My head is spinning. Freddie Mac, Fannie Mae, Bear Stearns, Lehman Brothers, AIG. Federal bailouts seem imminent for most of them. I cannot calculate how many people have asked me in the past week for my opinion about these historic events. Uncertainty and financial markets mix like oil and water, and this time around is no exception. I would like to add a calming voice to the current situation. There is a history of this sort of thing, and the financial world did not end. Most people do not realize that in the Savings and Loan bailout of the 1980’s, the government was able to recoup most or all of its investment, as I mentioned many blogs ago. I do not want to minimize what has happened either. The Federal government has taken on debt that some estimate may be as much as half a trillion dollars. That sort of thing will have far reaching repercussions. We are in uncharted waters, I think, but the ship is sound.
I am fascinated by the mass psychology of tumultuous financial events such as the one we are currently in. I get impatient to know how it will all turn out, wishing I could fast forward to a more stable point in the future. Not just for the financial gain I would have by knowing the future (though if I’m daydreaming, there is no reason to leave out those sort of fantasies) but just to see who steps forward, who was right, who was dreadfully wrong. You can say a lot of things about the twenty-first century so far, but you can never call it boring. I am also fascinated by the history of such events. The decision of this government to bail out these institutions makes me wonder if the entire Great Depression might have been avoided if the government came in and supported the banks in 1929. That is the most fascinating thing about all this. Did we just avert the second Great Depression, or did we just guarantee its arrival?
By Myron Gushlak
Thursday, September 25, 2008
Wednesday, September 17, 2008
Non-conventional
There is no shortage of things to say about the recently concluded Democratic and Republican conventions in the United States. As a “foreigner”, perhaps my take might be a little different from the standard CNN/Fox News fare. As I’ve stated in the past, one of the perks of my investment banking business, Blue Water Partners, is the opportunity I have to confer with people of almost every nationality from countries spanning the globe.
It has escaped no one’s attention that the United States has nominated a black man for its highest leadership position. While not quite as shocking as the possibility of the Germans nominating a Jew, it has definitely caught the world’s eye. Some of the non-European people I do business with are quite euphoric. There is skepticism about the willingness of the United States to actually elect him, however, especially in the southern states where racism is assumed to be alive and well. But the possibility has garnered plenty of attention.
McCain and Obama could not be more different in their personalities and speaking styles. And as the cable and network talking heads point out ad nauseum in their attempt to be even-handed, both are coming to the party with their own unique talents. A couple of things strike me as a non-American, however. One is the insistence on referring to the next president as the “leader of the free world”. If that is the case, shouldn’t we Canadians (or Europeans) get a vote, or a half vote? It brings to my mind the baseball World Series, which if I’m not mistaken has been won by an American team every year it has been played. But I can shrug that off as normal American hubris.
The Democratic convention was a remarkable display of passion. The Republican convention- not so much, except for the reception given the Vice Presidential nominee, Governor Sarah Palin. Apparently you Americans are big on the Hollywood ending – “virtual unknown PTO mom rises to become the supreme commander of the world” scenario. Life imitating art, for certain! It raised a few eyebrows in the lunch I had with several European businessmen last week. Only in America.
But even that unlikely script did not cause as much of a discussion as the Republican speaker who stated (and I’m paraphrasing) that Obama was ready to turn his back on Iraq while McCain was committed to stay until the war was won. Everyone I’ve spoken to was surprised that that notion was not challenged by the “political experts” after the speech. The consensus among people I’ve met was “what will the Americans have won?” The war has thrown trillions of dollars of debt onto this and future generations. It has cost thousands of American lives, and many more thousands of wounded veterans are returning home requiring medical attention for years to come. The price of gas has almost doubled in the US since the war began, their economy is in shambles, and certainly it would be difficult to defend the argument that the Middle East (and the world by extension) is safer today than in 2001. So what is it that Americans, or at least McCain Republicans think they are on the verge of winning?
At any rate, the open window on the American way of selecting its leaders is always entertaining. It is also helped immeasurably by such American inventions as Tivo and the fast-forward button.
By Myron Gushlak
It has escaped no one’s attention that the United States has nominated a black man for its highest leadership position. While not quite as shocking as the possibility of the Germans nominating a Jew, it has definitely caught the world’s eye. Some of the non-European people I do business with are quite euphoric. There is skepticism about the willingness of the United States to actually elect him, however, especially in the southern states where racism is assumed to be alive and well. But the possibility has garnered plenty of attention.
