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June 30, 2006
Great Interactive China Map for Business
Asia Times has a terrific interactive map of China which is a good introduction to the economic differences in the country's provinces.
[Thanks for Dan Harris at the China Law Blog for the pointer.]
Posted by John at 8:57 AM | Comments (0) | TrackBackThe Dangers of "Cures" for Globalization from Pandering Politicians
Writing for YaleGlobal, Richard Hornik observes that the "cure" for globalization can be worse than the "malady", particularly when those cures come from pandering politicians at both ends of the spectrum:
Posted by John at 8:44 AM | Comments (0) | TrackBackFrom an economic standpoint, the dislocation that stems from the transition to a post-industrial, globalized economy, whatever that may turn out to be, will probably last another 10 years. But the discomfort and resulting public anger will likely increase, and that will only intensify the polarization of electorates in Europe and North America. If politicians at both ends of the political spectrum continue to win votes by pandering to the worst fears and basest instincts of a frightened electorate, it seems only a matter of time before the resulting governments indulge in the self-destructive grand gestures that could lead to a global trade war or a violent anti-immigrant backlash or both. As the world discovered 80 years ago, the dislocations wrought by globalization’s creative destruction are nothing compared to the economic chaos unleashed when efforts are made to halt the process.
Quote of the Day for Friday, June 30, 2006
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June 29, 2006
Disrupting Your Comfort Zone in Order to Grow
I'm a big fan of the NPR series This I Believe. Modeled on a 1950s radio program of the same name, This I Believe is a series of essays by Americans from all stations of life offering short essays on personal credos which have guided their lives.
One particular recent essay stood out for me, written by producer Brian Grazer. Grazer discusses the importance of getting out of your comfort zone, the secure little corner we all have in which we don't have to take chances or court failure and possible ridicule.
Only by pushing out of this corner of our lives can we grow, Grazer says, and I strongly agree with him:
I was 45 years old when I decided to learn how to surf.
Picture this scene: The north shore of Oahu -- the toughest, most competitive surfing spot on the planet. Fourteen-foot swells. Twenty tattooed locals. And me, 5-foot-8-inches of abject terror. What will get me first, I wondered, the next big wave or the guy to my right with the tattoo on his chest that reads "RIP"?
They say that life is tough enough. But I guess I like to make things difficult on myself, because I do that all the time. Every day and on purpose. That's because I believe in disrupting my comfort zone.
Posted by John at 9:39 PM | Comments (0) | TrackBackWhen I first started out in the entertainment business, I made a list of people I thought it would be good to meet. Not people who could give me a job or a deal, but people who could shake me up, teach me something, challenge my ideas about myself and the world. So I started calling up experts in all kinds of fields: trial lawyers, neurosurgeons, CIA agents, embryologists, firewalkers, police chiefs, hypnotists, forensic anthropologists and even presidents.
Some of them -- like Carlos Castaneda, Jonas Salk and Fidel Castro -- were world-famous. Of course, I didn't know any of these people and none of them knew me. So when I called these people up to ask for a meeting, the response wasn't always friendly. And even when they agreed to give me some of their time, the results weren't always what one might describe as pleasant.
Take, for example, Edward Teller, the father of the hydrogen bomb. You've heard of him? However, he'd never heard of me. It took me a year of begging, cajoling and more begging to get to him to agree to meet with me. And then what happened? He ridiculed me and insulted me. But that was okay. I was hoping to learn something from him -- and I did, even if it was only that I'm not that interesting to a physicist with no taste for our pop culture.
Over the last 30 years, I've produced more than 50 movies and 20 television series. I'm successful and, in my business, pretty well known. I'm a guy who could retire to the golf course tomorrow where the worst that could happen is that my Bloody Mary is watered-down. So why do I continue to subject myself to this sort of thing? The answer is simple: Disrupting my comfort zone, bombarding myself with challenging people and situations -- this is the best way I know to keep growing. And to paraphrase a biologist I once met, if you're not growing, you're dying.
So maybe I'm not the best surfer on the north shore, but that's okay. The discomfort, the uncertainty, the physical and mental challenge that I get from this -- all the things that too many of us spend our time and energy trying to avoid -- they are precisely the things that keep me in the game.
Better Late Than Never: Justice Rendered in Alabama
Given my dismay over this news last year, I welcomed the news of this verdict.
Posted by John at 9:21 PM | Comments (0) | TrackBackA China Law and Business Blog Recommendation
I've been a reader of the China Law Blog for a while now, and have actually referenced one of their posts on crime statistics.
The China Law Blog is authored by Dan Harris and Steve Dickinson. They are based in Seattle and Qingdao, respectively, and are partners in the boutique law firm Harris & Moure. The firm has a particular international focus relating to small and medium sized businesses. I love it! Small and medium sized businesses--so many of which seem to be ignoring golden international opportunities--need boutique firms like Dan and Steve's which focus on their size firm.
Some of their recent posts include a very interesting commentary on Beijing's moves to increase intellectual property protection, the increasing demand for Western branded clothing in China's middle class, and why Tianjin is poised for explosive growth. They also had a post on Chinese investment in the U.S., in which, in addition to being kind enough to reference a recent editorial of mine on Chinese investment in Georgia, they mention that Seattle-based Eddie Bauer, currently on the block, would make a good acquisition for a Chinese company seeking to acquire a Western clothing brand.
I've added Dan and Steve's blog to my favorites; I encourage you to do the same.
Posted by John at 8:49 PM | Comments (0) | TrackBackQuote of the Day for Thursday, June 29, 2006
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June 28, 2006
Content is THE Differentiator for Media Distributors
Broadband speeds offered by telcos and cable operators are likely to converge, Cable World argues, meaning that content will remain king in media:
. . . broadband competitors will eventually reach virtual speed parity and, like the superpowers of the Cold War, could arrive at a stalemate. As a result, providing exclusive content and applications to broadband customers might provide the crucial competitive edge. "High-speed data pipes are quickly being commoditized," says Tanya VanCourt, VP and general manager of ESPN Broadband and Interactive Television. "Providers have to figure out how to differentiate themselves and their relevance to their audience." . . .
