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Alisa Miller’s entry in Seth Godin’s new eBook caught my attention (pg 34).  In the entry, and a TED presentation, she talks about the abysmal state of global news coverage by the US press corps. Anybody who’s ever been subjected to around-the-clock styled American news programs can nod at the following.

Too often, American commercial news is myopic and inwardly focused.

This leads to a severe lack of global news.  And increasingly, a shortage of “enterprise journalism” – journalistic depth built over time through original sources – that provides the context and enables thoughtful response.

Too often, the news sticks to crime, disasters, infotainment, and horse-race politics.  Many important topics such as education, race and ethnicity, science, environment, and women and children’s issues are often less than 5% of all news combined.

Much of widely-seen online news isn’t better – it’s often just re-circulates the same stories.

The result: much of our news can’t be called “knowledge media” – content that builds insight about our world.

Things happen all the time, everywhere.  What gets made news, and what doesn’t, more often or not depends on where the news take place, and whether the happenstance in question belonged to one of the above-mentioned items deemed headline-worthy.  When we think about it, it’s really not at all unlike an abundance of trees falling in a remote forest.  Trees fall all the time, but only those that fall at the right time, at the right place, witnessed by the right bystander that deem it important enough, will have their fate made known to the world.

As indicated by Miller, Americans are becoming more, not less curious about what’s going on around the world, aove and beyond what the cable networks are able to deliver. It is evident, because British media outlets  that do a much better job with their foreign correspondents are eating into the audience pie. BBC and Guardian, not to mention the revered Economist, all command respect and eyeballs of those across the Atlantic.  But with cost-cuts and and ensuing shutting downs of foreign bureaus, especially for on-air networks in the US, we hardly get a glimpse of the outside world beside bombings and disasters.  That job has been relegated to public broadcast outlets such as PBS, NPR, and new private outfits the likes of Current and GlobalPost.

How did it come to this?

1. First and foremost, the race to top of the ratings league, and the focus on profitability have most likely doomed the industry to short-sightedness.  Should one fixate on ratings numbers and profit to the exclusion of any long-term vision, then the quality of stories will most likely keep falling to meet the lowest denominator. Until one day, 75% of your programming is spent chasing after Anna Nichole Smith, MJ, the balloon boy or Jon and Kate+8.  When that happens, you have essentially stooped so low as to talk to the entire American demographic as though they are stay-at-home moms.

2. Reporters should be story tellers, not type-writer monkeys that intercept wire stories and churn them out through templates. Yet most outfits lack the will and ambition to unveil global stories with the right kind of background and context to render them relevant.  I don’t mean one has do a song and dance number in order to “entertain” and bribe its audience members into attention.  But there are ways to of framing an issue, of presenting a coherent (and more importantly, accurate) chain of events to make us listen.

It may be more costly and time-consuming to produce, but credibility is gained through hard work behind honest reporting that happens day after day. And quality definitely trumps quantity, right? Instead of crappy live reporting 7 hours a day, how about quality, educational reporting, for just 1 hour a day?  If it’s that good, I promise, I will watch it 7 times.

On a side note, CNN, you are going overboard with your Twitter and Facebook shenanigans.  For someone with your kind of newsroom reach and brain power, why must you have Jim Clancy read out incoherent 140 char tweets?  We know what you are trying to do, and the game is lame.

3.  For the better part of the last decade, political culture in America has become more inward-looking.  Unilateral political actions has triumphed over multi-lateralism, and its influence has clearly permeated the culture fabric, making its impact on the general public felt.  By blithely shunning its allies and pulling away from global governing bodies, the unspoken message seemed to be: there’s no need to get too involved, or interested, in the rest of the world.

Similarly, globalization has sometimes been mistakenly painted as Americanization – every city’s getting its own Starbucks and McDonald’s.  The popularity of American culture and language has for decades perpetuated the very illusion.  As global trade continues, the exchange of culture has more or less been a one way street – much on its way out, and very little coming in.

So now big media is in trouble, and everyone’s hyperventilating. There’s a lot of talk about going local, even hyperlocal, whatever that means.  But my question is, why not go out, go global, go hyperglobal?  After all, there really is such a lot of world to see.

Great dialectic, in case you ever need to fend off a case of late-stage platonic advances from your whipping sidekick/ non-boyfriend.

I mean, sure, we could go on some dates, maybe mess around a little and finally validate the six years you’ve spent languishing in this platonic nightmare, but then what? How could we ever go back to the way we were, where I take advantage of your clear attraction to me so I can have someone at my beck and call? That part of our friendship means so much to me.No. We are just destined to be really, really good friends who only hang out when I don’t have a boyfriend, but still need male attention to boost my fragile and all-consuming ego.

[The Onion]

For a lot of us, the decision of what course or specialty to follow usually got made when we were still teens.  However well calculated or arbitrary they might have been, they often set us on a somewhat deterministic path in life.  With time, we discover more of who we are, what we like, and what our strengths and weaknesses are.  Those later stage discoveries either reinforce the choices we had made earlier, or come into conflict with whom we had grown to become.

Much of the existential angst for young adults centre around the issue of what to do with one’s life. But it always strike me as somewhat counterintuitive, how we have been brought up, and parsed through a system that seem to facilitate, if not actively promote, a somewhat backward way of assessing and arriving at that vital decision. The issue on hand is really the conflict and compromises illustrated by this graph, courtesy of Bud Caddell.

I will not generalize, although I believe this is a common rite of passage for many of us.  While still in high school, we choose, or at least look forward to learning more about a field, based on our own social upbringing, family influences, our own interests.  But more importantly, we looked at fields of specialty, extrapolated them into careers, and measured them up against prestige, salary, and employment statistics.  It was no coincidence that while I was in high school in the late 90s and early 2000s, half of my graduating class went on to study engineering of some kind – the most popular sub-discipline being that of computer engineering. Even though a few years later, the same group could have easily chosen another hot field, finance anyone?

