Saturday Edition

Get the Blog Feed
What is RSS?

dispatches from the new world of work

Jennifer and Brad and Angelina and the Great Recession

New Zealand--Stingray in the surf

Is there a celeb magazine that doesn't cover Jennifer and Brad and Angelina each and every week? With the next story more outrageous than its predecessor? That's the way it feels from the grocery check-out line.

Well, it seems to me that the Eastern press is covering the Great Recession the same way—every story using adjectives more dire than its predecessors. To be sure, bad news piles on top of bad news. And every other day, it seems, GM or Citi needs another $10 billion of your and my money.

And yet there's more to the story of America in 2009 than the lurid webs spun by Chris Matthews, Lou Dobbs, & Co. And more to the U.S.A. than Detroit and Manhattan and the bookends of PA Avenue in D.C.

Lots more.

The news is bad in California, to be sure. The state's budget deficit is catastrophic. Foreclosures occur at the speed of light. But there's more to California than that.

Lots more.

Though I'm in New Zealand, I email California friends and read the daily papers from SF and San Jose, my stomping grounds for three plus decades.

The panic in CA is minimal.
There's a ton, or at least a half ton, of news about start-ups and staggering new technologies; it almost feels like business as usual.
The world continues to turn in CA.
The same world that's stopped turning—according to the East Coast press, the Washington Post and the New York Times and CNN and MSNBC, all of which resemble an economics National Enquirer these days.

We're in for a tough slog. Could go on for years. Yet entrepreneurs and incipient entrepreneurs and university research scientists and any number of companies (Oracle comes to mind) continue to embrace the future—at warp speed, as they have for years. (Such full speed acts of creation, smaller in number to begin with, were effectively AWOL during the Great Depression.)

There seems to be grave concern but little panic in California—remember, about 40,000,000 of us live there, though you'd never know it from the press, which seems to consider Michigan the western boundary of the U.S.A. And there's significant, though not grave, concern and no discernable or incipient panic in New Zealand.

Yes, I think we're in for a tough, tough slog, and a long one at that. But the Panic-from-the-East may be overblown—and thence, to some extent, perhaps to some great extent, it has the makings of a self-fulfilling prophecy.

I wish Mr. Obama would come to Stanford or San Jose. I wish Chris Matthews would return for a while to his beat at the SF Examiner. I wish Lou Dobbs would take a Zen class in breathing.

A friend sent me a Peggy Noonan column from last week. Okay, she lives in the East. But she made her bones as a Reagan speech writer—Reagan is the guy, most will recall, whose sunny disposition per se squelched the panic of the eighties. (That, and, I'd remind you, a whopping deficit.) My "a friend," Bo Burlingham, longtime superstar and spirit of Inc. magazine (and a liberal's liberal), all but ordered me to cast my eyes upon the column's final paragraph. I offer it below as the last words of this post:

I end with a hunch that is not an unhappy one. Dynamism has been leached from our system for now, but not from the human brain or heart. Just as our political regeneration will happen locally, in counties and states that learn how to control themselves and demonstrate how to govern effectively in a time of limits, so will our economic regeneration. That will begin in someone's garage, somebody's kitchen, as it did in the case of Messrs. Jobs and Wozniak. The comeback will be from the ground up and will start with innovation. No one trusts big anymore. In the future everything will be local. That's where the magic will be. And no amount of pessimism will stop it once it starts.

(The picture above, from a beach in Abel Tasman Park, is a stingray on patrol. Below, NZ's signature fern.)

New Zealand fern

Tom Peters posted this on 02/23/09.

Comments

Tom, thank you for sharing this. Here in the land of the contented cows (Switzerland) we seem to live up to east coast pessimism. Any coping strategies?

Why not try to focus on signal instead of noise (turn of the damn tv, trash what used to be "fit to print") and revel in the thoughts of the world's most brilliant minds.

Why not Kick-start optimism by reading John Brockman's "What are you optimistic about". A great compendium in which today's leading thinkers share why things are good and getting better. Read stuff like...

