Reinvestment Act loans as the cause of Fannie and Freddie's downfall, and the broader market's collapse. That talk-radio meme, the machine gun nature of pre-emptive blame spraying is tear-inducing and rampage-making, and I can't decide which has more general utility.

Back to today, to the sudden crisis of philosophy due to a failure of that philosophy. A vote failed, the market tanked. It clawed back, then it tanked some more. Maybe that will shock some out of their pantomime. Somehow I think that those who weren't so concerned in 2005 about the solvency and resilience of the average family's economy will betray their Harlequin Romance view of Adam Smith to prop up the American Exceptionalism™ of our wheezing National Economy.

In the end, philosophy be damned. The vote will be made in favor of unfreezing liquidity, because Arthur Jensen wants it.

The question nodody asks: Why is Credit Frozen?

A few days ago I posted that this is a crisis of ideology not finance. That was not fully clear. The Credit Collapse is a symptom of an organ failing, a part an organism that has been bingeing because it's been told it can do no wrong, no harm can come to it if it pursues it's desire for pure self-interest. Some call this consumerism. Some call it the American Dream--life, liberty and all that.

How'd this discrepancy happen? Well, absent grownups to remind me that things that go up invariably come down, I tend to get used to the idea that things going up will always do so. These absent grown-ups? They, or it, would be called functional, diligent oversight. Or the belief in it.

To me, this isn't about liquidity per se but rather, about the reality of reality itself catching up to the mark-to-model and mark-to-market methods of financial services of the last few decades. (Mark to model is the theoretical accounting of Enron and other recent flameouts--basically rosy scenarios on crack.)

Sounds complicated? Most of the blameworthy would like us to think so. Let's try and clarify.

Look at it this way, from their perspective: IF YOU'VE been selling smoke and confusing ponzi schemes for years you start to worry that too MANY OTHERS are doing the same and suddenly if only types like you are available to deal with--in a market ostensibly reliant on trust and sentiment--well, then, MAYBE NOBODY's TRUSTWORTHY and the best thing to do is reset and take a mulligan. Or, to continue the golf parlance, to turn in your card and self-disqualify.

But no one in positions of responsibility is willing to do that latter thing, to banish themselves as the abject giddy and greedy failures they have been. They have PhDs in Economics and Finance, after all. They write the fine print!

And that's where we are - top tier banks and investment houses doubled down serially, and so often, that everybody's bluffed out and faithless. Nobody trusts anybody, and everybody's in flopsweat. And when the titans start sweating, and conserving any capital they have "just in case," we mere mortals feel it shower as a gear-rusting, road-blocking downpour that shorts out our ability to do day-to-day business. That, in my goofy metaphor-drenched opinion, is where we are.

That the market is choking off "liquidity"--cashflow and credit flow--is a symptom of its overdue diagnosis: too much play, too many lies, too little seriousness.

The problem is limbic and fundamental. Stop lying, stop avoiding responsibility, stop hiding behind the cleverness; it's over. Admit the failure you knew was coming long ago, and that which is still half-hidden under the rug. Take your medicine is what the market is saying. And also, what the public thinks ought to happen - "I get no pass, no bailout for stupid greedy choices." That would be the way, in a truly free market, death and destruction a la Lehman, IndyMac Bank etc and so on.

But it isn't. Their best answer to an anxious and desperately curious electorate could be construed so far as: Flounder, you fucked up. You trusted us.

Can I ramble some more in search of some clarity?

We have something like 45 trillion of US home ownership paper, maybe 15% added in the last 10 years, that are potentially, really worth 30 trillion in a true free market. Underlaying this are myrid financial instruments, an alphabet soup of insurances, derivatives, IOUs and promissory notes, worth tens of trillions more, and few of which can be reliably valued in a world with laws of actual financial gravity.

This soup, then, is as much if not more of the worry that Fed Chief Bernanke and Treasury Secretary Paulson used to most likely drain the blood from the faces of Congressional leaders over a week ago. And so consists the huge discrepancy borne of wishful thinking and a culture desperately told that having more means you are more meaningful. I believe Bush quaintly called it "An Ownership Society" not long after he told us the patriotic thing to do was "go shopping" after 9/11.

In this environment, the market is not so much free as it open to the highest bidder, virtue and values not being a requirement. The resulting "market" is one jiggered by various narrow interests and by functions convinced through the lure of fees to go along with the asset inflation and reindeer gamers.

What Interests? Whose Functions? A bunch. Such as...

* Such as ordinary local home appraisers all the way up to big-ticket national debt ratings agencies like Moody's, Fitch, S&P and others. Some in the bag, some not, with the nots struggling against the tide.

* Such as regulatory agencies staffed at the executive level with anti-regulatory ideologues, believers in the virtues, and fantasy, of Free Market wisdom. Yes, political appointees, mostly conservative due to who's in the White House these 8 years, and almost all necessarily hewing the party line: HANDS OFF, whenever possible.

* Such as too clever by half Wall Street theorists known as quants delivering to their bosses new, arcane and faith-based methods to do what those CEO bosses are hired to do: Make lots of money for shareholders. That they were exotic and barely understood mattered not. At the end of a blackboard long equation, like that at right, was a big $ sign with several !s next to it. "Say no more Boys and Girls, make it so!" said the bosses.

• Such as mayors and building trades desiring two intertwined things: Jobs and building permits. Both public and private sector glommed onto the fact that all kinds of goodies bloomed from a structures-based boom comparable to the telco/internet booms of the 90s. Manufacturing had long since been packing up for destinations Latin and Asian. No jobs there. However, building retail shops and big boxes and homes and suburbs and all that 2nd and 3rd level economic activity that came with them was like a mirror of the 50's Levittown postwar surge. Manna from heaven for car dealers to Applebees' to Hollister.

* Lastly, such as homeowners themselves--also called Mortgage product consumers. Many had homes prior to this mess, homes with lots of equity. Some were newer homeowners--consumers--getting their piece of the dream thanks to newly 'friendly' bankers who before might have shooed them out of their office. Each of these crudely described demographics are part of the "Shopping as Patriotism" culture referenced above. For the 'house-rich", all that equity could be viewed as an ATM. HELOCs (Home Equity Lines of Credit) became that ATM device. Some got patios to add value to the underlying asset. Many bought plasma screens or took a cruise. This was obviously all well and good when, like Wall Street, they trusted that their ONE Dollar of investment was really worth FIVE today, because home prices were skyrocketing and that dollar in the not so distant future (so they were told, or wanted to believe) would be worth TWENTY in almost no time at all.

And then home prices in far flung suburbs got two successive shocks: 1. The housing market had climbed to saturation. Home Buyers--also known as Mortgage Customers--started by by 2005-6 to be harder to find. And when that happens, you do what? You dig closer to the bottom of the creditworthiness barrel to keep the graph moving up and to to the right. 2. Prices on hydrocarbon fuels started climbing--gasoline, to natural gas to heating oil. It cost more to get places from those newly built and bought houses. It cost more to get the materials to those building sites. Anything petroleum-based like plastics, cladding, vapor barriers and roofing started climbing. Hell, Tupperware was getting more expensive.

And the thing that stopped climbing was the dreamed of ONE to FIVE to TWENTY. The ATM didn't work anymore if it hadn't already been tapped out. Maybe this is obvious to readers and others. It seems, though, not so evident how it all fits together to many I speak with between 9 to 5. When credit card debt, another aspect of our recent fun-fest is added to the mix (how many apps in the mail have you gotten in the last 10 years? what's in your wallet?), well, it becomes easy to see how easy credit afflicted and addicted both the Titans of Wall Street and the merely mortal. Each has played fantastical games of head-in-sand in pursuit of the ultimate market bubble, one perfectly suited to an age of hyper-real experience-seeking and of lives lived virtually: Call it Unicornomics.

Q: How do you buy a unicorn? A: With imaginary money.
Q: How do you buy 2 unicorns? A: Declare the first unicorn and the rides you give as an asset and revenue stream for your CapitalOne card application.

