Human Capital and Agency Effects on CEO Compensation of IPO's

 I'm looking through a study on IPO market founders trying to determine whether or not there is a way to attract young entrepreneurs to a small outdoor enthusiast community and in turn help them turn their businesses into public companies that can effectively compete on the market. There is a long road to becoming a public traded company but its helpful to see which firms are likely to be more successful than others. In this case I am looking at founder CEOs that start a company and then turn them public.

According to a study on Human Capital and Agency Effects on CEO compensation we find (Williams, Coffey, & Young, 2018):

1. IPO rewards firms that have founder CEOs. 

2. CEOs with venture capital experience receive higher incentive compensation.

3. CEOs with greater ownership interest in the firm receive lower incentive compensation but higher salaries. 

4. CEOS of firms with a greater percentage of insiders are incentive drive but with higher salaries. 

While this study looked at pharmaceutical companies I believe it may also apply to other types of firms. The more of these studies one reads the better able they can grasp where they apply and don't apply. I'm trying to figure how to attract international entrepreneurs to Delta County beyond just filling up the downtown (There is a previous article for that HERE). Best case scenario is to attract investors and entrepreneurs that want to turn their companies public. This is just theoretical exploration of a large economic development system based on innovation through cluster development. Its not so much if it happens as its more related to closing a loop in theory play and its relation to upward development of creative destruction. HERE. 

Williams, D. R., Coffey, B. S., & Young, C. C. (2018). Human Capital and Agency Effects on CEO Compensation of IPO Biopharmaceutical Firms and the Market’s Response. Journal of Management and Governance, 22(2), 315–337.

Beating Extremism Means Local Eyes and Ears-MSP Releases Statement

The extremists that attacked our capitol and those that threat our state capital are people that live within our communities. What happened was inexcusable and is a risk to the viability of our republic. It makes no difference which political leanings one holds or their objectives the use of violence to solve problems is not in the spirit of civil dialogue and national adjustment.

MSP releases video and explanation of terrorism and extremism. They also have a listing of some of the specific behaviors you might look for. I believe it would also be helpful to focus on some changes in behaviors and an over focus on specific needs that can only be resolved through "if and then" or black/white thinking. 

 According to Kruglanski, et. al. (2017),"Extremism is defined as motivated deviance from general behavioral norms and is assumed to stem from a shift from a balanced satisfaction of basic human needs afforded by moderation to a motivational imbalance wherein a given need dominates the others."

Based on the psychological motivation Its helpful to look for rigidity in ideology and anger directed at specific groups or heuristic category of people. While not all people who are upset and angry move to extremism we can say that when matched with specific behaviors could raise a "red flag". That red flag turns into a blinking red light when someone begins to prepare and talk about using violence against others.

No matter where one lives the best place to overcome these issues is on a local level where people understand each other on intuitive levels and notice an increase in radical dialogue. When people become radicals they also change their focus hate begins to consume their thinking and words (i.e. online chatting). Notice none of this has to do with someone's color, religion, or national origin.

If you hear or see anything please report it to the appropriate authorities so they may investigate and track. Don't confront people yourself but instead take a mental note and report it if your intuitive radar bounces up and seems to match with specific actions/behaviors (Within each of us is the subconscious ability to detect threats). Eradicating these behaviors means working on the local level to ensure such behaviors are discovered and discouraged before they become a problem.

  

Kruglanski, A. W., Jasko, K., Chernikova, M., Dugas, M., & Webber, D. (2017). To the fringe and back: Violent extremism and the psychology of deviance. American Psychologist, 72(3), 217–230. https://doi.org/10.1037/amp0000091

Steve Forbes Discusses Bitcoin and Money Replacement?

The video highlights some of the limitations of bit coin. I couldn't agree more. What I can say is that cryptocurrency isn't fully developed yet and isn't as useful as money. That may change in the future as as we move more and more digital. The biggest factor is portability and ease of use. If one were to use money for everyday purchases they would need a highly secure, portable, and easy to use currency accepted by most vendors. We might be a decade or more off until the digital economy has really set in on a global scale. This is one reason why I think the U.S. should embrace digital development and help secure itself as central to the intellectual innovation and world supply chains where the greatest value is created. 

President Elect Joe Biden Delivers Remarks On Covid Vaccine Plan

 President Elect offers information on vaccine distribution plan. It is important for people to watch how it will be distributed and to which people first. 

Congressman Bill Huizenga Discusses Riots, Election, and Reform

Congressman Bill Huizenga discusses riots and convo w/ V.P. Pence. Facebook page HERE.

Detroit Economic Club-Business Environment Needs Improvement

 The Detroit Economic Club offers beneficial feedback information that businesses and public leaders should consider while thinking about strategic steps to bring Michigan to a global competitive status. That may require working across the isle to help put in place those strategies that attract new business investments while still encouraging organic local business growth. 

As of now, Michigan is dipping as a place to start a business. Some of that has to do with COVID and some to do with our approach to the market. There are new ideas out there but as of yet we are still moving along older lines of thinking. Sometimes they can be fruitful but often highly dependent on the pressure from the market. They don't necessarily seek to step in front of the market or fully capitalize on the new digital economy. 

I'm working on a few unfinished ideas on the use of economic clusters to encourage new business development and innovation in places like Delta County. With luck and a solid working model maybe it can be applied to other places. Its unfinished (in process) so no major judgements please! HERE.

