Should We Cry For General Motors and Chrysler

I have been waiting to write this blog since both these car companies filed for bankruptcy. However, I wanted some proof before I proffered my theory about the so-called American Auto Industry. I subscribe to an on-line website called the Deal.com. In today's edition, there was a story about a recent survey by Grant Thornton, a leading consulting and accounting firm regarding the future of the American Auto Industry. The article stated that due to the restructuring of the American auto industry, foreign carmakers will produce more automobiles in the United States than the Big Three by the year 2012. Foreign automobile companies are expected to increase production by 20% during this period of time. The big impact will be felt by US automobile suppliers who have feasted at the trough of the Big Three for far too long. The US automobile suppliers will have to actually compete for new business with foreign automobile suppliers. There will be no allegiance by the foreign automobile companies to US automobile suppliers like the Big Three. I don't see why this news is a shock to anyone. When in the last ten years have you read about the Big Three opening a new automobile assembly plant in the United States. Yet, BMW, Nissan, Toyota, Honda, Hyundai, Mercedes-Benz and I may be missing a few, have all opened assembly plants during this period of time. Has it come down to "Buy American, Buy Toyota."

Does the whole Madoff scandal reveal something about ourselves

I felt compelled to write this blog not based on any article I had read (See I don't spend my life reading newspapers) but on a recent seminar I had attended regarding the psychology of investing. Most of the people on the panel make a living coaching people to invest or make business decisions based on their heads not their hearts. Basically, don't let emotions get the best of you. There was also a lawyer and a wealth advisor on the panel as well. The discussion focused on how to control your emotions while investing and to not live and die on every utterance from some television or radio pundit. If you can't control yourself, the consensus of the panel seemed to be that you should hire some professional help ie. wealth advisor, financial planner etc. Thereafter,most of the night's conversation seemed to focus on that aspect. No great surprise in my mind since it was the wealth advisor's firm that was sponsoring the seminar to begin with. In the discussion of hiring such a professional, the word "Trust" kept coming up. People kept asking questions like "How do I know if the advisor is a good fit for me," and "What can I do to check the advisor's background." Finally, one of the panelists said that there has to be element of trust whenever you choose a professional that provides a service to the public. It doesn't matter if it is a doctor, lawyer, accountant, wealth advisor or for that matter a car mechanic, carpenter or plumber. I can check all the professional associations, Better Business Bureaus, client references I want but at the end of the day I am placing my trust in them to perform a service that benefits my interests. If I knew as much as they did about the service they were going to perform, then I wouldn't need to hire them unless I was required by Law to do so. I admit that when it comes to inside the hood of my car or pretty much anything to do with maintenance of my house, I am a moron. When it comes to my car or my house, I pretty much blindly listen to whoever is fixing the problem. If some suggestion seemed innately wrong to me I would certainly question it or perhaps seek another opinion but at the end of the day you have to have some trust in the person your hiring and believe in THEIR judgment not yours. They are considered the expert not you. The medical profession is a perfect example. You are relying on the doctor's skill and judgment. The reliance shouldn't be blind but it is not equal either. So the discussion inevitably turned to good old Bernie. Why did so many people drink the Kool-Aid. There are many reasons. Everyone knows the expression, "If something is too good to be true, then it probably is." Yet, many people whom I would consider to be very smart business people lost their shirts and in some cases were completely wiped out. Someone said that success in business doesn't equal success in investing. I agree with that statement to a point but successful people have certain personal characteristics that can crossover to different fields of endeavor. However, there is an X factor as well called "Ego." Some people believe that success in one field means they are an expert in every field. They know it all. I also believe that Madoff's appeal was the sense of exclusivity. I was being allowed to invest in a fund that was not open to everyone, even people as wealthy if not wealthier than me. Madoff preyed on the snob appeal. And of course the greed appeal as well. You can make money no matter what the market does. It was almost pitched like municipal security. No risk involved, as good as gold. What did P.T. Barnum say years ago. Oh, how it still rings true today.

Can Twitter Cause Revolutions

What can I say. Again I read today's New York Times with my morning coffee and came across two interesting articles. The first one concerned a request by a staff member of the White House asking the company Twitter to delay a global maintenance of their service which would have shut the service down for a period of time so that the White House could continue to receive up to date news on the civil unrest in Iran. Dissidents in Iran have been Twitterring away (Is that such a word) by the second about the disputed election and it's repurcussions. Recently, We have seen this before where massive protests were organized through the use of some social networking site. In this new world, a large number of people can be mobilized in a very short period of time. Are these sites the new tools of Democracy. The United States Government may look at this with glee when it comes to other countries, especially ones considered hostile to our own interests but I wonder if the government would feel the same way if massive protests were being organized in this country using the same tools. This leads me to the next article. The increased scrutiny by the National Security Agency over people's e-mails and phone calls. Big Brother is watching. Technology has done wonderful things. We can now get more information faster over the Internet. We can communicate with people continents away with a touch of a button. We can organize people with similar interests. But have we lost something in return. We have to be extremely careful what we we say or pictures we post in our e-mails, blogs,websites etc. You never know who could we looking at it and for what reason. Someone might consider me a subversive after reading this blog. All of this just seems so Orwellian (Is that a word) to me.