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November 30, 2005
The Technological Advantage Check 21 Offers for Community Banks
The Birmingham Business Journal featured an article on Check 21 technology adoption by community banks which must make larger banks cringe. That is, if those big bank bankers are humble and self effacing enough, just for a few moments, not to allow their size to delude them into thinking that community banks can’t be serious competition.
Yeah, right.
Check 21 technology allows a bank to capture the image of a check at the point of deposit and present that image and attendant information electronically to the bank on which the check was drawn. A bank can even place a device with one of its customers, let’s say a retailer, which allows that store to capture the information on the checks it receives during the course of business. The store can send this information to the bank electronically and the processing of these payments proceeds immediately.
For the store, float is reduced significantly, and they don't have to run to a branch or mess around with couriers. The bank can not only reduce its paper and processing costs, but its ability to service its clients without physical locations is dramatically enhanced.
Admittedly, it’s early. Technology providers are early in rolling out systems taking advantage of Check 21.
As the Birmingham Business Journal reports, however, community banks can adopt the latest technology because they have no sunk costs in "white elephant" legacy systems which the bureaucracy demands be defended:
John Teta, chief risk officer for SouthPoint, says new operations such as SouthPoint have an extra edge. Starting from scratch, he says, banks can adopt the latest and greatest systems on the market without the need for a costly conversion process and the burden of extensive historical data, or the need for "unlearning" legacy processes and re-training employees.
With "no baggage from the past," new banks are "immediately able to adopt new technology from the start." . . .
With help from Birmingham-based Aquracy Corp., Teta says, the bank also is planning to implement remote image capture technology, installing check scanners in clients' businesses to electronically collect check information and transmit it to the bank for deposit.
Teta says the bank is slated to begin testing the system in the next month or so, with plans to begin accepting electronic files in the first quarter of 2006.
The bank also will set up the machines at teller windows, allowing customer deposits to be electronically scanned.
Teta says the technology will save time and expense for the bank and its business customers, posting deposits quicker, reducing courier expenses and possibly allowing the bank to extend daily deadlines for receiving deposits. "It's good for everybody," he says.
Good for everyone except the big banks, many of whom have been on branch building spree the last few years which makes the so-called housing bubble look tame.
As technology for Check 21 advances and costs decline—-that’s the nature of such technology—-banks will be able to justify placing devices with smaller businesses with less check volume. In other words, they’ll reduce the relative need for branches for an increasing number of their customers.
The competitive advantage of having branches all over town, one of the prime appeals of larger banks, could be neutralized if not virtually erased.
Larger banks will tell you all this is "pie in the sky" or some such nonsense. On the contrary, such a scenario is unfolding, and will do so faster than most can imagine.
Posted by John at 11:37 PM | Comments (0) | TrackBackThe Halo Effect of China’s Airports
Amit Varma at the Indian Economy Blog notes that India is planning a $10 billion investment in new and revamped airport infrastructure in the next four years. He likes the idea:
Why so? Well, because of the halo effect. Airports are the entry point of many people into a city, and even the country, and inform their first impressions of it. Give them a neat, ultra-modern, comfortable airport, and you’ve already brought them closer to doing business here, or investing here, or even just spending time (and thereby money) here. If you want India Shining, you’ve got to get the airports shining first. Right now, we have neither.
I think Amit is absolutely right. I see the halo effect in play in China with its airport infrastructure. It seems as though every airport of size in China is a brand new facility. When you land in an airport like that in Guangzhou or Jinan, both opened within the last year, you immediately have a favorable first impression.
 Guangzhou Baiyun International Airport |
If first impressions are everything, then the halo effect for China’s airports is in play. It’s "China shining."
 Jinan International Airport |
Posted by John at 10:35 PM | Comments (0) | TrackBack
A Genuine Hero in the Fight Against Lung Cancer
The Atlanta Journal-Constitution featured a story on a hero in the fight against cancer. This man is a hero in the most genuine sense.
Two years ago, Ed Levitt was told that his lung cancer was advanced enough that he should prepare his funeral. Today, as his cancer has spread to his spine, ribs, and jaw, this man is working on behalf of literally tens of thousands in this country who die of lung cancer every year:
"I'm one of the really, really lucky ones," said Levitt, 63, a former corporate speaker who spends about six to eight hours a day working on behalf of lung cancer patients. "I'm alive."
Levitt is using what he considers his good fortune to do what hundreds of thousands of lung cancer patients have not been able enough to do: become an advocate for the disease, the No. 1 cancer killer of Americans. . . .
Lung cancer kills 85 percent of its victims within five years after they are diagnosed, most of them in the first year, according to the American Cancer Society. Because survivors are rare, advocates are rare.
Also, it's an often forgotten, or even stigmatized, disease, because people blame those who contract it for getting it in the first place, its advocates say. Lung cancer is heavily associated with cigarette smoking, with about 35 percent to 40 percent of those diagnosed being current smokers.
But there are tens of thousands, like Levitt, who are long-stopped former smokers and thousands more, like Dana Reeve [widow of Christopher Reeve], who got lung cancer despite never smoking. About 10 percent to 15 percent never smoked, and about 50 percent are former smokers.
Levitt has worked especially hard in November, Lung Cancer Awareness Month. His main goal was to convince people that lung cancer is a horrible illness that needs a little compassion --- and a lot of money --- for research if the five-year survival rate is going to improve. . . .