Chris Anderson: "The Unending Stream of Bad News Is Itself Flawed"
Daniel Goleman: "Transparency Is Invevitable
Oliver Morton: "The Coming Solar Power Boom"
George Dyson: "The Return of Commercial Sailing Vessels"
Tor Nørretranders: "Optimism Has a Bright Future"

In the age of doom and gloom let's not forget that there is a heckofalodda good stuff yet to come.

Best regards,

Steven Loepfe
loepfe@loepfe.ch

Posted by Steven Loepfe at February 23, 2009 11:49 AM

Certainly we should be aware of the problems - but nobody ever succeeded hiding under their desk. Here in New Mexico, I hear an increasing number of biz owners and entrepreneurs saying they're simply not listening to the "news" anymore. They're focusing on opportunity and how to work together.

People are still starting businesses and innovation is still happening. (duh-oh! Humans just can't help themselves! We love to look at a twig and see a tool...;-)

At the NM equity symposium this year, we've got 16 entrepreneur presenting to investors...and new technologies keep pouring out of our universities and labs. "From the ground up"indeed. Here in NM, we've got wildly creative types that live literally in the middle of nowhere. An Internet connection and they're good to go.

Posted by Mary Schmidt at February 23, 2009 11:49 AM

Tom,
A very timely article since I was reflecting yesterday on the sorry state of affairs with the media. The media has a practice of amplifying the events. When the world was crazy about the real estate and the economic boom, there was the news media that promoted life styles, options and everything under the sun which exacerbated the situation. Now in bad times, they are ready to right the death sermon. Life is going to be tough from all perspectives but the right attitude and commitment will prevail. Yes, you a need a lot of it in tough times and yes sometimes you may fail also but I don't think so that the other option of procrastinating and blaming everything else and being a parasite is acceptable and does anyone any good. It starts from You and it defines the Brand You.

Posted by Arvinder Singh at February 23, 2009 1:19 PM

Tom-

I wonder how much of the drumbeat of pessimism that's coming from the Eastern press is some sort of projection on the part of its writers who fear (and rightly so) that their economic world is coming to an end.

Personally, I can't think of a better time to launch a business. When will I be better able to differentiate my services from the rest of the market? When will there again be so many outstanding and concrete examples of how things shouldn't be done?

This crisis (and I don't mean to make light of those are truly in a bind) has been very liberating for me--the clarity that comes from contrast has given me the courage to take the steps that I've known inside for years that I must take to be true to myself.

Posted by Cole Coconino II at February 23, 2009 1:55 PM

To sum it all up,
let them eat cake.

Posted by dot at February 23, 2009 2:03 PM

I agree with the sentiment of the post and the comments. I have always believed that excellence comes from pursuit of pleasure rather than the avoidance of pain. Having said that, I do believe we need a good sobering. I, of course, focus on reading Michigan newspapers and it is a bit frightening. Was it Beckhard who pointed out that real change only happens when we are convinced our current path will lead to failure, we have reasonable first steps toward the change, and both of those have to overwhelm whatever rewards we are receiving for staying the same? I think that applies here. I think we have to embrace the severity enough to make real change...for instance, even as a down river kid, I would not send one dime of federal aid to Detroit until they completely overhaul their governance. I don't think the people of Detroit have grasped their problem enough to cause real change. So I say, a somber assessment, then an optimistic plan of approach that is not blind to our ills. Tough love comes to mind

Posted by Mike Neiss at February 23, 2009 4:05 PM

Tom - Fascinating post thanks - and brilliant comments. The best results I’ve ever had in my work; the most exhilarating times in my career; and the most creative I’ve ever been is when my back has been against the wall. When things are going along smoothly it’s easy to get complacent – we all do it. The most effective leaders insist on the highest levels of focus and maintenance of standards when things are going well. As my hero Sir Alex Ferguson says; "The players must be hungry - especially after winning trophies." I think we are at our most vulnerable when things are going well. That’s the time to be most aware of the fall we can take. I remain optimistic about this ‘crisis’ but not because of leaders. I have very little faith in political leaders or business leaders – they contributed more than most to the mess we are in. As Tony Benn says – “If you look for leaders don’t look up to a platform – look next door”

My greatest faith, as always, is with individuals doing great work at the front line; they try their best; they make things happen; and ‘twas ever thus – whether in a crisis or not. I know who I want beside me in the trenches among the muck and bullets in a crisis. It’s definitely not those managers who sit in offices (as Mary so perfectly describes – ‘hiding under their desk’)

Posted by Trevor Gay at February 23, 2009 6:42 PM

Big & bigger is where it is at! Big Wal$Mart, McDonalds, & Amazon are thriving. Big government in D.C. is thriving - 2.4% growth there vs. NYC which is shrinking 4.2% per the latest
BusinessWeek!

