Quick Economic Recovery Optimism Wanes

Anyone else caught up in an amazing whirl-wind of seemingly endless new piles of idunnowhat since Jan 4?   Hard to believe a month of 2010 has seemed to just jam on by.

Whether you had the last 2 weeks of ’09 off or tried to polish as much as possible before year end, almost everyone I’ve talked to has seen an onslaught of renewed vengeance into business activity that seemed to be paced with undeniable optimism.  The pains of ’09 are behind us, right?  Er, at least that’s what we thought.   We were all immensely excited to move beyond the last year of the decade.   The holiday season seemed to be filled with hope that at long last the recession was ending.   And, 2010 will be filled with glorious growth and the taste of prosperity.

Brace yourself for more ’09
When Jan 2010 started, it appeared that everyone had quickly forgotten about ’09.   And, for good reason.   Last year was challenging in many, many ways.   A new year brings renewed budgets, a chance to re-start, a chance to reach back to those contacts that said “yea, let’s touch base in January”.   What’s transpired so far appears to be an over-flowing bucket of messages, requests, schedules, deadlines, budgets, and most important — defining and delivering on our target goals.  This is testing everyone’s ability to get organized, to be organized, and the realization that not much has changed.   I am also reminded that at the end of the day our schedules are really dictated by our networks of contacts, family, and business events and rarely by ourselves.  It’s really hard to control.   What ever happened to those days when I had time to blissfully fall asleep on the couch in front of the basketball game?  Those seem like decades ago.  Oh…it was.

Look at what we’ve seen in 2010 already:

  • Federal budget deficit will be worse in 2010.  Now estimated $1.6Trillion.  Up from $1.4 Trillion in ’09.  Disgusting.
  • Transit agencies fighting to close budget shortfalls.   In the San Francisco Bay Area, we’ve already heard woes from BART, Muni, and Caltrain.  I’m sure there’s many more metros and cities in the same boat.
  • Layoffs and restructuring.  Chevron, Verizon, Walmart, and Johnson & Johnson have all announced layoff plans in Jan. 2010.
  • Current unemployment rate is 9.7 (December ’09).  There were increases in all 50 states in the last month of the year.
  • Live events canceled, postponed.  2010 will be filled with inconsistencies.  some events that will trigger renewed hope;  Other events  you’ll be caught asking yourself  “how did I ever get involved in this?”
  • The Dow closed the year (Dec. 31) at10,428.05 and NASDAQ was 2,269.15.   By January 31, it’s 10,067.33 for the Dow, and 2,147.35 for NASDAQ.  Investors are not exactly oozing with consistent confidence.
  • There’s still a war in Afghanistan, Mr. President.

OK, enough of the doom and gloom
Yea, I had to dig deep here, but let’s look at some areas that are looking good in 2010.

  • Apple.  Stock (AAPL) at all-time highs.  Cool consumer electronics are continuing to be the rage.  And, for a few hundred dollars, people are willing to try almost anything Apple.
  • Venture capital improving and business results stabilizing.  Upstream has received $75Million in venture capital.   Ford reports strong January sales (could be due to Toyota’s accelerating disaster).   UPS beat expectations, which shows packages are on the move and internet sales are continuing to grow.   Expect more turn-around news in the areas of home purchasing and financing.
  • Businesses are adopting social marketing into their operations and not just using the free stuff.  Real $ being spent, department resources being re-shaped.  This isn’t an after-thought anymore of some rogue employees.  It’s mainstream and if you ain’t doing it or not supporting the efforts, you’re losing out to your competitors.  Big time.
  • Many green businesses are thriving.  Great source of jobs, economic growth, and investment into the future.
  • Microsoft Office 2010 is in Beta – that should solve a few issues, right?   Oh, possibly negated by introducing a million new Windows bugs and 100 security patches.

Personal brain hygiene perhaps
Do you really feel you can accomplish everything on your plate by just coming in and grinding it out like you’ve done for the last 30 days?  I want to suggest a few ideas that might get you back on track.   Sure, it can’t change the deficit or solve the war.   It can’t balance an ill-allocated municipal budget.   But, it will make you feel better and more productive.

5 things you need to do.