. . . cable operators are already forging content alliances and creating concepts that capitalize on broadband speeds. In May, for example, Comcast partnered with IGN Entertainment to launch Game Invasion, a new broadband gaming service designed to drive gamers to its premium 8 Mbps broadband tier. In October, Comcast partnered with programmer OLN and the National Hockey League to stream live games over broadband. A month later, Cox announced Premium Access Pass, which offers subscription-based content from its "Best of the Web Zone" and "Sports Zone" packages of broadband video and other content. Time Warner Cable, meanwhile, offers broadband content from dozens of cable programmers through its Road Runner portal and in partnership with affiliated America Online.
Posted by John at 8:59 AM | Comments (0) | TrackBackAt the same time, MSOs' content strategies are evolving. "We're still in the testing phase in terms of content business models," says Cook. Companies in the Web video space that would like to partner with MSOs and telcos are anxious to explore new models.
As Internet-based services like Google, iTunes, MySpace and YouTube continue to gain customers with multimedia content, some Internet players wonder whether MSOs and telcos will start their own similar services to compete--or whether they might strike new partnerships with successful Internet content firms. "Will you see the cable companies and telcos at the level of the application space?" asks Greg Kostello, CEO of music-oriented video site Vmix.com. "It's unclear right now. Their portals aren't very visited, and they really haven't figured out that consumer offering."
Content partnerships, however, are moving forward rapidly: AT&T is giving its broadband customers access to Akimbo's library of more than 10,000 videos and to TotalVid's more than 2,600 entertainment and instructional videos. Recently it inked a pact with Starz Entertainment Group-owned Vongo to offer its movie-download subscription service to AT&T broadband customers. In May, it partnered with mobile content aggregator MobiTV to deliver video through nearly 7,000 AT&T Wi-Fi hot spots across the U.S. "Today's consumers are looking for readily available video and entertainment-related content to enhance their broadband experience," AT&T's Sarah Baker says. . . .
VanCourt says broadband access providers should start promoting the availability of such content rather than more commoditized perks like spam protection and pop-up blockers. "[Content] gives consumers a reason to choose that high-speed connection over another one," she says. VanCourt predicts that exclusive broadband content deals could be on the horizon. "There are a number of different business models out there, and people are trying to figure it out," she says. "If history is any indication...there might be some exclusive deals done." She says one historical example in the multichannel world is DirecTV's NFL Sunday Ticket, which gives subscribers exclusive live access to all NFL football games across the country. . . .
A Step Toward Tailored Cancer Treatment
A cancer research team in Boston has demonstrated a technique for isolating mutations in tumors, which can lead to more personalized treatments for cancer:
. . . a team from MIT, Harvard, and the Dana-Farber Cancer Institute in Boston has demonstrated a technique for isolating and quickly sequencing single snippets of DNA. And that advance could be crucial for cancer patients, since some cancer therapies work almost miraculously in some patients whose tumors contain a specific mutation, while other mutations make certain drugs ineffective on tumors.
"We want to know the mutational profile of a tumor, and then make informed decisions about the best therapy," says William Pao, a physician scientist at the Memorial Sloan-Kettering Cancer Center in New York, who has previously identified key mutations in lung cancer tumors. "The ultimate goal is molecularly tailored therapy." . . .
Kittering's Pao, who was not involved with the new research, says the results are promising. "If this kind of technique can be applied in the clinic, it would be very useful," he says. "A lot of tumor samples from patients are limited in quantity, so it's crucial to be able to take a minute amount of tumor cells and detect mutations."
The technology was launched commercially last year, and 20 or so systems have already been sold, according to Michael Egholm, the company's vice president of molecular biology.
The outfit is one of several companies striving to create fast, accurate, and affordable sequencing methods, which could ultimately have a broad impact on both cancer research and clinical practice. Last year, the National Institutes of Health (the nation's premier biomedical funding agency) announced a project to create an atlas of genetic mutations in selected types of tumors. The number and types of tumors that can be sequenced will depend largely on the speed, accuracy, and cost of new sequencing methods . . .
"We think in a few years, we'll have a catalogue of genes involved in cancer," says Larry Thompson, a spokesman for the National Human Genome Research Institute, one of the sponsors of the atlas project. "Then we should be able to develop new diagnostic tests and new targets."
"The more these technology companies move forward with improving the technology and driving down the cost," he adds, "the more rapidly they will reach the clinic."
Unless Moore's Law has been repealed, one thing is virtually certain: the cost will decline, allowing widespread adoption.
Posted by John at 8:07 AM | Comments (0) | TrackBackQuote of the Day for Wednesday, June 28, 2006
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June 27, 2006
The Sorry State of the U.S. Visa Process for Skilled Workers
If you want to understand why so many business executives are upset about the issue of visas for foreign highly-skilled workers, take a look at today's front page Wall Street Journal article:
Manajit Sengupta studies clouds -- how they can be used to forecast hurricanes, how they may relate to global warming, how to predict their formation over a battlefield.
In the post-Katrina world, Dr. Sengupta's expertise would seem to make the 39-year-old Indian national a highly prized immigrant. Colorado State University, which helps fund the Fort Collins institute where Dr. Sengupta works on a temporary visa, thinks so highly of him that it is sponsoring him for a type of permanent visa that is available only to "outstanding researchers."
Even so, Dr. Sengupta can expect a years-long wait for a visa that would allow him to stay and expand his research. With the economy humming, so is the demand for visas for skilled workers such as scientists and engineers. But Congress caps the number of visas available to them.
Meanwhile, terrorist concerns and antiquated government procedures mean there are enormous paperwork backlogs for would-be immigrants. The Labor Department, which clears one of three forms that most skilled immigrants must file to become permanent residents, has a backlog of 235,000 cases. The Citizenship and Immigration Service, which clears the second form, is 180,000 cases behind. And after those two agencies have acted, the State Department, which issues the visas, predicts waits of a further one to five years for even the most highly trained Indian- and Chinese-born immigrants.