That, unfunny as it is, for me, explains where we are. It doesn't make sense, but it didn't have to be so if people in positions of responsibility didn't abandon their integrity. Now those people want our help as taxpayers, because we have the only pockets collectively even close to deep enough to rescue them from their folly. Did we play along? Yes, we did. Did somebody wonder "where is all this easy money coming from?" Some did, some didn't, but very few buyers of those plasma screens or Palladian mini-mansions wanted to look a gift-unicorn in the mouth. And very few carpenters or lawn services or auto-detailers complained sincerely of too much business.

And it was fun, while it lasted, eh?

Well, this may suck, but it is time to pay. And because it sucks, in differing degrees and varieties, many refuse to step up without some clarity...

Joe on the Street thinks: This sucks because it's more of the same--free market, sink or swim for me, and parachutes, pontoon party boats and do-overs for those who claim to have the right stuff.

Doctrinaire Conservatives: This sucks because government sucks. It has to suck, and to be awful at everything or my reason for living and my guiding stars are gone. Sucks because we have no answers beyond more deregulation. And yes, even though it's a 40 Trillion unregulated Credit Derivatives shadow economy that's at fault here, more deregulation and reducing capital gains for exactly these players is the ONLY solution here.

Republicans: This sucks because Business guys are the Pros from Dover, right? They know and see all! Sucks because we've spent 20 years admiring and defending these Money Types and flying on their jets and playing golf with them and, dammit, they never once said what they did was sorta like my day job - making shit up and selling knee-jerk perceptions, not product.

And there we are. Fine Americans abused by the beatitudes of our tales of woe and wonder, each right and wrong.

But only one has the pull to do this thing.

As unjust as it seems, it IS time for taxpayers to come to the rescue. Because only they collectively can finance this fix of financial and political malpractice. To do it in a way that doesn't offend our sense of justice or capitalism. That means equity for bailouts. It means no pay for non-performance. It means reasonable rules replacing the fairy tales of deregulation that got us here. It means an explanation and an apology of some sort from somewhere and from some people who should have--and did--know better.

And even if that unlikely apology is forthcoming, for God's sake, exact righteous vengeance at the ballot box next month. But do it for reasons that will do you, do us all, some good. Know who's been selling you a bill of goods based upon a thing you know but were willing to overlook: There's no such thing as unicorns, or a free lunch. Ask why cops are seen, and encouraged, in a Farmers Market but virtually banished from our Credit Markets? Ask how government grows more, and also more useless-feckless, under "small government" boosters? Ask why your kids' bill for your choices, the national debt, has ballooned so ridiculously? Ask, are my ideas really sound when I rail against this party or that? Is tax and spend or borrow and spend the model you choose? Is law and order a thing for urbanites of various colors but something unnecessary for people wearing pinstripes and Rotary Club pins? Ask for useful explanations. And vote accordingly

If there is one thing that all of us need, it is explanations beyond spooky and cloudy requests for 700,000,000,000-plus checks.

Now is the time to explain this--Barney, Nancy, Harry, Hank, Ben, Warren, John, Barack, somebody--just as FDR did in his fireside chats weekly through the Great Depression to a bewildered and beat population.

As we have just seen, George W. Bush is woefully equipped to do the job.

That he is the first MBA president is both hysterically funny and metaphysically cruel.

And yes, God bless America. We're gonna need him.

The Crisis is Ideological not Financial

I'm working on a fouro-style daisycutter on why the bailout is more about forgiving stupid moves by still-solvent companies before the election and new agendas take hold. And how easy credit was easily seen as a poison steroid pill, enabled by unreasonable expectations of corporate growth. Later on that.

It's obvious already via Paulson on Capitol Hill that the rush-job is just a copy of the Patriot Act and Homeland Security 'gotta do it' power grabs that have little to do with democracy or actual problem solving-- so let's hope the Congress-critters keep their new-found spines.

The nut of where things are: As Sam Zell noted just now (4:19) on CNBC: " in many cases the borrowers shouldn't have borrowed and the lenders shouldn't have lent." Good--no, excellent--point. And yeah, this isn't about liquidity but rather, about the reality of reality itself catching up to the mark-to-model methods of financial services of the last few decades. Look at it this way: if you've been selling smoke and confusing ponzi schemes for years you start to worry that too many others are doing the same and suddenly if only types like you are available to deal with--in a market ostensibly reliant on trust and sentiment--well, then, maybe nobody's trustworthy and the best thing to do is reset and take a mulligan. And by god, do it before some new Democrat president gets to commit that available money elsewhere to useless stuff like, say, infrastructure rebuilding or Apollo-style energy R&D plans.

A 700 billion to 2 trillion mulligan. Easily. Except if you're a homeowner who's been watching too much Flip This House instead of the other, similarly, fantastical shows like Squawk Box.

It's about deleveraging real values from pretend booked asset values, not about liquidity or some unforeseen calamity.

Fratto insisted that the plan was not slapped together and had been drawn up as a contingency over previous months and weeks by administration officials. He acknowledged lawmakers were getting only days to peruse it, but he said this should be enough. [bold mine]

A simple phrase that needs to be heard more from one candidate is "no pay, no relief for non-performance" and that applies to CEOs or Shareholders. And, yes, to the truly greedy home-equity-as-ATM mortgagees, too.

But let's remember to differentiate the greedy from the truly dumb/unfortunate in the majority of troubled mortagages--the ones who did what most of us do--"It's the usual paperwork legalese, just sign next to these 12 red paste-on plastic tabs and here's your bottle of champagne!"

Right now, Maria Bartiromo is trying, loudly and stridently, again on CNBC to sell that this is a liquidity problem, that firms can't raise capital. WRONG. The money is there, it's access to capital that's choked due to the glut of lies. Trust is broken and 700 billion won't miraculously make saints out of sinners. The saying is "It's only a principle if it costs you something." These companies want to preserve/recover their asset values and their balance sheets without admitting that their principals and staff abandoned, or never had, sustainable principles.

The market is choking "liquidity"--cashflow and credit flow--as a symptom of its overdue diagnosis: too much play, too many lies, too little seriousness. The problem is limbic and fundamental. Stop lying, stop avoiding responsibility, stop hiding behind the cleverness; it's over. Admit the failure you knew was coming long ago, and that which is still half under the rug. Take your medicine like a real frontiersman not a kid in a Roy Rogers outfit from WalMart.

The lower half of Manhattan is now discussing the "awful" impact of losing several 10s of thousands of Financial Services jobs. Guess what? Job losses are what Wall Street has viewed as prudent responses for failed business plans and models for years. And for good models too: They happily make companies like Costco suffer for viewing quality pay and job security as weaknesses.

The fans of deregulation and dismissers of government suddenly want it to make the booboos not hurt so much and for us to play cop and arrest and fine the market that bit them so badly. In the face of all evidence, they want us to call a self inflicted wound some kind of mugging. And to refashion reality and call their dramatically failed ideological war on spadework, physical worth, and accountability just a failure of financial markets.

Bullshit. Grow up.

Mercedes: We're Ditching Dinosaur Juice by 2015

Yeah, you read that right. They say they're phasing out petroleum-based powerplants in 7 years. The boys and girls in Stuttgart must read this blog (/snark). Here's the news in a quite decent article from Murdoch's The Sun (UK):

MERCEDES are aiming to end the need for filling your fuel tank with petrol or diesel within just SEVEN YEARS.

The German firm are determined to make their model range run on alternative fuels - to improve costs, become more eco-friendly and because the oil supply will eventually run out

There are 50million jobs worldwide associated with the car and more than 80 per cent of goods are transported by road.

Mercedes are convinced that these two crucial areas of industry can be saved by making vehicles independent of crude oil - to improve costs, become more eco-friendly and because the oil supply will eventually run out.

The company have already spent £2million on their new long-term Sustainable Mobility plan and are set to invest a further £7billion before 2014.

This includes making current engines even cleaner and more fuel-efficient while increasing the amount of hybrids, emission-free electric cars and clean-fuel gas engines and the further development of battery and hydrogen-powered vehicles.