So as a first step in our tentative journey to find our calling, we were guided to look for careers that pay well.

Then, picturing myself sitting through a mandatory guidance counseling session back in high school, our counselors would glance at our report cards and promptly informed us of the areas that we could potentially excel in university.  This happened in university too.  One of my friends was repeatedly told by our career guidance office that with terrible accounting and finance marks like hers, she could forget about going into banking, and should try for human resources instead.  Disgusted with the dismissive attitude, and even more horrified at the prospect of getting slotted into a field she had no interest in, she transferred to another school immediately. She was very brave.  And it paid off. She proceeded to complete summer internships at numerous top I-banks, and now thriving as an associate in a well-known wealth management firm.

So, during the second round, we often dwelled and obsessed over things that we did well, and tried to make ourselves even better in them. More often than not, at this stage, our search for that personally and financially fulfilling career has come to a brief end.

Then, quarterlife, or mid-life crisis hit: we wake up one morning and realize we don’t actually like what we do for a living, despite the status, the financial security, and the glossy exterior of a life.  Trying desperately to find some wiggle room, we see the lives we had set ourselves up for required financial commitments that do not allow for sudden and unplanned exits, so perhaps it’s not really that secure after all! With aging parents, dependent children, and possibly equally high-strung spouses, where to turn?  We seek solace on therapist couches, or more economically, at our local Borders’ self-help section.  Crammed with personality, parachute, career aptitude books, they are all there to help you answer that million dollar question: what do I actually want to do?

To me, the order of this exercise is all wrong.  It would’ve made much more sense to start from this very last, but terribly vital question of what we actually want to do, layer on the things we do well, find a plausible interaction of the first two, and match it against things the world can pay us for.

Of course, the difficulty of not knowing what one wants to do at an early age is a sizable obstacle, which is why many settle, and may even prefer the solution offered by the order described earlier.  But it should not stop us from striving to address this well meaning, highly prevalent, but nevertheless faulty compromise many had come to accept as the way things are.  The longer we leave this question unanswered, the more monstrous the scope of the problem will become, and the most costly it will be to resolve.

picture source: sheriktek

You think I’m advocating sexual abstinence.  No.  Let me explain.

When I was 18, I wanted to be older so desperately.  For some of the reasons that everyone can relate to, and others that were unique to me (or not, as I found out later).  I wanted independence.  For me, that involved getting my parents out of my hair, and gaining freedom.  There was no doubt in my mind that becoming older was the panacea to all my problems.  Ha Ha. And Ha.

The word “freedom” is probably the second most misconstrued word in history, shortly trailing “love”.  Just like there are many varieties of love indulged in by people both balanced and unhinged, there are just as many different editions of “freedom”, subject to use and abuse, interpretation and misinterpretation.  The triumph of leaving home at 18 (albeit for school) lasted only for so long, as I soon found out that 1) freedom means nobody will tell you anything anymore, and 2) freedom sure ain’t free.

First of all, freedom can turn into a burden when you are old enough to supposedly make tough choices for yourself.  Decisions like choosing a major, picking a summer internship, or whether to go long-distance with your significant other.  Your parents, siblings and friends now recoil from giving you any sort of concrete advice, but resort to lame catch-all phrases such as “only you can make this decision”, or worse yet, “just follow your heart”.  Highly impractical and definitely not actionable.  Soon enough, the only times that you can get yourself some decent advice is by sitting next to a complete stranger on a cross-Atlantic flight, munching over peanuts and wine in a plastic cup.  Or more expensively, lying on the couch in your therapist’s office.

Secondly, if you weren’t born with a trust fund, freedom means paying the bills.  Paying the bills means picking up a good job, and picking up a good job means that you are only free to do fun things once the sun sets.  In other words, you’re paid to sell the best time of your day for money, so strict time and geographical limitations are placed on the practice of freedom.  During those paid hours, you are expected to do as told (probably by someone a lot dumber than you), dress in unfortunate slacks and shirts, and sit in on pointless meetings and feign enthusiasm.  It’s probably too early for you to truly appreciate the sadistic ironies of Office Space.  That’s ok, you will get your strain of the Muuundays soon enough.

When I was 18, I used to roll my eyes when people spewed out stuff that complimented my age.  I always took the praise as backhanded and gratuitous.  How was a disadvantage youth with hands tied behind her back supposed to feel next to an adult who was free to go everywhere and do everything?  Now crossing over to the latter part of my 20s, a lot of us murmur that we would not want to be 18 again.  But why are we so nostalgic about those years past?  Now looking back, the world was indisputably simpler (despite what you may think now) and lighter.  Many of us marvel at how time could fly so fast and retaliate against it in our own ways – against the shackles of those so-called freedoms of the grown-ups.

If I was 18 again, as futile as my words would be, I’d tell myself to slow down just a bit.  Because life will not always be as it is now, for better or worse.  For every bit of freedom you gain, there’s something else that gives.

picture source: `gilad

Nobody’s watching you!

At least not all the time.

I wish I knew this when I was 18, because life would’ve been so much more chill.  In fact, there are lots of things I wish I knew when I was 18, but nobody told me, or I just didn’t listen.  So a while ago, I wrote about what I wish I knew if I was 18 again, the first being that smartness isn’t really envy-worthy.  It generated a bit of discussion.  Easily encouraged, I decided to follow up with this.

I’m told that kids grow up hell of a lot faster these days, so hopefully they have this figured out by now.  But when I was 18, I had all the symptoms of a paranoid schizophrenic without the benefit of medication or therapy.  I felt as though everyone was watching me all the time, and was only just waiting till I stumbled on something (literally and figuratively) and made a fool of myself, so they could erupt in collective laughter with the satisfying knowledge that I, was a complete idiot, and they, were superior in every aspect.  I felt self-conscious walking down the street, eating out in restaurants, talking in class.  So pretty much every activity that required some, or any level of self-expression.  Parents were of course, a major source of attention magnet, and I refused to be seen in public with them.  Life kinda sucked back then.

