*michael parekh on IT*

ON HOT WHEELS SMOKIN' AGAIN

ONCE UPON A TIME

This one is from the nostalgia bin, a Newsweek piece on how the iconic Hot Wheels of our youth, is really on a roll these days, as this Newsweek piece reminds us:

"In the fad-driven fantasyland of toys, Hot Wheels has had an incredible ride. Those pocket rockets have been racing down their familiar orange tracks for four decades now and, unlike the real car market, show no signs of slowing down.

Last year Hot Wheels set a record, as sales surged by 16 percent, and they continue to accelerate in 2008 even as the economy tanks. In fact, as Motown melts down, Hot Wheels is heating up. The tiny toy cars' parent company, Mattel, now has a market capitalization that surpasses General Motors. That's right—Wall Street thinks the maker of toy cars is worth more than the largest real carmaker in America."

The secret of their resurgence is the reconnecting customers with their past and finding ways to connect with their kids:

"The brand is riding a hot streak because it reconnected with little boys and their fathers. "Dads would see the old blue box and say, 'I remember those'," says Larry Wood, a former Ford designer who started penning Hot Wheels in 1969 and constituted the entire design staff for much of 1970s...

"...about three years ago, Hot Wheels returned to its roots—simple tracks that snap together quickly and fast cars that excite 5-to 8-year-old boys just coming out of their Thomas the Tank Engine years. "We were trying too hard to push the brand older," says Tim Kilpin, the Mattel senior VP who steered Hot Wheels back to basics. "We had to make it cool for the right-age boys."

What's interesting also is the strong connection between the makers of the toy cars and the real cars:

Hot Wheels takes no pleasure in Detroit's pain. "We need Detroit to exist for us to be successful," says Walker. After all, Hot Wheels bestsellers remain replicas of classic Detroit iron. For decades, Motown has shared its top-secret blueprints of upcoming models with Mattel so that the Hot Wheels and real-wheels versions could debut simultaneously.

That's happening again in November at the L.A. Auto Show, when Ford unveils a new design for its Mustang. As soon as the wraps come off the candy-red pony car, the journalists covering the introduction will be handed the 1/64th-scale Hot Wheels replica with a matching paint job. "It helps sell the real thing,"

It's nice to see something still working for Detroit despite it's current litany of woes.

ON A GLOBAL OBAMA ENDORSEMENT

EITHER OR

It's been one long election season, almost two years long, and a lot of us are glad that Election day is a scant five days away. 

There have been a lot of endorsements for both McCain and Obama, and many of us, regardless of party affiliation or position (right, left or center) are struggling with a lot of issues related to both candidates*.
One endorsement that caught my attention today was that of The Economist, an international publication I've read and respected for a very long time.
Probably not surprising, given that it's an "international" publication, and the rest of the world has all but elected Senator Obama for President already, the wise folk behind the Economist have cast their vote for Obama as well.
But it's their thought process that had me nodding in agreement in various places, starting with their hesitation with choosing Senator McCain, despite his record as a relatively moderate Republican:

"...the Candidate McCain of the past six months has too often seemed the victim of political sorcery, his good features magically inverted, his bad ones exaggerated.  The fiscal conservative who once tackled Mr Bush over his unaffordable tax cuts now proposes not just to keep the cuts, but to deepen them. The man who denounced the religious right as “agents of intolerance” now embraces theocratic culture warriors. The campaigner against ethanol subsidies (who had a better record on global warming than most Democrats) came out in favour of a petrol-tax holiday."

They go on on what voting for McCain would mean for moderates:

"Ironically, given that he first won over so many independents by speaking his mind, the case for Mr McCain comes down to a piece of artifice: vote for him on the assumption that he does not believe a word of what he has been saying. Once he reaches the White House, runs this argument, he will put Mrs Palin back in her box, throw away his unrealistic tax plan and begin negotiations with the Democratic Congress."

