Why Corporations Get Into Trouble

One wonders how the Hewlett-Packard Corporation was able to minimize laying off employees in recession periods during the time that Hewlett and Packard were the executives of the company. The most probable answer is that Hewlett and Packard planned ahead for these periods and didn’t make policy based on their own personal gain.

Even people who own successful small businesses know that the business cycle has its ups and downs and you have to plan ahead to take care of the down periods. This includes having an established credit line,  retaining cash in up times, and limiting the number of employees to that required for efficient operation. If you are a public corporation, and an approaching down cycle is evident, borrowing ahead of need might also be wise in case the corporation stock price drops sufficiently  to cause lenders to deny extending  financing.

I understand that during the down cycles Hewlett and Packard moved people from the production side of the company to the research and development areas  which partially explains why their products used to be far advanced over their competitors and of superior quality. Of course this required advanced financial planning and the selection of a certain number of employees that could embrace dual roles.

Following the management by Hewlett and Packard, the company has been managed by CEO’s that have followed the policy of other corporations, which is the policy of personal gain and employment and fiscal policies embraced by government organizations. The former is promoted by stock options and bonus plans, and  the latter by block assignments of funds for tasks, which have to be spent, regardless of need, and the hiring and firing of employees to match immediate  requirements.  This allows CEO’s to concentrate on maximizing stock prices and to neglect planning for maintaining a stable employment base and prudent fiscal policies.

I attended a management seminar of a fortune five hundred company and one of the statements that was expressed is that when you reach the vice president level of this particular corporation, you no longer work for the corporation, but for yourself.  Apparently the board of directors believed that an executive working for his own personal gain would, by default, benefit the company. I suspect that this is the philosophy of  industry in general, especially  since CEOs can be on each others boards  and provides some insight, as evidenced by the Enron fiasco, why corporations get into trouble.  Also. providing Golden Parachutes relieves the CEOs from worrying about a companies future prosperity, therefore minimizing their concerns  in the day to day operations of the companies.

It would seem that if the government is going to continue to bail out companies, putting a few strings on how management is compensated, and a study on how management policies effect the stock market and a stable employment base  might be in order.

Stock Market Fluctuations

Watching the market, it appears that the excessive fluctuations are not due to normal buying and selling of stocks but to excessive shorting of stocks and later buying to the cover shorts. Since John Q Public in normally not allowed to do this, it seems that the big boys are being able to reap big profits at the expense of everyone else.

The administration should again restrict short selling, or as a minimum, reinstate the requirement that stocks have to increase in value for three days before it can be shorted. They should also ban naked shorts, along with all the other questionable policies the Feds have put in place in the last few years. Allowing and promoting the major traders to run wild in these areas has been a major contributor to our current problems.

Breaking news and commentaries by Fed officials drive the direction of the market. Unfortunately, traders with portfolios large enough to move the market get this information in advance of the news cycle, and are able to position themselves to make a huge profit, no matter which direction the market is predisposed to go. In normal times this might be acceptable, but right now they are cycling the market alternately up and down every few days and driving the average consistently lower. This is compromising the eventual ability to recover since it causes confidence in the market to disappear.

It would help if administration officials, Paulson et al, would keep their speeches limited to what they are doing and plan to do without rattling off a series of negative concerns that the traders use for direction. It boggles my mind that supposedly intelligent people can’t figure out that what they say can effect the whole economy, especially since promoting the economy is the business that they are in.

Another issue that the Feds seem to not comprehend is that when people drive, they shop. When gas prices get too high, they quit driving.  When they quit driving, they quit shopping. When people quit shopping, they get used to their new life style and don’t resume shopping for a long time, even if gas prices go down. Since consumer spending is the largest part of the economy, the economy goes into the cellar. This caused the early 80’s recession and contributed to the current recession, since a noticeable slow down in consumer spending occurred when gas prices were raised above four dollars a gallon with no end in sight. This was already in play before the housing fiasco raised its ugly head.

Let us hope that the new team is familiar with economics 101.

MY DOG CHICO

One day Chico wandered into the play area of my son’s fiance’s sisters home. He had no collar and had a knife slice across his back, which was in the healing process. Otherwise he seemed healthy and was friendly with the sisters children. Chico was a chihuahua, but large for the type, 13 pounds. He didn’t seem to be disposed to leave, and since the sister didn’t want to adopt him, my son’s fiance, Thea,  brought him to my son’s and my home. At first he was only friendly with Thea and kept Jeff and I at bay, snarling if we got near. As time passed, he proved to be a mans dog, and ended up being friendly with Jeff and I, snarling when Thea tried to caress him.