It wasn’t until I turned the ripe old age of 23 that I was forced to grow some thick skin.  I prefer to think of it as calloused, as a result of repeated rubbing.  A series of changes began to take place, culminating in the liberating (or humiliating) final act where I allowed myself to fall asleep on the bus.  That’s right, the bus on my way to and from work.  Because I was too tired.  I was too tired to care that I probably had drool spilling out from one side of my mouth, with a bus full of people “watching”.  It was around that time that I finally figured out (without truly inhabiting the full implications of such realization, that took another couple of years) that people are generally 1) self-absorbed and has too much going on in their own lives to care about anyone but themselves, 2) most people, friends or frenemies, are not permanent fixtures in life (nothing is), and therefore, are not worth the worries.

The series of events that led up to that climatic commute ride started as soon as I got to university.  When I stepped into my first class in a huge auditorium of a few hundred people, it became evident that getting called on or singled out for attention was probably the last thing that could happen. Whoo-hooo! I was lost in a sea of student numbers!  After enjoying this exhilarating anonymity for a while, I realized that there were certain downsides to this invisibility.  For starters, I couldn’t for the life of me get the attention of the lecturer, or even the lowly TAs for that matter.  They simply did not know who I was, nor did they care.  All that Dead Poet Society, Half Nelson, Good Will Hunting, Finding Forrester crap lost whatever iota of truth it might have had back in high school.  It soon dawned on me that all that concerted efforts in high school trying to deflect attention away from myself became a liability in university.

While I sulked in insolence, scores of other people were bathing in their new-found notoriety for their ability to return clever retorts to authority figures three times their age, or their impressively loud debacles at parties that resulted in favourable attention from members of the opposite sex.  For once, nobody was paying any attention to me, but I still couldn’t enjoy the benefits that I thought it would yield me. I knew I was in trouble when our communications lecturer in business school told us that it was absolutely imperative that we had to distinguish ourselves from one another.  It took the next half decade to correct the ensuing fallout from this declaration.

So, when you’re 18, it might not be a bad thing to be seen from time to time.  You won’t stay the centre of attention for long.  Real life will emancipate you from that situation eventually.

picture source: =beaucoupzero

Armed with technology, globalization changed the way of life for many of us in a shocking span of time. The way we work, live, communicate, learn, has been completely transformed. Learning has undoubted changed too. But how will this change impact the way we value education and knowledge-based work going forward?

In the past few years, more and more educational materials have moved off of campus firewalls, and onto the web for all to consume. We are talking about entire course curriculum, reading list, lecture notes and videos. When the accessibility of information is no longer constrained, and the cost for knowledge acquisition is inconsequential, what does that mean for the education of knowledge workers?

Horizontal playing field

A horizontal playing field means that students and workers in less privileged countries or regions have a much more equal starting point, where the only determinants of success is motivation and hard work.

Right now, the up-and-coming parts of the world are still performing relatively mundane and technical tasks outsourced from the west. But let’s not forget how much of a leap that had been already. Computer engineers two decades ago were a rare breed and commanded high salaries. Nowadays, programmers with little business experiences are a dime a dozen. And they compete directly with well-educated coders from India, Russia, and China.

But as the next generation of customer service operators and programmers become exposed to the vast sea of free information readily available on the net, what’s preventing them from “pricing options, or calculating weighted average cost of capital, or mechanically ploughing through ‘five forces’ analysis”? It seems to me that any activities that require only technical proficiency will become low value-added tasks going forward, and can be contracted out.

Value deflation in certain areas of knowledge-based work

In the coming decades, information will become more free and more readily available than ever before. As a result, more than one category of jobs will be made obsolete, or attain the endangered status in their current forms. It’s not only the low level tasks that get outsourced anymore.

Cost for low value-added knowledge and execution of tasks keep falling, due to both a falling cost of information, and the increased competition from a more level playing ground. Power no longer rests in the hands of those with knowledge, not when knowledge has become such a public good. But it rests in the hands of those that know how to manipulate and utilize knowledge in the most value-adding manner.

The newspaper industry’s present-time struggles are partly due to inflexible and inadequate responses to the lowered entry barrier (on the supply side) and lowered valuation of its current product offerings (on the demand side). Also afflicted? Future of higher education. This is succinctly illustrated in the lament on the present course of training MBAs.

What will we sell them when the algorithmic skills we are now teaching will be available at zero marginal cost? What will we be selecting for when the preeminent source of value will be the skills involved in defining values rather than those involved in calculating the best means to achieve accepted values?

And just exactly what kind of thinkers will flourish in this new economy? You know, the ones that will lead the transition from the Age of Information to the Age of Interpretation?

These thinkers will be big- and nimble-minded enough to reason coherently about radically different cultural, metaphysical, technical, disciplinary, linguistic, and methodological perspectives; and tough-minded enough to take constructive, positive action in the face of radical inconsistency and incongruity among perspectives; to stare the future in the eyes even after realizing truth is not equivalent to certainty—and to think about the world while thinking about thinking about the world at the same time, having realized that all thoughts are fallible, but thinking itself is priceless.

Critical thinking and morality in education

I had little interest in the field of education, short of writing about the inadequacies of my own education. Then I came across Shafeen Charnia’s blog, where the shortcomings of our education systems are placed in context with much of corporate and social misdeeds.

This financial crisis has exposed, some says over-exposed (because it always has, and always will exist) corporate mis-behaviour. Executives have been called anything from greedy to immoral. Suddenly, morality found itself a central theme in the discussion of education reforms.

As a precursor to aspired characteristics such as integrity and accountability, morality is no doubt a good starting place for the future leaders and participants of civil societies. Yet one psychologist so far sees flaw in the logic, and pointed out that “true moral education encourages critical thinking and cannot be assumed to promote virtuous behavior any more than education about economics can be assumed to promote thrift.”

