Friday, September 23, 2016

Americans Say They are Dissatisfied with Economy but "OK" with Personal Finance

A joint poll conducted by CNN and the Kaiser Family Foundation found that the far majority of Americans are dissatisfied (53%) or somewhat dissatisfied (23%) with the economy. Two-thirds of adults are satisfied with their own economic situation and three-quarters are optimistic about how things are going in their own lives.  At the same time people where only moderately convinced things would be better for their kids.

Why people are dissatisfied with the economy (76%) and still optimistic about their future is interesting. When they look at the large economy they feel it isn't going in the right direction but when they look at their own particular situation they seem to be just fine. There may be something going on as it relates to perception.

When we look at the large economy the things people know about it are drawn from the media, politicians and government officials. It gets mixed up with other events in the world like conflict and terrorism. They blend together these concepts and negative rhetoric to come to a conclusion about how the world looks.

Most of us have some sense of optimism and believe we are doing better than other people. When we buy products and other items we compare ourselves to our neighbors the "Jones" to see how we are doing. If we seem to be doing well and taking care of our business our own personal situation looks a little better. A few examples of catastrophe that creates the bottom line can also help us feel as though we are overcoming economic challenges.

At the same time we can say that this pessimism does seem to go along with the loss of American competitiveness in certain markets.   Manufacturing, once a backbone of American jobs, is declining. Major large scale industries that employed a large segment of the population is declining and contributing to a shrinking middle class. We will need to find a way to bring back production and jobs. While we may be happen about our individual situation we are hoping for greater performance for the nation as a whole.

The Article

Thursday, September 22, 2016

Wealth of Character and Wealth of Objects

Nice car, nice house/apartment, fancy clothing, and a good job. It all looks great doesn't it? Most people would assume this person has everything they need. We judge people within a few seconds of meeting them and then carry this assumption throughout our relationships only changing after many alternative impressions are created. Does this outward appearance tell the whole story?

Certainly it takes money and some success to buy lots of great and expensive things that help us look good. There is inherently nothing wrong will putting our best foot forward. At times this is one of the best ways to land a job, partner, or respect. However, there can be something dysfunctional when it consumes our life.

Thinking logically and thinking emotionally are two different things. There are people in the world that judge everything by its outward impressions. This means they lack the substance and insight to realize that every person has inherent value.  They must understand that worldly possessions and skill and character quality are different.

Their emotions are telling them that if they don't look good they are not valuable. With billions of people to compete against they want to stand out.

Let me give you an example. I have a boat, something that needs some work, that is docked in Point Loma. Mine doesn't show much status at all. However, in the same marina are large yachts that are worth over a million dollars a piece. Something anyone would be impressed with. I love to watch them use their thrusters to smoothly get in and out of their slips.

How do these multi-millionaires dress? They look like bums! T-shirts, cut off jeans, messed up hair, unshaven and walking around in flip flops. If you saw them at the local grocery story you might consider them homeless. Yet they are CEO's, investors, businessmen, and own large companies. Most are so wealthy they will never work again.

High income and high spending could still mean you have a negative balance sheet. Some people are savers and don't spend money on things they don't enjoy. For most of us it is best to be in the middle somewhere by looking descent and saving appropriately. Having money and showing money are two different things. Sometimes it is better to work on your wealth of character than the wealth of your possessions.

Wednesday, September 21, 2016

Learning to be a Business Guru

Business is about opportunity and then matching resources to fill the need of that opportunity. On any given day we pass hundreds, if not thousands, of opportunities. The problem is that we either don't know what the opportunities are or we don't have the resources to capitalize on those opportunities. Consider both Opportunities and Capital in your learning process.


Opportunities exist anytime there is a market need that isn't being finished. If people are willing to pay for a product then it becomes an option to find a way to service this need.

People are not well trained on spotting opportunities when they exist. It is a way of looking at the world and comparing and contrasting different outcomes.