That leaves people like Dr. Sengupta in long-term legal limbo. After 10 years in the U.S. on temporary and student visas, he feels at home here. He's bought a house and is raising a U.S.-born daughter. But his immigration status means he can't change jobs, apply for certain government grants or adopt a child, as he and his wife would like to do. "I have this feeling: Am I wanted here or am I trying to push myself on this country?" he says. . . .
The foreign-born now account for about half of the Ph.D. engineers, life scientists, physical scientists and math and computer scientists in the U.S., the National Science Foundation says. A Stanford University study estimates that half of all Silicon Valley high-tech companies have at least one founding member who is foreign born. Eight of 18 Ph.D.s in Dr. Sengupta's research program are foreign-born.
The immigration service, part of the Department of Homeland Security, says that in 2005 1.1 million immigrants received green-card visas, which means they are allowed to stay permanently and eventually apply for citizenship. But most green cards go to relatives of earlier immigrants. Congress caps the number of permanent visas available to skilled workers and their families at 140,000 a year. The result is that the typical wait for a permanent employment-based visa is now five years or more.
Congress also allows the State Department each fiscal year to issue 65,000 temporary employment visas -- so-called H-1B visas -- that allow skilled workers to stay in the U.S. for up to six years. But H-1Bs for the 2007 fiscal year ran out last month, five months before the fiscal year even begins and just weeks after the government began taking applications. . . .
Let me give you an example of how horrendous our visa system is, as it relates to highly skilled workers. I spoke with an immigration attorney here in Atlanta today regarding an individual one of our portfolio companies is trying to hire. During the conversation, this attorney, who is very good at what he does, told me that if the employer-sponsored application for an H-1B visa is denied, for whatever reason, it's better to simply start over, in spite of the fact that you are allowed to appeal. Even if the Department of Labor loses all your properly executed paperwork, for instance, and denies your application, you might as well start over.
Why? Appeals take months and months simply because there are no real resources set up for the appeal process, according to this knowledgeable attorney. In other words, the right of appeal, which is detailed in the letter of denial you receive from the Labor Department, is really, in essence, one big sham. It's a one way ticket to the padded room in the basement of the bureaucracy.
I suppose if you're Microsoft or Cisco or some other large company, you can throw legal resources behind a valued employee indefinitely. If you're a small company, however, you're screwed.
According to the Department of Labor's own Job Openings and Labor Turnover Survey, the number of job openings is now about 5 million, about double what it was just three years ago. It is simply incorrect to make the assertion that we are denying qualified Americans jobs they would otherwise have. According to the DOL's own statistics, jobs are begging to be filled in this country.
If the self-proclaimed champions of small business, the Republican Congress, really cared about the health of this constituency, they would fix this problem. According to the WSJ article, an increase in the number of visas allowed for skilled workers is unlikely.
It's a pitiful shame that Congress is so focused on looking tough with talk of "securing our borders" that they cannot deal with competitiveness issues like this one.
Posted by John at 6:41 PM | Comments (1) | TrackBackVenture Investment in China, Spurred by IT, Continues to Expand
Red Herring looks at current venture capital investment trends in China:
The latest taste of the figures shows the flow of venture capital between 2004 and the first quarter of 2006 topped $2.81 billion, according to Dow Jones VentureOne, which has begun to track China and will take a closer look in a report slated for release later this summer.
Overall, the country attracted $1.5 billion in 2005, up from $1 billion in 2004. This year appears to be on track, with preliminary numbers showing China snared more than $300 million in new investment in the first quarter of 2006—not bad for what is historically the lowest quarter of the year—and about twice the level of investment in the year-ago quarter.
Posted by John at 6:30 PM | Comments (0) | TrackBackThese numbers are in line with similar figures released by Zero2IPO, a Shanghai-based firm that monitors both foreign and domestic venture capital. But unless second and subsequent quarters vastly exceed the $300 million mark, venture capital in China for 2006 won’t soar—it will fall.
If history is any indicator, that’s unlikely: first quarters in China are frequently tepid for VC, but subsequent quarters usually make up the difference. Moreover, the trend in China VC is resilient, even during a downturn. . . .
Hot areas for investment in the first quarter, according to VentureOne, include information technology investments, which garnered 64 percent of all Chinese deals in the quarter. That’s down from 2005, when IT investment snared 71 percent.
Consumer and business services are the largest segment for Chinese venture capital investment outside of the IT sector, representing more than half of the deals in the products and services category.
Thriving in the Shadow of Wal-Mart
The Detroit News profiled several independent specialty stores which are surviving and even prospering--in spite of, and often because of, the competition from big-box retailers like Wal-Mart:
. . . Independent specialty stores, boutiques and cafes are surviving -- and even thriving -- in the shadow of the retail giants through a mix of personal service, specialized skills and unique products. They fend off the mega-stores by catering to a specific clientele or carving out a niche that's small enough to keep the big retailers out.
A 2005 survey of small-business owners found that 52 percent of those already in business changed their tactics and either retained their market share or actually increased business when a Wal-Mart, Target, Kohl's or other "big box" retailer opened nearby, according to DollarDays International Inc. of Scottsdale, Ariz., an Internet-based wholesaler to small businesses. . . . [emphasis mine]
"If a store has a niche that means they are highly specialized, and the big guys can't compete," said Bruce Wood, a retail analyst with Farmington Hills-based Kenneth J. Dalto and Associates.
One tactic small operators can take is to avoid competing with the powerhouses altogether and focus instead on offering service and merchandise that the big businesses can't. In some cases, a small business can ride the big stores' coattails, such as servicing items sold by the big-box stores.
"You can go to Wal-Mart and get a clock and it does the same thing, but they can't do what we do," explained Mai Pin, whose family runs the 30-year-old Roseville Clock Shop. The store -- within a mile of a Wal-Mart -- sells clocks ranging from $20 to $2,000, but 80 percent of its business is repairing and servicing broken clocks.
Besides the low-price outlets, Pin's shop also has to compete with big furniture chains, such as Art Van and Gardner White. They sell some of the same grandfather clocks as Roseville Clock, but nobody at the furniture stores can repair the massive time pieces.