  1. Clean up. Take a look at the papers and magazines on your desk.   Shuffle them into 1 neat pile and set it in the corner.   Check back in a week.  If you haven’t touched the pile, recycle it.  You’ll probably never have time to read them this year.
  2. Organize your inbox.  Find a 3 hour window on your calendar next week.   Block it off.   And book yourself a conference room regardless if you live in a cube or an office.  No one bothers you in a conference room — they think you’re in a meeting.  While you’re at it, turn off your mobile phone, and log out of social networks — particularly Facebook and Twitter.  You’ll survive.  At the end of your 3 hour one on one meeting, write down the 10 most important items you’ll work on next.
  3. Plan a vacation with family or friends.   Even if only for 1 nite.  Perhaps you went away at end of December and came back to work and it’s been go-go-go.   You need something to look forward to.
  4. Stay focused on value-add vendors.   This is a two-fold suggestion.  It means #1 – shortlist your vendors that are viable and let the rest go, and #2 – make a decision, sign agreements, generate POs, build a plan, and start executing.   Everyday you postpone is 1 more day you don’t have a solution and won’t be addressing your MBOs.
  5. Attend a seminar outside of your business domain.  Perhaps you have a hobby or new interest.  Find a local event or seminar and make plans to go.  Meet some new people and get your mind on something fresh.

Worth considering?   Any other ideas that are personally helping you?   Or, do you believe 2010 will be way easier than ’09?

I have no doubts we will exit 2010 in a far more prosperous situation than ’09 and way beyond ’08.   Until then, address your own productivity now…it’s only going to get harder.

Feeling a Little Loma

Reading all those comments about CalTrans on sfgate.com.   People definitely feel strongly about that Bridge and CalTrans.  When things go right, everyone applauds CalTrans…and, at the slightest of slip-ups, they’re called out as “bums”.   The 70-year-old bridge was in severe need of repair, yet one that I seem to rarely think about being unsafe.  Now, we’re all set with the new detour to begin the retrofit of the new East side section to this iconic and important artery in the Bay Area.

The Bridge had a planned closure this weekend, and by all accounts, CalTrans and the CC Myers’ crew were ready to address a near engineering marvel to move out and replace 300 feet of road way, 200 feet high off the water.   That part went fine.  What we weren’t ready for was an extended closure due to an issue found during the new road work.   It was the bridge inspection that led to the extended, and now, unexpected, unscheduled closure.

An upper strut of the Bridge cracked and they needed 1 more day to fix.  With the Tuesday commute pending, we all went scrambling, but when the rubber met the road, literally, CalTrans ended up completing the repairs early Tuesday morning, which led to a 2 hour delay and avoided a whole extra (24 hour) delay.   Quite stunning change of course in last 24 hours.

It’s always a little strange when the Bay Bridge closes.  It happened 2 years ago to fix the West side of the bridge, and ended up opening up about 12 hours ahead of schedule.   But, what really occupies me is what happened 20 years ago.

Loma Prieta.   It’s one of the few times when I remember to a tee what happened after the quake hit and the

number of people who shared in the experience within a short period.

I had just arrived home from my afternoon history class at UC Davis.  I only had 2 quarters left at school.  I walked into my apartment on F Street, put my books down, and felt a strong, rolling wave.  Perhaps just a little

lp - bay bridge_09

woozy after a long day at school.  No, it felt like an earthquake.   I turned on the radio and I ran to my study room.  Sure enough, a hanging plant was swaying to and fro.  From the radio “a large earthquake has hit the bay area, and centered in Palo Alto”, a 100 miles away.  My parents lived in Palo Alto.  I immediately called home.  I reached my mother instantly.  She said that everything is fine.  Her clock radio fell off a shelf, but the power was still on.  I learned later that the earthquake was actually centered in Hollister, but regardless, it was a miracle that I actually got thru that instant as almost every phone line got tied up as the Bay Area was reeling in damage.

I bolted out of my apartment on my bike to head up the street to my buddies house to watch the World Series.  It wasn’t just *any* World Series…it was the “Bay Bridge Series” between the Oakland A’s and the SF Giants.   I opened the door swiftly, “did anyone feel the earthquake?’

“Sure did,” everyone responded.   “And, no baseball today”.

“Really?”

earthquake22No way.  Candlestick had cracked in the upper section.   The upper deck of the bay bridge went thru the lower deck.   The Marina district was engulfed in flames and crushed homes, and the Cypress Structure in Oakland completely collapsed.

I stared at the TV.  Looking at the Bay Area and roads I had travelled uncountable times.   Stunned.   Helpless.   The Bay Area would never be the same again.