Chico was very independent. If he got out of house off lease he wouldn’t let you pick him up, and only came back when he got good and ready. This became a problem when he got loose at times when accompanying us shopping, because he would disappear and not return to where the car was parked for up to an hour. If you located him during this time, he would evade you until he was done wandering.

He became very playful, snarling and snapping when you wrestled with him. If he happened to nip you in this process, he would immediately stop and hop up with his arms around yourneck, licking your face, tail wagging vigorously. If he encountered children in the area, particularly if they were riding bicycles, he would run after them, jumping up on them and barking. This frightened them until they realized he wasn’t going to hurt them. It wasn’t long before he had a reputation in the neighborhood and the kids would brag “I touched Chico” and began inquiring “where is Chico?”.

He eventually became my constant companion, staying near me wherever I happened to be in the house and sitting on the center console of my car whenever I went somewhere. He entertained himself by staring at drivers that pulled along side at stop lights and barking furiously at them if they returned his stare. He did not like to be left alone and would try to scratch a hole in the stucco if left in the back yard, and scatter all the waste baskets if left in the house. If you secured these, he would urinate in the center of the family room tile to make sure you wouldn’t miss it. He would then hide somewhere in the house, and was very difficult to find sometimes. If you scolded him and he was able to slip out of the house you would find him walking slowly with his head down and tail between his legs, “running away from home”.

He appeared to be a target for German Shepherds and was attacked on two occasions, one resulting in an expensive vet bill. The Shepherd only suffered a damaged penis. On the other he was able to extract himself by maneuvering under the Shepherd until help arrived.

He always maintained his habit of slipping out of the house unnoticed sometimes and not returning until he was ready. The only difference was that he would come to you and let you pick him up if you located him. One day he didn’t return and we couldn’t find him. We notified security and they asked around. After about three days he was located. He had been maced with pepper spray and had taken refuge with a family nearby.

He eventually developed a paralysis type condition where he would stiffen up like a board with his eyes glazed. This was quite scary, but found that by giving him a rub down, it would eventually pass. A large vet bill cured him of this problem. Later he contracted cushings disease, where he lost his hair, got lesions on his skin, and developed a thirst and a desire for food that couldn’t be satisfied. He developed an uncanny skill at slipping out of the house unnoticed and scouring the neighborhood begging for food and water. I got many calls from neighbors to come pick up my dog. I knew he was missing but was unable to locate him myself. Eventually he lost his appetite and lost control of his body functions, along with coughing up blood. The vets (yes, got a second opinion) recommended that he be put to sleep, because he was beyond help.

So on the day of the appointed time I took him to his favorite place and watched him wander around for a couple hours while I prepared myself for the final act. I then took him to the vet and held him while he was injected with the death dealing fluid. I am not an emotional person but I have never felt this sad about any human close to me passing away.

I have had pets before, but have never become this attached. Maybe it was because Chico was such an individual that I dealt with him like he was human. You always felt his affection, yet he didn’t like to be caressed. If you picked him up he would look at you as if to say, “faggot”. Yes, he was a male.

I am aware of the advice that the dog whisperer gives, but I liked him just the way he was. I will always miss him.

THE MOVIE “W”

I went to see the movie “W”with some trepidation because the rumors surrounding it inferred it would be showing President Bush in a bad light. Since I didn’t want to financially support any defamation of character, I was concerned. To my surprise the movie was complementary in many ways and depicted President Bush as a wild charismatic young man who transformed himself, with help, into a driven, responsible individual. His detractors will probably use the “wild young man” segment as the total sum of his character, while his supporters, being more on the social edge, will appreciate both sides of his character.

The part of the movie where meetings with his cabinet and staff are played out depicts a decisive President who listens to all advice before making a “gut feel” decision and also answers critics on the Iraq war issues. This is contrary to the leftist bloggesphere. I thought Oliver Stone was liberally oriented. Is it possible for one to be fair?

Obama’s associations

Questions about Obama’s associations with less than savory characters center in concerns on how they have effected his ideology and ethics. It must be remembered that Obama is a product of the Chicago political machine which is not timid about using any tactic to win votes. His associations are merely people that could help him politically and personally to further his career and his families well being.  In other words he was merely using them and not particularly concerned about their behavior. Historically, Democrats have not been particularly concerned about the personal associations and character of their representatives, but only on their ability to bring home the bacon.  Republicans have been less fortunate and in many cases thrown out of office for a perceived digression. The Li’l Abner cartoon series of old was great at ponting this out in the character of Senator Phogbound.                                                                                                                                                         I