Many would argue that moral education should be left in the hands of the parents. But when parents fail, should the system pick up the slack? And just exactly how do we promote morality through the education system? And more importantly, should the promotion of such qualities be a part of its mandate? With a system that in some instances, still struggles to impress upon its students the basic skills of life, is the promotion of moral behaviour too much to ask?

Globalization and the right responses in education reform

American children are by no mean masters of rote learning. And nor should they be. But when it comes to talks of education reform, an overwhelming amount of focus is given to better GPAs and higher SAT scores. The end goal? The right college or university.

This is all good and well when the dissemination of knowledge is protected and monopolized by educational institutions. Those were the times when self-learning was a much more laborious and arduous journey, a journey that requires mental fortitudes not possessed by most. Going forward, perhaps outcomes will one day trump processes. Equality of information access ensures everyone gets to play. In the near future, perhaps other measures of learnedness can be created to replace the diploma-driven educational market.

Some would argue that the west cannot compete with children from countries in East Asia, where children possess higher technical skills. So let them be, and accept the challenge. Focus on molding our children into more creative, conscientious, culturally adaptable and well-rounded beings. While those societies are producing the next batch of knowledge workers, perhaps we want to charge forward and nurture the above-mentioned information “interpreters”.

picture source: ~ForbiddenEmotions

I am across-the-board average by all accounts, so I used to seriously envy the smart kids.  Why smartness? Because I became convinced early on that having great body parts doesn’t translate into long-lasting success in the real world.  Adding to the delusion, I was TV-schooled during the Dawson’s Creek, Popular and Felicity era.  The general take-away was that looks were only worth celebrating when it played supplement to a brooding yet brilliant mind.

So you can imagine my seizure when I discovered in the real world, intelligence held only a fleeting chance at success when challenged by obstacles such as luck, to-die-for connections, good looks (gasp!), passion, and most importantly, a great personality.  Needless to say, this was hugely disappointing, since half of my brilliant high school graduating year had gone on to study computer engineering, and most of them possessed little, if any of the above.  It was also hugely disappointing for me, since it robbed me one of the only things that I could consistently blame Mother Nature for: shortage of brain power.

The thing was, stepping into university, and subsequently the real world, put Relativity Theory to test, for real.  Once the bubble wraps burst, what was deemed brilliant when I was eighteen was not much when placed against the myriad of talents out there.  People had all kinds of stuff going on for them, and very few of those could be quantified by an entrance average or a percentile ranking.  It began to make sense after a while, since we do not robotically assign people scores we meet based on their understanding of quantum mechanics or their ability to recite and analyze Paradise Lost in iambic pentameter.  What seemed to get brownie points were one’s ability to tell or take (preferably) a self-deprecating joke, to have some kind of special talent that was driven by passion versus competitiveness (bragging about piano grades and Taekwondo belt level were not cool), and if they have ever tasted the humbleness pie.

Now in the latter leg of my 20s, I am not envious of anyone anymore, least of all the smarty pants from high school.  From what I’ve seen, God (or whoever it is up there), is pretty fair.  What we are not endowed in one area, is most likely made up by something else.  To be wildly talented in one part of your life may very well cripple the many other areas that scream for attention.  Maybe somebody’s going to create the next Google or design the next Mac, but so what, if he cannot carry on a conversation with the opposite gender or someone outside of his zip code?  By the way, if you are one of those guys, it’s ok – Bill Gates got through it, so will you.  If you’ve got the personality of Leno but little skills to back it up, there are plenty of jobs out there that will pay you to schmooze and get other people to like you.  If you are all-around average like me, it’s ok too.  It just means that you won’t require date coaching, or regular AA attendance to dial your life back to sanity.

In short, each one of us is unique, and everything is the way it is for a good reason. So save the envy, there’s no need.

More discussion on this post can be found here.

picture source: =BaltazarArt

Welcome Gen-X readers, and thank you for visiting my blog.  I write about investing, macro-economics, society, culture, career, and any other ideas and thoughts I have from my own experiences.  Some samples are available here.  If you enjoy my posts, then please consider subscribing to the RSS feed and spread the word, I would love to hear from you!

Here are some places to start that will give you a taste of this blog:

More on the Recession

• What are high profile economists saying about 2009? Hear from Roubini, Taleb, Faber, Rogers, Schiff, Coxe, and more.  Mirror mirror on the wall, who’s the gloomiest of them all?
• For Gen X and Ys, the recession presents a myriad of opportunities in housing and investment. They are there, you just gonna look for them, and be very optimistic.  Believe it or not, the recession has perks
• What the recession and the past can and can not teach us.  When the paradigm changes, one must re-adjust. So perhaps looking back on history is not a great thing. One way of dealing with a broken economy: Ignore history

On investment

• The market is far from inefficient, the sooner you accept this, the better you can sleep at night.  Believe this, and you’ll sleep better at night
• Whole-picture macro-trends driven investing is not easy, if you don’t believe the difficulties of it, just read this.  Or maybe not, because you might stop investing altogether. Are you seeing the whole picture when it comes to investing?
• Has the financial crisis changed fundamental rules of investing going forward? Read about why investors and consumers are the only ones that can push businesses into good behaviour. Old rules out, new rules in: What investors should demand going forward?

Some investment ideas

• The food crisis ruled the news last year, now it’s forgotten.  Will the food crisis come back, and when it does, are we prepared? And more importantly, can we benefit from this?  What the forgotten food crisis means for your investment
• The housing bubble took place with no demographic support, maybe that’s why we’re in this hole right now.  Love it or hate it, demographics matters for an investor (I)
• What demographics are telling investors to focus on in the future. Hint: needs will trump wants. Hint: where do most people in the world live and what do they absolutely need? Love it or hate it, demographics matters for an investor (II)

Some comic relief, cuz God knows we need every bit of laugh we can get

• Places that are doing worse than your average recession-ridden economies.  That is, unless you live in Iceland, Germany, Japan, or Ireland.  Then I’m truly sorry.  Who’s worse off than you?
• The curious case of Berlin and how it’s able to avoid the recession. I explain my findings of the city, along with pictures from 2008.  Who is too poor to afford a recession?
• Thoughts on European immigration and the welfare system, and a piece on Japan and its very broken society . Those are not as funny but hopefully you find some solace in other people’s equally unsolveable problems?  When pragmatism trumps ideology and Japan and its broken social contract.
  
