Tuesday, November 18, 2008

NO to the Auto Industry Bailout

I am not alone in saying NO the auto industry bailout. Many Americans feel the same way. The reasons may vary but most people I know don't want this bailout - including my Democrat friends.

We all feel the same way - why should our tax dollars be put into bailing out antiquated, inefficient, irresponsible companies?

Democrat and Republican voters might have differing views on the UAW and their role in the inefficiencies and irresponsibility of the Big 3, but we agree that the auto makers need reform and that those reforms should NOT be financed by our tax dollars.

I think most American voters are not comfortable with paying more taxes to fund a bailout of big companies when all of us are hurting and need our own individual bailout.

I personally hate Ford, GM, and Chrysler. I hate the companies because they make crappy cars. Their trucks suck; nothing more than giant gas-guzzling, top-heavy, road-hogging pieces of crap. Those things can't keep value, are loaded with extra crap, and are highly over-priced with average starting prices at $25,000. I drive an import. I have been a Honda man - and have lately found great value in Hyundai's Sonata - features, reliability, and great price. There's nothing in Ford, GM, or Chrysler's inventory even remotely close to that quality or value. Plus, there's no sedan that any of those Big 3 offers that is at all comparable to the Honda Accord, Toyota Camry, or Hyundai Sonata.

I also hate the UAW and union workers. On top of, clearly, overpaid executives that continue to fumble the ball managing the Big 3, union auto workers are classic examples of overpaid, underworked labor. These guys make more money than I do, have more benefits than my job offrs, and I have a friggin college education! A college education is supposed to offer MORE economic opportunities, right? What gives? But I am not mad about them making more money - that's part of this society to be able to succeed spectacularly or fail miserably. What I don't like is the idea that the auto maker executives AND union workers want tax-payer money to continue to fund their cushy overpaid, underworked, lazy butts. Why should the government take the food out of my mouth to help their worthless butts keep their jobs?

I can say this with clarity because my job is non-union. So why should I support any union jobs with my tax dollars? It's a rhetorical question because I don't support it.

I can also say all this with clarity because Honda and Toyota manufacture their cars here in the US and they use non-union labor. They bring manufacturing plants to places OUTSIDE of Detriot and Michigan to places like Tennessee. These companies do very well. They employ workers, they sell their cars because the cars are well-built and have great value. The companies are efficient in manufacturing, keeping costs down, and they produce wise cars. Oh, and they also don't cheapen themselves by selling fleet vehicles.

Now if Honda and Toyota can do this, so can US automakers. US automakers can have fairer, non-union labor. They can make fuel-efficient, small cars. They can push the envelope of automotive engineering. Better manufacturing, better engineering - all of this is possible and it's been done already! The Big 3 - both management and union - are just way too lazy to evolve.

That's why I say NO to the bailout. Screw these guys. Let the fall, let them rot. They refuse to change for the better - and yet want tax payer money to help them to keep their ways? NO! Money is a great incentive - and they should be forced to change under duress.

Management needs to trim the fat. The surviving managers need to be driven like slaves to install refined and efficient manufacturing - and better business models. Engineers need to be slave-driven to push automotive engineering for more reliable and fuel-efficient cars. And Labor needs to "de-unionize". The union needs to be broken. When manufacturing is so streamlined with automation, there's no reason auto workers should be so highly overpaid. Labor is labor - if you are paid to press a button, you should be paid a wage befitting pressing a button.

Monday, November 17, 2008

Jerry Yang Stepping Down from Yahoo - Finally?

Breaking news now - Jerry Yang is stepping down from Yahoo. He will step down from Yahoo as CEO as soon as a suitable replacement is found for the position. He'll remain with Yahoo and resume his former position of "Chief Yahoo" (rolls eyes - throwback to the crazy names from the pre-Dotcom Bubble Burst days).

YHOO closed 10.63 on November 17, 2008.

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Wednesday, November 12, 2008

Tuchman's Law - Is The Economy Really That Bad?

Economic news is depressing these days. Ford and GM are dying - with shares trading at below $4 a share. Banks have failed. Even entire countries like Iceland is facing bankruptcy. Oil, which was hit by speculative trading that drove futures to nearly $150 a barrel have fallen - below $60 a barrel as of closing November 11, 2008. US consumers are not shopping affecting retail, particularly this holiday shopping season.

