Unemployment

WaPo writer channels Kathy Griffin

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What on earth inspires people to write such things after the shooting at a Congressional baseball practice in Virginia? How does someone who tweets such vile and thoughtless texts ever pass the editorial sniff test of a newspaper like WaPo where Malcolm Harris is an occasional writer? Will we see an apology via a televised press conference where Harris will claim it was comedy and that now his life is ruined?

I note that WaPo is using “Democracy dies in darkness” on its banner – perhaps it should be “journalistic integrity dies in daylight”.

What is this obsession with crowd funding?

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I get where crowd funding the plight of some poor starving tribe in Africa hit by a devastating famine, or a Bangladeshi child who needs emergency surgery to save her might have merit but to dig deep for Katie Hopkins takes some convincing. Her ‘final solution’ comments in the wake of the Manchester bombing got her fired from LBC. I’m not here to debate the radio station’s internal staff policies or how they execute them. Katie’s views are always strong, especially with regards to radical Islamic terrorism. I actually thought Janet Albrechtson’s article in the Weekend Australian was a far more eloquent summation of how to put a case forward to fix the problem.

Katie chose her words poorly (even if deliberately) and even if she expresses her views under the banner of ‘free speech’ she has to accept the consequences of those actions of the sponsor that pays her wages. In a sense LBC has the right (mostly for concerns to its advertisers) to make a call on that. Just like those US government agencies who were told to cease criticizing their President-elect on taxpayer funded websites. It was not a ban on free speech but a question of insubordination. To those that couldn’t see that view I suggested they send a message to their boss with the rest of the company CC’d about how stupid you thought he was. The LBC decision stands.

Still one has to wonder why there is a need to crowd fund Katie? Surely she will resurface again. I am surprised Breitbart hasn’t posted an applicaton form to join. Her darkest hour? Are they serious? I am sure she has had many darker. Though who is it for me to determine who wishes to give her money? After all it is charitable. I wonder though whether the tax authorities must have a good, hard look at such crowdfunding and deem whether there is a legitimate tax deductibility case to be had…

Having said that, what a sign of the times that crowd funding tells us about how deeply certain issues affect others. The flip side is they only think she is worth 100,000 pounds. If I ever get crowdfunded I can only hope the figure is far higher.

Rebels too old for a cause

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The average age of motorcyclists in Japan is 53 years old and continuing to climb as younger riders looking to obtain new licenses continues to drift. Between 2010 and 2016 the Japanese National Police Agency (JNPA) noted that large capacity motorcycle license holders (ogata – classified as 400cc+) have fallen by nearly 1,500,000. While mid-size (chugata – classified as below 400cc) have risen around 715,000. Female riders have shown a similar pattern of 178,000 fall in ogata licenses and 147,000 increase in chugata respectively. While there are still 9.175mn men and 625,000 women willing to get out on the highway with large capacity bikes, the trend is alarming. More frighteningly, new graduates aren’t lining up either. 30,000 fewer students lined up to get a mid or large size bike license between 2014 and 2016 representing a 12.3% dip. Latest report found here Motorcycles in Japan – Analogica KK

Tsunami Tales Pt.4: the sea wall of Ishinomaki

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Ishinomaki Port in Miyagi Prefecture was hit hard by the March 2011 tsunami. The sea wall defenses being erected (as pictured) run the entire length of the town (15km). Not only are the sea walls running out to sea they are being built immediately behind the warehouses sitting on the harbour front. On top of this dirt mound (already at an elevated level) gigantic concrete blocks will be layered in top.

Also a lot of trees are being felled in the smaller towns to the north meaning a lot of wood is being exported.

The hotel I stayed at was full of construction workers. Hotel Route Inn in Ishinomaki is cleaning up with more or less full occupancy during the week if the breakfast hall was anything to go by. Fly-in, fly-out workers is my guess.