Mercedes will drip-feed different forms of more eco-friendly vehicles into our showrooms as and when the technology has been developed over the next decade - but the process begins towards the end of this year... (lots more detail)

From the Otto engine to whatever's next. Welcome to Mooonshot-ville, M-B. Gottlieb and Wilhelm would be proud.

Okay, I just went and looked in archives and since Benz' F700 concept is so skit-skat bat-lookin I'll post this picture and pat myself on the back some more....

I once wrote somewhere that the problem with Daimler's and Chrysler's merger was that they hadn't lived in sin together. Not to any meaningful degree anyway, and, without a simple requirement: Once enough hot, rough, draining and sweaty rapid prototyping had steamed up the windows and, uh, "preferences" were known (Dirty Secret Soulmates!), the marriage (we don't do "deal" here, baby) should have been signed in blood, on a dog-eared 1969 copy of June Autoweek. Maybe cigars or Don Shermans afterwards. But definitely Jaeger. Lots of it. And Strohs. And Moet. Shooken up and sprayed wildly. Then a wild orgy of kimono-opening top to bottom with get out jail free cards from accounting and PR.

And then, something really good: Let's make catalytic converters obsolete in 20 years. While cranking out the baddest, sexiest rides since, since.... well, forever. Now go!

Something really good. But 7 years is quite nice and oddly symmetrical. We did the moon in about that time--Sept 1962 to July 1969, starting with Kennedy's speech at Rice University:

GM: Losing options, getting close to teachable?

CNBC brings us news that Goldman sez: Sell!

[At a current share price of $11.40] the world's largest auto maker has a stock market value of only about $7 billion. That compares with a market cap of about $56 billion in 2000, when the stock was at its all-time high of $94.62 a share....

GM's value is now:

* Half that of cosmetics company Avon
* A third of cruise operator Carnival Cruiselines
* A quarter of Internet media company Yahoo!
* A fifth of online auction house Ebay
* A sixth of retailer Home Depot
* A seventh of biotech firm Amgen's
* An eighth of drugstore chain CVS
* A ninth of fast-food giant McDonald's

Dayumm.

Said it before, too much money is GM's problem. Makes you arrogant, stupid and lazy. Here's hoping the Volt is a crash cart of the health restoring kind. But if Lutz insists on dueling statements like this and this, somebody's gonna have to cart him off before it hits the showrooms.

Attack of the 50-foot Negro

Steve Benen at The Carpetbagger Report has a bit on how the narrative against Obama has devolved to it's ultimate Hollywood-Kryptonite form: He's a Commie-Socialist-Pinko. From Mars.

Benen rightfully observes a few things. ONE, how in fair cricket it just isn't done to suggest that avid uncritical melding of pro-military, pro-corporate views may accrue fascist-sounding and -appearing trappings and behaviours like, oh, monolithic definitions of "patriot" and flags on everything including the NYSE and big aircraft carriers named for still-living politicians related to the current boss. And TWO, how this accusation of soulless socialistic monsterdom is not supposed to rile the sensibilities of leftward leaning types, what with it being patently obvious like how women are just awful drivers and Polish people are really dumb.

Wait, those last things aren't true? Next, someone will tell me liberals don't cheer aborted babies and may, just may, actually love their own children. As if.

Yes, the Commie meme is especially dear to this blogger what with it being a perverse driver of so much of the last 50 years' triumphs and trainwrecks and an endlessly evolving project about Moonshots and (Red Menace-like) Tsunamis. The short exposition is the fact that thinking is damn boring, and that feeling, well, that's what some intelligent designer™ designed us for and here we are, feeling to the max. 21st C. American life is an orgy of sensation, the Friday the 13th franchise or the endless parade of bad 50s sci-fi all rolled up. Spooky stories enliven us, no matter how ridiculously stretched the telling has to get. And hey, I have slides to prove it...



So now, we have the main feature. Obama the alien being, a Muslim in reel one, a radical Christian in reel two, a liberal non-bowling elitist in reel three and, next, now, the ultimate culmination that only sputniks, UFOs, mushroom clouds and Rosa Parks could deliver. Attack of the 50 Foot Negro. There goes the galaxy.

Does it make sense? Hah. Sense would be Hillary Clinton realizing she's fragging one of her own and her legacy in her quixotic search for relevance and its last gasp cartoon of Boomer consultant-solution-speak, all the while making John McCain appear like a breath of fresh air to a GOP-fatigued electorate. Sense in this age of hyperreal, with adults displaying the appetites, patience and judgment of children is as rare as Iridium, something I hear scientists say we find on Earth mostly because asteroids deliver it from outerspace with big cataclysmic booms of their own.

I digress. Benen points out the odd idea that comparisons to Joe Stalin shouldn't trouble a sturdy liberal head but calling a conservative fascist is somehow akin to calling one a pedophile and just beyond the pale. There is nothing so complicated here as the "I'm rubber, you're glue" model of 7 year old debate. But Andrew Sullivan thinks he sees more.

[Kristol's] calling him a lying, Godless communist.

You could argue, as Kristol and others hilariously will, that Lou Dobbs has no base,
that fundamentalist Christianism has no problem with "the other" in a globalized world, that dozens of state constitutional amendments banning civil marriages that had never and would never have taken place were just spirited forms of civic engagement, rather than scapegoating or politicking on resentment. You could also argue, as others legitimately will, that spasms of economic distress and social discontent are unconnected. Hey: Weimar had nothing to do with Hitler. But Kristol is doing something much more pernicious: he is saying that Obama is faking faith, that his very profession of faith is a "mask" that is slipping, and that Kristol is the person to determine whose faith is genuine and who is a fraud.

A non-Christian manipulator of Christianity is calling a Christian a liar about his own faith. That's where they've gone to already. And it's only the middle of April. What are they so scared of?

What? Something so scary, so alien it makes them quake. Something William James would call a 'novel idea,' too novel and too discombobulating for comfort. They are scared of a black man who tilts their understanding of the machine, one whom many of their fellow Rs actually liked before he started getting the Michael Rennie treatment from Hillary and Mark Penn. They are scared of a 6-foot, 1.5 inch man, who is liked almost regardless AND because of his color. But it's his invocation of intrinsic goods, of the things we'd like to believe about ourselves collectively as Americans, that's what makes him seem 50-foot tall.

Leave be those small-town voters who may or may not be "bitter" about getting the shaft for the last 30 years. It's Hillary and Kristol who are apoplectic that their particular Boomer projects straddling two American centuries just haven't been the Moonshots they'd hoped for. They've got nukes. And Flag pins. And the 50-foot Commie-Alien with a real map to the moon must pay.

Credit Markets: "Complexity" is French for "I got mine."

Remember the old saw about the Chinese symbol for crisis being a hybrid of the icons for Danger and Opportunity?



It's bullshit borne of some business consultant looking for a profound-sounding moment or 'take-away."

Likewise, the Securitization of Debt and it's hoary babysitter, Hedge Funds, have little to do with Fiduciary Responsibility mated with Risk Management and everything to do with a different, old combo thing that gets us into trouble: Boredom and Greed. And it's yet another example of the search for feeling boost of Hyperrealism because the actual realism thing seems so damn stodgy what with it not having CGI and a crescendo-building soundtrack by Celtic waifs or chanting Monks or, by Nickleback.

Damn, I'm such a cynic. Too many boardrooms. But Tanta, of Calculated Risk, ain't buying it either.

Wharton on the Future of Securitization:

"The lurking concept here is 'leverage.' You want to make the big bucks investing in MBS? You leverage them. That's where those CDOs came from. A whole lot of this complexity is driven by the 'need' to goose the yield, not by some essential opacity of the underlying credits or the failure of originators to retain residuals--which, in fact, they actually did quite a bit of in there. The complexity came in because you can't get a tranche paying 12% out of a bunch of loans that pay 8% unless you create complex cash-flow structures hedged by complex rate swaps leading to re-securitization of tranches in new vehicles (parts of the MBS become CDOs, for instance).

So are all the rest of you convinced that market participants are going to give up on the chase for mo' better yield without regulation?"