McCain and Obama could not be more different in their personalities and speaking styles. And as the cable and network talking heads point out ad nauseum in their attempt to be even-handed, both are coming to the party with their own unique talents. A couple of things strike me as a non-American, however. One is the insistence on referring to the next president as the “leader of the free world”. If that is the case, shouldn’t we Canadians (or Europeans) get a vote, or a half vote? It brings to my mind the baseball World Series, which if I’m not mistaken has been won by an American team every year it has been played. But I can shrug that off as normal American hubris.
The Democratic convention was a remarkable display of passion. The Republican convention- not so much, except for the reception given the Vice Presidential nominee, Governor Sarah Palin. Apparently you Americans are big on the Hollywood ending – “virtual unknown PTO mom rises to become the supreme commander of the world” scenario. Life imitating art, for certain! It raised a few eyebrows in the lunch I had with several European businessmen last week. Only in America.
But even that unlikely script did not cause as much of a discussion as the Republican speaker who stated (and I’m paraphrasing) that Obama was ready to turn his back on Iraq while McCain was committed to stay until the war was won. Everyone I’ve spoken to was surprised that that notion was not challenged by the “political experts” after the speech. The consensus among people I’ve met was “what will the Americans have won?” The war has thrown trillions of dollars of debt onto this and future generations. It has cost thousands of American lives, and many more thousands of wounded veterans are returning home requiring medical attention for years to come. The price of gas has almost doubled in the US since the war began, their economy is in shambles, and certainly it would be difficult to defend the argument that the Middle East (and the world by extension) is safer today than in 2001. So what is it that Americans, or at least McCain Republicans think they are on the verge of winning?
At any rate, the open window on the American way of selecting its leaders is always entertaining. It is also helped immeasurably by such American inventions as Tivo and the fast-forward button.
By Myron Gushlak
Monday, September 8, 2008
Education Revolution
Have you noticed what is happening in New Orleans? In the wake of Hurricane Katrina, there is an excitement brewing about education, of all things. Most of the existing pre-Katrina school system was washed away by the hurricane, both literally and figuratively. Even before the hurricane, the system was failing miserably. Statewide, Louisiana ranked as low as 46th out of the fifty United States in student achievement rankings. Instead of rebuilding a broken system, New Orleans decided to become a laboratory for charter schools. More than half of New Orleans’s public-school students are now in charter schools. Early successes have caught the attention of educators nationwide, as well as local governments still unsure about the viability of the charter school concept.
Charter schools are publicly financed, but are run privately. The individual school has much more latitude about the students it accepts and the curriculum it chooses to follow. Paul Vallas, the former head of the school systems in both Chicago and Philadelphia is the superintendent behind this mass experiment. Thus far, the experiment is successful beyond most reasonable expectation. We hear about the failures of New Orleans all the time. It is truly uplifting to hear about the occasional phoenix that every now and then rises from (very wet) ashes.
Robert M. Hutchins has said “We have not had the three R’s in America, we have had the six R’s: remedial readin’, remedial ‘ritin’ and remedial ‘rithmetic.” Perhaps out of the misery of Katrina, something may actually change for the better. Before Katrina, New Orleans and education went together as well as McDonalds and good nutrition. Don’t look now, but the times, they are ‘a changin.
By Myron Gushlak
Charter schools are publicly financed, but are run privately. The individual school has much more latitude about the students it accepts and the curriculum it chooses to follow. Paul Vallas, the former head of the school systems in both Chicago and Philadelphia is the superintendent behind this mass experiment. Thus far, the experiment is successful beyond most reasonable expectation. We hear about the failures of New Orleans all the time. It is truly uplifting to hear about the occasional phoenix that every now and then rises from (very wet) ashes.
Robert M. Hutchins has said “We have not had the three R’s in America, we have had the six R’s: remedial readin’, remedial ‘ritin’ and remedial ‘rithmetic.” Perhaps out of the misery of Katrina, something may actually change for the better. Before Katrina, New Orleans and education went together as well as McDonalds and good nutrition. Don’t look now, but the times, they are ‘a changin.
By Myron Gushlak
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