This has been the summer of anniversaries:
80 years: ‘Gone with the Wind” & “Wizard of Oz”
75 years: D-Day, allies landing on Normandy Beach, France
65 years: Brown v. Board of Education decision declaring separate public schools
as unconstitutional
55 years: Nixon’s Resignation
50 years: Neil Armstrong walking on the Moon & Woodstock Music Festival
40 years: Three Mile Island Unit 2 reactor, Middletown, Pa.
30 years: Berlin Wall coming down
Some good and some not so good.
Lately we in this country are creating new
anniversaries:
Chicago 7 people killed, 48 wounded this past
weekend
Dayton, 9
El Paso, 21
Virginia Beach, 12
Aurora, Ill., 5
Thousand Oaks, 12
Pittsburgh, 11
Annapolis, 5
Santa Fe, Tx., 10
Parkland, 17
Sutherland Springs, Tx., 26
Las Vegas, 58
Orlando, 5
Ft. Lauderdale, 5
Burlington, Wash., 5
Only the sites and numbers change; nothing else
does.
Anniversaries celebrate accomplishments and help us
remember days we hope to never see again.
Let’s hope we all have the courage to change the
course of America away from the violence.
UNIVERSITY SECOND CLASS
– The story never ends:
The University of Southern California has agreed to pay $50
million to the University of California at San Diego and apologize over a star
researcher’s departure that led to a closely watched academic-poaching lawsuit.
The backstory: In 2015, Paul S. Aisen, a professor of neurology,
defected to USC from UC-San Diego, and took his multimillion-dollar Alzheimer’s
Disease Cooperative Study and its staff with him. The dispute between the two
institutions turned ugly and gave rise to a rare court battle.
In its apology, USC said its past actions “did not align with the
standards of ethics and integrity which USC expects of all its faculty,
administrators, and staff.” With the $50-million penalty and USC’s mea culpa,
the lawsuit has been settled.
MONEY FOR NOTHING - Saudi Arabia directed about
$650 million to American universities from 2012 to 2018, according to an
Education Department report on foreign gifts to colleges in the United States.
That’s good enough for third on the list, behind Britain and Qatar. And the
total from Saudi Arabia is likely to be far higher than it appears, since
universities are inconsistent in how they report such contributions.
The current focus is on the Massachusetts Institute of Technology,
which last year played host to Mohammed bin Salman, the Saudi monarchy’s crown
prince. An official in the Saudi leader’s campus entourage was later suspected
of having played a leading role in the dismemberment and murder of the
Washington Post columnist Jamal Khashoggi. This past spring MIT decided to
subject its research collaborations with Saudi Arabia and other nations to
stricter scrutiny after a groundswell of public criticism.
WHEN CARS WERE KING - Before Keith Krach was a Silicon
Valley-billionaire-founder, he was a rising star in my hometown, Detroit, the
Motor City.
The
vice president of General Motors’ emerging robotics venture, he was a regular
guest at the country club where the boss of his company, Roger Smith, and
Chrysler’s Lee Iacocca hung out. Mr. Krach couldn’t help but think he was on
track to be chief executive of GM, then among the biggest and most valuable
companies in the world.
In
1987, though, he left Detroit behind to take a significant pay cut and join a
software startup in Northern California. “I thought that was kind of the way of
the future,” he recently said. He went on to found Ariba, an e-commerce network
that achieved a $40 billion market capitalization, and later run the DocuSign
Inc. electronic-signature company.
As
prudent as Mr. Krach’s bet seems today, it was shaky when he made it.
When
Mr. Krach changed careers, Americans’ most prized possessions didn’t have
screens or buzz in our pockets; they rolled up in driveways and fit in garages.
U.S. auto makers churned out more than seven in 10 cars sold in U.S.
dealerships, and 15% of the working public relied on the industry for its
livelihood. A car (not a cellphone bill, student loan, or Peloton exercise
bike) would be a person’s second-biggest purchase behind a house.
Mr.