Customers have been coming to the store for years and tell their friends about the service the shop offers. Repairmen are called out as far as Port Huron and Ann Arbor to fix broken clocks, Pin said.
That's why Leo Festian of Clinton Township has been bringing his clocks to the store for the past 15 years. He recently brought his mother's antique mantel clock to the store after it fell off a table and the pendulum broke off.
"You're friend or neighbor can't fix it," Festian said. "Department stores can't help you, but they'll sell you a new one."
The mass-merchandising approach of the mega-retailers also creates opportunity for small stores, noted Charlie Owens, Michigan director for the National Federation of Independent Businesses.
"The weakness of big boxes is that they carry standard products," Owens said. "Nothing is specialized." . . .
The article goes on to offer tips, from the book The Secrets of Retailing, or How to Beat Wal-Mart!, for small retailers as they compete against larger chains:
Think small: While large chains can buy in very large quantities, they can't buy in small quantities. They can't benefit from the true closeouts, which are broken lots or left-over goods that a manufacturer needs to unload.
Go unique: There are many new products that, because the supply is limited, chains pass over.
Find small manufacturers: Many small manufacturers will not sell to chain stores because one year the chain may gobble up most of their production, and the next year the chain will take that item and make a knock-off overseas.
Overhead cost: Instead of teams of buyers, batteries of lawyers and layers of accountants, an independent business can be run by a true entrepreneur and their trusty staff.
Simpler shopping: A store that is 2,000-5,000 square feet is much easier to shop than a 100,000 square foot giant.
Location, location, location: Under-served neighborhoods are an opportunity for independent stores to thrive where the giants are not.
Personal attention: People like to shop where they feel comfortable, where they feel the owner cares about their wants and needs.
Incidentally, I went to the Roseville Clock Shop website and saw that they make house calls. See if you can get Wal-Mart or your local department store to do that.
Posted by John at 9:42 AM | Comments (0) | TrackBackQuote of the Day for Tuesday, June 27, 2006
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June 26, 2006
Free Trade is the Real Charitable Gift
Greg Mankiw offers the following comparison from the pages of today's New York Times:
Philanthropy: Warren Buffett's gift of his $44 billion fortune, most of which of is going to the Bill and Melinda Gates Foundation.
Free Trade: The $54 billion annual gain to the global economy, according to a study by the International Food Policy Research Institute, if the current deal on the table regarding agricultural subsidies at the Doha Development Round of trade talks is accepted by all nations.
As Mankiw observes, success in agricultural free trade talks can deliver more good to global society in one year than the accumulated lifetime result of the world's most successful investor.
Posted by John at 8:41 PM | Comments (0) | TrackBackSometimes No Matter How Far You Go, The City Will Find You
Twenty-two years ago, burned-out Washington lawyer George Farnham hauled his 1955 jukebox around Sleepy Creek Mountain and moved into an old farmhouse here where he found peace and understanding and got into collectibles.
Here, his ponytail turned gray. Here, he erected four huge fiberglass statues in his back yard -- Muffler Man, a 26-foot-tall beach boy in sunglasses, Santa Claus and a monstrous grocery clerk called Big John. And here, he fit right in with the other eccentrics who had come to escape the madness across the mountain.
Then, one day recently, Farnham discovered something scary. Test holes were being drilled in a field across from his house. And he knew: All that he had fled years before had found him once again. A housing development was coming to paradise. . . .
Posted by John at 8:33 PM | Comments (0) | TrackBackRoughly 100 miles from Washington, Morgan is the westernmost of the three counties in the thriving tip of West Virginia's eastern panhandle. Pinched between Northern Virginia and Western Maryland, it joins Berkeley and Jefferson counties, which are now bustling with development and increasingly a part of the Washington and Baltimore suburbs.
"I could tell even 22 years ago that Jefferson County and Berkeley County were going to fall," Farnham, attended by one of his 14 cats, said in an interview in his living room.
But Morgan County, he believed, would be safe. "I thought we'd be immune," he said. "That's why all of us who have moved here in the last 20, 30 years have come out here. We really didn't think it was going to follow this far out." . . .
Georgia Ports Growing Faster Than Hometown Companies
The Georgia Ports Authority has announced an expansion which will results in 54 new jobs and an $83 million capital investment.
The new jobs are necessary to accomodate expected container growth of better than 9% this coming year. By comparison, consensus estimates for Cola-Cola's revenue growth for 2007 are less than 6%. Home Depot's revenue growth for its next fiscal year is expected to be just under 9%. UPS is expected to experience 7% revenue growth next year.
It's great to root for hometown companies and their continued prosperity--I'm as much of homer for Atlanta, Georgia, and its companies as anyone. The marginal impact of Georgia's deepening participation in the global economy, however, is clearly significant, and possibly larger in the aggregate than some of its marquee companies.
We looked at these numbers previously, but here they are again: Georgia's ports and barge terminals account for over 270,000 jobs in the state, $35 billion in sales (7% of Georgia's total), and $17 billion, or 6%, of Georgia's gross state product.
Posted by John at 7:23 PM | Comments (1) | TrackBackTwo Billion GSM Mobile Phone Users Worldwide
According to the GSM Association, new GSM mobile phone users are signing up worldwide at the rate of 18 per second. The trade group says that it took 12 years to reach one billion users, and only another two and a half years to hit the next billion.
(Thanks to the Private Sector Development Blog for the pointer.)
Posted by John at 4:54 PM | Comments (0) | TrackBackA Legend Worth Knowing: Alonzo Herndon
If I were able to pick a few famous American business leaders from the past and be able to interview them, Alonzo Herndon would be on my shortlist. Herndon was born into slavery, yet rose from poverty and little formal education to become one of Atlanta's top entrepreneurs. One of his many achievements was the founding of Atlanta Life, which just celebrated its centennial last year.
Today is the 148th anniversary of Herndon's birth, and he's the source of today's quote of the day. If you don't already know Herndon's story, follow this link and read more about him.