One of my favorite clients wants me to believe this (Credit Swaps, SIVs, Bear Stearns, the whole thing) is about liquidity. No, it's about runaway human nature fire-walled from accountability by over-complicated jargon and 'cleverness,' and practiced by people who love to tell other people they just don't understand complex systems.

"Complexity" is, too often, French for I don't really understand it myself, but it helps me make a buck and it hasn't hurt my interests yet, so we'll worry about it later.

Why do I get so animated about this shit? Because me and mine, we're the clean-up crew once the "pros from Dover" get done self-actualizing themselves into others' oblivion. Yes, we try to fix the damage. And we get paid something for it. But I much prefer the other side of our business, where we deal in hope, humility and curiosity and opportunity. Because it's a sorry day when a Child Protective Services worker hopes for more customers.

Sullivan's Mythology: Obama needs more Cowboy

Andrew Sullivan has been dreaming and droning about Obama Republicans--and they are there. But he's taken the Reagan Democrat mythology and spackled it onto the man from Illinois without understanding, I think, how mythology works.

Let's have a look-see.

Peggy Noonan, semi-admiring Obama's Wright Speech here, channels Ronnie Reagan as is her custom, teeing it up for Sullivan. Andy then attempts a heroic bank shot off the gnome, the fiberglass rhino, and into the door of the windmill:

The Daily Dish | By Andrew Sullivan: That's why I think Pennsylvania is an opportunity for him. The most tired element, and the least refreshing aspect, of his message so far is a resort to left bromides about the grim facts of American life in the last twenty years or so. There are problems, real problems. Inequality, fostered by globalization, has left many Americans treading water at best. But the vitality of the economy, the astonishing creativity of American industry, especially in tech and pharmaceuticals, the miracle of the Internet, the relative cheapness of items like food and clothing that once consumed far more of the average American's expenses - these are also integral to the picture. Obama hasn't conveyed this complicated picture - perhaps because of the primary season. But he should. America needs hope. But it is not currently hopeless. And its recent past, despite the disasters of the past eight years, has had as many highs as lows.

Yes, the "left bromides about the grim facts of American life" are, well, grim, aren't they? But "if you can't say anything nice..." only goes so far here. A big part of slaying dragons and earning the hand of the fair maiden requires actually being in the company of, well, dragons. If dragon-breath, dragon-wreckage, and dragon-droppings make you queasy, maybe you've picked the wrong gig?

Andy is an unenviable position. Several really. He's actually trying to reconcile some of the metastatic misjudgments he's made in the last 8 or so years, most based on supremely magical thinking and mythic projection (Go to this Slate post of his look into the abyss.)

But, with his support of Obama, he's in a double bind. On the face of it, a vote for Obama offers psychic atonement and a public display of--what?--Hope? Practical open-mindedness? Atypical-white-personness? Probably some of each. But, and big but here, the Democrat's appeal to and via Kantian Intrinsic Goods such as Hope and Courage, Prudence and Charity have direct opposites in the concepts of Wrath and Fear, Sloth and Avarice. As Lakoff is noted for pointing out, orientational metaphors and concepts are meaningless without their opposites. Down needs an Up. Wrath demands Justice. Avarice evokes and revivifies Charity.

In a way, that's what this fight is about--Hillary versus Obama, I mean. He is tuned to Intrinsic and immutable concepts, she is aligned with the tired professional toolkit of "I'm about solutions™," otherwise known as Instrumental Goods. He compels others to consider self-sacrifice and Hope, she offers her time and energy and body as a Warrior, a sacrifice for our good - We Can versus I Will. Hers is truly a Martyr archetype versus his Sage or transforming Magician. Think about that for a moment. Hillary freaks over his ascendence because she, like certain others, can't hear the frequency of Obama's tune; can't understand how "words, just words" deserve any respect in a world of Men and Women of Action--in a world framed and formed by "Leaders" like her, each proud of their formulae and instruments. "Leaders" who misunderstand their job and turn it instead into "management," forgetting or never learning that actual leaders don't so much inspire others as they seek to catalyze those others to self-inspire. The reason this latter, truer definition makes sense is supremely practical -- you can't really do it alone, despite your admiration for Die Hard's John McClane or GE's Jack Welch. Leadership is a sort of 50 State Strategy for the heart and mind where everybody gets to fill their own big chair in ways large and small.

So, Andy, like a surprising (to some) cross-section of Americans are responding viscerally and behaviorally to their idealised self being reflected back at them by Obama. Andy likes liking Andy and believing the best of himself, as do we all. But, as guys like Jung and Boree tell us, the "Self"we're talking about here is the transcendence of opposites--the accommodation of higher and base elements within our psyches--not the banishment of the less savory bits. And there's the problem. Okay, the problems...

There are problems, real problems. Inequality, fostered by globalization, has left many Americans treading water at best.

Damn, "treading water" is what you do while waiting to be rescued, Andy. Or, while waiting for your asshole brother in law to come back around with the ski-boat. It's hard to be charitable and philosophical when you're snorting in water every couple of breaths. Reports from the field suggest most are praying the lifeguard gets to them quick. But I digress. What advantages should diminish the impact of Sullivan's tiring cultural swim test?

the vitality of the economy, the astonishing creativity of American industry, especially in tech and pharmaceuticals, the miracle of the Internet, the relative cheapness of items like food and clothing that once consumed far more of the average American's expenses

Do you see it, or is it just me? A vital economy that has many treading water. A sleek American socio-economic clipper deserving of awe from its "many" citizens, who, while treading water should find the time to admire it's astonishingly creative form as it glides past them on its weekly jaunt to Asia. (Their dream jobs in it's cargo hold one way and returning with those "relatively cheap items" that they tread some extra-more to afford.)

Now, I'm just a stupid business consultant, so take this for what it's worth, but there aren't many middle managers I've met who can muster sustained interest, never mind bliss, when asked to contemplate the trails blazed by pharma science and process materials patentry. Most are consumed with their own variety of dog paddle.

I'll stop parsing with "recent disasters" equaling some imagined "highs" since my overworked prose doesn't do justice to such easy sport as Andy presents. He does deserve some credit for tiptoeing up to that abyss: Sullivan's trying where others remain soulless and unapologetic cowards, armchair dragon-slayers, pretend warriors. But Andy's not going to find his absolution, his clarity (and nor would others), until he lets go of the a la carte method of characterizing the dragons he's really trying to slay.

He's not going to succeed in his apparent mono-mythic journey if he insists on making its requirements conform to him rather than the necessary other way 'round.

The mythology here is really the truest way to explain Andy's temporal battle. Myths are gathered collections of meaning holding immutable lessons played out by people with funny names doing alarming things. They are fantasy or fabrications on the outside, true and sustaining in some way at their core. But it's easy to get them muxed. Noonan's and Andy's Reagan, as history shows, was less their beautiful Achilles and more the mythical three-part Chimera defined - A persona that said one thing, an ego that did another, and a self that believed there was no dissonance between the two.

REAGAN (3/4/87): A few months ago, I told the American people I did not trade arms for hostages. My heart and my best intentions still tell me that’s true. But the facts and the evidence tell me it is not.

And so it goes; archetypes need not observe gravity and other laws if they feed some latent or damaged need in those who have the mass, the mouth or the money to sustain them.

Still, the Reagan Chimera, draped over the country as a whole, offends the sensibilities of people who are asked to agree that it is, in fact, a beautiful Pegasus-like steed at all times. It offends people whose mythology and reality are equally alarming: 20 year-old men hanging from trees and set afire is unbelievably horrible imagery fresh in the minds of now-70 year-old men who escaped alive that particular chapter of American White-Horse Exceptionalism. Likewise, 35 year-old workers told to get tech jobs to replace their disappearing factory ones now find, at 50, that the shiny economy they're to be so proud of rewards market sentiment and derivatives--a tea leaves-reading priesthood--not guilds of crafting or coding.