The Economist then goes on to ask the same question of Obama's candidacy, especially in a global context:

"Is Mr Obama any better? Most of the hoopla about him has been about what he is, rather than what he would do. His identity is not as irrelevant as it sounds. Merely by becoming president, he would dispel many of the myths built up about America: it would be far harder for the spreaders of hate in the Islamic world to denounce the Great Satan if it were led by a black man whose middle name is Hussein; and far harder for autocrats around the world to claim that American democracy is a sham. America’s allies would rally to him: the global electoral college on our website shows a landslide in his favour."

And then go to make a powerful point on Obama's accomplishment to date, with my favorite line in the whole piece (marked in bold):

"There is no getting around the fact that Mr Obama’s résumé is thin for the world’s biggest job. But the exceptionally assured way in which he has run his campaign is a considerable comfort. It is not just that he has more than held his own against Mr McCain in the debates.
A man who started with no money and few supporters has out-thought, out-organised and outfought the two mightiest machines in American politics—the Clintons and the conservative right."

They go on to articulate the one concern most moderates and independents would have choosing Senator Obama:

"Our main doubts about Mr Obama have to do with the damage a muddle-headed Democratic Congress might try to do to the economy. Despite the protectionist rhetoric that still sometimes seeps into his speeches, Mr Obama would not sponsor a China-bashing bill. But what happens if one appears out of Congress?
Worryingly, he has a poor record of defying his party’s baronies, especially the unions. His advisers insist that Mr Obama is too clever to usher in a new age of over-regulation, that he will stop such nonsense getting out of Congress, that he is a political chameleon who would move to the centre in Washington. But the risk remains that on economic matters the centre that Mr Obama moves to would be that of his party, not that of the country as a whole."

The piece ends of course with their endorsement of Senator Obama:

"So Mr Obama in that respect is a gamble.
But the same goes for Mr McCain on at least as many counts, not least the possibility of President Palin. And this cannot be another election where the choice is based merely on fear. In terms of painting a brighter future for America and the world, Mr Obama has produced the more compelling and detailed portrait. He has campaigned with more style, intelligence and discipline than his opponent. Whether he can fulfil his immense potential remains to be seen.
But Mr Obama deserves the presidency."

We're in uncharted waters in so many ways, especially given the extraordinary perfect storm of global forces that promise to keep the economy and financial markets deeply unsettled for a long time to come.  Not to mention all the uncertainty of our long-term standing in the world to come.
The Economist has made it's choice. 

One may disagree with their decision, but the process by which they made it is pretty sound.

*image source.

ON TRANSPARENT CALORIES

LIGHTNESS OF BEING

One of my hard-earned accomplishments this year has been to lose dozens of pounds and get to a weight I haven't been at since my twenties.  There was no magic process, just a disciplined approach to eating better, exercising, and most important, counting calories.

A medically supervised diet incorporating a daily net calorie deficit, was probably the most important driver for success.

It'll be especially important to keeping the weight off over the coming months.  As most folks know through painful personal experience, losing the weight is generally the easy part, keeping it off is the hardest.

The New York Times had a timely article today titled "Calories Do Count", that emphasize this obvious point on calorie counting, especially given how mainstream servings in restaurants and grocery stores tend to be more "Super-sized" than not:

"For the last few decades, the most popular diets were complex formulas that promised abundant eating with just the right combinations of fat, protein and carbohydrates. Now those regimens are starting to look like exotic mortgages and other risky financing instruments. And just like a reliable savings account, good old calorie counting is coming back into fashion.

“More and more, people are looking at calories in, and calories out,” said Dr. Terry Eagan, a Los Angeles psychiatrist, who for 16 years has helped people with eating disorders and other addictions. “I know some people want something that’s sexy and different and new, but there really isn’t anything new about weight loss.”

As a New Yorker, I'm glad the city has rolled out some initiatives to make counting calories a more transparent process:

"New Yorkers got a harsh dose of calorie reality this summer when restaurants with 15 or more outlets were forced to post the calorie content of food next to the price. The resulting sticker shock has brought parts of a great city to its knees, often to do push-ups.