Home foreclosures continue, driving down home sales both new and existing. Cars are not selling, gas consumption in the US and worldwide (including China) have waned. And now - increasing rounds of layoffs as corporations attempt to trim the fat.

Yet even with all of these economic bad news, for most of us, is it really that bad? Or are we still functioning but with more sacrifice?

No doubt a lot of people are feeling the pain and have curtailed a lot of "luxuries" (whatever that may be - for me, it's going to the movies).

But, the fact that the bad economic news is not juxtaposed with the latest robberies, mugging, or murder-suicide over finances and is, instead, matched with more economic bad news, it makes me wonder if most people have found a way to cope.

Perhaps the American and human spirit is more resilient and is capable of coping with economic hardships. Perhaps, Tuchman's Law is in effect?

Tuchman's Law was coined by American author and historian, Barbara Tuchman who wrote "The Guns of August", a history about the buildup and first month of World War I. The book, by the way, was referenced by President John F. Kennedy during the Cuban Missile Crisis and he encouraged his Cabinet to read it to help deal with the crisis (a really well done movie, Thirteen Days, is about the Cuban Missile Crisis).

Tuchman's Law, however, states that the presence of negative news would have you believe that the world is ending and that it seems at every moment, something bad is going to happen when the reality is that bad news is actually OUT of the ordinary.

The fact of being reported multiplies the apparent extent of any deplorable development by five- to tenfold. Disaster is rarely as pervasive as it seems from recorded accounts. The fact of being on the record makes it appear continuous and ubiquitous whereas it is more likely to have been sporadic both in time and place. Besides, persistence of the normal is usually greater than the effect of the disturbance, as we know from our own times. After absorbing the news of today, one expects to face a world consisting entirely of strikes, crimes, power failures, broken water mains, stalled trains, school shutdowns, muggers, drug addicts, neo-Nazis, and rapists. The fact is that one can come home in the evening, on a lucky day, without having encountered more than one or two of these phenomena.(reference)

I suspect that for most of us, the presence of the economic bad news has strained us, but has not broken us, caused us to be homicidal or suicidal (much). Perhaps my faith in God is also my strength because I know who's in control, regardless of a Democrat or Republican in charge.

But with most Americans having faith in a God - be it Christian, Jewish, Muslim or other - I suspect that most Americans are coping and making appropriate sacrifices, strengthened by their faith.

So while the news seems bad, most of us are still handling our business. We go to work. Or look for a job - anything to pay the bills. We curtail our spending to essentials as much as possible (life still does take place, after all, so some measure of luxury can still be afforded).

To me, even with all the economic bad news and even though things are bad, things are not quite so bad. Tuchman's Law does indeed apply.

Tuesday, November 11, 2008

Critics say Tax-payer Mortgage Aid Not Enough

From the AP news, "Critics say new mortgage aid effort for Fannie, Freddie loans doesn't go far enough."

The Federal (tax-payer) mortgage aid plan announced November 11 is geared towards Fannie Mae and Freddie Mac loans. The plan, in simple terms, would allow Fannie and Freddie borrowers get reduced rates and longer loan terms to reduce payments and make it more affordable.

Sounds good, but the critics say Fannie and Freddie only make up about 20% of the distressed or delinquent loans.

Politics aside, I'm willing to concede that the economy is in crisis and extraordinary measures to bring stability is needed.

What I do not like are the journalists' usage of examples to try and build empathy. I don't know if there is enough empathy going around this country (or the world) anymore. People want to blame Bush, the mortgage companies, and the "other" borrowers - the "irresponsible" ones. In my case, I am among those who blame the borrowers as much as the mortgage companies and loan investors.

In this report, the particular "sob" story is San Francisco police officer, Troy Courtney. He is mad because this mortgage aid is too little too late for him. He lost his home in Mill Valley - taking his children, THREE dogs and ONE cat.

Tuesday's announcement comes too late for Troy Courtney, a 44-year-old San Francisco police officer.