As a self-described clear-eyed man, Sullivan continues to take Myth to childish extremes. And to twist it's utility. He looks for the Perfect Hero, ignoring Achilles' heel, ignoring the flaws of the actor-president he adores; ignoring the necessary qualifications of "Hero." Andy wants Obama to heavy up on the Greek, and go easy on the Tragedy. He wants fantasy within the fantasy, a Gyro, not a Hero.

But, left to their own interpretive devices, grown-up Americans seem quite game to accept the truth within their ideal, to attempt an honest, unvarnished appraisal of at least one national dragon.

CBS/NYTimes National Poll: 70% Approved of Obama's Speech
by rashomon

And so, in order that Andy's cosmology can suffer least damage, Andy prescribes that Obama contort himself to the wrong kind of fantastical storytelling, falsifying the depth of lesson-learning and fact-acknowledging that underlies Obama's outward appeal. Andy wants Obama to make it all better by ignoring what made it "worse." But that is a recipe for another fabled tale, the continued Sisyphean boulder-pushing many sense of life in these 21st Century times that were supposed to be "better."

-----

Since we mention the Kant stuff above, an update for those following along: M&T has its legs and has had some rudimentary presentations to some hardcore political and finance types last week. The reaction was pretty good and our explanation of OODA, category/event, and the leverage of R-Complex was a hit; clarity achieved. More work to come, but great news.

Parents, you cannot win. Immediately, anyway.

One of the large aspects of parenting seems to be patience. Sometimes it's fruitful and on or in your terms, sometimes you have to wait inordinate amounts of time to get some "payback." Sometimes you get weak signals.

Mrs Fouro got this Sunday nite from the oldest grrrl:

You're driving me insane

====

If you ever try to change me
You’ll have a hard time
Cause I’m stronger and greater
Than any old wine

Try to drive me crazy
Try to drive me cruel
I'll win you know it
I rock that cool

You’re driving me insane
But I’m to blame
Just leave me alone
We aren't the same
But I’m to blame!

====

This is the only way I know who to say it…
Sometimes this is how I feel!

Oh yeah. Wish for an independent-minded, self-determining daughter and you'll get one. But as I read that poem I felt the pangs of parental control (and resistance and eventual wisdom) that I recognized. Mostly, since this was directed and emailed to Mom, and I'm just an interested CC'd by-stander, I wanted to add to Mom's mix:

We want for our children what we want for ourselves,
courage, patience, strength, wisdom, good fortune, humility

We want for ourselves what we see in our children,
Beauty, humor, curiosity, hope, love, comfort

And we want for the world what we desire inside,

the patience to remain hopeful until we begin to hear our own lessons, not just those of others

the courage to learn that good fortune without curiosity or love is seldom beautiful

the wisdom to know that learning is life, and life is change and change is always a challenge because, well, “why change perfection?”

And, finally, the humor to laugh at our pretend “why change perfect?” selves and at the mistakes they lead us to, with love enough to laugh it out loud. This shared noise called laughter is the ultimate lesson and sign; the ultimate knowing:

Strength is humility is curiosity is courage is strength.

"Mom" is doing an awesome job, even if "daughter" can't appreciate it yet. Gee, I should write a book about this phenomenon.

New York Manhole Covers, Forged Barefoot in India

Manhole covers. Bulky, analog, grimy, un-sexy, lightly-skilled. In other words, just like 80% of the work and abilities of any nation's population curve. This is why I think Thomas Friedman is as full of shit as the guys who came up with Pets.com and S&L Deregulation.

New York Times

The scene was as spectacular as it was anachronistic: flames, sweat and liquid iron mixing in the smoke like something from the Middle Ages. That’s what attracted the interest of a photographer who often works for The New York Times — images that practically radiate heat and illustrate where New York’s manhole covers are born.

When officials at Con Edison — which buys a quarter of its manhole covers, roughly 2,750 a year, from India — were shown the pictures by the photographer, they said they were surprised.

“We were disturbed by the photos,” said Michael S. Clendenin, director of media relations with Con Edison. “We take worker safety very seriously,” he said.

Now, the utility said, it is rewriting international contracts to include safety requirements. Contracts will now require overseas manufacturers to “take appropriate actions to provide a safe and healthy workplace,” and to follow local and federal guidelines in India, Mr. Clendenin said.

West versus East elitism? First world-view idealism against Second- and Third-World desire to feed the kids? Maybe so. But something's worth saying plainly that gets downplayed by Wall Street and other neo-liberal free-trade fans: Just as water seeks its own level, Indian foundry workers and other semi-skilled professions will enjoy a slow increase in wages and opportunities over the next 40 or so years as they approach some kind of parity with the West. We, on the other hand, will have to see a more precipitous drop in living standards in order to contribute to that journey to equilibrium point. When we get there, here will feel more like India than India will seem more like us. Looks something like this graphic, via BusinessWorld India.



Hype? Will it look as bad as that? Well, what's your definition of "bad"? If it's only 20% as bad as the graph it's still net awful for Americans with with relatively stagnant wages (measured against inflation) since the late 70s.

So, question is, as we expand the wading pool to Olympic size and the water level drops from chest to ankle (the oft-avoided bullet point in free-trade pitches) what do we do as more and more of our unavoidably bell curved population becomes over-priced labor and appears by comparison, at least to certain balance sheet cowboys, as safety-obsessed whiners? For those still resisting the parallel Moonshot & Tsunami opportunities of our time, Energy and Climate, the urge to attach Darwinist blame, to resist, and to pretend to the strong vitality of their ideas and models will be overwhelming.

That's the difference between markets and humans; between maturing industries and maturing parents. Both may resort to cosmetic surgery, comb-overs and Viagra. Many will find diversion in the feel-good pretend Harlequin business-romance of Tom Friedman. But, for the most part, the parental versions of Mature who fight against time and gravity have an interest in seeing their successors succeed--and exceed--them. And if they don't, maybe an equivalent graph...

Do client employees give you truth in interviews?

Initially? Without a trusting relationship between the two of you? When the loss of jobs or apportioning of fault/weakness is the potential outcome? Check out this video interview of Navy Intel specialist and atty, Lt. Cmdr. Charles Swift

…To me, it’s unfathomable that we are up against the line. You know, again, looking back at WWII, what history’s taught us, what we found is the reliable means of getting intelligence, at least in the context of a war, are using those things that build rapport with the person. That they find out you’re not the ogre they’ve been told, they begin to question the people who are leading them. And eventually, that leads to actionable intelligence and it’s reliable.

Trust and the revealed Truth that comes from it. This is so basic to human nature that it both surprises and doesn't. We want a limbically balanced world where an eye for an eye gives us both visceral satisfaction and useful information. Problem is so many physical laws don't work that way, never mind the seeming counter-intuitions of how our grey matter helmet functions: you want me to *dive* my aircraft to gain speed to recover from a deadly stall that already has me helplessly pointed at the ground? You must be crazy!

The examples of less is more, flow beating force, are often understood by ground practitioners. Dozens of martial arts moves are dependent on leverage allowing the small to take down the overwhelmingly large. Looks impossible, but it works thanks to understanding and skill, and a brake on the useless impulse. In a world that has passed beyond the "boring" inputs of reality to the cartoonish hyperreal, we again see our victimization by our own paleo-brains. Thanks a bunch, Hollywood. Some say "never bring a knife to a gun fight." Those people don't need survivors to provide them with information, nor do they concern themselves with blowback or insurgency (and insurgency is a fine description of what happens also within many organizations burdened with dull leadership.) But, if they're only educable by the fairy tales of film, they should watch a knife used properly by the likes of Britt (James Coburn) in the Magnificent Seven.

I'll be posting much more on this hyperreal thing in the coming weeks.

Are you Right or Left Brain dominant? A Test

Quick, which direction is she twirling?



If you say clockwise, you may be Right- brain dominant. Counter- clockwise means Left- brain preference.

I'm not sure this is exactly super scientific but one thing is fascinating. I saw clockwise first. (No surprise for those who know me.) But, then my eye scanned elsewhere on the page, and when I returned my eyes directly to her she'd flipped directions - I was perceiving counter-clockwise.

I was actually kinda freaked. I looked at her some more trying to "see" clockwise turning. Nothing, still anti-clockwise.