Big Amazon.com - super Big - on the cover of BusinessWeek as Number 1 in customer service - big Zappos.com is A material in customer service also!

The big 4 banks of B of America, Citicorp, JP Morgan Chase, & Wells Fargo knew if they stayed big they'd get big Barack bail out funds via the taxpayers because of the big recession - they are successfully using the too "big to fail" mantra of all things big!

Meanwhile the inept president with big ears rushes an opague $1T big debt load with his big democratic congress as lapdogs - to ensure the biggest recession in history!

Plus since the big liberal inept one's election the Dow Jones 30 are down 2500 big points! Big rules! Take down the world USA with big ineptness - or settle just for the UK for now since they are an easy target!

PS - when the revolution goes down in the street I trust Costco, McD's & Wal$Mart to cater it rather than hyper-drama-obama. :>)

Posted by C Love at February 23, 2009 7:07 PM

I agree with Mike's concept of change before cash. I have been doing some advocacy for working single parents and earlier this month spent a day at the State Capitol. I attended a meeting of the House Education Committee. This was like traveling back into time. As the legislators and experts worked to get their bills out of committee to the floor for a vote my mind said "What, are you kidding me? ", "Yeah, waste some more money on that leadership program that trained the administrators that are a large part of why schools are under performing today." "A consultants network? The last thing that is needed is more advice and more meetings." No one knows the challenges their schools face better than the Principal, teachers, support staff, parents, and patrons of that particular school. They need (expletive deleted) funds, time, and community support not another (5 expletives deleted) program for gosh sakes!" I was close to having a Howard Beale moment when they asked for public comment...I did manage to keep my self talk to myself for now.

Spending money on the same programs that haven't produced results is dumb and nothing is gonna change until those folks in government know we are gonna hold them accountable for results they produce. We need to put the "citizen" back in "citizen government" and we need to do it now.

Posted by Dave Wheeler at February 23, 2009 7:13 PM

Its great to see just how differently people are experiencing our world at this time of confusion and genuine change. My take on what is happening around the globe right now is pretty simple. I can not judge any other person's decisions, opinions, motivations, etc until I have worked or walked in their shoes.....

My immediate world & my community is currently under siege to Aust. Bushfires so it is hard to lift my head up at the moment. Today I have set out the fire hose and a plan for myself and the boys to defend our home until Friday. Then we plan to leave the place to the mercy of the elements. In general, my Yarra Valley community has been fantastic with self-help and with their willingness to share with others less fortunate.

Looking at the bigger picture for a moment, I see Government as the new Start-up and its forming a new bubble.

Move over Silicon Valley and Route 128 Boston the new start-up is Government. What did I just write? Can that be true?

Yes it is true!

Government in Washington (USA) and Canberra (Australia) are now constantly launching new stuff. Stuff that does not have a dedicated revenue model nor make economic sense in a rational world. But this is not a rational world. This is the irrational world bequeathed to us all by those who screwed up the global financial system - whomever they were.

The worrisome thing for little old me is that in this irrational world we have a Government Bubble looming. We have a set of public transfers of wealth, asset building, and "make work" programs that were not subject to rational analysis before their prototyping. Remember these are public sector prototypes not private sector ventures. But also note the only difference between the two really is that taxpayers not venture capitalists are funding these new Government led experiments.

What is truly frightening me right now is the "burn rate" (cost of operation per week/month/year) for these Government start-ups. What is patently clear already is that when Governments do Start-ups they burn hundreds of millions, even billions, of dollars. When private companies do Start-ups they have more modest "burn rates" of a few hundred thousand and later a few million dollars. Government Start-up "burn rates" are truly amazing.

Do you remember the fall-out from the Internet Bubble around 2001? Who can forget the fall-out from the Real Estate Bubble in 2008? What will the fall-out look like in 2015 from this Government Bubble?