Hump Day Blues in the News

Poetry is something that is long forgotten as a medium of communication. Within poetry you can find rhythm and rhyme but mostly it provides an ancient level of story telling.

Hump Day News,

National Blues, 

Right to Choose? 

Ok sorry...maybe my painting is getting better than my poems. Yikes! 🙈🙉 Its the process not the outcome that matters. I think people in business should have extra curricular activities so as to increase life satisfaction. There is also association of art and creative thinking. 

Congressman Peter Meijers and Michigan Rep. Fred Upon Choice and its Implications

The very problem with politics is the group clan mentality that leads to pressure for people to choose based group norms and not their own conscious. Its important to respect Freshman Michigan GOP Congressman Peter Meijer and Michigan Rep. Fred Upon' right to choose based on what they believe is the right path forward. This isn't a judgement call about what they choose. 

It is helpful to remember that the ability to step out of one's social pressures to stand up for what one believes is a responsibility of our politicians. Looking back over history it was the failure of leaders to choose their conscious that led to all types of national/international calamities.

I understand that this is not how things work in the "real world" and I also understand how the "real world" nature of politics led to our capital being sacked and the continued decline of our great nation. It makes no difference what we believe and what we think the outcome should be in so long as we afford the right of "choice".

We vote by our party affiliations and we create pressure on people to vote one way or another (This isn't party specific). The problem is that as the details of the events unfold we will likely become aware of more information that may make us think twice about our choices (hindsight 20/20). Thus choice is dependent on information and rational decision making at a specific moment in time.

At present, we don't have all the details of what is happening which makes quick voting difficult also risky but it does not stop our politicians from making a choice base on their own personal experiences and values. Without all the details we have a choice of conscious by which people must "construct" the missing pieces based on recurring themes (You may want to read about neuroscience and the construction of ideas HERE as well as the construction of public opinion HERE). 

The root of bi-partisan decision making is that people have the right to choose based on what they believe is in the best interest of society. This isn't about whether one is a support of Trump or not; he is/was a mixed bag who existed within a national context. Leaders are often chosen based on broader environment factors in which they were elected (That might be a better place to find broad reaching solutions?🤔".

Democracy is about the right to choose based on one's personal beliefs. We voted for people to make decisions. Whether one agrees with their decision or not I can say that was their choice and I respect their integrity in the process. That doesn't mean that those who voted "no impeachment" are wrong; its a judgement call.

It only means that as a free democracy we must have people that are willing to choose based on what they personally believe. While we may generally follow our Republican or Democratic principles anchored to our party's perspective we are not bounded to always choose one way or another.

We do not want "yes men" and "yes women" in politics. They are to be our leaders (no matter how they vote.) We need them to work with their parties, opposing parties and come to a final conclusion they own for themselves. We are going to "own" our outcomes as a society so we should let our politicians make free choice.

If we are rigidly bounded then we are no longer free to choose and thus we can question the integrity of our politicians that are no longer free to make decisions they agree or disagree with. Do we have free choice and free elections or do we have something just a little less?

I may not choose impeachment or I may choose to impeach depending on what I think the intention was and the general needs of society. The point is that working within a party is very important to get things accomplished but there must be enough "wiggle room" to ensure it is free choice; it helps in societal trust.

The highest state of human development is when people choose based on their understanding of the world and their personal value systems. "Maslow summarized, they were perceptive, self-accepting, spontaneous, autonomous, empathetic, and creative. They always made up their own minds...." displaying independence and free will (You can Read some stuff about it HERE). 

Right, wrong, or indifferent they voted what they believe was important and they did their duty to society. I agree with their right to choose weather or not I agree (or disagree) with their choice. I have my own opinions but at the moment are not relevant. Where we will be a year from now will depend in part on the total sum of our choices as a society.  

President Trump Encourages Partisans to Not Engage in Violence

 The President discourages partisan groups from engaging in violence and encourages appropriate expressions of freedom. It is helpful when our elected leaders come out to create a uniform expectation that people should not engaged in violence. We all have the right to express our needs and views but we don't have the right to engage in violence. The central message of all of our political leaders, no matter which party they adhere, is that we have time honored methods of dealing with disagreement and we should use them....without punching, kicking and biting. 

Federal Reserve Bank Releases Economic Data - Mixed Economy

The Beige Book offers information on the state of economic affairs and is used by Federal Reserve economists and staff to assess economic conditions in the Federal Reserve Districts. It is helpful to watch these indicators because they can lead to insight into possible Federal Reserve policy changes and in turn investment prospects, economic activities, etc... 

If you are an employer you may look at this data to figure out wage and employment changes that help you make decisions as an employer. Businesses live within a broader economic system and as the system changes they will need to change their strategies in order to meet market needs. The Beige Book offers insight to economic change throughout the year. 

The U.P. is in the Minneapolis District: MAP

Minneapolis District economic activity increased modestly. Hiring demand increased, but contacts said health risks and other obstacles kept some workers out of the labor force. Holiday spending was better than many feared, but below last year, especially for small retailers. Commercial construction slowed, and the outlook remained weak. Agricultural conditions improved due to increased commodity prices and government aid.

The rest of Michigan is in Chicago District.

Beige Book January 13th 2021