• On my life in the land of cows and windmills, on baking my own birthday cake and endless air kisses.  The year of living Dutch

Do you like what you’ve read and want to keep up?  Please consider subscribing to the RSS feed and drop a line, I would love to hear from you!

picture source: jimmycohrssen

The human mind cannot grasp the causes of phenomena in the aggregate. But the need to find these causes is inherent in man’s soul. And the human intellect, without investigating the multiplicity and complexity of the conditions of phenomena, any one of which taken separately may seem to be the cause, snatches at the first, the most intelligible approximation to a cause, and says: “This is the cause!”

Leo Tolstoy, War and Peace [via The Big Picture]

The populist pitch-forking movement has duly commenced, and fingers are pointed in all directions. In a classic case of pot calling the kettle black, all the players are now seizing populist rage to divert attention from itself. The momentum must be maintained, should the public calm down and re-assess, everyone is culpable.

Government

The whole debacle surrounding the AIG bonus is ridiculous. The government passed the legislation with the inserted lines that allowed for bonuses in the first place. Even if Chris Dodd is the culprit, surely it only serves to highlights the incompetence and indifference of the system. If what he’s saying is true (that the administration made him do it), then it shows complicity. This indignant outrage shown by politicians from both sides is nothing but political grandstanding to placate mass anger. Better this mess is channeled towards the evil executives than at the government, right?

The de-regulation of US financial system started with Clinton, and continued with the Bush administration. Policies from ten years ago directly contributed to the California black-out (Enron), and the current mortgage crisis. Without the government’s collusion in both banking deregulation and predatory lending practices, corporate greed would’ve had little opportunity to spread.

It doesn’t take much digging to see the hypocrisy of politicians now railing against exorbitant executive compensation or incompetence. For the most part, those very politicians were responsible for the rise in reckless risk-taking behaviour of those financial Einsteins. Members of the public are beginning to see the thinly-guised witch hunt as a way to deflect blame and secure public support. This kind of shameless and ingratiating behaviour from publicly-elected officials is insulting and condescending: because it pushes accountability away from itself, and props up effigies of greedy corporate executives for the public to burn.

Regulators

It’s hard to see how the phrase “financial innovation” could return with any kind of goodwill. Driven by his “Ayn Randian passion for regulatory minimalism”, and fearing lack of competitiveness that regulation weighed on said “financial innovation”, Greenspan opened the Pandora’s box.

In the aftermaths of banking collapses and Ponzi schemes, the SEC can hardly deny its failure in oversight. In one embarrassing expose after another, SEC is blasted for its inept and financial illiterate handling of warnings, its cozy relationship with the very bankers it was charged to regulate, and became a puppet that was captive to the powerful industry.  So the court can put the likes of Madoff away and the public can demonize the banking executives all they might, but the SEC deserves just as much wrath as its former wards.

Media

No matter how the broadcast media plays it, it will always run one of two risks. One is setting high journalistic standard, cover the news it deems worthy, works to inform, to investigate, and to inspire. It then runs the risk of appearing out of touch with the public. In the US, where news is de-centralized and competition is fierce, fear of low ratings has sent most networks to the latter approach. This now dominant reporting technique sensationalizes. Reporters claim that this will resonate better with its viewers, which more often than not, send all the networks racing towards the lowest denominator. For an outsider, coverage of highway chases, celebrity mishaps and other juicy scandals does nothing but dumb down its audience.

The broadcast media then commit a severe error in omission. By catering to the public’s guilty indulgences in vices and gossip, the media has missed its calling. So while the excessive liquidity and sub-prime crisis was brewing under the surface a few years back, we heard little serious discussion on the economy and its sustainability. Remember, those were the popular stories of 2007 and 2006.

And then there is the business reporting media that cannot decide which side they are on. The conflict of interest is glaring. Do they exist as mouth piece to the CEOs and analysts invited on the show with a scripted message, or do they exist to slice and dice data in order to inform its viewers? Considering the party footing the network bills, and the ongoing gamesmanship that nobody bothered to call out, are they not just as responsible for failing to do their jobs? Since the Cramer versus Stewart showdown, CNBC and its bretherens have been largely silent on accusations lashed upon it, and instead threw themsleves whole-hearted into the chorus of public fury. Are they silent in their atonement, or merely evading public scrutiny?

Education

Capitalism is a beautiful thing, especially the version taught in business school. It’s competitive but fair, rational and deterministic, and most of all, it’s supposed to be a force for good.

Needless to say, in the past few months, the public has begun to uncover the darker side of capitalism, especially when infused with greed and corruption. Educational institutions are not immune to public probe. Deans of business school across the US are admitting to “widespread failure of leadership”. Its decline in global reputation, along with questionable US economic prospects, has led to a drop in international student enrollment in American MBA programs.

By acts of omission, b-schools nursed a culture that inflated egos, placed a premium on performance at the expense of balance, instilled a reverence for mathematical models (in finance) or salesmanship (in marketing). It also funneled an acceptance of the status-quo corporate hierarchy. My post on some of the shortfalls of business school was picked up by Shafeen Charnia in his discussion of leadership. He says:

In both teaching and the corporate world, experience can give you the confidence to be adept in front of a room, but it doesn’t ensure leadership. It seems that one is taught how to use authority versus leadership. We all know that authority is about power. And power (and its abuse) are why we still and likely always will need workers’ rights laws and unions. It is also why some students don’t get to learn.