Good luck to all of you... may you all find compassion in your heart for all those less fortunate than yourself and your family....

Posted by Richard Lipscombe at February 23, 2009 8:05 PM

There was a time where local communities provided their own sustenance and pleasure, i.e., food distribution, movie theaters, bowling alleys, housing, dry cleaning, clothing stores, tailors, etc. (Do we even mend anything these days? Are we the throw away generation?) Such is not the case now, though there is still a need. From local community, came innovation and cooperation. Yes, big box stores have created value and technology is great. But businesses that aide basic needs on a local level are also important, though not glitzy. Small businesses build community and hold each other accountable. You knew the baker and store owner.

The people in Detroit need to be held responsible for their own neighborhoods and the also need to hold their elected official accountable. When I worked as a consultant under the Archer administration I was quite vocal about these things. But these are problems to a greater or lesser extent in many cities nationwide. Personal responsibility and community activism are essential; they breed creativity and innovation. But we are progressively focusing on the internet community and video gamming that are less likely to build the kind of communities needed. Getting to know your neighbors through your kids may spark communal innovation and a palpable sense of making something happen. Encouragement is good.

I know Mike no longer lives downriver and some cities have always been more prosperous than others. But many many cities downriver most certainly have their own problems and ill-conceptions. While I do not know a whole lot about the governance of many of the much smaller downriver cities, save working with a non-profit down there that included some government interaction, the general area is considered by some to be the pit of metro Detroit. Perhaps residents in the prominent and progressive neighborhoods of Indian Village (I lived there) and Palmer Woods are also concerned about sending their dimes to those cities down river. (I am NOT, though I believe in responsibility and accountability.) There seems to be a serious lack of governance in some of the cities down there too. The problem seems pervasive nationwide, but repairable with an emphasis on the mindset embraced in this post and comments.

I will take your advice, TP, and turn off the news for a while. You are right on about the tabloid affect. It can be quite depressing indeed. I stopped watching local news altogether years ago for this very reason. It was sensational and all doom and gloom.

Posted by Judith Ellis at February 23, 2009 9:17 PM

Brangeliniffer strikes again...

You're right Tom. However, did you notice how miserable Brad Pitt looked last night? Let's not forget that Angelina used to be a certifiable wacko with Billy Bob. The tattoos, the vials of blood around the neck, the humpty-dumpty before the Oscars that one year. Brad is miserable; you can see it, you can sense it, and I'm sure that seeing Jennifer last night ate him alive.

I mean, every time Brangelina leaves the country, they come home with 3 or 4 new children. I feel sorry for the guy. He looks terrible.

I like the pictures too. Although I thought that was some of the NZ happy grass you encountered on your trip. I was disappointed to read that it was just a fern.

Here's a point to consider. Let's legalize drugs right now to pay down the deficit. Across the US/Mexico border there is a huge war rageing against the cartel and Mexican government. Legalize the stuff right now and tax it to death. Have the government control the distribution and pay down our debt to foreign countries. I'll smoke to that! We'll also understand C Love a little clearer if we're hangin' with the NZ happy grass!

Posted by Bach Anon at February 23, 2009 10:35 PM

Richard, thinking of you and your family. All the best, mate.

Posted by RobCH at February 24, 2009 7:11 AM

Great post! As a former news reporter (and I think most former news reporters would agree), I can say the media loves bad news because bad news grabs more attention, more clicks, more dollars, by and large.

That said, a CNN poll headline yesterday: "3 out of 4 Americans are scared about state of country." But buried in the article: 3 out of 4 also say things are going well for them personally. A perfect example of how so many other Americans are living like you Californians, but the media prefers not to focus on that.

Posted by Hayli @ Rise Smart at February 24, 2009 7:17 AM

Richard...all of us wish you well in that difficult situation. Be safe and be well

Posted by Mike Neiss at February 24, 2009 8:53 AM

pfizer viagra 100mg I can't agree more. As a serial small-business-starter-upper, I must say that the best of times for me has been times like this--- low overhead goes a long way, and a little cash even farther.

The "News" has alway been about bad things-- that makes it news. What's different is how long our cable news outlets stay with a story. They've adopted "Entertainment Tonight" and the old "A Current Affair" as models.