Then I started reading the list of attributes below and halfway down one stack of words there was perceptible shift in the corner of my eye. Damn! She'd reverted back to clockwise as I was assimilating the bullet points. Below is the list of attributes. Try it and see how it works for you.

LEFT BRAIN FUNCTIONS uses logic detail oriented facts rule words and language present and past math and science can comprehend knowing acknowledges order/pattern perception knows object name reality based forms strategies practical safe

RIGHT BRAIN FUNCTIONS uses feeling "big picture" oriented imagination rules symbols and images present and future philosophy & religion can "get it" (i.e. meaning) believes appreciates spatial perception knows object function fantasy based presents possibilities impetuous risk taking

=====

In a way, she really is a like a tachometer for our brains. As I was perceiving her in right-brain mode (home to instantaneous image perception and other sensory gestalt), perhaps my left hemisphere, home to theories and chunks of knowledge (words, words, words!) began to kick in to attempt an answer to "what's going on here?" That flip of focus seems to carry with it a different set of "eyes." What's it mean? I'll save what I think for the book (OK, for a taste click on Brain, Metaphor Archetype, Brand at right). But here's something: Beware Power Pointers and Bullet Listers: Halfway through the list of bullets is where I, at least, flipped onto Right-Brain again without consciously deciding to do so.

Maybe my sensation-seeking brain took over and wanted not lists or packeted discipline, but instead, all-at-once imagery--"big picture" or, perhaps, just the stimulation and simplicity of plain old pictures, moving or not. In other words, in order to keep my attention on that list of points, after about 3 seconds the words would have needed to start doing something with each other or doing something to the cones and rods collecting light in my eyeballs. Your mileage may vary. Whadaya think?

Link

UPDATE: I've gone ahead and broken the GIF down into frames (34) here. Nope, it's not a cheap reverse-direction thing. Click the link for some thoughts on how our brains' might infer different directions for her.

and we see some possible reason

UPDATED UPDATE: We've had many many many hits since hitting send on this "throwaway post" so I thought I should correct some--but by no means all of--the sloppy inferences and grammar in the above text.

In addition, one thing I overlooked (ha!) is that there seem to be parallels to the practical experience of presenters and Powerpoint™ cowboys: Don't say what you are showing on screen; mix your images to stimulate attention in your audience. People bore when both hemispheres are experiencing comparable concepts ("Seen it, done it, got the free t-shirt.") So. don't "say [read] what they're seeing" but, instead, find imagery that challenges your audiences' assumptions. Why "challenge" them? Important point. Assumption, or bias, a harsher word than Assumption, is latent in everyone. And, people's bias is your persuasion target, not the people themselves. If you attempt to persuade, you will lose. But, if you engage their mental library of metaphors and images in service of your (seemingly) counter-argument, then you will have them working to make your "adjustment" cohere with their already established belief. Think about it.

50 years after Sputnik

NYT has an extensive commemoration of space, trivia and not-so trivial. Start here.

7-20-1969

A belated Memorial Day post from Mark Twain



Mark Twain's The Mysterious Stranger: A Romance, via UVA's etexts.

Chapter 9, Satan unloads...

"Oh, it's true. I know your race. It is made up of sheep. It is governed by minorities, seldom or never by majorities. It suppresses its feelings and its beliefs and follows the handful that makes the most noise. Sometimes the noisy handful is right, sometimes wrong; but no matter, the crowd follows it. The vast majority of the race, whether savage or civilized, are secretly kind-hearted and shrink from inflicting pain, but in the presence of the aggressive and pitiless minority they don't dare to assert themselves. Think of it! One kind-hearted creature spies upon another, and sees to it that he loyally helps in iniquities which revolt both of them. Speaking as an expert, I know that ninety-nine out of a hundred of your race were strongly against the killing of witches when that foolishness was first agitated by a handful of pious lunatics in the long ago. And I know that even to-day, after ages of transmitted prejudice and silly teaching, only one person in twenty puts any real heart into the harrying of a witch. And yet apparently everybody hates witches and wants them killed. Some day a handful will rise up on the other side and make the most noise -- perhaps even a single daring man with a big voice and a determined front will do it -- and in a week all the sheep will wheel and follow him, and witch-hunting will come to a sudden end.

"Monarchies, aristocracies, and religions are all based upon that large defect in your race -- the individual's distrust of his neighbor, and his desire, for safety's or comfort's sake, to stand well in his neighbor's eye. These institutions will always remain, and always flourish, and always oppress you, affront you, and degrade you, because you will always be and remain slaves of minorities. There was never a country where the majority of the people were in their secret hearts loyal to any of these institutions."

I did not like to hear our race called sheep, and said I did not think they were.

"Still, it is true, lamb," said Satan. "Look at you in war -- what mutton you are, and how ridiculous!"

"In war? How?"

"There has never been a just one, never an honorable one -- on the part of the instigator of the war. I can see a million years ahead, and this rule will never change in so many as half a dozen instances. The loud little handful -- as usual -- will shout for the war. The pulpit will -- warily and cautiously -- object -- at first; the great, big, dull bulk of the nation will rub its sleepy eyes and try to make out why there should be a war, and will say, earnestly and indignantly, "It is unjust and dishonorable, and there is no necessity for it." Then the handful will shout louder. A few fair men on the other side will argue and reason against the war with speech and pen, and at first will have a hearing and be applauded; but it will not last long; those others will outshout them, and presently the anti-war audiences will thin out and lose popularity. Before long you will see this curious thing: the speakers stoned from the platform, and free speech strangled by hordes of furious men who in their secret hearts are still at one with those stoned speakers -- as earlier -- but do not dare to say so. And now the whole nation -- pulpit and all -- will take up the war-cry, and shout itself hoarse, and mob any honest man who ventures to open his mouth; and presently such mouths will cease to open. Next the statesmen will invent cheap lies, putting the blame upon the nation that is attacked, and every man will be glad of those conscience-soothing falsities, and will diligently study them, and refuse to examine any refutations of them; and thus he will by and by convince himself that the war is just, and will thank God for the better sleep he enjoys after this process of grotesque self-deception."

Complicated or Complex?

Puzzle or Mystery?

Smithsonian

There's a reason millions of people try to solve crossword puzzles each day. Amid the well-ordered combat between a puzzler's mind and the blank boxes waiting to be filled, there is satisfaction along with frustration. Even when you can't find the right answer, you know it exists. Puzzles can be solved; they have answers.

But a mystery offers no such comfort. It poses a question that has no definitive answer because the answer is contingent; it depends on a future interaction of many factors, known and unknown. A mystery

cannot be answered; it can only be framed, by identifying the critical factors and applying some sense of how they have interacted in the past and might interact in the future. A mystery is an attempt to define ambiguities...

Wanna say more on this, particularly some of its examples, but I'll have to come back later.

Climate change: A guide for the perplexed

Britain's New Scientist offers the below and, I'm sure, no good deed will go unpunished on teh internets. Each bullet is a link tackling the question in this guide post (ayeee, sorry)

In the articles we've included lots of links to primary research and major reports for those who want to follow through to the original sources.

• Human CO2 emissions are too tiny to matter
• We can't do anything about climate change
• The 'hockey stick' graph has been proven wrong
• Chaotic systems are not predictable
• We can't trust computer models of climate
• They predicted global cooling in the 1970s
• It's been far warmer in the past, what's the big deal?
• It's too cold where I live - warming will be great
• Global warming is down to the Sun, not humans
• It’s all down to cosmic rays
• CO2 isn't the most important greenhouse gas
• The lower atmosphere is cooling, not warming
• Antarctica is getting cooler, not warmer, disproving global warming
• The oceans are cooling
• The cooling after 1940 shows CO2 does not cause warming
• It was warmer during the Medieval period, with vineyards in England
• We are simply recovering from the Little Ice Age
• Warming will cause an ice age in Europe
• Ice cores show CO2 increases lag behind temperature rises, disproving the link to global warming
• Ice cores show CO2 rising as temperatures fell
• Mars and Pluto are warming too
• Many leading scientists question climate change
• It's all a conspiracy
• Hurricane Katrina was caused by global warming
• Higher CO2 levels will boost plant growth and food production
• Polar bear numbers are increasing

Jolly Wally Schirra, dead at 84

Scientific American/Reuters article

Naval Academy's bio

Innovate? But it's raining, Fouro.