The Public

It would be unfair and naïve to not place a fair portion of the blame on ourselves. Granted, when times were good, it was hard to work up the will to ask tough questions. But there were signs, as well as a sizable and vocal group that voiced their concerns over the mortgage market, the banking system, and the economy as a whole.

If nothing else, this recession will force the general public to become more discerning citizens. Whatever trust that existed between the people and the government, its regulatory bodies, its hawking media, will be rigorously tested.

Greed is ingrained in our nature. Many organizational psychologists recognize this indisputable character of businesses and its executives, and work very hard to find a way to align corporate interests with consumer interests. End of the day, it is my belief that only consumers and investors can force and enforce corporate responsibility and accountability. In a society where technology is the barometer for transparency, businesses are finding it increasingly difficult to hide behind carefully orchestrated PR campaigns. Authenticity is not just a buzzword anymore, because the public is becoming more astute. If we can somehow translate our need for transparency and accountability towards a system that either rewards or punishes a business for its corporate behaviour, perhaps then we will no longer rely solely on the government and its regulators to safeguard our investments.

picture source: theakker3

If I was eighteen, and clueless about what I wanted to do with my life, I would do business school all over again.

I’m not eighteen anymore, so I would not go back to business school.  Not when there are many other ways of learning out there.

1. I’m not fit to give you any business advice

A couple of months ago, a friend of mine headed back to school in a remote community in interior BC.  She wrote to me, excitedly about her new surroundings.  She was also excited about a business idea she’s had: the campus was set up miles away from the nearest town, so why not start a grocery delivery service for the hungry students?  I was the only person she knew with a business degree, so it found me.

I started to write back somewhat vague and non-committal, than I stopped typing, hit the ENTER key, and wrote the following: “The thing is, a business degree is probably the least helpful to someone that wants to start their business, because in business school, all we got trained on was how to service someone else.”

I wrote this to concede that I had little practical advice for her.

I was not wholly clueless when it comes to entrepreneurship – I did get my hands dirty on a business for a couple of years during university, and that has proven to be one of the biggest confidence-booster of my life.  But whatever skills I had gained during this time became neutered in a classroom setting.

School trained us to become task-masters, one that is great at driving efficiency, expediency, and a razor-sharp ability to prioritize.  We become extremely proficient at functional tasks, but terrible at matters involving creativity and imagination.  It takes a smart and able person to answer a question correctly, but a non-conformist to re-phrase the questions posed in the first place. In face of the current crisis, I think that kind of out-of-the-box inquisitiveness might have been helpful.

But perhaps that was the plan all along with business schools and their generous donors. Just like the military, business schools are probably better at training problem solvers instead of thinkers.  It didn’t profess to churn out Aristotles that philosophize.  Equipped with plenty of discipline and normalized by years of standardized training, we marched into the corporate world.  I then got into bed with Excel, let someone else worry about the bottom line, and became a cog.

2. Business school made us masochists

I was a mediocre student at best, struggling to keep up with endless lists of projects, papers, presentations.  After four years of hard labor, I barely made it out with honors.

The only subject that I liked was statistics.  Not because I was a huge fan of means and standard deviations, but because statistics was the only subject where the exams were open book!  All other subjects had exams that required an immense and inexhaustible capacity to memorize and reproduce.  Whether they’d be accounting principles and subsequent treatment of business scenarios, or spewing out every piece of marketing jargon that we could to cram into a 30-page exam, or to reproduce mind boggling hedging formulations. Exams were like bulimia for the brains.

The mantra in business school was “work hard, play harder”.  It wasn’t until I left school that I found out this was the mantra employed by every other sports team or cultish business organization.  Most of us bought the idea wholesale, because work and partying looked so cool in movies, and it worked for a while with coffee slurping and caffeine pills popping.

The type-A success stories graduated to high-rolling careers in banking or consulting.  When alumni visited our school, they would boast of working 80, 90, or over 100-hour weeks – because they were so dedicated to their careers and cared so much.  We were in awe.  They told stories of themselves falling asleep in the shower or taking naps in the bathroom, we thought they were hilarious.  Worse yet, most of us thought we could beat that.  Because at 22, we were all Superman with complete disregard for our bodies, and working inhumane hours get you a badge of honour.

3. I’m not sure I would trust me with your money

I can’t say it with a straight face anymore. But back then, “maximizing shareholders’ value” was something we strived to put on every slideshow that could fit during case study presentations.  If you’ve been to a business school, you know what I’m talking about.  It’s nothing to smirk at.

There is a fine line between corporate responsibility and civil responsibility.  Sometimes the line is gray and very blurry; other times it is, unfortunately, a zero-sum game.  I’m sure all business professors are well aware of the fact, and it must be a struggle to instill business principles into our impressionable mind, without crossing that line of ethics.  Because every marketing principle, every tax minimization tactic, and every financial hedging strategy could be turned into something sinister and potentially corrupt in the hands of an ethically ambiguous individual.  Give that person a budget to work with, put in some skewed incentive structures, add lax regulation, sprinkle genuine misunderstanding and ignorance of the marketplace, then top it with a 90-hour workweek, is it really any surprise that within the last ten years, we’ve had three severe instances of corporate breach?

The bursting of the tech bubble in the early 2000s was partially blamed on the team of analysts that talked up stocks despite evidence to the contrary.  Failing to sniff the trail of accounting misconduct and fueling the speculative frenzy based on investment banking relationships, the stock market wiped out $5 trillion of market value.  Everyone had invested in the stock market then, and almost everyone I knew lost money, directly, or indirectly.  That includes my college fund.

After 9/11, accounting scandals surrounding Enron and Worldcom, among others, eventually brought down Arthur Andersen, and forced the SEC to examine the relationship between auditors and their consulting branch.  We were in school then, and we most definitely did not delight in learning the new rules ordained by Sarbane-Oxley.