Posted by John at 3:59 PM | Comments (0) | TrackBackCompetition for Your Family Doctor
With chains such as Wal-Mart, Target, and CVS opening in-store medical clinics, doctors are having to respond to the competition with faster service and flexible scheduling, reports the New York Times:
. . . doctors know that as walk-in medical offices and retail-store clinics pose new competition, and as shrinking insurance benefits mean patients are paying more of their own bills, family care medicine is more than ever a consumer-service business. And it pays to keep the customer satisfied. . . .
Professional societies for family doctors and internists are urging their members to break with tradition by making it easier to schedule appointments — or even making appointments unnecessary in the case of walk-in patients who need immediate attention.
"It's a big trend," said Amanda Denning, a spokeswoman for the American Academy of Family Physicians, which has about 94,000 members.
Posted by John at 3:53 PM | Comments (0) | TrackBackThe academy is spending $8 million on consultants who visit doctors nationwide to suggest improvements in patient care. The advice is meant to "keep them from going to an in-store clinic," Ms. Denning said, while also benefiting doctors by making office procedures more efficient.
Meanwhile, the 119,000-member American College Of Physicians is promoting "patient-centric care," which it made the focus of a policy paper this year, calling for more consumer-friendly scheduling, electronic medical records and electronic prescriptions, among other measures.
In [Texas-based] Dr. [Melissa] Gerdes's office, the innovations include daily clinics at lunchtime called QuickSick, in which patients who have phoned up that morning can come in for routine problems requiring immediate attention, like an upper respiratory infection, and are guaranteed they will be examined, treated and on their way within a half-hour.
After a nurse checks the patient's temperature and blood pressure and types the symptoms into a computer, the doctor follows up with a brief exam. If medication is warranted, Dr. Gerdes can e-mail a prescription that will be ready when the patient arrives at the pharmacy.
"I can see three patients with acute needs every 15 minutes," she said.
The charge is $52 to $60, which is coverable by insurance and similar to prices at many of the new clinics springing up in places like CVS pharmacies and retail chains like Wal-Mart.
According to various polls, cost is a high priority for most patients. "People will change physicians for differentials of $10 or $15 in a co-pay," said Dr. Anne B. Francis, a pediatrician in Rochester and spokeswoman for the American Academy of Pediatrics.
But convenience also ranks high. That is one reason about 20,000 of the 59,000 actively practicing members of the American Academy of Family Physicians now use electronic health records. Being highly computerized can let doctors offer Web-based scheduling that enables patients to book their own appointments.
Many of those doctors also offer what Dr. Larry S. Fields, the academy's president, refers to as "open scheduling" — setting aside certain hours each day for seeing previously unscheduled patients.
"We try to cut down on the waiting time," Dr. Fields added. "We need to be more conscious of patients' time.". . .
Influential Sam
Congratulations to my partner Sam Zamarripa; once again, Sam has been named one of the 100 Most Influential Atlantans by the Atlanta Business Chronicle. This makes the fourth consecutive year which Sam has been named to this list. I'm biased, of course, but his honor is extremely well-deserved.
Posted by John at 2:09 PM | Comments (0) | TrackBackQuote of the Day for Monday, June 26, 2006
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June 25, 2006
Trade, Exports, and Prosperity
As former U.S. Trade Representative Rob Portman recently said, "We must fight the protectionist forces with the facts, which show that benefits from trade are substantial." The $12 trillion U.S. economy is bolstered by free trade, a pillar of America's vitality. American exports support one in five U.S. manufacturing jobs. Jobs directly linked to exports pay 13% to 18% more than other U.S. jobs. Moreover, agricultural exports hit a record high in 2005 and now account for 926,000 jobs. It is in America's economic interest to expand trade by lowering barriers.
--Daniella Markheim, Heritage Foundation
Quote of the Day for Sunday, June 25, 2006
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June 24, 2006
Quote of the Day for Saturday, June 24, 2006
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June 23, 2006
A Dollars and Cuts Lesson in Mandarin
My associate Yin Wu, a native of mainland China, tells me that the word "dollar" sounds like "dao le" in Mandarin. "Dao" is the pronunciation for "刀" in Chinese, which means knife or cut.
For example, if a Chinese man sees that his wife has purchased some very expensive jewelry, he might ask: "多少刀?", which means "How many cuts on my body did I receive to pay for this?"
Posted by John at 10:59 AM | Comments (0) | TrackBack
Quote fo the Day for Friday, June 23, 2006
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June 22, 2006
Odd Fact of the Day: Phoenix Residents the Sweatiest in the U.S.
For the second year in a row, Phoenix is tops on the list of the nation's 100 sweatiest cities, reports LiveScience.com. Adult residences in the Phoenix area, on average, sweat enough to fill an Olympic-sized swimming pool in less than three hours.
Follow the link, I'm not making this up.
When you get tired of sweating in Phoenix, head to San Francisco. It's the lowest rated city on the list.
Posted by John at 6:37 AM | Comments (0) | TrackBackBusiness Forging Ties Between China and Central America
I'm of the view that markets and free enterprise are often well ahead of politics when it comes to things like resolving inefficiencies, correcting imbalances, or creating closer ties between nations. Stone age conservatives and the radical left both distrust such a notion--for different reasons, of course.
In this vein, the Wall Street Journal reports on the efforts of China Mobile to close the largest corporate acquisition in the country's history:
State-controlled China Mobile Communications Corp. has been near a $5.3 billion deal to buy Millicom International Cellular SA of Luxembourg for more than a month, people familiar with the matter said. The deal has been complicated by China's lack of diplomatic relations with five of the 16 countries where Millicom has operations, mostly in Central America.
In a sign of how the Millicom deal is serving as a beachhead for Chinese businesses to enter these markets, all five nations have granted visas to Chinese officials, people close to the matter said.
Due-diligence teams of about 15 people, including about three China Mobile officials, accompanied by bankers, lawyers and consultants, have visited all but two of the countries where Millicom operates and will visit those nations this week, these people added.
A person in Beijing familiar with China Mobile's thinking said the lack of diplomatic relations had been a problem because it had interfered with the China Mobile team's so-called due-diligence study of Millicom's finances and operations.