The campaign has inspired lawmakers around the country to follow New York’s lead.

Restaurants and food companies are lightening recipes and portion sizes. Starbucks, for example, claims to have saved the nation 17 billion calories since last October by swapping 2 percent milk for whole. The 100-calorie snack is this decade’s answer to the fat-free SnackWell cookie, as more brands introduce tiny portions of things like Cool Ranch Doritos and Clif bars."

It's a trend that's good for America.  We all just need to start paying attention to the basics on the calorie front just as we're also reminded to pay attention to the basics on the financial front.

ON THE FESTIVAL OF LIGHTS

CELEBRATIONS

About a billion folks, most of them in India, are celebrating Diwali, aka the Festival of Lights, today.  As Wikipedia explains,

"Diwali (or Deepavali) is a major Indian holiday, and a significant festival in Hinduism, Sikhism, "Buddhism, and Jainism. ^[3] Many legends are associated with Diwali. Today it is celebrated by Hindus, Jains, and Sikhs across the globe as the "Festival of Lights," where the lights or lamps signify victory of good over the evil within every human being. "

It's the equivalent of Christmas in India today, and so a big day of celebration across the sub-continent. 
The recent global financial crisis has not left India untouched, and this post by Asit Barma, on the current mood on the ground in India, is worth noting:

"With the global stocks plummeting , and a free fall of BSE sensex driving it into the blackest phase in recent times , and the general uncertainties in Job market,... Diwali 2008 is no doubt has been one of the most frugal and spiritless Diwali.
The lights and candles did not seem to have ushered in much hope of recovery."
We too may have a similar mood to look forward to as we approach the big holidays in late December.  But regardless of the ups and downs of the markets and the economy, one needs to keep in mind the bigger import of these celebrations.  As Asit continues to note in his post:

"Can we now vow to celebrate Diwali with its essential aspects of promoting peace and brotherhood..."

Amen.

Happy Diwali everyone, and best wishes for the New Year.
* Image source one and two

ON THE PRIVILEGES OF A SENATOR

DIFFERENT STROKES

Senator Ted Stevens of Alaska, of the "Internet is a Series of Tubes" fame, got some bad news on the legal front today.  As the Wall Street Journal reports:

"A federal jury found Alaska Republican Sen. Ted Stevens guilty today of accepting and concealing tens of thousands of dollars in free home renovations and other gifts, a felony conviction that likely spells the end of a legendary Senate career..."

"The jury convicted Stevens on all seven counts brought by federal prosecutors..."

"Stevens is only the fifth sitting senator ever to be convicted of a crime, and the first since 1981. The verdict comes just eight days before Election Day."

What happens to Senator Stevens in the context of a tight upcoming election for him, and his fate in the Senate should he be re-elected for a seventh term, is an interesting question:

"If Stevens is re-elected and chooses not to resign, the Senate eventually will hold hearings to decide if he should be expelled. Traditionally, however, the Senate has not initiated that process until a lawmaker has exhausted his legal options on appeal, a process that could take several years.

The verdict further damaged Senate Republicans’ prospects to hold onto Republican-held seats when voters head to the polls next Tuesday. Democrats currently hold a 51-49 majority in the Senate, which is expected to grow by at least three to four seats."

This New York Times article adds more detail:

"Despite being a convicted felon, he is not required to drop out of the race or resign from the Senate. If he wins re-election, he can continue to hold his seat because there is no rule barring felons from serving in Congress. The Senate could vote to expel Stevens on a two-thirds vote."

Which of course, is not likely to happen any time soon.

We all know if something like this happened to the CEO of a major public company.  He or she'd be gone in the blink of an eye.

The rules do seem to be different for our elected leaders in Congress, regardless of party.