Again, the first decade of the 21^st century, saw us failing again to learn from neither the speculative hubris of the tech bubble, nor from the accounting fraudulence of the Enron era: banks, lawyers, and accountants had helped to create a debt-induced housing recession.  Skeptics that doubted reckless lending practices were either ignored by the authorities, or chided by the mainstream media.

It could’ve been isolated cases of bad apples that got us to where we are today.  But it is hard not to see those disastrous endings as results of concerted, if not colluded effort by those in charge.  Incentives are a huge part of the problem, and so is the overall framework in place that resulted in the hubris.  So it really begs the question from or an ex-business school student: who’s at fault here, the system itself, or the people in charge of the system?  And given the system and the opportunity, what would I have done?

4. Where did our sense of humor go?

We all took ourselves so seriously.

We studied separately from the rest of the school.  We had our own buildings, and were usually only friends or housemates with people from the business school.  We studied in private meeting rooms named after wealthy donors, many of which were heads or former heads of something publicly listed.  We held roles in clubs manned exclusively by business students.  The air of self-importance, cliqueness, and hierarchy can put Mean Girls in a corner.  At 18, we wore our first power suit, trying to walk on heels while looking professional.  At 20, we were using various permutations of the word strategy without really understanding what it meant.  At 22, some of us had signed on to jobs that made more than our professors, business professors!  On some days, it’s a wonder how all our egos could fit in one room.

I’m sure some people had it all figured out, and probably saw the whole thing as one big joke.  I was not bright, so I went along for the ride.

5. In pursuit of sustainable careers

Talking about career burn-outs in a big banking firm for a 22-year-old was not unlike talking about hangovers from the best frat party.  It sounds painful but the sheer awesomeness of the job, and the doors it would open for you, would makes the pain worthwhile.  At the time, the popular roadmap for soon-to-be bankers was to toil as an analyst for two to three years, then leave to get an MBA, or to move on to the buy side.

It occurred to me a while ago that this short-term mindset is hardly the exception among bankers of all ranks and ages.  Hardly anyone I know had plans to stick around for the long term at one firm, and nor should they have.  But the issue of employee attrition may be the problem behind a genuine disregard of corporate responsibility.  Short-term financial incentives begets short-term profiteering behaviour.  And when an entire layer of a business is expected to depart after two or three years of sweatshop labour, how realistic is it to expect the firm to create and foster a culture that emphasizes anything long-term? So is it any surprise that a couple of years of record profits were made on backs of unreasonable risk-taking activities?  No, because they were offsprings of short-term thinking.

It’s hard to say how much structural changes will really take place as a result of this economic fall-out. Business cycles will most likely continue oscillating in response to economic activities, and careers will be made and then broken.  But as business owners, investors, consumers and employees, a longer term, more sustainable way of doing business, of investing, of consuming, and of working, may be a solid way forward.

picture source: ~roscofox

It’s been a month since the Investoralist officially kicked off, and I thought I’d briefly pause and write about what I’ve learned so far.  Granted, a month is barely a blip, and some of the musings may seem pretty amateur to bloggers that have been labouring in this medium for years.  But hey, this is the Internet, everyone gets their piece.  And there’s hardly anything that I can do to prevent you from clicking away.  So off I go.

The need to provide value. Before I enrolled in politics – that was my choice for graduate studies, I was interested in the Middle East.  To prove it, I went traveling in the region and ended up living in Egypt for three months.  I took Arabic classes. Then I went to grad school, and realized that everyone was interested in the Middle East, and everyone has seen the sufferings of the Palestinians, first-hand.  I then promptly decided that I was no longer interested in the Middle East, since whatever problems it may have had, it was not for a lack of concerned political science students.  And if all these smart, motivated, and outraged graduates of political science studies around the world have yet to find a solution to the problem – other than becoming bitter and indignant and depressed, I had little to offer.  At least not through the same path.  Or not at all.

So now I find myself blogging about investing, which is a subject that’s pretty vast and covered by a lot of people.  The same issues are frequently debated up and down the journalistic and blogsophere chain.  Some opinions are fruits born from careful examinations of arguments and data, some agenda-driven, some are pure drivel and derivatives.  The issue of adding value to the discussion is never far from my mind when I write.

The need to be interesting. I’m not sure if the importance of being interesting should take a back-seat to providing value.  God knows that we are subjected to enough dull and dreary readings.  I can barely work up the will to look at my tax re-assessment from 2007 and call the government to see why they are demanding $64.36.

The issue with investment and perhaps any kind of personal finance writing is that the subject itself is not something most people naturally gravitate towards.  It’s not escapist, because reading about something that tells you how to sort out your money is usually pretty serious stuff, and you need to pay attention.  Not like reading snarky news on some dumb celebrity’s impending divorce or rehab mishaps when you are waiting for your dentist appointment or sitting in the salon chair. Because at the end of those, you roll your eyes, shake your head, slap the stuff down and get on with your life, feeling just that slightly happier and relived.  But what you read on personal finance probably just makes you more jittery and agitated.  Most writers on those subject are out to teach you something that you are doing wrong.  And there’s always a call to action at the end that more often than not leaves you feeling guilty, because you know you should do it, or at least look into it.  But that to-do list just gets longer.

Investing and managing your finances is also not sexy. I’m not sure if there is anything instinctual about the subject that pulls one in, compared to say, gossip or productivity and inspirational writing.  Let’s face it, the subject itself does not have broad appeal.  But we deal with it out of necessity, and competitiveness.  Or perhaps greed.  That could be a good motivating factor.  Except most advice served in this subject tend to be conservative and very sensible.  Too sensible to rouse that Donald Trump I-will-make-you-rich-if-only intensity.  Personal finance bloggers are a prudent bunch, dishing out advice from frugal living to high-yield saving accounts, to carefully monitoring the market and discussing amongst themselves whether there is potential for an upturn.  It does not promise a quantum jump in the quality of your life in one sweeping gesture of dramatic change.

So what makes, interesting?