I bet CNN had a lot easier time making money back when it didn't have high paid stars and didn't shout a lot.

Posted by Brien Lee at February 24, 2009 9:03 AM

richard, our thoughts are with you.

Posted by erik at February 24, 2009 9:09 AM

If only a shred of this thinking could catch on, Tom...

Yes, the economy is volatile right now; but clients are still in need, money is still available, and many goods and services may – if framed correctly – be more valuable than ever before. For those bold and determined, this is “our time to shine,” not “our time to hunker down and hope for bread crumbs.”

Never let ourselves kid each other that there’s no business out there right now. There is.

Mi dos centavos (that’s “my two cents” for you non-hispanic learned northerners…):

1. Identify strong prospects and pursue them. Vigorously. Now’s the time to remember that “NO” is always the answer to a question we don’t ask…

2. Most competition is retreating, particularly in the services space. So be bolder and more aggressive. Bull-shit counts right now. Bravado works.

3. Nail your brand. Raise your image. Speak, write, publish, network, glad-hand. It’s varsity-level activities now, so invest big.

Further, there's a good adage that says “…continued business growth and success required calculated risk taking…”

This isn’t necessarily new thinking, of course, but I believe it’s incredibly relevant in our current times.

They say that the definition of insanity is “…doing the same thing over and over and expecting different results.” Are we guilty of that? In today’s conditions, are we still getting all we need from our business – personally, professionally, financially – by doing exactly what we’ve been doing, only “hoping harder” that it works? Or even “trying” harder while doing the same things?

Or, is it time to take some “calculated risks?” And do we need to re-calculate our risk-measurement also? In other words, today, if something is a little riskier, does that mean it’s any less viable a consideration?

Things that make you go hmmm...

Posted by Kevin Berchelmann at February 24, 2009 12:37 PM

Kevin - Thanks for that - much appreciated.

Channeling Arsenio, eh? :-)

Posted by Judith Ellis at February 24, 2009 4:30 PM

The media have always been in the business of bad news. Who was it that said "good news does not sell papers"?
The journalists are only mirroring. They are not there to revolutionise (in the main). Banks have created 'wealth' from nothing and it has disappeared the same way, is it any wonder?

Everything begins with inspiriation. Without that spark nothing gets done or is achieved. Most execs seem to routinely display 'sheep-like' tendancies througout most downturns in their market or their perceived market share.

What is needed right now is the contrarian view, like Tom Peters and others. They have consistantly challenged the 'Conventional Wisdom' be that recession or boom.

Mr Peters may you live forever! brand viagra on sale in canada

Posted by John Burke at February 24, 2009 5:02 PM

I don't see the news as all that bad.
The economy is a wreck, but most people in the US (and the world) support Obama.
Americans like the man and it is well deserved.
As for Reagans sunny personality, why did his kids seem to hate him so?
And why do his political so hateful?
Reagan had a sunny personality like John Wayne was a real war hero.

Posted by dot at February 24, 2009 5:30 PM

"Mr Peters may you live forever!"

I second this wholeheartedly!

Posted by Judith Ellis at February 24, 2009 5:47 PM

Thank you all for your well wishes - it makes a real difference to know that people have stopped to think about my little community of the Yarra Valley with all the pressures faced by all of you in your own lives.

A special thanks and my best wished back to Judith (we are still going well here thanks), RobCH (we appreciate your support mate), Mike Neiss (we will take the care you urge thanks) and erik (mate, in a weird sense I wish you were here to witness this event because throughout the length and breadth of my little community there are true stories of leadership, mateship, giving, sacrifice, union, and cohesion that you could report on. Thanks erik for your thoughts).

In reference to this post let me tell you that when your community is the story of the day, week, and month it is very different to knowing someone, who knows someone, who might have been ..... There is a truth about the stories here that is tangible... There is a quality about the simple acts of heroism that is amazing - people do heroic things each and every day here right now and yet all they will tell you about it is they were simply doing their job. When you have real drama, upheaval, change, misery, suffering, hurt, & purposeful determination in your life - you don't feel the urge or need to read papers, magazines, watch TV, etc. My community might be less well informed than ever before about the events of the world and yet they are more united and optimistic than I can ever recall. Go figure...