He moved out of his home in Mill Valley, Calif., earlier this month -- taking his children, three dogs and one cat with him -- after failing at several attempts to get a loan modification or a short sale. A short sale occurs when the lender agrees to receive less than the loan is worth.

Courtney worked overtime and tapped into his retirement account to try to catch up with two loans on his home. But in the end, he couldn't persuade Countrywide Financial, which managed the loan for Wells Fargo, to modify the loan.

Now - maybe I'm heartless. Maybe I am selfish. Maybe it's because it's the economy or because I just am - but I don't feel sorry for Troy. In fact, he's exactly one of those irresponsible borrowers I blame.

What person, in his right mind, would keep THREE dogs and ONE cat - a full FOUR house pets - plus his children while struggling to pay his house?

First of all, he absolutely bought too much house for him to afford. Second of all, owning and maintaining FOUR house pets is NOT cheap. Dog food for three plus cat food add significant costs to groceries. Not to mention feeding and clothing his children, his monthly costs were probably exorbitant.

Now while Troy couldn't get rid of his children (nor should he), the pets should have been gone. Four pets should not suck a penny from the family budget, not in times like these and not when one is struggling to pay the mortgage.

And while it is possible that even without the pets, Troy would ultimately have lost his house, then at least he can walk away knowing he did all he could to make the sacrifices to make ends meet.

Troy's lack of personal financial responsibility, however, is a perfect example to me of the recklessness these types of borrowers - the ones I blame.

When I come across borrowers like Troy, it pisses me off. His own recklessness along with others like him, along with the mortgage companies, and along with idiot greedy investors, have caused world economic pain and have killed my own investment portfolio.

While people like Troy spent money like no tomorrow, people like me sacrificed "stuff" to sock money away for the long-term. Yet for those of us who played by the rules and tried to do the right thing, we end up losing because of people like Troy.

I want to say people like Troy got what he deserved. But his downfall contributed to my own pains - and I won't condemn myself. So I sit here, angry at Troy while he is angry that he lost his house.

Not much of a choice, in the end.

Monday, November 10, 2008

Learning Chinese for Business - and Perhaps SEO

My last boss told me if he has his choice on what language his children would learn, he would have them learn Chinese. It's the language of the future, he said.

Since I speak Mandarin Chinese already, I wasn't going crazy up and down for it. I mean - shoot, I speak it with my parents. But then again, I have a natural fondness and affinity for language so I like all languages.

But while I speak conversational Mandarin Chinese, I grew up in the States and am a US citizen. My first language at this point is English. I don't have the expansive vocabulary to speak like a native fluent speaker. I also don't read or write Chinese.

And another thing that compounds learning Chinese is the difference between Traditional versus Simplified. As a Taiwanese (R.O.C.), I am a staunch "Traditionalist" that is, traditional Chinese character writing. But with China's (P.R.O.C., Mainland, Communist China) increasing world presence, China's Simplified writing system is gaining more usage. To someone like me, who's used to Traditional Chinese writing, trying to learn written Chinese is not easy because who knows what's Traditional and what is Simplified?

After a lot of searching (yes, SEO skills in use), I found one website that I really like that teaches both Traditional and Simplified: Chinese-course.com.

The website has flash cards to make it easy to learn. Daily lessons are available and can be emailed to you. You can also subscribe via RSS feed. Getting lessons is very easy.

If you want to learn how to read, write, and speak Mandarin Chinese without paying for Rosetta Stone (and without succumbing to Michael Phelps' pitch), then Chinese-Course.com is a great way to start.

Sunday, November 09, 2008

Yahoo Microsoft Drama

I have watched this closely since the beginning of Microsoft's unsolicited offer in early 2008. (I probably should have kept up with it by blogging about it). The latest news is that Yahoo's advertising deal with Google is lost as Google has decided it is simply not worth the DOJ trouble. As a result, Jerry Yang, who walked away from Microsoft's offer of $33 a share is now declaring Microsoft's best move is to buy Yahoo.

My opinion was always that Yahoo should have sold. As a search marketer, I saw no strength in Yahoo. While Yahoo actually commands strong usage outside of the US particularly in Asia, it is not enough to keep Yahoo competitive; especially against Google.