Iacocca’s death this week reminded me of just how much ground the auto industry
has lost since the car-company CEO was king. In the mid-1980s, The Wall Street
Journal called Mr. Iacocca “the most famous industrialist in the world.” He
graced magazine covers and was heralded for greenlighting innovations spanning
sexy pony cars and boxy minivans. A Gallup Poll listed him behind only
President Reagan and Pope John Paul II in a ranking of the world’s most
respected men.
“He
was a rock star,” former Chrysler CEO Tom LaSorda said Wednesday, the day
after Mr. Iacocca died. Mr. LaSorda joined Chrysler from GM after Mr. Iacocca’s
time, but his father, a labor leader, negotiated with Chrysler’s legendary boss
in the 1980s. Mr. LaSorda said auto executives were “totally engaged in product
development, telling designers how high to make this or how long to make that.
That’s a really good example of what the legend is all about.”
Names
like Bob Lutz, Harley Earl, and Henry Ford II were the Elon Musks of their
time. Mr. Iacocca, whose career began in 1946 at Ford Motor Co. , outshined
them all and was a proxy for an era when the car industry was the pinnacle of
innovation.
Steve
Miller, a well-known turnaround artist, got his start at Ford in the late
1960s, well after Mr. Iacocca had become famous and gave the go-ahead to
creating the sporty Mustang. On Tuesday, Mr. Miller said he sprinted to Detroit
after graduating with his business degree from Stanford and joined the
Dearborn, Mich., auto maker because the pay was good and the product was at the
center of society.
Mr.
Miller would later follow Mr. Iacocca to Chrysler after Mr. Iacocca was ejected
from the driver’s seat by Mr. Ford, even though the company was minting money.
It was a headline-grabbing clash of personalities.
Mr.
Miller arrived at a Chrysler on life support. Why? Because Mr. Iacocca was
spending the only money left on trying to update a product lineup he viewed as
“crap.” Much like a startup founder today, Mr. Iacocca was trying to create
whiz-bang products—including little-lamented K-Cars and hyper successful
minivans—using someone else’s money.
The
saga of Mr. Iacocca’s pitch to the U.S. government for loan guarantees is well
known, but here is something we often forget. Chrysler was able to win
Congressional backing in 1980 because almost every congressman in America came
from a district propped up by the auto industry. Constituents from California to
Rhode Island were taxpaying members of the middle class because of a job in a
car factory, or a job as a supplier of auto parts, or a job selling cars.
“We’d
approach it like this: ‘Dear congressman from Utah. In your district here are
how many jobs [that] come from Chrysler, Mr. Miller said. He recalled former
House Speaker Tip O’Neill telling Mr. Iacocca that his desperate and successful
push for rescue financing was proof all politics are local.
That’s
because the car business was woven into every town in America.
Before
Mr. Miller’s time, in the 1950s, people would go to try to see behind big
sheets of paper that shielded the showroom windows at Dean Sellers in Detroit.
Somewhere behind that covered glass sat a freshened version of Ford’s
Thunderbird or Galaxie and kids strained for a sneak peek before the official
reveal. Back then, sheet metal was redesigned every year, hitting the market at
the same clip as today’s software updates for devices or the latest
binge-worthy series from Netflix. There is now far more enthusiasm for leaked
pictures of the next iPhone or details on the next line of business Amazon.com
. plans to disrupt.
We
still hold automotive chiefs in high regard. GM’s Mary Barra often tops a list
of most powerful women, for example, and Bill Ford headlines economic
conferences. Car enthusiasts aren’t extinct, but the industry—with the
exception of Mr. Musk’s Tesla Inc. —has handed the mantle of technological
leadership over to the likes of Uber Technologies Inc. or Google. Names like Jeff
Bezos or Mark Zuckerberg far outrank even the most successful of Detroit’s
recent CEOs, like Sergio Marchionne or Alan Mulally. Go ahead, name today’s
CEOs of each of Detroit’s Big Three.
Sure,
we are promised that the industry’s best days are ahead, but those days are
expected to involve automobiles where drivers aren’t needed. We’ll all be
traveling smartphones on wheels.