Innovate? But it's raining, Fouro.

Been quite bz around here in the first qtr, so, in lieu of catching up with some lame posts I thought I'd upload some of what we've been exploring and sharing. These are sized down so a click or two to "view image in new window" should make them legible. See any patterns?









































I'll bet your brain hurts after all that.

Bar-charts or Bearskins?

Had to go to a certain financial institution what likes visigoths and assorted meanies in their ads, yesterday. On the way, one of our group mentioned a radio story she's heard earlier in the day about a study, one that claimed, as she put it, "rich people aren't motivated by money." After listening to the top line, we agreed: "Sounds goofy--they do care, but about significant amounts of money. And by the time you've reached "significant," money isn't "money" anymore. It's something else.

Not a bad conversation to have on the way to talk to some nice people about what makes financial services workers engage with boring old, mostly invisible money. Anyway, trolling neuroscience blogs this morning and lookety here, via the frontal cortex....

"They were bored by the pocket change."

w00t!

Poor People Learn Faster

Marginal utility can be measured. According to new research out of Wolfram Schultz's lab, poor people are much quicker learners than rich people when playing a Pavlovian paradigm for small amounts of money. (Poor people took about 12 trials to figure out the game, while rich people took about 35 trials.) This behavior was then confirmed with fMRI. Sure enough, rich people demonstrated less dopaminergic midbrain activity than poor people in response to the experimental paradigm. They were bored by the pocket change. Here's the abstract:

A basic tenet of microeconomics suggests that the subjective value of financial gains decreases with increasing assets of individuals ("marginal utility"). Using concepts from learning theory and microeconomics, we assessed the capacity of financial rewards to elicit behavioral and neuronal changes during reward-predictive learning in participants with different financial backgrounds. Behavioral learning speed during both acquisition and extinction correlated negatively with the assets of the participants, irrespective of education and age. Correspondingly, response changes in midbrain and striatum measured with functional magnetic resonance imaging were slower during both acquisition and extinction with increasing assets and income of the participants. By contrast, asymptotic magnitudes of behavioral and neuronal responses after learning were unrelated to personal finances. The inverse relationship of behavioral and neuronal learning speed with personal finances is compatible with the general concept of decreasing marginal utility with increasing wealth.

Ouch. And zzzzzz. Poor people learn faster? Or, rich people yawn at the familiar, the already 'learned,' and the seemingly easy?

Now, I could see where we could get into how this *seemingly easy* thing could get people in all kinds of trouble. That would be a cool study. Something about the inverse relationship between confidence and competence and the dangers of broadbrushing--confusing catgeories of things with their individually unique events.

What if, say, the lowly dismissed quarter was a Standing Liberty worth $8,000? What if the "rich" person was seated in a waiting area with CNN on in the background? What if one of the TV bobbleheads did a quick story about rare coins and their value?

A rare coin and a rare chance, yes. But maybe a quarter's not a quarter anymore after that. What has it become? A challenge? A reminder to look closely? An affirmation of your keen observational skills? A worthy adversary? *Real* money?

Marginal utility and incentive. At certain levels, money ain't "the thing" for peeps who gots money, it's what their money sez about them to other folks who ain't gots. Hello, Darwin; and, Hi there! Signifying and Being Noted. Might as well be about who's got the sharpest spear, the best nose and the quickest reflexes. In that case, the tallest pile of the plushest bearskins would be the marker. And the bragging right. And the factor what makes the girlies think you're handsomer and stuff. The other boys? They just keep asking if you've been working out.

In a larger, more serious sense, this really is a nice reminder of how when all others have their heads down or noses to grindstone being all dedicated n stuff, guys like Apple's Jobs or Chrysler's Lutz or Southwest's Kelleher come along and "change the game."

But, what they really show is that, "Whooops! All along, the game wasn't about what you thought it was, was it fellas?"

Look! A bear!

What a great idea for a book

Do you know what today, 7-20-2006 is? It's Moonshot Day.

Anybody out there? Sorry for the extended absence, most of my writing will still be offline til Labor Day.

But today seems a perfect day to explain a bit of why. Mike Dewitt of Spooky Action and I are writing a dead tree book. (Yeah, it'll have all the online bells and whistles also.)

It's called Moonshots & Tsunamis (colon and descriptor TBA), from a phrase we coined sometime back as shorthand for what gets people up off their butts and into doing extraordinary things. It's about change management. It's about innovation. It's about leading and feeling and thinking. And it's about strategies and models for those things. All of which means, it's about people, and what makes them rev and tick in this here 21st Century.

The premise is simple: Nothing gets done, and stays done, without a "Moonshot" or a "Tsunami."

Here's a little bit of what to expect:

M&T is about following your gut: the instincts and rule-sets God and Darwin gave you and which you, dear reader, have augmented with your experiences and education. The Various models and scientific or managerial explanations you'll encounter in the book are more often than not, rational supports--reason to believe or trust--in the face of an uncomfortable truth for some. We are creatures of amazing potential, but our actions and achievements are the products of emotion first and foremost.

The reason Mike and I wrote this book is simple: If logic, models, sage advice, facts and rules are all it takes to be successful in business or leadership or life, why do so many fail to achieve that success? Yes, you can lead a horse to water...

We believe that the models of others, from Six Sigma to the 7 Habits of Highly Effective People, are often ineffective because, well, they belong to others. They are the fruits of someone else's experience and feeling. Someone has thoughtfully reverse engineered their particular understanding of the world and its challenges and offered it to us, packaged and bullet-pointed. They were probably very successful in applying it as a personal model, one that worked spectacularly for them.

The challenge comes when we try on another's custom-tailored suit. Whether I'm "moving someone else's cheese," or, indeed, explaining a thing called Moonshots & Tsunamis, there is often one person that's left out of the "How to?" and the "Who cares?" That person is us, in all our messy, unpredictable yet hopeful glory. So guess what? The one model we will attempt to exalt and explain over all others is you.

Sounds pretty ambitious, doesn't it? It is. And we will fail miserably in doing so. But, in trying to cut through the clutter of all the business and leadership ideas that leave you out of the equation, we will hopefully have credibly suggested some things that are quite rare for this type of book:

1. Life is much simpler than we suspect.
2. People don't know what they think, or how.
3. Emotion trumps logic.
4. Nothing gets done, and stays done, without a "Moonshot" or a "Tsunami"

Arriving at the sum of these four points will require us to delve into the assertions and models of others, some of which you may find in bookstores or on movie screens today. Other ideas you'll recognize as being thousands of years old, the products of collected wisdom, history and the Bill Gates's and Edisons of ages past. And, among other things, we will see that there are no new ideas, only old ideas applied in new and unexpected places.

You, dear Human reader, are an old idea, capable of new things, but often, misunderstoood.

A Tsunami. A Moonshot.

French mathematician, Blaise Pascal, said "The heart has reason that reason does not know." But, notice, he did not say that the heart and it's particular reason was unknowable. And there's the nub of why Moonshots & Tsunamis came to be.

Think back to the 1950s. We were consumed with thoughts of a Tsunami -- "The Red Menace," Sputnik, even rumours about the nefarious plots underlying the flouridation of water were everywhere. Amazingly, we had gone from one of America's shining moments, a true team effort ending with victory in World War II, to a decade of suspicion, anxiety and accusations. Sen. Joseph McCarthy and others roiled the waters of that Tsunami mindset with the Army-McCarthy Hearings and the House Unamerican Activities Committee. Hollywood stars were blacklisted, screen hero cowboys were now enemy suspects. Elementary school children were drilled to hide under their desks and dads were digging holes in the back yard for things called bomb shelters.

What a drag.