Ishinomaki is also the site of a Japan Air Self Defence Force which lost 16 of its F-2 fighter jets (half of those stationed there) which were damaged by the tsunami. Why on earth they weren’t scrambled beggars belief. All had to be written off as the salt corrosion meant a rebuild was too expensive.

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The McTurnbull Burger – 2017 budget that says ‘waistline be damned!’

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Remember the Big Mac jingo? “Two all beef patties, special sauce, lettuce, cheese, pickles,  onions on a sesame seed bun?”  Well the 2017 budget From the Coalition might as well be called the super sized McTurnbull Burger. Two all thief parties, special porkies, levies, fees, spun on a $600bn dollar bomb. While the government needed to introduce a vegan budget of lentils, tofu and alfalfa to get the country’s nutrition properly sorted they’ve said waistline be damned. Morgan Spurlock couldn’t keep up with this super sized meal. As my wise sage Stu told me last week, “About as well-timed as Mining Super Profits tax – ding ding ding – top of the banking cycle just called by inept bureaucrats”

If people wanted a tax and spend party they’d have voted Labor. In a desperate attempt to supersize the meal they’ve made of the economy since Turnbull took office the debt ceiling will be raised. Wage growth has slowed for the past 5 years from 4% to under 2% according to the RBA. Throw higher Medicare on top why not?!. Cost of living is soaring. So let’s look at the extra calories they’ll inevitably load on the taxpayer.

1) Let’s tax the big 4 banks. That’ll work. What will they do as responsible shareholder owned organizations? Pass those costs straight on to the tapped out borrower where 1/3 mortgagees already under strain and 25% odd have less than a month of buffer savings. NAB already jacked interest only loans 50bps.

2) allowing retirees to park $300,000 tax free into super if they downsize their empty nest. Wow! So sell your $5mn waterfront property so you can park $300k tax free into superannuation. Can see those Mosmanites queue up to move to Punchbowl to retire. Hopefully the $1mn fibro former council shack the Punchbowl pensioner flips will mean they can move to a $500,000 demountable in Casula in order to free up the property market for the first home buyer who is getting stung with higher interest rates, .

3) Australia has a property bubble. The Reserve Bank has recently had an epiphany where they’re afraid to raise rates to crash the housing market and they can’t cut because they’ll fire it up more. Allowing creative superannuation deposit schemes (max $30,000 per person & $15k/year) to help with a deposit only doubles down on encouraging first home buyers to get levered up at the top of the market using a system designed to build a safety net for retirement. When governments start abusing sensible policies in ways it was never designed for then look out for trouble down the line. This doesn’t help first home buyers it just pushes up the hurdle to enter.

4) Australia’s credit rating is on the block. Australia’s main banks are 40% wholesale financed meaning they have to go out into the market unlike Japanese banks which are almost 100% funded by their depositors. Aussie banks could see a rise in their cost of funds which the RBA could do little to avoid. That will put a huge dent in the retail consumption figures.

5) speaking of credit cards. Have people noticed that average credit card limits have not budged in 7 years. If banks are confident in the ability of consumers to repay debt, they’d let out the limits to encourage them to splash out! Not so – see here for more details.

6) Infrastructure – I live in the land of big infrastructure. Jobs creation schemes which mostly never recover the costs – especially regional rail. The Sydney-Melbourne bullet train makes absolute sense. We only need look at the submarines to know that waste will be a reality.

7) small business – tax concessions of $20,000 not much to write home about. Small businesses thrive on a robust economy which is unlikely to occur given the backdrop. Once again this budget is based on rosy assumptions and you can bet your bottom dollar Australia won’t be back in surplus by 2021.

Some  media are talking of Turnbull & Morrison stealing the thunder of the Labor Party, providing a budget more akin to their platform. Sadly I disagree that this legitimizes Turnbull. It totally alienates his base, what is left of it. Tax the rich, give to the poor. Moreover voters see through the veneer. The stench of the Coalition is so on the nose that without ditching Turnbull they have no chance of keeping office. Labor is not much better and One Nation and other independents will hoover up disaffected voters by effectively letting the others dance around the petty identity political correctness nonsense.

