Telling It Like It Is

THE ENTERPRISE--ANOTHER YEAR ENDS

THE ENTERPRISE--ANOTHER YEAR ENDS--WITH A SHOCKING ASSASSINATION

I've been asked what I think about the repercussions of Benazir Bhutto's assassination.  I am not an expert, so I will call on the experts at Stratfor and share their first take on the situation.

PAKISTAN: THE FALLOUT AFTER BHUTTO’S KILLING (Excerpts from a review ©Stratfor.com)

   

The killing of top Pakistani opposition leader Benazir Bhutto triggered a storm of political unrest.  Only time and military intervention will calm.. For now, Pakistan People’s Party activists are rioting against government and rival parties in Punjab and Sindh provinces . Soon this violence will lead to clashes between various groups. The situation already is getting out of hand for the police, and it is likely that  military forces will be needed to quell the disturbances.
    Given that the country was already going through a period of significant instability and the unprecedented jihadist insurgency, questions remain about whether the army will be able to gain control of the situation quickly. Bhutto’s death creates a major vacuum in Pakistan, and will make it difficult to stabilize the situation since her Pakistan People's Party--the only true national-level party--is going to weaken without her. This will lead to a fragmentation of the political landscape and by extension the country.
    It is highly unlikely that elections can be held any time soon, and the imposition of martial law is also a distinct possibility. Meanwhile, the polarization of the country --  Islamist forces are struggling with mainstream ones and the pro-democracy forces are competing with authoritarianism  --  further complicates matters. Army chief Gen. Ashfaq Kayani could step in and take charge, but he will have to carefully work with an array of civilian forces because direct military rule could worsen the situation. There is the potential for Pakistani President Pervez Musharraf, to see Bhutto's death as an opportunity, to become a new military junta.
    Either way, a cooling-off period will be required before stabilization can be achieved.

Stratfor has superb coverage of such events and their nuances.  For more info go to http://www.stratfor.com.

This could alter the dynamics of the US Presidential races too!

WHAT'S HAPPENED--GOOD OR BAD?
The change in political control of Congress did little--no, make that nothing--to improve our country.  When can you remember a more lame set of leaders than Nancy Pelosi and Harry Reid.  This reflects the problem of "incumbentitis" in the House and the negative power of the "Good Old Boys (and Girls) club in the Senate.  Incumbents get reelected to the House far too often because they are the easy, familiar choice, and not because they are the better choice.  In the Senate, tenure is king.  The longer you've been around, the more deals you've made, the more power you can wield on important committees--the more likely you'll have power that either corrupts or "inepts" (if that's proper English) the  legislator.

From RealClearPolitics.com--info as of 12/19/07:
President Bush job approval 35%; Congress job approval 25%.
What does this say about our government?

TERM LIMITS--IT'S TIME
I have no idea what member of Congress will have the nerve to bring it up, but it's time to get rid of octogenarian legislators who've never done anything else in their adult life.  Our Congress was intended to be made up of citizens who have lived, worked and existed outside the "Beltway."  It's been corrupted by politics and power and special interest money.    Here's the deal.  12 consecutive years is enough time to really do a job well.  That's 6 terms for a Congressman, and 2 terms for a Senator.  A total time in Congress of 18 years would permit a Representative to serve 3 terms and then be elected a Senator and serve two terms.  Now, who, in Congress has the nerve to propose this?  Or would one of the Presidential candidates like to step up?  After this one, they can take on Social Security and Medicare entitlements, which will then be a piece of cake.

THE PRESIDENTIAL PRIMARIES--ALMOST HERE
I don't have a clue who's going to win.  The one, almost inescapable conclusion, is that people are tired of hearing the candidates spew "positions" and want "hope."  Look at the two who are surging:  Barack Obama, who is seemingly a good man, with little experience at anything except writing and speaking well--perhaps that is enough if he'd surround himself with talented staff representing a wide range of policy positions.  It worked for an actor named Reagan.  Hillary's true nature and flaws are being exposed more and more each week.  Edwards is just hanging on.

On the other side, Mike Huckabee's direct, honest and in your face religious positions have raised the question of how much religious beliefs enter into this thing called politics.   Huckabee may be coming on strong, but the faith stuff backfired for Bush.   Is there more...or less...to Huckabee than meets the eye?  Or both?  I still think Mitt Romney's the most qualified candidate (but eeek...he's a Mormon?  So what?  What are all the others?  One religion or another--or none?)  But Romney is coming under pressure for his shifting positions in the past.  This, along with Huckabee's surge, could torpedo Romney's bid. Rudy Guiiani's lead is slipping under pressure from 3 fronts.  He'd be my pick to go head to head with Russia's Putin--but Rudy has a lot of skeletons in his closet--and he rubs a lot of people the wrong way.  Fred Thompson should go back to "Law and Order" where he was comfortable and good.

And, ah yes, the hero--John McCain--is rebounding a bit. He  has suffered more and given more of this life for his country than most of the other candidates added together.  McCain deserves more than a little respect.  Does he deserve to be President?  Maybe--but we'd better pay closer attention to the VP choice than normal.  One of McCain's lines during the (silly) "debates" is still ringing in my ears.   He said, "I'd rather lose an election, than lose a war."  That is the kind of character, courage and fortitude that could lead our country back where it belongs.  Maybe those debates do reveal character!

Soon the chips will start to fall in place.  Until then we can only watch.