For
a hint of how things are changing, look at attitudes toward driving. The
percentage of teens with a driver’s license has tumbled in the last few decades
and more young people are delaying purchasing their first car—if buying one at
all. About a quarter of 16-year-olds had a driver’s license in 2017, a sharp
decline from nearly half in 1983.
Consumers
are far more likely to know what Apple Inc. unveiled at the latest Worldwide
Developers Conference in June or at a star-studded product event in March than
to be able to tell you what’s next for BMW or how much an electric car costs.
Or
consider the fading fortunes of the motor show. Detroit’s annual North American
International Auto Show, which was the toast of the business press and host to
outlandish vehicle reveals, is moving to summer from its customary January
dates.
Sure,
the weather will be better, but the main reason for the move is that it
couldn’t compete with the other corporate extravaganza in January: the Consumer
Electronics Show in Las Vegas.
BIRTHDAYS
THIS WEEK – Birthday wishes and thoughts this week to Tony Bennett (93),
Kevin Gallagher …famous NY Giant fan, Tom McGuire ….what can I say, The Man,
Barack Obama (58), Lauren Thompson (37).
MARKET
WEEK - Dollar Strength, Hold the Cheese: Since 1986, The Economist has periodically given
econ professors a chance to up their RateMyProfessor stats with the Big Mac
Index, a gauge of relative currency strength represented by McDonald’s Big
Macs.
How it works: It makes the concept of
purchasing-power parity...digestible. If one currency can buy something (like a
Big Mac) at a lower price than another currency, the first currency is
comparatively undervalued.
The most recent McStandings:
The euro: A Big Mac is now 19% cheaper
in the eurozone than in the U.S. Six months ago, it was 17% cheaper.
The Russian ruble: A Big Mac costs 65%
less in Russia, making the ruble the most undervalued currency vs. the
greenback.
The Swiss franc: A Big Mac costs about
14% more if you trade your fondue for Special Sauce.
This is about more than burgers. After
climbing 4% in 2018, the dollar has gained almost 1% this year. Politicians
from President Trump to Sen. Elizabeth Warren have criticized dollar strength
as a disadvantage for the U.S. in the global economy.
- The S&P 500 has fallen
every day this week, entering today's session following its worst four-day
stretch in two months. The index rose as much as 1.1% Thursday before closing
down 0.9%.
The yield on the benchmark 10-year U.S.
Treasury note, which helps set borrowing costs on everything from mortgages to
corporate debt, slid 0.14 percentage point to 1.894% yesterday, its largest
drop since May 2018.
U.S. crude-oil prices closed down 7.9%
Thursday, their biggest one-day drop since Feb. 4, 2015, as analysts worried
that slowing demand will lead to a glut. Prices are now down 19% from their
April highs and 29% below their 52-week high hit in October.
A look under the bun. Meatless patties
from Beyond Meat and Impossible Foods are selling like hotcakes. But some
nutritionists and customers are raising questions about the health benefits of
plant-based patties versus burgers.
Under water. Farmers in the soggiest
parts of the Midwest are facing the toughest year many can remember. The seed
and supply companies that rely on them are starting to suffer, too.
Packed for profit. Amazon has set new
packaging rules for food makers and most other companies that sell through its
site, aiming to waste less materials and shipping space—and cut costs.
ONLY IN CALIFORNIA
- A manhole will become a maintenance hole, artisans will replace craftsmen and
firefighters and police officers no longer will be identified by their gender
in Berkeley, California’s city code under an ordinance passed by city leaders
Tuesday.
The City Council voted unanimously to
replace more than two dozen terms often used in the city’s municipal code with
gender-neutral words.
“In recent years, broadening societal
awareness of transgender and gender nonconforming identities has brought to
light the importance of non-binary gender inclusivity,” council member Rigel
Robinson wrote in a letter to the council in March.
Berkeley’s current municipal code
contains mostly masculine pronouns, according to a city staff report.
“It is both timely and necessary to make
the environment of City Hall and the language of city legislation consistent
with the principles of inclusion,” Robinson said.
Broadening social awareness of
transgender and gender nonconforming identities has led to sweeping changes
across the state.