In the world of modern medicine, advocates have become an essential part of the process by which illnesses from AIDS to breast cancer to diabetes get funding. Better diagnostic tools, drugs and even cures have, in many cases, resulted.
Many researchers believe that breast cancer is perhaps the best example of the power of advocacy for a specific type of cancer.
According to the Lung Cancer Alliance, the five-year survival rate for breast cancer is 88 percent; for prostate cancer it is 99 percent.
Lung cancer's survival rate is about the same as it was in 1971, when President Richard Nixon declared war on cancer.
Advocates see a connection between low survival rates and low funding rates. They point to such things as the amount spent by the National Cancer Institute on lung cancer --- about $1,829 per each person who dies, according to the Lung Cancer Alliance --- to the amount spent on breast cancer --- about $23,474 per death. . . .
Levitt thought he was a picture of health in January 2004. A self-professed health nut who exercised four hours a day, he first noticed horrible pain in his upper leg while on a business trip. He had to drag his foot as he walked. Within a few days, one side of his face was drooping.
Then came fierce pain in his back, which he later learned was from tumors on his adrenal glands that had spread from his lungs.
In March 2004, his original doctor told him to plan his funeral, that maybe he could last 90 days with Stage IV lung cancer.
Those who treat Levitt say they are amazed at what a guy with lesions all over his body is able to do.
Levitt said he has become determined to help raise awareness of the disease so that others won't have to hear the fateful words he heard that bleak day almost two years ago.
He also credits great doctors and care providers at Emory University's Winship Cancer Institute, where no one told him that he should plan for his death.
They, in turn, credit him.
"You think I'm dedicated to make a difference?" said Dr. Fadlo Khuri, a lung cancer researcher at the institute. "Here comes a guy whose time is much more valuable than mine, who could be taking a trip to Alaska or to see the world, and he's just indefatigable. He never stops; he's like the Energizer Bunny. I'll be having a bad day at the clinic, and he calls me on my way home, and he replenishes me." . . .
In between chemo treatments, Levitt meets with congressional leaders --- U.S. Sen. Johnny Isakson (R-Ga.) on Nov. 21, for example. He e-mails drug company executives, and he harangues insurers who lag in paying claims for certain drugs. He brainstorms with Fenton, who is based in Washington, almost daily. . . .
Levitt knows full well that he's living on borrowed time, and that any change he may bring about will be too late for him.
As he sees it, he was granted extra time to make a difference for others with lung cancer. "We will make a dent, and the dent will get bigger and bigger and bigger," said Levitt, a London native who moved to the United States when he was a child. "And one day, we'll have such a big dent that we'll have a cure."
We will one day have a cure, thanks to the efforts of heroes like Ed Levitt. We owe it to Ed and hundreds of thousands of people like him to find the dollars necessary to fund the research which will end this blight.
Posted by John at 9:34 AM | Comments (1) | TrackBackQuote of the Day for Wednesday, November 30, 2005
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November 29, 2005
Further Signs of Rising Incomes in China: Pampered Pooches
From the Shanghai Daily:
Posted by John at 11:59 PM | Comments (0) | TrackBackChina has about 150 million pet dogs, about one for every nine people. Beijing alone registered more than 500,000 pet dogs in 2004.
And so there's a new career for professional pet trainers and nurturers, especially since families are too busy to care properly for their pets . . .
Sources from the housekeeping market in Guangzhou in south China say there are only about 100 professional pet attendants in the city — a meager figure compared with market demand.
More than 30,000 families with pets in Guangzhou are said to be seeking qualified pet attendants.
The World’s Worst Disease: Small Minded Thinking
Forbes Publisher Rich Karlgaard, in his terrific blog, says the world’s worst disease is small minded, zero sum thinking which results in the following beliefs:
1. The earth is running out of resources
2. People consume more than they contribute
3. Wealth is a zero sum distribution game
History overwhelmingly refutes these ideas, or else humankind would still be living in caves, sharpening its spears for the hunt. Our lives would be brutal and short, lasting on average about 30 years. We’d enjoy no books, movies or iPods; we’d drive no cars to visit grandma on Thanksgiving; we’d enjoy no pumpkin pie if the economic pie had not been growing all along.
Yet most politicians, economists and journalists act is if growth is a mirage and wealth is zero sum. What else accounts for today’s headlines screaming GM’s cut of 30,000 jobs? Does the creation of 30,000 jobs get equal treatment? Why not? That’s about how many jobs are born every week in the United States.
What causes some to take the zero-sum view?
Politicians, even the best and brightest, I think, become zero-sum thinkers over time because they occupy a zero-sum world. Only one person can be U.S. president. Only 50 can be governors. Only 100 can be Senators. The most creative entrepreneur in the world can’t change these facts. Politicians live in a world where one person’s gain is another’s loss.
Head of nail, meet Rich Karlgaard’s hammer.
Posted by John at 11:30 PM | Comments (0) | TrackBackAging Cubans, Young Mexicans
The Hispanic demographic in the United States is stratified in a variety of ways, one of which is age.
Hispanic Business points out that over 20% of Cubans are 65 or older, while only 4% of Mexicans are seniors.
Approximately 37% of Mexicans are under 18, compared to just 20% of Cubans. The median age for Mexicans in the U.S. is 24.7 years, while Cubans have a median age of 42.7 years. (The median age of the entire U.S. population is 35.9 years.)