While MSN, or Windows Live, is FAR from competing with either Google or Yahoo, a merger of the 2 companies would make more sense. Mergers, of course, is a strategy for weaker parties to join together to better compete with a larger "foe". In this case, Microsoft and Yahoo made sense - again, from a search marketer's perspective.

But from a personal perspective, I love this whole drama. The drama of this whole affair is fascinating to me and I find incredible enjoyment in the way this story plays out. I imagine that this kind of "cult of personality" - Yang vs. Ballmer - was what European politics was like during the Middle Ages until the 20th century. Between all the aristocratic intrigue, royal families from one country ruling the other, and with the lives of the common people in the balance, the European days of yore seems to be playing out in Yang vs. Ballmer.

After Google walked away from the deal with Yahoo, Jerry Yang is interviewed by John Battelle (read the interview here)

"To this day, I have to say that the best thing for Microsoft to do is to buy Yahoo. I don't think that is a bad idea at all...at the right price, whatever the price is, we are willing to sell the company...We were ready to negotiate, we wanted to negotiate a deal, and we felt that we weren't that far apart. But at the end of the day, they withdrew and they since have been very clear about not wanting to buy the company."

To me, to say this after Yahoo walked away from Microsoft and after Google walked away from Yahoo, is severely losing face.

Maybe I'm just plain old fashioned, but I think even in this modern 21st century, people are people and saving face is important.

There's a part of me that sees Yang as having been tragically forced into this position. Terry Semel recklessly ran Yahoo long after his purpose was served (which was to help navigate Yahoo and keep it afloat after the Dotcom Bust of 2000-2001). During the good times, henceforth, however, Semel made Yahoo into a joke and lost out big to upstart Google.

Semel was finally replaced by Yang in 2007 but the damage was already done. In fact, Semel had survived a previous shareholder meeting in early 2007 and was not removed from his position even though shareholders had the opportunity. But by mid-2007, Yahoo had enough and the reigns were given over to co-founder Yang.

But Yahoo is a big ship and turning it around is not easy with 6 remaining months in 2007. The economy had already slowed down and in early 2007, foreclosures and the credit squeeze already began to rear their ugly heads. Yahoo's stock, YHOO, began to drop as well. In August 2007, the market suddenly dropped and many stocks lost value - including YHOO. By the end of January 2008, YHOO was trading below $20.

Talks of a MSFT buyout helped skyrocket YHOO's value to nearly $30 a share. When the deal fell through, YHOO dropped to below $25 a share as analysts had expected.

Meanwhile the economy continued to grind down, jobs lost, foreclosures and credit squeeze took its toll and speculative oil futures trading drove oil to $180. The economy was extremely strained helping to make things volatile for YHOO.

Then September and October 2008 came - "Armageddon".

By now, everything seemed to be at a standstill and the news from Wall Street's failures after Bear Sterns (earlier in 2008), Lehman Brothers, the banks, and AiG just made things worse. The world economy began feeling the chaotic butterfly effects too.

Which finally leaves us here - November 5. After long talks about Yahoo and Google's advertising deal, Google finally walks away. Some analysts think this was Google's intention all along - to simply drive a wedge of enmity between Yahoo and Microsoft. At this point, with Ballmer saying no we've moved on, it sure feels like enmity between the two CEOs.

But, as I wrote earlier, I almost feel Yang was forced into this position. I think he did believe he was acting in the best interest to ask for $37 a share from Microsoft. But it was a bad bluff and Microsoft called it. Then, having no recourse and no real direction for Yahoo, Yang turned to Google. And when that fell apart, Yang was left with no additional option for Yahoo.

Yahoo is in the middle - unable to move forward alone, unable (and justifiably unwilling) to move backward. Clearly, Yahoo cannot go it alone - it has no real innovation to effectively combat Google to win more user market share. MSFT has nothing to lose because it is so dead last compared to Google and Yahoo. It is in the position to keep sniping at both "giants".

But while I almost feel a little sympathy for Yang, I think he should have made a business decision and taken the deal. It made sense from a business perspective. It made sense from a search marketer's perspective. And it makes sense from a shareholder perspective.

...well, I at least am not a YHOO or MSFT shareholder.

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