The acquisition is expected to be announced in Beijing next week. A Millicom spokesman declined to comment.
Obtaining a visa to visit nations where China doesn't have diplomatic relations is no easy feat. Senior government officials in the five countries -- El Salvador, Guatemala, Honduras, Paraguay and Chad -- had to be consulted and approve the process, the people familiar with the matter said.
In many cases, Millicom's general manager in each country approached the president or foreign minister to explain the deal and introduce Chinese officials, the people said.
China Mobile's entry in these countries has been encouraged because the company has promised to invest heavily to improve and expand Millicom's existing telecommunications network. Building telecommunications systems -- particularly mobile networks -- has been made a priority across much of the developing world. . . .
Most countries in Central America have traditionally had diplomatic relations with Taiwan, which China considers a renegade province. Taiwan has relations with 25 small and mostly poor countries in the Caribbean, Latin America, the island nations of the Pacific, and Africa, while China has relations with nearly 180 countries. China won't establish relations with countries that have relations with Taiwan. . . .
After the due diligence closes, how are China Mobile employees going to get in and out of El Salvador or Paraguay as they proceed in expanding the property they've acquired? The political bureaucracies in China and these countries will have to accomodate each other in some way to resolve this issue. Such a dialogue is healthy, and can lead to creating closer ties in other ways as well.
Business leads.
Posted by John at 6:06 AM | Comments (0) | TrackBackGas Prices and the Declining Quality of Oil
A year ago we referenced a prediction by Cambridge Energy Research Associates (CERA) that an oil supply glut is likely to occur later this decade. James Hamilton at Econobrowser notes that CERA just released a substantially more moderate view of the future, as reported by the Oil & Gas Journal:
Disruptions to supplies of gasoline, diesel fuel, and light products, associated in part with changes in fuel quality standards, will keep oil markets tight and prices high during the next 2 years, Cambridge Energy Research Associates forecast in a report issued June 6.
"Incremental additions to refining capacity over the next 2 years [will] be insufficient to meet new global demand," it predicts. . . .
. . . CERA analysts expect global markets to remain tight "with exposure to potentially sharp price upswings—even in response to small, unexpected disruptions in refinery operations."
Inventories of refined products are critical when markets are constrained by a lack of spare refining capacity, CERA notes. "Gasoline and distillate inventories in the US are not particularly flush, foreshadowing tight oil supplies this summer."
Margins for light products are expected to remain well above historical averages during 2006-07, higher than even 2005's soaring levels, for a number of reasons, CERA says, including:
-- Rising wages, shortages of skilled labor, and inflation of costs for other key services and construction materials, such as iron, steel, and cement, are likely to raise costs and delay refinery expansions.
-- Economic incentives for some refinery expansions may be stifled by the policies of China and several other developing countries, which are interfering with the market by initiating price controls on refined products and creating subsidies.
-- Midwest refiners in the US, however, may upgrade facilities in deep conversion projects to refine extra-heavy crude from Western Canada as Canadian producers seek outlets for their crude and develop strategies to produce hydrogen to improve its quality.
-- Proposed new heavy-oil refinery projects in the Middle East likely will go forward to ensure markets for national oil companies' heavy crudes, meet growing demand for area transportation fuels, and reestablish an influence on global benchmark crude prices.
In his analysis, Hamilton goes on to note that the quality of crude being produced, particularly by the Saudis, is steadily declining, which is in turn causing increasing bottlenecks and costs in the refining process. "Peak oil", Hamilton observes, is not a sudden discovery that oil supplies are depleting rapidly. Instead, he says, it is a
Posted by John at 5:25 AM | Comments (0) | TrackBackmore gradual process in which we continually pay more for oil, trying to extract lower quality stuff from harder-to-get-at locations and with increasing geopolitical risks. When asked, "what will peak oil look like?", my answer has been, "perhaps a lot like the last two years".
Quote of the Day for Thursday, June 22, 2006
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June 21, 2006
U.S. Needs to Expand Its Nuclear Power Industry
Historian and Forbes columnist Paul Johnson argues that the United States needs to emphasize an expansion of its nuclear power industry:
The world's biggest technical failure over the last half-century has been the refusal to make full use of nuclear power. Following the explosion of the two atomic bombs in Japan in August 1945, I recall vividly the speculation that the peaceful use of nuclear energy would replace the world's dependence on fossil fuels with a cheaper, cleaner and inexhaustible source of power. But this has not happened. It's not because the technology or the capital resources are lacking but because public opinion has been stampeded into the antinuclear camp by scare tactics, helped along by a minor accident in the U.S. at Three Mile Island and a major one in the old, inefficient, corrupt and careless U.S.S.R. at Chernobyl. In fact, for the long term nuclear energy is by far the cheapest, cleanest and most trustworthy way to produce power. The safety procedures for nuclear energy can be improved upon indefinitely, while the risks involved in continuing dependence on fossil fuels are intrinsic.
Posted by John at 10:31 PM | Comments (0) | TrackBackThe present oil crisis--the longest on record--is forcing the governments of many nations to drop their craven deference to the antinuclear lobbies and tread the path of realism. France, thanks to the foresight of President Valéry Giscard d'Estaing, has always stuck with the nuclear option. Finland, at one time thoroughly shaken by Chernobyl, is now following suit. Britain has just decided to build a score of new nuclear power plants.
I'd like to see the U.S. not only building many more nuclear power plants but also taking a leap forward in the game, to become a major supplier of nuclear-generated energy to the whole world. The U.S. was the first nuclear power and is still well ahead of other countries in nuclear technology. It is capable of building nuclear generators on a scale hitherto undreamed of and concentrating them in remote areas that would provide the maximum geographical safeguards and, in the unlikely chance of attack, allow for antimissile defenses to be set up. . . .
It's worth remembering that the U.S. has not entirely ne-glected the potential of large-scale use of nuclear energy. Its fleets of aircraft carriers and submarines, which form the core of its capacity as the world's only superpower and are the means of making its global military outreach a reality, are almost entirely powered by nuclear reactors. These have performed over many decades with spectacular efficiency and superb safety records. . . .