Posted by John at 11:04 PM | Comments (0) | TrackBackQuote of the Day for Tuesday, November 29, 2005
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November 28, 2005
"China" is a Big Subject
On an early morning flight to Boston today I was catching up on my reading and found an insightful article ($) in the Far Eastern Economic Review by Michael Enright, business professor at the University of Hong Kong.
Enright’s ostensible topic is China’s competitiveness in the world economy. His basic point, however, for many of us in the United States, is something simple: China is a big and diverse subject. One who speaks about China in broad generalizations is misinformed, to be mild.
"China" is viewed by many in the West as a juggernaut which threatens every industry which it sets its eye on. In fact, some of China's industries are highly competitive with the West, and some are no where near being near par with their international counterparts. Enright points out a few important facts:
--China’s share of world exports is lower than either that of Germany and the United States.
--The World Economic Forum places China 57th out of 116 countries in business competitiveness, twelve spots behind Ghana.
--In a study of growth competitiveness by the World Economic Forum, China ranked 49th, just behind Jordan and Botswana.
--While China runs a trade surplus with the United States, it runs a trade deficit with the rest of Asia. As Enright notes, "since the 1990s, China has been importing capital goods and advanced components from Japan and South Korea; other components from Hong Kong, South Korea, Taiwan and Singapore; and still other components and subassemblies from other Southeast Asian countries."
--60% of China’s exports are produced by foreign-invested enterprises. Most of these enterprises, many owned wholly or in part by U.S. companies, do their research and development, design, distribution and sales, and some component manufacturing outside of China. Moreover, "substantial portions" of China’s exports are organized by international retailers such as Wal-Mart or trading companies.
--China’s role in many industries as an assembler of components from elsewhere for finished goods export place is the low margin spot on the supply chain. Enright observes that foreign firms who design and sell goods that Chinese enterprises manufacture often make more money on those goods than those Chinese companies do. "When lawmakers in the West warn against a flood of cheap Chinese merchandise," Enright observes, "they sometimes forget that this phenomenon is partly owned and orchestrated by Western businesses."
--Approximately three-fourths of China’s exports come from the Greater Pearl River Delta, the Yangtze River delta, and Bohai regions—only 3% of its land mass. Only in recent years has infrastructure improved enough for manufacturers to locate in larger numbers away from these coastal regions.
"Internationally networked business systems have allowed China to export without having all the cards needed to be competitive." Even at that, Enright notes, China is competitive in a "complementary" sense in many industries; it needs knowledge, goods, and services imported from elsewhere to succeed.
For China’s economy to develop further, the country’s businesses have to develop their design, research, marketing, and financial prowess and infrastructure. Some of this development revolves around the need, which I alluded to earlier, to further deregulate the financial services industry.
There’s a lot of work to be done, and China’s leaders in government and business recognize as much.
To understand China from this side of the world, its important we comprehend what’s left to be done as well.
China Unlikely to Allow Foreign Control of Banks
China is unlikely to allow the country’s banks to be controlled by foreign ownership, and the central government is likely to maintain majority stakes for the foreseeable future. So says Guo Shuqing, chairman of China Construction Bank Corp., in a published interview.
The same China Construction Bank recently sold a minority stake to Bank of America. There’s nothing particularly magic in the control, and therefore management oversight, of Bank of America, a bank whose own track record in not the most stellar this nation’s banking industry has ever seen.
At the same time, subjecting banks to market discipline, even without loss of "control", is the wisest public policy in the long run, in our view.
We’ve proved as much in the United States with the savings & loan debacle of the 1980s. Many of the institutions which failed were mutual-owned and not subject to shareholder pressure. Moreover, federal and state regulation of these institutions was completely bungled. The ultimate cost to the U.S. government for this mess was about $175 billion.
Posted by John at 6:45 AM | Comments (0) | TrackBackQuote of the Day for Monday, November 28, 2005
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November 27, 2005
Spanish Firms Buying in the Lone Star State
The Houston Chronicle reports on the buying spree Spanish firms are on in the state of Texas:
In the past two years, a handful of multinational Spanish companies have expanded their empires into Texas with food company Grupo SOS Cuetara purchasing American Rice, BBVA Bancomer acquiring Laredo National Bank and rice giant Grupo Ebro Puleva snatching up counterpart Houston-based Riviana Foods.
The most recent Spanish acquisition was of Houston construction company Webber Group by Madrid-based Ferrovial in September.
The $220 million investment is Ferrovial's second foray into the state after its subsidiary, Cintra, began to partner with the Texas Department of Transportation in March to design the Trans-Texas Corridor, linking the state's borders with Mexico and Oklahoma.
Trade ties between Texas and Spain also have been on the rise in recent years, totaling $1.2 billion last year, up from $847.5 million in 2003. Most of that business was conducted by Houston companies.
Spanish-owned businesses still number far fewer than those owned by other Hispanics in Houston, but they generate lots of cash. The 661 Spanish-owned firms in Houston, for example, had $5.2 billion in sales in 1997, according to the latest census data available.
In comparison, the greatest number of Hispanic-owned firms are run by Mexicans, who own 25,407 businesses but make just $3.9 billion in sales.
The bond between Texas and Spain has grown so rapidly that earlier this month the Spanish government hosted a trade conference here, and next week the Spanish ambassador will visit the Bayou City to boost business between the two regions. . . .