In the end the McTurnbull Burger meal will look like the usual finished product which resembles nothing like the picture you see on the menu. A flattened combination of squished mush, soggy over-salted fries and a large Coke where the cup is 90% ice. Yep, the Coalition has spat between your buns too. This is a meal that won’t get voters queuing up for more. Well at least we know Turnbull remembers that smiles and selfies are free after all ‘he’s lovin’ it‘! After all virtue signaling is all that matters. All this to arrest some shoddy poll numbers which will unlikely last more than one week.

Why don’t firms hire staff like they’d choose a heart surgeon?

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How many times have I heard over my career senior management talk incessantly about the need for new blood yet when it comes to doing anything about it with regards to new hires 99% of the time  the safe cookie cutter is favoured over the left field choice. It is ever more so the truth in the post GFC world. Managers seem afraid to take calculated risks because the left-field candidate may jeopardize their own positions if he/she fails.

As an example managers in finance often fall foul of hiring exclusively within the industry. The level of inferiority complex can be so overwhelming that they fawn at the idea a Goldman Sachs employee will work for them for some ridiculous sum. Invariably they forget that Goldman hires duds too and usually those that get cast off are in that bucket. If you are properly good, there is no incentive to leave Goldman as the salaries, opportunities and product capabilities are too wonderful vs peers.

Yet many financial firms set upon trying to change the firm into a wannabe Goldman Sachs. They forget that their clients can already deal with Goldman directly should they feel the urge. Why on earth would they choose to deal with a wannabe copy? Surely each firm has a unique selling property that is of value to clients. Why not invest and promote that rather than overlook the talent within. Who honestly values flattery? Besides, there are so many cautionary tales with hiring ex-bulge bracket employees who are so used to being spoon fed every possible product line that they struggle immensely when they are required to actually put elbow grease into the job. It is uncanny.

Some firms occasionally hire from outside the industry with huge success. Instead of financial analysts pontificating about a stock, someone who has worked within the industry has a far better feel for cycles, internal decision processes and strategy that formulates under different points in the cycle. Clients glean that value. They couldn’t care less about the stock target or valuation metrics because that ultimately is the investor’s job. Besides the history of brokers behind the curve is etched in stone. Unique context and perspective trumps commoditization every time.

Some financial (and other) professionals have such checkered histories that one wonders how on earth they get rehired. If companies viewed their hiring decisions as akin to selecting a heart surgeon for a life threatening operation, many of these people would never make the cut (no pun intended) given the body count from previous poor execution. Yet many firms continue to put quacks in their ‘surgeries’ with expected disastrous results. Generally hiring managers run interference on these bad choices to cover their own mistakes.

Many HR surveys (including Harvard) show that bad hires end up costing way more than the salary when the cost of onboarding is included. Not only do companies potentially have to foot the cost of a headhunter (25-30% of salary is a standard fee) , what follows is poorer output, the potential for incumbent employees to become disgruntled at the new hire’s lack of ability and most worryingly an increase in dissatisfied customers. If they land a toxic employee that can damage team productivity to such an extent the best performers will seek challenges elsewhere.

So in a world that is getting harder and harder to succeed in, on what basis does conventional thinking bring anything to the table but more of the same? What does hiring a competitor do other than bring similar tactics? In fact, the more telling question is if they were knocking the lights out their success would permeate within their current employer. Unseating happy employees requires dynamite way over and above what they can probably afford.  What hirers often forget is the extent to which internal human capital plays a part. How awful does one’s human capital creation have to be to consider jumping ship?

That is where the left field choice comes into its own when hiring. A person genuinely looking for career change may well be doing it because they’ve tired of several decades of the same industry. They’ll likely come full of fresh ideas, out of the box solutions and lessons from a completely different background with the passion of a new graduate.