Then we had an election. John F. Kennedy became our 39th President. And he did a thing that many of us still regard as a highlight of the American resume. He took idle hands, and anxious heads and hearts and gave them focus. He took the potential energy of that Tsunami which, up to then, had been channeled to mostly narrow and limiting ends, and he turned it into a gift. He gave us a Moonshot, literally, and metaphorically.

Perhaps he did it intuitively. Natural leaders do such things all the time without really getting bogged down in the whys and wherefores. Maybe he was just just a very canny man. Either way, it's important to note that his transformation of Tsunami into Moonshot was done without the "aid" of focus groups, market testing, statistical analysis, or the fashionable business process of your choosing. It was the thing to do. He did it. And so did we.

Let's talk about how...

Take it easy. You're making us look bad.

Take it easy. You're making us look bad.

"We have to walk before we can run."

Overheard that nugget being used to flog a really smart person today.

Bullshit.

Infants have to walk before they run. But they only run if their parents let them; only if those parents remember that falling and getting a boo-boo is part of growth and ambition.

But "walk before we can run" gets used by 45-year olds overseeing 30-year olds all working for 75-year old companies. Not too many diapers in those boardrooms. Just plenty of "wubbies."

No, "We" don't run because those who can grant permission--encourage the running--prefer to walk. Walking is a higher percentage endeavor in their eyes. A lower exertion one, too. Running is not their ambition, exposure makes them anxious. Horizons make them squint.

Problem is, people are hard-wired to run. And to admire the fleet of foot. And to follow them. In business and evolution, running is a primary adaptation that allowed man to climb to the top of the heap. Running ahead too far has it's dangers certainly, but those are issues of direction and purpose, not speed--running just to run, to feel or look busy, not to get somewhere. Too bad Darwin proves the "walk before we run" business people wrong. Too bad, for all of us, that what "walk before we run" people really usually mean is: I prefer camouflage to speed. And average over ambition.

Run. As soon as you can walk. You'll encounter more numerous useful experiences. You won't get eaten as easily. And you'll like who you become.

Dispatches from the Climb Ev’ry Mountain department

Boy, there sure is a lot of jostle and champing at the bit out there in blogville. A disturbance in The Force. I love it! Yesterday afternoon, I was pointed to Seth Godin’s post on Alpha Credit Card Execs and Beta CPAs (Fair characterization, Seth? Probably not.):

I just finished giving a talk to a group of 400 high-powered (high-leverage, high-paid) credit card execs. As I left the hotel, I passed a much smaller room, where a seminar for local CPAs was going on...

The difference, i think, was that a long time ago, the people in the second room had made a decision about what they deserved, or what they were capable of, or what they were going to stick with. And it was a bad decision.

Then, I find Business Pundit lamenting the lack of ambition and rambunction in companies:

Talk is cheap. I guess that is why so many people talk about being great but never do anything about it.... I. Don't. Understand. Sometimes I think we benchmark not to see if we are better than our competitors, but to make sure we are all doing the same things so that we can feel comfortable.... I think most companies are confined to mediocrity because they want to do what everyone else is doing. It gives them a sense of confidence that they are on the right track when in truth they are just playing follow the leader.

And, in comments, vinod has this:

Generally, there are only 2 [opportunties] to get out of "Chasing Taillights" mode -

1) at the VERY START of the venture - before any revenue commitments are made, employee orgs are designed, relationships with external firms are constructed, etc. This is the "having sex" part of new venture creation ;-) You've got a blank slate.

2) AFTER the company is profitable / out of the woods - when the short / medium term health is secure, and you've got enough time / $$$ to fund exploration.

Fair enough. But relative to what Seth, Rob and vinod are saying is this point: many of these people are only following the rules as they’ve been set out for them. Set out wrongly. In my estimation, we see the tail wagging the dog of what Business is really about: Allowing men and women to exercise their creativity and energy, with profit as proof of their success, not a ring through their noses.

In that vein, let's add another, third bullet, to vinod's above--one I think has far more probability of occurring than his "#2":

Henry Kissinger once said "A lack of choices clears the mind marvelously." When companies are against the wall, when every available arrow in their quiver has been shot and missed, their "sliderules" are failing them, they then become open to new ideas; teachable, as it were.

Large scale case: Chrysler was in the dumper several times in the last few decades. In many instances their problems stemmed from a lack of leading their market and getting stodgy and bureaucratic, causing finance/senior management to dictate strategic risk choices due to their lesser size relative to competitiors. This led finance to go to the only bag of tricks they knew and felt comfortable with. Messy, wrong acquisitions and projects as silver bullets and "leapfrog " moves--Lamborghini, for instance. I'm simplifying for space, but these suit-centric choices, if you will, got them in holes and delivered them to death's door. At this point, many traditionalist auto-types gave up on Chrysler and bailed for another "host". Suits gone, guys like Bob Lutz, were allowed a "What the F*ck," last ditch effort. In other words, freer reign.

("Whadawegot to lose?" Who was watching to say, "NO"? )

What did Lutz do? He raided design schools and foreign and unusual sources and shipped in a hot rod culture and let them go to it... Cars built for love of curve and metal, for love of cars. Bing bang boom, Viper. Using a V10 development people in finance hated because of parts economics of scale, and because it wasn't their idea in the first place. Next: Prowler. Next PTs. Next: Curvy-fendered Ram pick-ups when the trend was to GM's boxy longbed frame and body of the 1500s and Suburban genre.

They were designing cars people suddenly "had to have." Lotta craft, lotta love, lotta intuition, and Bob Lutz out front running interference with his "First law": The customer is not always right. In this case, he meant designing to the customers desires, ahead of them, not to the customers specifications, which was what previous management had done with focus groups and market testing concepts to death--not one, but three! cupholders as "design breakthrough!" He let people exercise their love and skill, used some unususal research models like cultural anthropology and resurrected a winner. Even Daimler-Benz got interested, not for Chrysler's sexy balance sheet--it still wasn't all that sexy, yet--but for their ideas.

And that brings us to the prologue. Once craft and goofy passion had generated the new appeal, guess who got re-interested and re-exerted their control? Yes, the suits. Cat's away the mice will play. The suits then went to their "craft" and engineered a very dumb M&A with D-B, two different DNA streams, poorly imagined and merged. Not impossible, but poorly understood and intuited. And now, the indigestion is getting worse. Germany and the US are at each others throats. Again, an arranged marriage signed in differing blood types, on a balance sheet, not--NOT--on a dogeared 1969 copy of a Le Mans month Autoweek, after a suitable period living in sin to learn and blend each others quirks, as it should have been.

Now, race back to the 1920-30s when car manufacturers were everywhere. Look at a PT cruiser or Ram. Shape remind you of anything? A Packard, Ford, Doble, Velie, Studebaker, Hudson or Dodge of the era? Of course it does. Car designers didn't have CADCAM or statistical sampling or one way mirrors with customers behind them to guide ideas. They had their gut, their art and their craft.

Now go back further: Adam Smith. Division of Labor. 1776. Wealth of Nations. Smith knew he was onto something good. But, while he may not have seen all the effects of his newly new minted economic description, he recognized one: It’s stifling potential on people’s minds and ambition….

“if man is not asked of his work to exert his understanding, or his invention when presented with challenges, then he generally becomes as stupid and ignorant as it is possible for a human creature to become.

Funny how most of us business types gloss over that one for the more soul-crushing but "actionable" examples of mass production Smith used in his Pin Factory example, eh?

And herein lies the entrepreneur's dilemma: We are allowed to make it very personal, to actualize ourselves in the extreme through our business efforts. For us it's not business, it is personal. But the structures we then create, unless we're very careful, suck the very same passion we crave out of the efforts of those who work for and represent us. We then demand of our people "Where's the commitment!? Where's the magic?!" Once we're done huffing, we then unleash them on unsuspecting customers who somehow sense from these employees: "Gee, it's all business with this guy. Where's the humanity and flexibility and can do? Where's the power? Where's the personal?"

Ladies and gents, Seth and Rob and Vinod are right to wonder. They're just right. It doesn't have to be that way. This way.

You have the Pole.