Based on some of the conversations we’ve had with some of these companies, I believe there’s a surprisingly simple explanation for Spanish companies using Texas a beachhead to the United States, in addition to the understandable attraction of the Hispanic market in the Lone Star state and of Texas in general.
Geography plays a part as well. Relative to other large Hispanic markets like California, Miami, or New York, Texas is a centrally located jumping off point. It’s not the only factor, but it’s important, as simple as it sounds.
Posted by John at 10:00 PM | Comments (0) | TrackBackTweener Technology Consultants
The Los Angeles Times reports on a very influential age group which consumer technology companies must pay special attention to:
When it comes to technology, Arden Arnold is the go-to guy in his house.
Mulling over an emergency backup power generator for the family, he researched all the choices before picking a Black & Decker Corp. Storm Station. He's interested in a new desktop computer, but it needs to have at least an 80-gigabyte hard drive, 512 megabytes of RAM and "a pretty good video card." And he's trying to persuade his mother to switch from Microsoft Corp.'s Hotmail to Google Inc.'s Gmail service.
"She pays for 1 gigabyte of storage, but Gmail gives you more than 2 gigabytes for free," he said. "And it has a very intuitive search function."
Arden is just 12 years old. But the influence the San Francisco sixth-grader wields makes marketers take notice. . . .
Tweens ages 8 to 12, according to the article, influence the purchase of some $60 billion of spending annually.
My five year old son is well on his way to influence some purchases of his own, too.
Posted by John at 8:53 PM | Comments (0) | TrackBackMore Hispanic Characters on Network Television
More characters of Hispanic origin are being added to network television shows, reports the Chicago Tribune, and the reason is money:
Posted by John at 8:33 PM | Comments (0) | TrackBackThere are many explanations why ABC, for example, has Hispanics in so many prominent roles in so many of its series of late, from Eva Longoria's Gabrielle on "Desperate Housewives" and Jorge Garcia's Hurley on "Lost" to Sofia Vergara's Lola on "Hot Properties" and Freddie Prinze Jr.'s title character on "Freddie."
Not the least of those reasons, however, is that dinero talks.
"The genesis is good business," said Stephen McPherson, president of ABC Entertainment. "We're a broadcast network, and you look at the multicultural nature of this country these days and I think you would be making a big mistake as a broadcaster to not recognize that and program for it."
With the fight for viewers ever-more competitive, thanks to the growing number of entertainment options, ABC has identified U.S. Hispanics, a population more than 40 million strong, as a target of opportunity, even if almost half their number watch mainly Spanish-language TV. . . .
Beyond giving better roles to Latin performers and airing a pair of sitcoms centering on Hispanic families--"George Lopez" and "Freddie," which has one character who speaks only Spanish--ABC this fall became the first English-language broadcast network to make its entire regular prime-time lineup available in Spanish through secondary audio program (SAP) dubbing and closed caption subtitles.
Fox is said to enjoy an advantage of more than 80,000 Hispanic viewers over ABC overall, but ABC is tightening the race and doing particularly well with Hispanics between the ages of 18 and 49. Among that advertiser-coveted demographic, ABC has the top six shows this season. . . .
Quote of the Day for Sunday, November 27, 2005
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November 26, 2005
A Kimchi Trade War
South Korea is in a trade dispute with China over kimchi, reports the Los Angeles Times, which is something akin to being in a trade war with Memphis over barbeque.
This trade dispute, like most you find these days, is a little more complicated than a nationalist "China vs. South Korea" fight. Many Chinese kimchi producers are actually owned by Koreans living in Shandong Province, particularly Qingdao. Qingdao, as we’ve pointed out previously, has about 5000 Korean-owned businesses of all sorts, located there not just because of the lower cost structure but the quality of life.
As with the textile disputes between the United States and China, you can rest assured that many of the "domestic" kimchi producers in South Korea also have production facilities in China.
There’s always more to a trade clash, in a global economy, than meets the eye.
Posted by John at 8:57 AM | Comments (0) | TrackBackIBM’s Head of Research on the Importance of Innovation
BusinessWeek’s Steve Hamm, in working on a story on smart machines, talked to IBM Head of Research Paul Horn regarding "autonomics," making machines into self-regulating, self-diagnoising systems like an automatic nervous system. Autonomics, Horn contends, could be America’s answer to outsourcing:
"I like to think of about it in terms of Thomas Friedman and the world being flat. The Internet allows the building of software and the management of computing operations to go to low-labor-cost geographies. Meanwhile, major pieces of the IT industry are commoditized--hardware, software, and services. So the labor goes to low-cost places. If you take labor out of computing through automation, you take the labor-cost factor out to some extent. When you do that, you can the place the work in high-labor-cost places."
"If you go out 10 to 20 years, the more you can take labor out of the equation, the better it is for the more innovative and high-labor-cost parts of the world. It makes succeeding in services more about who has the best technology to get the work done fastest--not who has the lowest labor costs. In this way, a highly innovative society can trump a lower-labor-cost society."
In a couple of paragraphs Horn captures the vital stake the United States has in maintaining and enhancing a business environment which fosters innovation and creativity.
Posted by John at 6:18 AM | Comments (0) | TrackBackIn One Picture, the Natural Advantage of India and China
We recently highlighted a recent World Bank report on remittances and their role in economic development.