The first way of finding something useful to capitalize on for business is to see "need". Find out what people want, whats available, and then determine how they can get it. For example, if your city doesn't offer methods of refurbishing old surfboard there is a cottage industry to start.

The second way is to find new market needs by evaluating available products and projecting what people will be willing to pay for. For example, if you keep loosing your car in a parking lot people might be willing to pay $1 to download a lost car tracker.


Once you have a great idea you will still need to find a way to produce it. With small and start up businesses you can use your own money are start small in the garage. With larger products you will need to find angel investors.

To find investors you will need to design your product, build a prototype, and create a solid business plan. Investors are as likely to invest in your business acumen as much as your product.

Study Shows Student Evaluations Have Nothing to Do With Quality of Learning

Your looking at your end of course survey and find that you have been bashed by a couple of students for grading "too hard" and being "unfair in grading". With near perfect prose, which they didn't show in the classroom, they go on a long winded discussion on how poor of an instructor you are. I almost want to give them an A for the quality of their writing. With some luck you also might find an equal amount of positive comments but they are usually shorter such as ,"Great instructor!" and "Love the Class". The good news is that student evaluations have no reflection on your skill as an instructor. One could make an additional argument that high ratings doesn't necessarily mean your a good instructor.

A study discussed in Inside Higher Ed helps show that there is almost no correlation between instructor quality and student evaluations. Previous studies showed only a mild correlation based on flawed research and limited examples. A recent study shows shows there is almost no correlation and it is unwise to use such information in professor evaluations for promotion and pay.

Students come to each classroom with different skill sets and abilities. While the study didn't address this issue but those who give the highest grades are likely to have higher ratings while those that challenge students are likely to give poor ratings. The grades are seen as a scorecard and those professors that push their students to learn stand in the way of a high GPA.

The study should make us reconsider student evaluations for specific instructors. Is the purpose of higher education to make students feel happy with the class or is it to have them learn more? If we are seeking to raise student learning for a higher performing graduate that is capable of meeting the demands of work and society then it may not be wise to determine merit based on how much the students like or dislike an instructor as described in a few short questions.

Tuesday, September 20, 2016

On the Path to Ultra Nationalism

Americans are struggling with some fears about the global economy and their place within it. Some have been displaced and many others have struggled to make financial headway. Most are living pay-check to pay-check with little respite. As the U.S. comes to grip with the rise of China and Asia it will need to consider some serious paths and consequences going forward.

The people, and their representatives, will choose between greater global interaction or the charm of protectionism economics. One embraces the world and encourages the country to become more competitive while the other partially disengages somewhat from the international community and seeks to create protected industries that employ Americans.

There is nothing inherently wrong with either approach but one leads to a better long-term outcome than another. There is nothing more or less patriotic in one approach over another regardless of the feelings associated with protectionism. Patriotism is that which is best for one's nation and most importantly its people!

Research has shown that countries that engage in isolation and protectionism become weaker over time. They cannot hedge their best capacity and resources to create value. Their approach is to artificially produce everything with heavy government subsidies that no system can sustain without complete economic control.

While all businesses should be given an opportunity to enter the market they should do so based on their capacity so they can grow large and strong on their natural abilities. Creating the right environment for business growth impacts all industries in a positive way without making government shoulder the impossible burden.

For example, protecting some American businesses long enough to get them competitive can be beneficial and China has done this successfully on a number of occasions. However, continuing to protect them beyond their seedling stages from competition leaves these industries weaker and noncompetitive. Protectionist policies only work so long before it hinders growth as the companies fail to adapt to challenges.

If you can't adapt you cant grow!

No doubt America should be a little more selfish with its policies but it should continue to engage and collaborate with the rest of the world. Those nations that are most likely to be successful will create competitive economic environments that draw international investment and resources that spur new innovations and business. Over the years and decades isolationism will cause more problems than it will solve while fixing our government policies will encourage growth and jobs.