Writing what I want to write. I had no idea what the personal finance blog landscape was like a month ago. I had no idea what other people wrote, and I had no idea what people liked to read.  A few days into writing, I figured it was a good idea to find out.  I did, and now I know.

So now I can write with the peace of mind that everyone does it their own way.  Sure, there are plenty of people out there talking about SEO, writing catchy titles, baiting existing bloggers, stirring up controversy.  I’ve seen what HuffPo resorts to in order to get more pageviews, I don’t think I can do that.  At least not before moneymaking become a concern and Google AdSense goes up.  But for now, I really just want to focus on what I want to write.

I know what I cannot write.  I am not fit to give out frugality tips, nor tell someone how to organize their bank accounts when I can’t do the same, nor graph my way to stock-picking stardom.  So I will write what I find interesting – the market, and how it absorbs ebbs and flows of political and economic decisions of past and present, how it translates and amplifies our various rational and irrational expectations of the present and future.  It is as close to an oracle as it can be: it reflects the fundamental health of the economy, but it also deceptive in its momentary indulgence of collective greed or fear.  In good times, it’s mellow and eternally optimistic. But in times like now, it is a wild beast unleashed.

To me, that is dynamism worth learning and writing about.  Because learning about the market is akin to learning about the world.  For there is not one force that dominates, but an intersection of competing and antagonistic ideas that battle against each other on a daily basis.  In that sense, the topics that I can bring up in an investment-focused blog is endless.

Write less and talk more. It’s no fun talking to myself.  It’s even less fun talking to myself in verbose and stuffy sentences.  This is an unfortunate side-effect of spending time in graduate school writing essays that nobody reads.  I will work on simpler delivery.

I left graduate school last year.  There were various reasons.  But one that bothered me the most was the tendency for everyone to talk past each other.  And everybody talked too much, the least of all me.  The thing with school is that you pay to voice your opinions, and nobody can shut you up and say, “Hey, that was completely ridiculous and irrelevant and please just shut it because we can’t take it anymore.”  It’s the same idea as saying “There are no stupid questions.”  Actually, there are, lots of them.

So what ultimately happens is that everyone sits around for hours on end, pontificating on theories developed by long-dead Europeans that would probably turn in their graves if they so much as overhear some of our self-involved interpretations of their life’s work.  It gradually dawned on me, on how the whole field of social science is like setting up the scene to accommodate breakthroughs, not unlike waiting for the Second Coming.  The rest of the time, people mull around to recycle, re-test, quote and mis-quote, agree or disagree with mountains of academic journals before them.  To me, there just wasn’t enough value generated to justify the huge expense in time.

Back to blogging.  I hear time and again that community and dialogue is the most important aspect of blogging.  I am looking forward to that.  There is no shortage of good discussion in the blogosphere, and I’m as eager as the next blogger for some heated and engaging conversations.  I also like to be disagreed with.  So bring it on!

picture source: *eduardovieira

I’ve felt ambiguous and conflicted about education for a long time, because it inspires while it stifles. But here are two ways it has always resonated with me.

One is learning for learning’s sake. Now looking back, and without sounding nauseatingly cheesy, there is something pure and unadulterated in the joy of soaking in the world.  I was never a science person. But I still remember in Grade 11, the excitement I felt bubbling from my belly, when trying to explain to my mom the idea of atmospheric pressure and rain formation and somehow likening it to the pan on the stove that was steaming our vegetables for dinner.

But I am also diabolically practical. So this form of learning left me feeling somewhat indulgent. Coming from a family where money was never something to be taken for granted, I always felt slightly guilty if what I was putting in my brains was somehow not contributing to the process of attainment that would eventually be responsible for putting food on the table.

The second source of turn-on is the sometimes masochistic pleasure of having to perform under pressure. Yes, I am perfectly aware of what that sentence sounded like. But the truth is, when overwhelmed to just the right degree, education has contributed greatly in honing my “getting-things-done” skills.

For me, education hit the right spot in high school. It was broad enough to sample from, yet challenging in its particularities to stimulate quite a bit of brain activities. But university, not unlike technical colleges, tends to churn out specialists, whether in the fields of art history, chemical engineering, or accountants.

The often repetitive and dogmatic field of business studies made me more cautious, practical, and cynical about the institutional delivery of education. It also iterated the value of an education by continually flashing dollars signs in front of students in the forms of sponsored conferences, prized internships, and the ultimate plushy fruit – a prestigious, high-paying job.

After a couple of years of manipulating spreadsheets, I returned to school and picked up, then subsequently dropped, the utopian study of politics. Slightly disillusioned over the ivory tower dissection of some irksome subjects, I turned to the idea of educating myself.

Needless to say, we live in a time when knowledge dissemination could not be greater and more easily accessible. The only thing required of us is our time and attention. After divesting myself of school, I had all the time in the world. I can safely report that, if you have the time and patience to learn, then there’s someone out there willing to teach you how to do it, most likely for free.

My point here? Learning does not always need to take place in school, nor does the departure from a particular time in our lives signal the end of learning. Unbeknownst to us, when we put our heads down at jobs, our exposure to the world narrows significantly. But learning need not stop there – if not for the selfish reason of keeping ourselves relevant in this ever-changing world.

Less than half a decade ago, marketing itself revolved around the 5 Ps, whereas now it would seem dinosaurous to teach it without incorporating the power of social media and consumer dialogue throughout the online space. A couple of years ago, we approached the financial market through the lenses of Black-Scholes. But nobody in finance today would be taken seriously without acknowledging at least some of the fatal shortcomings from which modern finance was built upon.

When I felt less than inspired during my working life, the idea of education or school always gave me hope. I think the promise of education allows us to temporarily shed the shackles of our jobs in whichever its current incarnation may be, and open our eyes to new possibilities.

Now that I am working through my version of DIY education, I think I have found the right balance again. In an informal and self-controlled setting, learning can be more liberating and more rewarding than what most of us have experienced within the hallowed halls that our parents paid dearly for.

picture source: ~shimpo