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Quote of the Day for Saturday, November 26, 2005
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November 25, 2005
Further Moves Toward a More Freely Floating Yuan
From Bloomberg:
China allowed market makers in the yuan and will sell currency swaps to local banks at a stronger exchange rate, two steps toward a more freely traded currency.
Commercial lenders will be able to quote and trade the yuan against foreign currencies from next year, the State Administration of Foreign Exchange said on its Web site. Prices for the dollar will still have to be within 0.3 percent of a daily rate set by the central bank. . . .
Posted by John at 9:18 PM | Comments (0) | TrackBack"Market making is a significant step on a long journey of making the yuan more flexible," said Stephen Green, an economist at Standard Chartered Plc in Shanghai. "With the swap, the central bank is giving the market some guide to its expectation of how much the currency will appreciate next year.". . . .
In another sign China will let the yuan appreciate further, the People's Bank of China will conduct its first currency swap with commercial lenders, said traders at banks that deal with the central bank.
The central bank offered 12-month swaps to lenders at 7.85 yuan per dollar, an exchange rate 2.9 percent higher than today's closing level, said the traders, who declined to be named. The $6 billion swap deal was first reported today by the Shanghai Securities News, which is affiliated with the official Xinhua news agency. The yuan rate at which the transaction was offered was reported earlier today by Reuters.
"The significance of the move is that all the domestic banks and the PBOC agreed on the one-year forward rate of 7.85," said Frank Gong, chief economist for Greater China at JP Morgan Securities Asia in Hong Kong. "The yuan has to be stronger than that in one year for the banks to be in the money.". . .
Manufacturing's Share of the U.S. Economy Has Been Falling for Half a Century
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Posted by John at 5:30 AM | Comments (0) | TrackBack
Retiring Across the Border—South to Mexico and Beyond
The Economist reports on the increasing popularity of Mexico and several Central American countries as retirement destinations for foreigners, particularly U.S. expatriates:
Many of the American settlers barely speak a word of Spanish. They move south not so much in pursuit of the sun, which they could find just as easily in Florida or Arizona, but in a search for a cheaper way of life, along with the sense of community that foreign enclaves generate. Estimates for the number of Americans of non-Mexican ethnicity who have retired to Mexico, mostly in San Miguel and a handful of other towns, hover around 250,000, with at least as many Americans with Mexican roots more widely dispersed. But the house-price boom they and other foreigners, notably Canadians, have created is now driving others even farther south.
Panama, Costa Rica, Nicaragua and Honduras all offer tax breaks to foreigners seeking to retire there. Beachfront developments catering for pensioners have sprung up along both the Atlantic and Pacific coasts, with a house right on the beach often costing just half what you could expect to pay in San Miguel, smack in the middle of Mexico. Even an influx of a few tens of thousands of American “senior citizens” can have a big impact on the small economies of the Central American countries. And the numbers could grow even bigger if America agreed to change its public health-care system for those over 65.
At present, Medicare, as the system is called, cannot be claimed abroad. So American pensioners tend to travel back to the United States to get treatment. The possibility of making Medicare "portable" has been talked about for years. But, apart from the introduction of a small pilot project, it has never got much further than just an idea. Yet the advantages are clear: expatriate pensioners would find it easier to get health care; the costs for the crisis-ridden Medicare would be lessened; and Mexico and other Central American countries with American pensioners would benefit not only from a rise in their health-care expenditure, but also from the big increase in their numbers that such a change would certainly bring.
The cross border economic activity fostered by the Central American Free Trade Agreement is also likely to advance this trend.
Incidentally, according to this article from AARP Magazine, foreigners can enroll in the Mexican national health insurance program for only $300 per year, and private insurance is cheaper than in the United States. This same article, published last year, reviews the appeal of Guadalajara, Lake Chapala, and San Miguel de Allende, if you’re interested.
Posted by John at 5:05 AM | Comments (0) | TrackBackQuote of the Day for Friday, November 25, 2005
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November 24, 2005
The Object of Our Affection Today
I'm at a lull in the cooking action now and ran across this fine wild turkey, courtesy of Will Bragg. Everyone enjoy yours today!
Posted by John at 11:29 AM | Comments (0) | TrackBack
Happy Thanksgiving!
Happy Thanksgiving to all our Tidbits friends! The very best to you and your families on this special day.
Our thoughts today are especially with Robert Chapman, who is recovering from brain surgery. Robert is the husband of Jamie Chapman, who has worked with us faithfully for a number of years in Memphis. Robert and Jamie, our thoughts and prayers are with you.
Posted by John at 8:36 AM | Comments (0) | TrackBackQuote of the Day for Thursday, November 24, 2005
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November 23, 2005
Tom Mitchell’s Hole in One—in the Game of Life
Over this past weekend I was at the Houston fund raising events for Golfers Against Cancer, along with my partner Henry and several other great friends of ours.
On Monday, about 550 golfers played on a beautiful fall day, full of sun. We all had a tremendous time for a great cause.
The story of one particular golfer in Monday’s rounds stand out; fortunately for us, it was chronicled by his playing partner, friend, and doctor, Dr. Paul Mansfield:
Tom Mitchell stood on the #4 tee box at Champions where Ben Hogan had once looked out across the expanse of grass to the green on the par 3 and reached for his driver. Tom’s friend and teammate for the Golfer’s Against Cancer tournament, Tom Wertz, then told how Hogan had hit his driver, and after taking a 10 for the hole, went and picked up his ball and walked off the course saying, “If I can’t reach the green on a par 3 with my driver . . . “.