Many companies fail to adapt because the stupid questions don’t get asked by the incumbent staff for fear of ridicule. Yet someone eager to learn may ask the most basic of questions and ask “does it work?” One company I consult had a new boss join from HQ and he questioned why staff had meetings on such trivial matters? One staff member said “we’ve been doing it for 15 years!” When the boss said “does it work?” all replied ‘not really”. Yet they offered little in the way of proposals to change what was broken.

In a sense I see many businesses that operate in status quo mode where change if ever happens on a trivial or traumatic basis not through consistent due diligence and proactive leadership.

Think of it like asking an elderly person “if you had one more day to live what would you do?” “Well I’d play golf, take my wife to an expensive dinner and drive a Ferrari” If you asked Athenia”why don’t you do it now” the response would be “well I’m not dead yet!”

Look at the successful businesses around the world today and invariably the corporate culture is likely to be open and flexible. Bosses are prepared to hire people more qualified than them because they want to learn. Show me a company where inferior staff are hired to protect a manager and I’ll show you a dud business.

Which then goes back to the most important ingredient in a tech savvy smartphone world. Analog relationships. Look at the latest recruitment sites which ask candidates to fill in fields where a computer will sift through algorithms to screen. These systems remove the most important skill in selecting good candidates – gut feel. A good recruiter can understand a client’s needs far better than a computer. Besides if a computer is searching for terms fixated on what you’ve done and not what you want to do it will screen you out every time. What a wasted opportunity!

Human nature is uncanny. Risk taking is inevitable but instead of most people becoming  victims of change only a mere few will end up being agents of it and there will be no second guessing who dares wins! So instead of screening for the textbook definition of identity based diversity how about focus on diversity of thought!

 

No, it was because you thought it was a coronation not an election

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Reading through Hillary Clinton’s comments about ‘why’ she lost in November missed one huge point. She thought it was a coronation, not an election. It was supposed to be an ordained affair. Blaming Comey or Putin misses the point entirely. She conveniently forgets she had the entire mainstream media on her side coming in with poll after poll showing it was a forgone conclusion. Even betting agency Paddy Power paid out on a Clinton victory one month before the election. The DNC backed off the gas. To lose to a pussy-grabbing opponent who looked straight down the camera lens at 10s of millions saying “no one respects women more than I do! None!” after the scandal broke says more than most. She wasn’t a good enough candidate period.

Why did she make Debbie Wasserman-Schulz the head of her campaign strategy when she was forced to resign from the DNC chair for deliberately shafting Bernie Sanders? Accepting leaked questions before the CNN debate thanks to Donna Brazile. With all the dirty tricks leading into the campaign she still lost. Her emails were a matter of poor judgement. She had Obama out at every turn talking about how great his legacy was when an ever growing mass of people weren’t experiencing such happiness in their day to day lives. In fact the opposite was happening as poverty, welfare recipients and those working more than one job kept hitting new highs.

People who read this blog would know I’d been saying that Trump would win since the GOP primaries because he was connecting with the strugglers. No matter how big a BS-artist he maybe, he was visiting the manufacturing wastelands and recognizing their plight. Hillary was too busy entertaining her inner-city mates, ignoring the deplorables. I pointed out that he was growing his Twitter following at twice the rate of Clinton. So no matter how horrid you might think Trump was, is, will be, he still won an election by the rules. Perhaps if the establishment had done a better job over so many decades indeed Mrs Clinton would have been crowned first female POTUS. Then again perhaps identity politics was another reason why Americans were fed up her campaign.

On a slightly different topic, note that Macron has grown his Twitter base around 100,000 since he won the first round. Le Pen is around 60,000 net adds. Twitter growth has been a good predictor of election victories as it captures underlying moods that 1,000 people called at random in a poll can’t help to match.

In any event election success boils down to one line to voters – “it is the economy stupid!”