ON OUR ELECTORAL FATE

IT IS WRITTEN

Ten days before the Election, as every American citizen ponders their vote in these difficult times, this op-ed by Gail Collins raises a question on the mind of many voters*:

"I think it is about time for our quadrennial rant about the Electoral College.

Here we are just a little more than a week away from one of the most important elections in modern history, and most of us are beside the point, our states long since written off as hopelessly red or blue.

This is the time of year when parents from New York to Alabama ask the experts: How old should my child be before I tell him that his vote doesn’t count?

Do I wait until she’s in high school to break it to her that if she decides to plant her roots in California or Utah, her role in presidential elections will be less significant than her voice in deciding who should be eliminated in the next episode of “Dancing With the Stars”?

As we all know, in America the president is actually chosen by an Electoral College of 538 members. This was a system devised by the founding fathers, who got the idea from ancient Rome, where democratic government worked exceptionally well.

The electors are chosen by the states, winner take all. The only exceptions are Maine and Nebraska, which divvy their electors up more or less according to the popular vote."

Maybe the right thing is for all of votes caught in the "wrong" state for our political dispositions need to move to states like Ohio or Florida every four years.  Then of course we'd have both the individual and national suspense of whether our vote truly counted.

As Gail goes on to point out:

"Now, it appears that John McCain has decided that it is once again all about Florida. The Democrats, in response, have created the Great Schlep, in which Jewish youths are supposed to go to Florida and talk their grandparents into voting for Obama."

By the way, if you haven't yet caught the Great Schlep by comedian Sarah Silverman, it's worth checking out, regardless of your political dispositions. 
The Great Schlep from The Great Schlep on Vimeo.
And remember, don't write off your vote, even if you're stuck in a state whose vote has already been written.

*image source.

ON BALANCING DEMOCRATS AND REPUBLICANS

HOUSES DIVIDED

According to many observers of the Presidential race, the McCain camp has long had the opportunity to try and appeal to the critically important block of moderate and independent voters with the following argument.  Elect a Republican to the White House, if only to provide a counter-balance to a pre-dominantly Democrat controlled House and Senate as this Mercury News piece describes quoting John Feehery, a GOP strategist:

"Republican leaders are also making the "divided government" argument — that only McCain can block excessive spending and higher taxes from a heavily Democratic Congress.

Former House Speaker Newt Gingrich warned this week of an "Obama-Pelosi-Reid machine," referring to Speaker Nancy Pelosi and Senate Majority Leader Harry Reid.

"McCain should have been making that argument six months ago, but he didn't," Feehery said."

Some of these observers are in turn frustrated that this tack has not been taken by the McCain campaign, focusing instead of stepping up attacks against Obama, and scaring up votes in the "Real America", wherever that might be.

But if this Barron's assessment is validated in a couple of weeks, the argument of an all Democratic House and Senate may not come to pass.  Here's their take on it:

"How big a rout will it be? My estimate -- based on campaign fund-raising data, demographic trends, voter registrations and kibitzing with some venerable experts -- sees the Republicans dropping by 27 seats in the House and five seats in the Senate.

Democrats pick up those 27 House seats, of course, plus one vacancy, along with the five Senate seats.

Result: The Democrats will hold 263 seats in the House, versus 172 for the GOP. The Democrats will have 56 seats in the Senate, including two independent members who caucus with them, versus 44 seats for the Republicans.

But even with their larger majority, the Democrats won't be running a legislative express train. In the House, 49 fiscally conservative Blue Dog Democrats easily could join with Republicans to stymie any big tax increases or stabs at centrally planned industrial policy.

Over in the Senate, where one member can stall a bill, Republicans and Democratic outliers like Connecticut's Joe Lieberman will remain a significant barrier to Democrat aspirations to nationalize health care and redistribute income from the top 1% to everyone else.

In short, divided government will remain alive and well."

Granted, there are other assessments, equally credible, that the races will go more against the Republicans than expected by Barron's.  But they currently still seem to have a better shot than the Presidential candidate from the Party.