Twenty-four hours later Tom Mitchell stood on the tee box of the par 3 #4 at the Lakes Course at Kingwood during the GAC tournament and looked across the expanse of water to the green. The chances for the BMW, cash, and Continental Business First tickets had all come and gone, this hole was simply for closest to the pin. (As he would later find out only 3 others had reached the green that day). As the stiff wind blew into their faces, he said to his teammates, “If Ben Hogan can hit a driver on a par 3, I guess I can too.” With the driver he hit the ball, it cleared the water, landed and bounced once, rolled onto the green, curled and disappeared at the foot of the flag. Even from over 200 yards away, its disappearance in the hole was obvious. As Mitchell later put it, “I guess I got closest to the pin.”
That type of understatement is typical for this man who always seems so happy and will be the first to tell you he is richly blessed. Mitchell has come to Houston from Huntsville, AL, for the GAC tournament for 3 years now, but for 4 and one-half years as a patient at M.D. Anderson Cancer Center. He has a cancer so rare, it makes a hole-in-one seem like making a 10-foot putt. He has endured an 11-hour operation, nearly 3 months of in-hospital recovery, and was unable to eat for over 6 months (and his days of being a scratch golfer were by then, history). His cancer recurred and he went through chemotherapy and is now on experimental treatment in Cincinnati (where he goes weekly and had to leave the tournament festivities early so as to go receive his next treatment).
Tom lives in Huntsville, AL with his wife, Rhonda, and their 3 children. In addition to his faith and family, golf and music have been his life. He was a middle school music director and band-leader for 25 years. He has played trombone with the Huntsville Symphony and earlier this year directed the Star Spangled Banner before 85,000 fans for the Alabama-Tennessee football game (and he thought that was exciting until he finished his round in the GAC tournament).
Tom Mitchell really is what GAC is all about: fighting cancer, living and enjoying life, loving family and friends, using whatever tools you can find in the bag, and then succeeding where others have failed.
Tom Mitchell’s hole in one is not just to be found on a golf course in Houston, but in the game of life.
Posted by John at 11:59 AM | Comments (0) | TrackBackA Skinny Corollary to Today’s Quote from Seneca
My pal Ryan Walsh, who'll graduate from Princeton this spring--sent me the following quote--related to Seneca's--along with a few comments:
NEVER TRUST A SKINNY CHEF!!
When I lived outside of Houston, my friend's parents had that sign in their kitchen, and they were really large people, and they were some of the best cooks you'd ever come across. Wow those chocolate chip cookies were good. I always loved that sense of humor and the element of truth to the saying (though my mom is tiny and one of the best chefs around!).
Ryan: Your mom's a great lady beyond just cooking, and she may be proof of the corollary to the "skinny chef" rule: Sometimes the chef is so good they can't help but be skinny--there's not much left by the time they get to eat!
Posted by John at 9:00 AM | Comments (0) | TrackBackQuote of the Day for Wednesday, November 23, 2005
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November 22, 2005
Quote of the Day for Tuesday, November 22, 2005
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November 21, 2005
Immigrants and Their Remittances: "A Powerful Tool for Poverty Reduction"
In their examination of global economic prospects for 2006, the World Bank took a special look at remittances from immigrants back to their homeland.
Official figures indicate that migrants sent more than $167 billion to developing countries this year. This figure comes from official channels only; World Bank researchers suggest that remittances sent informally could add another 50% to this figure.
Importantly, even the official tally for remittances is twice the level of international aid.
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François Bourguignon, Chief Economist and Senior Vice President of the World Bank, told a French daily that "remittances constitute a powerful tool for poverty reduction."
Creating economic opportunity in the developed world for immigrants is a powerful yet underrecognized poverty reduction program.
Posted by John at 8:40 AM | Comments (0) | TrackBackBanks Follow the Growing Asian-American Community in Atlanta
The Atlanta Business Chronicle takes a look at the growth in banks seeking to serve the Asian-American community in the area:
Asian-Americans, whose ranks in metro Atlanta swelled more than 200 percent between 1990 and 2000, are becoming the new "it" demographic for banks in Atlanta.
Three banks are being formed in metro Atlanta to serve what has become the nation's fifth-fastest-growing Asian consumer market -- up 481 percent since 1990 -- and larger, out-of-state Asian-focused banks are eying the market as well, say observers. . . .
Between 1990 and 2000, the Asian population in metro Atlanta increased 229 percent to 135,959 from 41,323, according to the U.S. Census Bureau.
Accordingly, Asian buying power in Georgia now is among the heftiest in the country.
Georgia's Asian buying power was projected to be $6.5 billion this year, according to a report on minority buying power in Georgia by Jeffrey Humphreys, director of the Selig Center at the Terry College of Business of The University of Georgia.
The increase in buying power among Asians in Georgia ranks fifth behind only North Carolina, Nevada, Nebraska and South Dakota.
That has created many suitors eager to bank the state's Asian-Americans.
The history of the Asian-American community in Atlanta is not limited; for example, the Atlanta chapter of the National Association of Chinese Americans (NACA) just celebrated its 25th anniversary.
The Asian-American demographic in Atlanta, however, is achieving critical mass, not just in population, but affluence and business ownership. The growth in existing banks like Summit National Bank and the rise of new competition is recognition of this clout.