In 2014, then-Gov. Jerry Brown signed
into law a measure that replaced “husband” or “wife” in state law with the gender-neutral
term “spouse.” In 2017, California became the first state to provide a third
gender option on state driver’s licenses, identification cards and birth
certificates with the passage of Senate Bill 179.
Berkeley has also instituted some other
changes. In February, the city began extending the option to all employees to
receive a name badge with a preferred pronoun printed alongside their
professional title.
Anyone know of any real estate to buy in
Canada…I have to get out of here!
SIGN OF THE TIMES
- Median household income in the U.S. was $61,372 at the end of 2017, according
to the Census Bureau. When inflation is taken into account, that is just above
the 1999 level. Over a longer stretch — the three decades through 2017 —
incomes are up 14% in inflation-adjusted terms.
Average housing prices, however, swelled
290% over those three decades in inflation-adjusted terms.
Average tuition at public four-year
colleges went up 311%, adjusted for inflation, by his calculation. And average
per capita personal health-care expenditures rose about 51% in real terms over
a slightly shorter period, 1990 to 2017.
Wages stalled but costs haven’t, so
people increasingly rent or finance what their parents might have owned
outright. The unreachable goal for some: becoming a homeowner.
ON THIS DATE - Today marks 158
years since then-President Abraham Lincoln signed the Revenue Act of 1861,
which imposed the first ever federal income tax, during the first year of the
Civil War. ( A progressive income tax at that —taxpayers paid a 3 percent levy
on incomes between $800 and $10,000, and then a higher rate after that.)
DRIVING THE WEEK
- Monday: Earnings (Loews, Marriott, Shake Shack, Tyson Foods)
Tuesday: 74th anniversary of the
Hiroshima bombing; earnings (Disney, Discovery, HubSpot, Match Group, Planet
Fitness); job openings data
Wednesday: Samsung Galaxy Note 10
unveiling; earnings (Booking Holdings, CVS, Lyft, Monster Beverage, NYT, Roku,
TripAdvisor, Zillow)
Thursday: International Cat Day; DEF CON
begins in Las Vegas; earnings (AMC, Dropbox, Uber, Activision Blizzard, Kraft
Heinz), Roger Federer turns 38; PGA’s The Northern Trust begins
Friday: Producer prices data; first day
of the Hajj pilgrimage to Mecca; wipe down couch in preparation for National
Lazy Day
Saturday: National Lazy Day
SWAMI’S WEEK
TOP PICKS
–
NCAA RINK RATS COLLEGE FOOTBALL PRESEASON PICKS –
1).
Georgia Bulldogs
2).
Oklahoma Sooners
3).
Michigan Wolverines (pray)
4).
Clemson Tigers
5).
Alabama Crimson Tide
SCIAC –
1).
Chapman Argyros
2).
Redlands Bulldogs
3).
Cal Lutheran SATs
4).
La Verne Leopards
5).
Claremont-Mudd Republicans
Other –
St.
Lawrence Saints (6-4)
MLB Game of the Week – Saturday 8/10 7:10 PM ET: Cleveland Indians (66-45) vs. Minnesota Twins
(69-42). This is the weekend The
Twinkies begin to lose it in the American League Central. Tribe wins 8 – 6.
(Season to Date 4-1)
2019 Season
to Date (18 - 13)
Next Blog: Jackass of the Month and Words of the Month.
Until
next time, Adios
Claremont,
California
August
5, 2019
#X-5-394
2,790 words, five minute read
CARTOON OF
THE WEEK – “He Replied
All”, Admir Bilca
RINK RATS
POLL – Do you like OVER or UNDER?
____ Over
____ Under
____ Huh?
QUOTE OF THE
MONTH
– “Golf is not a game of good shots. It’s a game of bad shots.”
—Ben Hogan
Rink Rats is a blog
of weekly observations, predictions and commentary. We welcome your comments
and questions. Also participate in our monthly poll. Rink Rats is now viewed in
Europe, Canada, South America and the United States.
Posted at Rink Rats The Blog: First Published – May 3, 2010
Our Tenth Year.
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