ON A TOUGH PATH FOR NEWSPAPERS

READ ALL ABOUT IT

It's a dramatic headline to be sure, as the Wall Street Journal announces "Star-Ledger Newspaper says 40% of staff to leave".  Here are some details:

"The Star-Ledger newspaper in New Jersey said about 40% of its newsroom staff will depart in a buyout wave, among the steepest cuts in the continued downsizing of the newspaper industry.

The Star-Ledger earlier this month said it had secured enough buyout offers and labor concessions to ward off a threatened sale or closure of the paper, the country's 15th-largest by weekday circulation. Executives signaled they wanted about 200 people to depart, but the number of buyout requests was reported to exceed that number."

The news is notable in what it portends for the rest of the newspaper industry, which has long been struggling with the secular challenges to it's business model from the internet, and of late with the weakening Economy and it's obvious impact on the industry's advertising revenues.  As the WSJ piece goes on to observe:

"The newspaper industry has slashed thousands of jobs this year as advertising sales dwindle. Gannett Co., which publishes USA Today, said Friday it is looking at its second round of job cuts this year. Tribune Co., McClatchy Co., and New York Times Co. also have significantly cut back news staffs in the last year. On a percentage basis, the Star-Ledger's cuts are among the stiffest at major newspapers."

As the industry grapples with these difficult issues, it will also have to cope soon with the other problem after the inevitable down-sizings occur.  As the Editor of the Star-Ledger, Jim Wilse puts it,

"The task now, is to figure out a way to make a good newspaper with a 40% smaller staff."

Easier said than done for sure.  But it's something a lot of newspapers are going to need to figure out over the near term.

* Image source.

ON CHANGING WORLD VIEWS

SHOCK AND AWE

It's said that if one lives long enough, one will pretty much end up seeing everything.  Long-time market-watchers will likely have that reaction watching former Fed chairman Alan's Greenspan's comments today on Capitol Hill, as this Wall Street Journal piece reports:

"Former Federal Reserve Chairman Alan Greenspan said he “made a mistake” in believing banks and others would protect their shareholders and own firms’ equity. He was “shocked” to learn of the breakdown in lending standards and risk management at the firms that lead to the current credit crunch.

“I still do not fully understand why it happened and obviously to the extent that I figure where it happened and why I will change my views. If the facts change I will change,” he told the House Oversight Committee.

Rep. Henry Waxman, chairman of the committee, challenged Mr. Greenspan and asked “You found your view of the world…was not right?”

Mr. Greenspan admitted that he “found a flaw” in his ideology and “that’s precisely the reason I was shocked.”

Professionals in the financial markets always look for signs of capitulation in bear markets.  Greenspan capitulating as it were on his world view of deregulated (and presumably self-regulating) markets, is one whopper of a capitulation.  A landmark event of some note indeed.

ON HARNESSING SOCIAL NETWORKS

CONNECTING THE DOTS

The Guardian has an interesting piece on how today's social network technologies may be leveraged for government sponsored Homeland Security/Military applications:

"...a group of scientists and military officers...have helped build a new social analytics tool that identifies and automatically uncovers intelligence to help military personnel perform better in the field.

SRI International based in Menlo Park, California, teamed up with military officers to build a new social analytics tool called iLink that generates models and helps streamline the process by which a specific expert in an online community can be found.

In simple terms, iLink is a machine learning-based system that models users and content in a social network and then points the user to relevant content."

The article goes on to explain how this work is already being re-tasked for consumer and business social networks:

"Looking beyond the military, the applications for this kind of smart social networking technology are broad and diverse. The two SRI scientists are planning to spin off the technology into a startup to be called Social Kinetics. The team is currently working on a healthcare application.

And with the demand for social networking growing – estimates for social networking users in the US alone by 2012 is expected to hit 92.2 million, according to In-Stat's Hitwise research service – the commercial benefits to businesses and individuals could be immense."

Looks like we may have the basis of making social networks a whole lot more useful for mainstream users.