It’s a very good sign for Atlanta’s continued economic vitality.
Posted by John at 7:19 AM | Comments (0) | TrackBackQuote of the Day for Monday, November 21, 2005
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November 20, 2005
China’s Brightest Die Too Early
Shanghai Daily reports that Chinese intellectuals are dying much too early:
Posted by John at 11:35 PM | Comments (1) | TrackBackChinese intellectuals die at an average age of 58, at least 13 years younger than the national average, a senior Ministry of Health official told a conference yesterday, Beijing Morning Post reported today.
More and more people suffer from chronic illness connected with bad lifestyle, Vice Minister Yin Dakui, told the conference. In the last five years, 135 professors of Beijing University died and their average life span was 53.3.
It was also reported that 83 percent of Chinese people aged 18 to 44 don't exercise, said an expert of Chinese Center for Disease Control and Prevention. If this situation isn't changed, 400 million Chinese will be over weight and 210 million will suffer high blood pressure in the future.
The average life span of Chinese people is 71.4, the Ministry of Health said in a 2000 consensus, which is the latest available figure released.
Chinese Trade is Unbalanced
This statement is not just a U.S. point of view; it’s one held by many in China. Consider this commentary in People’s Daily:
In the first 10 months, China's foreign trade volume jumped 24 percent year on year to 1,148.61 billion US dollars, making it a rare large country in the world so heavily dependent on overseas demand.
The robust export growth shows the continued downturn of domestic demand, as well as the necessity to improve the domestic consumption environment and readjust export policy, the Beijing Modern Business has said in a recent article.
China faces a severe imbalance between its dependence upon overseas and domestic demand, it said.
Over 70 percent of China's economy now depends on foreign trade, which has been growing at an annual rate of over 30 percent for years.
The oversupply problem of some domestic industries is still rampant across the country, forcing Chinese manufacturers to put more focus on the overseas market. . . .
Net exports this year will contribute over 35 percent of China's economic growth, much higher than in the previous years, the State Information Center (SIC) said in its latest report.
The excessive dependence of Chinese economic growth upon overseas demand is risky, the SIC warned in its report. The huge sum of trade surplus will lead to the abnormal increase of China's forex reserve, pressuring the RMB to further appreciate and triggering international trade dispute, it said.
The rapid growth of China's foreign trade is now challenged by the uncertainties in the world economy, as well as international trade protectionism. . .
China has a huge stake in the continued prosperity of the world economies into which it exports, including the United States. This dependence is unnaturally large, as this commentary indicates, and subjects the country to political risks (in the form of potential protectionism) which is undesirable.
Posted by John at 11:20 PM | Comments (0) | TrackBackQuote of the Day for Sunday, November 20, 2005
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November 19, 2005
A More Secure World
The University of British Columbia has produced "The Human Security Report," which was funded by the governments of Canada, Norway, Sweden, Switzerland and the UK. The study concludes that all forms of political violence (wars, genocides, violent conflicts) have experienced major declines in recent years as well as over the last half century and more. Some of the report’s key findings include:
The number of armed conflicts has declined by more than 40% since 1992. The deadliest conflicts (those with 1000 or more battle-deaths) dropped even more dramatically––by 80%.
The number of international crises, often harbingers of war, fell by more than 70% between 1981 and 2001.
Wars between countries are more rare than in previous eras and now constitute less than 5% of all armed conflicts.
The number of military coups and attempted coups has declined by some 60% since 1963. In 1963, there were 25 coups or attempted coups; in 2004, there were 10. All failed.
Most armed conflicts now take place in the poorest countries in the world, but as incomes rise the risk of war declines. [Emphasis mine]
The period since the end of World War II is the longest interval without wars between the major powers in hundreds of years.
Most of the world’s conflicts are now concentrated in Africa. But even here there are signs of hope. A new dataset compiled for the Human Security Report finds that between 2002 and 2003 (the last year for which there is data) the number of armed conflicts in Africa dropped from 41 to 35.
The new dataset created for the Report finds that between 2002 and 2003 the number of reported deaths from all forms of political violence fell by 62% in the Americas, 32% in Europe, 35% in Asia and 24% in Africa.
Not withstanding the horrors of Rwanda and Srebrenica, Bosnia, the number of genocides and other mass killings plummeted by 80% between the 1989 high point and 2001.
The countertrend to the report’s basic conclusion, of course, is international terrorist incidents, which are up significantly in recent years:
International terrorism is the only form of political violence that appears to be getting worse. Some datasets have shown an overall decline in international terrorist incidents of all types since the early 1980s, but the most recent statistics suggest a dramatic increase in the number of high–casualty attacks since the September 11 attacks on the US in 2001. The annual death toll from international terrorist attacks is, however, only a tiny fraction of annual war death toll.
The report cites three main reasons for the increase in human security caused by the overall decline in conflicts:
1. The end of colonialism, the root of 60%-100% of all conflicts from the early 1950s to the early 1980s, depending on the year.
2. The end of the Cold War, responsible for one-third of all conflicts after World War II.
3. The surge of international activities, such as United Nations diplomacy and peacekeeping missions, designed to stop conflict and prevent clashes from breaking out. Counter to some perceptions, the report cites a RAND Corporation study which found that two-thirds of UN peace building missions have succeeded.