Posted by Richard Lipscombe at February 24, 2009 7:07 PM

"Mr Peters" - please - those with a slow learning curve - it is Dr. Peters - time to drink more CL Cool Ade with Siberian ginseng & GABA, et al.

Posted by C Love at February 24, 2009 7:12 PM

Richard - This is indeed good to know. When the fires began I thought of you and just wanted to send you my best wishes. As you know, I lived in Australia for almost a year and love the country.

"You don't feel the urge or need to read papers, magazines, watch TV, etc."

This seems precisely the relevance of this brilliant post and the recent other. We are indeed in a major global crisis with potentially profound consequences the likes that we have never seen.

This post is a call to action, a building of community, a need for ingenuity and a spirit of determination.

Posted by Judith Ellis at February 24, 2009 7:34 PM

Judith - this post is a call to Madness & you know it - including your Mr Peters faux pas - you are almost as psycho as the Dr. - a blessing & a curse. :>)

Posted by C Love at February 24, 2009 8:47 PM

C "Love" - Vous etes une plaisanterie.

Posted by Judith Ellis at February 24, 2009 9:44 PM

A friend told me that we are experiencing the end of business as usual. From my perspective, it is the end of society as an institution dominated community. The institutions that we've all depended upon to sustain society are not able to sustain themselves now. We are in a time of transition into a new world that is being born.
What is replacing it? Social networks that organize to meet the opportunities and challenges of society. I'm talking with two communities where their legacy institutions are no longer leading. They are hunkering down to defend what little territory they have left. We are talking about creating local business social networks that lack institutional boundaries, yet are organized to solve problems. The scheme is built around the good will of people to care for their community. To give back by creating new relationships of strength. It is individual initiative focused on immediate community needs. The principle activity is a leadership training event for business and middle managers that raising money for charity. The idea addresses two realities. One is local need for charity care is growing in every community. Two, institutions don't do leadership training for managers, directors and supervisors. New employee orientation isn't leadership training. In-service sessions tend toward information distribution. The impact of this approach is new working relationships within a community to serve the needs of the worse off, while strengthening the strategic ability of local businesses to grow. Old legacy institutions aren't doing this.
Here is where I see dynamism happening. It gives me great optimism because what I see is how little meaningful connection is happening in local business communities. All is not lost. Hope is in your own initiative to make a difference. And that is one thing that has not changed.

Posted by Ed Brenegar at February 26, 2009 8:39 AM

Ed - Thank you very much for that. There's a lot to think of there.

Posted by Judith Ellis at February 26, 2009 9:28 AM

I disagree. Where do you all live? Churches are losing donations and may close some of their "soup kitchens" because future donations have diminished. One thousand more dollars per month will be taken from many pay checks. (Remember two hundred fifty thousand dollars a year is not much on either coast where the majority of the population reside, but it buys a lot more in Illinois.) Many people will no longer be able to afford to send a child to college. I am not for Obama; he is driving corporations overseas where there is a more conducive environment. The U.S. will lose more jobs and more tax revenue. Do you remember when gold was pegged to around 35 dollars an ounce and it was illegal to own gold? I wonder when Obama will try to bring that back? Rome fell when it devalued its money by putting lead in the gold coins. Those who do not know history are doomed to repeat it. Funny, and I thought you were an avid reader. Fear is not always bad. It serves to warn.

Posted by Sam at February 27, 2009 1:25 PM

Tom,

You mention Oracle "embracing the future at warp speed" in this post. The same Oracle has been the biggest (in terms of $ value) and largest (in terms of number of companies) acquistion/merger player in the market. Their website http://www.oracle.com/corporate/acquisition.html lists 11 acquisitions in 2008 alone while there are multiple other companies which it has invested in. There are companies like BEA, Peoplesoft, Siebel which have been taken over by Oracle in the recent past.

You have never been much in favor of companies that take that trajectory - in your recent post about Westpac the same point is highlighted as well. So is there a change in belief for Oracle?

Thanks,
Nitin
http://nitnblogs.blogspot.com

Posted by Nitin Goyal at March 2, 2009 2:54 AM