The Swelling Ranks of Millionaires Around the World
The number of millionaires worldwide grew over 6% last year, rising to 8.7 million people.
Millionaires in South Korea grew the fastest--21.3%--followed by India, at 19.3%, and Russia, with 17% growth.
Posted by John at 10:08 PM | Comments (0) | TrackBackQuote of the Day for Wednesday, June 21, 2006
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June 20, 2006
Chinese Investment in Georgia: A Small Start to a Very Large Trend
From the Atlanta Business Chronicle:
A joint venture of China-based Lehui Enterprises and a U.S. manufacturer, W.Y. Industries, will open a new facility to manufacture, process and package a variety of condiments in Newnan, Ga., the state of Georgia announced today.
Georgia will gain 200 jobs within two years. The facility is expected to attract $12 million to $15 million in new investment to the Newnan area. . . .
In Newnan, Lehui Enterprises' 225,750-square-foot facility will be located at a former Olsonite manufacturing structure. The company will manufacture, process and package foodstuffs, including soy sauce, vinegars and cooking sherry. The facility will also be used to manufacture plastic packaging material in later phases of project operations.
"The building at 25 Dart Road in Newnan, the logistics infrastructure of metro Atlanta, the strength of the international airport, and growth of the Southeast marketplace were all factors we took into consideration during our decision-making process," said Bill Cheng, president of W.Y. Industries. "We know we will be successful in Georgia."
A small sign of more to come.
Posted by John at 5:24 AM | Comments (0) | TrackBackRisks of a Hard Landing in China Increasing?
Bloomberg's Andy Mukherjee argues that China is not raising rates fast enough, increasing the probability of a "hard landing":
Posted by John at 4:58 AM | Comments (0) | TrackBackAs the Chinese central bank buys dollars to keep the yuan stable at about 8-to-1 against the U.S. currency, it ties itself to a low interest-rate regime because an even bigger deluge of capital inflows into China may happen from a closing of the rate differential with the U.S. Federal Reserve.
The one-year benchmark deposit rate in China is 2.25 percent, as much as three percentage points lower than in the U.S. It was last raised by 27 basis points in October 2004.
Credit Suisse's [Dong] Tao estimates that Chinese deposit rates must rise by 200 basis points -- and lending rates by 300 points -- to reach the neutral zone. And yet, he expects the central bank will only raise the rates by a maximum of 54 basis points this summer. That may take the lending rate, which was increased by 27 basis points in April, to 6.39 percent.
The net result of all the tightening may be a big zero: Analysts almost unanimously expect the Chinese economy to expand 9.5 percent or more in 2006, not much slower than 9.9 percent last year.
Every year of "no landing" is increasing the risk of an eventual "hard landing." People's Bank of China badly needs to raise the cost of money significantly. And that necessitates a move on exchange rates, sooner rather than later.
Quote of the Day for Tuesday, June 20, 2006
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June 19, 2006
Rising Personnel Costs Baked in the Cake for Community Banks
It's getting increasingly difficult for community banks to find qualified bankers, which means salaries, incentive pay, and other benefits are destined to rise. The Orlando Business Journal reports:
. . . Nine out of 10 community bank chief executive officers nationwide say it would be hard or very hard to find qualified candidates to fill various management positions, shows a recent survey by the American Bankers Association.
Community bankers' solutions: thousand-dollar hiring bonuses, competitive salaries, out-of-market searches and better training. . . .
The recruitment and retention of qualified employees is a growing problem. Consider: 60 percent of U.S. community bankers surveyed believe their markets have too many branch locations -- yet 76 percent continue to see branch expansion as their main avenue of growth.
Because so many banks are adding branches, they often steal employees from competitors, community bankers say. . . .
Nationally, the problem is filling certain key positions. At least 90 percent of community bank CEOs surveyed say it would be difficult to find qualified candidates to work as trust officers, business lenders, compliance officers, chief financial officers and information technology officers.
In metro Orlando, community bankers are having trouble filling jobs from tellers to middle and upper managers.
Managers are especially in high demand. A branch manager with five years of experience can get up to $50,000 a year, [Citizens First Bank CEO Mike] Killingsworth says.
"Escalation of the pay for people in banking three or four years has grown to the point where it's hard to stay up with pay," he says.
To better attract and retain quality employees, seven out of 10 U.S. community bankers increased their overall salary scales; at least five in 10 increased incentive pay opportunities; and at least four in 10 increased educational opportunities. Others improved work areas, added 401(k) plans, increased a 401(k) match and established clear career paths.
Moreover, the large banks aren't sitting still. Fifth Third Bank has announced a major central Florida expansion. The company says it plans to grow from 15 branches currently to 70 by the end of 2008, representing an investment of $150 million and 150 new jobs by the end of 2007 alone. They won't staff those branches with trained seals, and they've got a lot more zeroes in their financials to hide those people behind.
Posted by John at 8:28 PM | Comments (0) | TrackBackNorth Carolina Hispanics and the State of the American Dream
The Economist goes to North Carolina to report on the state of the American Dream among Hispanic immigrants in North Carolina:
A hundred years ago, a sensational novel attacking the meatpacking industry prompted Congress to draft the first federal food-safety laws. The author of "The Jungle", Upton Sinclair, was disappointed. He had hoped to persuade Americans to embrace socialism. For him, the important point was not that the slaughterhouses of Chicago were unsanitary, but that they were "the spirit of capitalism made flesh"-—a system in which "a hundred human lives did not balance a penny of profit." The book's central character, a Lithuanian named Jurgis Rudkus, had come to America believing that through hard work he could grasp the American Dream. But he found that "the whole country...was nothing but one gigantic lie."
Rarely has a great novelist been so wrong about so much. No one now worries about the poverty of Lithuanian-Americans. But many still worry about the health of the American Dream. Can immigrants still work their way up from the bottom? Can they become American?
Posted by John at 8:51 AM | Comments (0) | TrackBackMany fear that, for the latest wave of mostly-unskilled immigrants from Latin America, the answer is no. Some fret that the newcomers are too ill-educated and culturally alien to prosper or assimilate. Others are convinced that immigrant workers are horribly exploited or trapped forever in low-wage jobs. Both worries are largely unfounded.