About 2 weeks later, I had tickets to the Rolling Stones concert in Oakland, which would have been fine to get to, but we also decided to spend the day before in the city.  It must have taken 2.5 hours to get from Richmond to SF…complete crawl over the Richmond-San Rafael and Golden Gate Bridges.

Alas, the Bay bridge would be fixed within a few weeks in 1989.  A new section would be dropped in.  The Cypress Structure was removed, the Embarcadero high-rise was removed.   Many blocks of the Marina were re-built.

Now on Tues, Sept. 8 2009, the bridge has re-opened as the earthquake-proofing from 20 years ago continues, which I guess is certainly far better than unscheduled closures.  Albeit a pain, we seem to adapt and move on.  And, being prepared for at least 1 or 2 more closures to re-attach the new section.  Until next Labor Day…

The Bridge is cracked and they need 1 more day, meaning we’re now scrambling to address a commute no one planned for.   So, no we’re in lp - bay bridge_09unscheduled territory and I can only stop and reflect on what happened 20 years ago.

Wa-Mu Boo-Boo

They’re fairly memorable ads.  Those Washington Mutual ones.  “Bank Another Way” they claimed.  They generally have a bank rep talking about why it’s so much better to be with Wa-Mu than “one of those other guys”, and a “what are you going to do about that Ed?”

To further demonstrate the extent of Wa-Mu’s ad network, I also enjoy this lovely sign on top of a SOMA (San Francisco) Building.  It’s placed for traffic heading West on Hwy 80 as you decent off the Bay Bridge into San Francisco.  This freeway section is one of the hairiest, tightest, crash-magnets in the Bay Area (Caltrans is completing a major Bay Bridge reconstruction and drivers are left with just being patient while the necessity proceeds) where the relief of finally coming off the bridge is met by a winding, swirl of “am I on the right road” syndrome.  Where everyone is just making damn sure you get thru safe, get off the freeway, or make the lane you need to continue in the desired direction.  If you can’t read it, the sign says “Online sign-ups.  Faster than a bike messenger with bad brakes.”  It’s very SF if you’ve seen those bike people whipping their way thru downtown, but only mildly funny.  And, I guarantee you 99.9% of those that blow thru that freeway roller coaster section, don’t even know that it’s there.  And, even if you see it, it’s so poorly positioned that you may not even be able to pick up the words.

Unfortunately, Wa-Mu’s problems were festering long before this obnoxious, poorly selected advertisement.  Additionally, the US is facing a financial crisis across those specializing in lending (Fannie Mae & Freddie Mac bailouts), Wall Street investment banks – MerrillLynch, Lehman, and regular banks all-around. But, I’m picking on Wa-Mu for the one reason…they’ve spent millions in marketing dollars articulating a marketing message that they are different.  Better than a bank, more service-oriented that a bank.  And why, it gives the perception of longevity, someone that will be there in good times and bad.  Someone that knows how to run a bank.  But, is it real?  What’s going to happen?

The Wa-Mu stock is reaching junk bond status having gone from $42.95/share to closing at $3.20 today in just 24 months.  It has gone as low as $2.01.  Kerry Killinger, who in 2001 was named American Banker of the Year, was ousted as CEO this year and replaced by Rick Wagoner.  In 2005, Kerry earned over $15M, and from 2001-2006 earned in excess of $63M.  In the first half of 2008, Wa-Mu reported losses of over $4.4Billion.  This is just pure shameful of epic proportions.  And, is it really the fault of home-owners for getting mortgages they can’t afford, or the bank’s fault for administrating a loan they knew damn-well the home buyer wouldn’t be able to afford?

But, the real irony here is that they are being auctioned off by GoldmanSachs and likely will be purchased by the very bank that mimicked as if it was a disgraceful waste.  Now, look at themselves.  I bet they’re 1,000s of investors and 10 of 1,000s of customers, who are biting fingernails in anticipation of being bought by a bank that knows how to operate.  Rumored buy-outs include Toronto Dominion Bank, Citigroup, Wells Fargo, HSBC, JP Morgan Chase, and Grupo Santanger.

Wa-Mu will likely be saved by one of their nemeses and a few years from now, after all the re-branding of their banks, loans, and credit cards and check books, it will all be forgotten.   We might start thinking about MerrillLynch’s famously branded slogan — “a breed apart”.  Yup, a breed apart from those who actually know how to profitably & legally operate a large financial institution.  Woo-hoo!