Over the long term, "equitable economic development, increased state capacity and the spread of inclusive democracy play a vital role in reducing the risk of political violence."
The reduction in conflict over the past half century or more is also clearly driven by a greater embrace of capitalism around the world. In turn, barriers to trade have been reduced and commerce between nations has grown dramatically. Average incomes in the developing world have increased markedly over the decades; for example, as I pointed out in this post, the number of Chinese citizens below the poverty line has dropped significantly since the country’s reform movement started in the late 1970s.
Economic development driven by global trade and investment is a global peacekeeping mission.
Posted by John at 9:20 AM | Comments (0) | TrackBackQuote of the Day for Saturday, November 19, 2005
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November 18, 2005
The Fertilizer of Small Business
The New York Times looks to Manitowoc, Wisconsin, and finds that the Internet is helping small retailers find a place to compete and thrive in a world purportedly dominated by Wal-Mart and their ilk:
In the newest era of this city's history, the Internet is propping up bricks and mortar downtown, acting as a mainstay for the stores that have helped Manitowoc establish what development specialists call a "recreational" shopping experience. Indeed, besides generating sales for giants like Amazon, the Internet is allowing small stores, here and around the country, to develop the niche products that shield them against big-box retailers.
Beyond the revenue from online sales, Manitowoc's merchants say the biggest benefit of e-commerce is that it enables them to turn over their inventory much more quickly, so owners can add more products and variety to their sales floors. That, in turn, encourages more interest and customer traffic, diversifies the revenue stream and contributes to downtown street life here and in other small cities. . .
At Eighth Street is the kitchen supply retailer Cooks Corner, which occupies a 20,000-square-foot store that was once a Kresge's. The company, which is 11 years old, employs 35 people and stocks 15,000 gadgets and appliances; its Web site, cookscorner.com, accounts for a third of the company's revenue. Of the 1,000 customers who visit the site each day, roughly 200 place a digital order, said Peter Burback, the company's owner and founder with his wife, Cathy. The site has also elevated Cooks Corner to regional and national attention. Mr. Burback keeps a customer log of cash-register receipts totaling 170,000 people who visited the store last year. "We're the No. 1 tourist draw in the city," he said. . . .
Former General Electric CEO Jack Welch once said that the Internet was the "Viagra of Big Business." It's also the fertilizer of small business, too.
Posted by John at 4:58 AM | Comments (0) | TrackBackQuote of the Day for Friday, November 18, 2005
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November 17, 2005
Immigrants a Catalyst to Inner City Economic Growth
Harvard Business School professor Michael Porter studied the 5.5 million immigrants who live in inner cities to determine their impact on local economies, reports USA Today. Porter found that immigrants are actually a key catalyst for economic growth and urban investment:
The immigrants "change the very face of entrepreneurship in inner cities" and "provide a much-needed shot of economic vibrancy to distressed neighborhoods," said Porter, who has advised Congress and the White House.
A large immigrant population is only one factor in establishing economic vibrancy in the inner city, however. Porter found that resurgent inner city economies have other factors in common such as strong local leadership, benign regulatory climates for business, and strong job training systems.
Inner cities with high immigrant populations in Porter’s study whose job growth outpaced that of the broader MSA include Anaheim, Long Beach, Oakland, San Jose, Seattle, Portland, Oregon, and St. Petersburg, Florida.
Posted by John at 7:32 AM | Comments (0) | TrackBackSlot Machines and ATMs
Here’s an interesting factoid from an Atlantic Monthly article by Marc Cooper on slot machines:
America now has twice as many publicly available gambling devices that take money--slot and video-poker machines and electronic lottery outlets-as it does ATMs that dispense it. In the past fifteen years the number of such devices has grown five-fold, to more than 740,000, and it's still mounting.
The two have little ostensible relation to each other, but the metaphor is thought-provoking.
Thanks to Daniel Gross for the pointer.
Posted by John at 5:17 AM | Comments (0) | TrackBackDrucker: The Economy is Biological, not Mechanistic
Steve Forbes penned a marvelous tribute to Peter Drucker for the Wall Street Journal, which I encourage you to absorb. Among several quotes of Drucker’s which Forbes cites, one stood out:
The economy is forever going to change and is biological rather than mechanistic in nature. The innovator is the true subject of economics. Entrepreneurs that move resources from old and obsolescent to new and more productive employments are the very essence of economics and certainly of a modern economy. Innovation makes obsolete yesterday's capital earnings and capital investment. The more an economy progresses the more capital formation -- profits -- will it therefore need.
Drucker’s concept of a "biological" economy wasn’t original to Drucker. As Forbes points out, Drucker was a student of the great economist Joseph Schumpeter, who gave us, among other important concepts, the idea of "creative destruction."
Drucker’s work offered vivid color supporting the tightly packed statement that "the economy is forever going to change and is biological rather than mechanistic in nature."
Never mind the control which monopolists, or overconfident companies with large market shares, might seek to exert. Forget the pronouncements of social critics or autocratic religious authorities. The seeming power of politicians and the institutions they inhibit cannot dam this river of change for long.
The world economy is not mechanistic and therefore easily explained, modified, or controlled by simple prescriptions or laws. Entrepreneurs and innovators provide the seeds of change, and the source of decay, within an economic ecosystem.
Change is inevitable. It’s now a cliché, thanks in large part to Peter Drucker. In fact, the term "change is inevitable"