Consider Alberto Queiroz, who crept across the border 12 years ago. After a stuffy ride in the boot of a car, he found his first job in a Chinese-owned clothes factory in Los Angeles. Workers with papers were paid the minimum wage, he recalls. Having none, he had to make do with $2.50 an hour. Though unlawfully stingy, this was much better than he could have earned back home in Mexico.
After two years he moved to North Carolina, a state that was then just starting to become a magnet for Mexicans. He picked blueberries for $5 a box, earning nearly $100, tax free, for a 12-hour day. But this job lasted only two months, until the harvest ended. So he sought more stable employment, which he eventually found at America's largest hog slaughterhouse.
Smithfield Foods' plant at Tar Heel, North Carolina, turns some 32,000 pigs a day into hams and loins. Thanks to selective breeding and efficient, hygienic processing, American meat has grown steadily leaner, cheaper and safer, says Joe Luter, Smithfield's chairman. A hundred years ago, food ate up half of Americans' take-home pay; now it is only about a tenth, and no one gets trichinosis from Mr. Luter's pork chops.
But is a slaughterhouse a nice place to work? Smithfield does not let journalists in, for reasons of "biosecurity". Human Rights Watch, a watchdog from New York, issued a report in 2004 entitled "Blood, Sweat and Fear", which accused American meat and poultry firms of "systematic human-rights violations". Slaughterhouses are harsh and dangerous places to work, said the report, and illegal immigrants, who form a large chunk of the workforce, find it hard to defy abusive employers.
Mr. Queiroz takes a more benign view. Yes, the work is hard. The line goes fast and you have to keep cutting till your hands are exhausted. And yes, it is sometimes dangerous. He says he once saw a co-worker lose a leg when he ducked under the disassembly line instead of walking round it. But many occupations are risky. Taxi-drivers are 34 times more likely to die on the job than meatpackers.
Mr Queiroz does not think Smithfield was a bad employer. Wages of more than $10 an hour enabled him to buy a house back in Mexico. Cutting up pigs was easier than picking blueberries, he says, because he did not have to toil under the sun all day. And when he had had enough, he quit and set up a taco stand with his brother. That was five years ago. Now he owns a Mexican restaurant. America, he says, is "the land of opportunity".
The meatpacking industry has changed dramatically since Sinclair's day, when pigs and cattle were transported live to city stockyards so that the meat would still be edible when city-dwellers bought it. Now, thanks to better roads and refrigerated trucks, there is no need to build slaughterhouses near where customers live. No pigs have been slaughtered in Chicago for years. Firms like Smithfield now favour rural sites, where rents and wages are lower. And the immigrant workforce is largely Hispanic, since Jurgis Rudkus's great-grandchildren prefer to work in offices. . . .
Fear of immigration is akin to fear of globalisation. Unemployment may be low, but many Americans fear losing their jobs to someone cheaper in Bangalore, or someone who took the bus up from Tijuana. Meanwhile, the benefits of immigration, like those of globalisation, are often taken for granted. "Americans just assume they can have a pizza delivered for $9," says Federico van Gelderen, a Raleigh-based executive for Univision, a Spanish-language television station.
Accurately measuring the economic consequences of immigration is hard. Looking only at North Carolina, John Kasarda and James Johnson recently found that Latinos paid $756m in taxes annually and cost the state government $817m. That works out as a net burden of $102 per head. Anti-immigrant agitators will seize on this figure, worries Mr Kasarda, a professor at the University of North Carolina's Kenan-Flagler Business School. But it is dwarfed by the positive impact of Latino spending in North Carolina, which he estimates at $9.19 billion in 2004. That translates into nearly 90,000 new jobs, he says.
The worry that America is importing a new Hispanic underclass, as some claim, is also probably unfounded. Granted, foreign-born Hispanics are less educated and earn less than the average American. But that is hardly surprising, given that so many were until recently Mexican peasants. What matters is whether they are socially mobile, and it seems that they are. Although, by some measures of income and education, the Hispanic average is not improving much, that average is dragged down by a steady influx of poor Mexicans. A better way of gauging progress is to look at inter-generational differences.
First-generation male Mexican immigrants earn only half as much as white men. But the second generation have overtaken black men and earn three-quarters as much as whites. They enjoy more benefits than the first generation, too: they are twice as likely to have employer-provided pensions and one-and-a-half times more likely to have health insurance. And the adult daughters of Mexican immigrants, having learned English, are much more likely to have jobs than their mothers were. . . .
For many first-generation immigrants, getting their children into an American university is the final proof that they have made it. Marco Roldan, for example, has been in America for 22 years but still has a Guatemalan accent and odd syntax. He started his career selling tortillas door to door. After many 75-hour weeks, he now owns a supermarket in Raleigh, where a mostly-immigrant clientele pays cash for Latin pop music, live tilapia and a wide variety of chillies. Mr Roldan is proud of his hard-earned wealth, but not as proud as he is of his daughter's MBA from Stanford.
Immigrants' children are typically American citizens, having been born on American soil. More than 90% speak English fluently; by the third generation, 72% speak nothing else. Many help their less-fluent parents with form-filling, as other children help their elders navigate the internet. The parents, in turn, try to infuse their offspring with their work ethic and entrepreneurial spirit. (Latinos open new firms at a rate three times the national norm.)
Miguel Lopez, who arrived from Mexico when he was 17, says his children will have a double advantage over him. Not only are they native-born Americans, but they are "native-born" to the information age. Mr Lopez is not doing badly himself: he owns a small window-cleaning firm. He woos customers by giving them instant estimates, which he can do because he looks at satellite photos of their houses online. His firm grossed $150,000 last year. With only a high-school education, he says, there is no other country where he could live so well. But his children will go to college, he says, and do something better than washing windows.
Labor Disputes in China Skyrocketing
Citing government statistics, the Times of London reports that labor disputes in China have risen from 5,600 in 1987 to over 300,000 last year, a 53 fold rise. Most disputes, the Times notes, a