OUR UNIVERSITIES ARE ALSO CORRUPTED--BUT DIFFERENTLY
I know some brilliant professors.  Some are teachers, some are researchers, and some do consulting as well.   These make up, at most 20-25% of the population in our Colleges and Universities.  As in all things,  these institutions need to be pruned and changed.  The teaching model was crafted centuries ago when the "wise man" would hold forth in the classroom to a widely varied (but much smaller) group youthful students.  Now our universities are poisoned with rampant liberal politics being postulated and the "absolute truth" when it is largely misguided poppycock, being purveyed by people who could not make a positive impact in other parts of society.

It's time to change the college level educational model.  A few places it is happening, but not widely enough.  The power of communications technology now allows education to be customized and tailored to the level of students--sorry but all students, like all professors do not come equally qualified.   Sort them out and teach them at their level--and keep the political commentary and discourse limited to pass-fail (for showing up) courses that are offered with a disclaimer:  the opinions of the professor in this class are his/her own, and may bear no resemblance to the real world; and they can be hazardous to your physical and economic well-being.

FINALLY HIGHER CAFE LIMITS--JUST A START--FIND MORE, USE LESS, ETC.
Finally Congress has passed CAFE (Corporate Average Fuel Economy) requirements more in tune with the needs of our energy stressed 21st century.  But this is just a tiny step.  We also need cleaner power sources for electricity (it's spelled nuclear--no, not nucular, Pres. Bush--NUCLEAR).    Corn ethanol is a politician-lobbyist boondoggle.  Stop it, and consider ethanol sources that have a positive energy balance, instead of raising the cost of food and other products made from corn.  And it's  time to become realistic about the wasteland called the Alaskan National Wildlife Reserve.  Drill for oil up there.  Do it wisely, but do it NOW. Ditto offshore drilling.  But conservation via higher fuel prices, higher fuel taxes, etc. is also needed.

HOLY COW!  A STINKY TOPIC, FOR SURE.
The last fix is harder.  We have to stop cows from farting and pooping.   Methane from cattle is a major source of greenhouse gases.  I suggest we delegate that one to Nobel Prize winner Al Gore. His expertise on slinging  BULLS--T should give him an experience advantage to solve the COW-FARTING problem.  Then we could award him the No-Bull Feces prize.

IRAQ?  THE FORGOTTEN STORY
As soon as the conflict in Iraq was no longer good for Bush-bashing, the liberal media lost interest.  After all, we all know that "good news" is not good for news; it takes "bad news" to really juice up a news program.  Or maybe a week's worth the Spears' family escapades, narrated by Lindsay Lohan and Paris Hilton.  They could call it "The Young and the Brainless."  Iraq is far from resolved, but the progress is encouraging.  Neither is the Irael-Palestine conflict.   Iran is not over either--not by a long shot (pun not intended).   Ahmadenijad is still a power hungry little despot.  (wait, was that Putin I meant to say? No this is Iran's version.)  North Korea's Beloved Leader Kim Jong Il is now chilling out a bit, in return for food and money.  He has all the luxury cars he needs--for now--but he'll be baaack, crazy as ever.

DID THE GRINCH STEAL CHRISTMAS?   YEP!
If my meager shopping expeditions are any indication, this Christmas flamed out after Black Friday's surge.  November's numbers looked OK because there was an extra shopping week after Thanksgiving.  Decembers' numbers will be weak.  Retail profits will be worse.  The good retailers will suffer too--even Target.  The weak ones, may start the process of dying (Sears/Kmart which in Eddie Lampert's case means "sell more retail property" because you are losing money on retailing operations.)  Eddie, can anybody there spell NEGATIVE COMP STORE numbers as far back and forward as you can see? A strong last week before Christmas can't save the season--and sure won't save the profits as discounts were rampant.  Retailers WILL sell down inventory in Jan., further dampening suppliers' sales.  2008 is shaping up to be a tough year.  "Batten down the hatches, boys."

SCARY THOUGHTS TO START OFF THE NEW YEAR
China is our banker. The US owes China billions.  China is our manufacturer for low cost, and now (in many cases) good quality products (Like Japan of 25 years ago?).  China is now developing the ability to launch space missions, and missiles that can shoot down satellites in orbit (where do you think we get a lot of our foreign intel--satellite imagery).

China is slowly migrating away from Communism to capitalism.  China is growing at 9+% per year in GDP and has a positive balance of trade and huge cash reserves.  China is now encountering two scourges of developed countries--shortages of quality labor and problems of environmental pollution.  Do you think China is the US' friend?  Ally?  Not for a minute.  China is out for China.  The US has supported and defended Taiwan, which irritates China greatly, since it considers Taiwan to an illegitimate, rogue province that "escaped from China decades ago."

Europe is becoming Eurabia.   Terrorists in the UK--not a few--whole neighborhoods of them.  Rioters in France--"youths" who are predominantly Muslim--and in France, the "immigrant" Muslims will soon be in the majority of the population under age 30.  In many parts of Northern Europe, the most popular boy's name is Mohammed.

And amidst all this, our Presidential candidates are bickering over whose sex, race or religion makes them more or less suited to serve.

Maybe we should focus on LEADERSHIP in the candidates.  Here are my words from p. 211 of THE COMPLEXITY CRISIS describing the role of a leader:
--To create a clear understanding of, and healthy dissatisfaction with the current reality.
--To build a shared vision of a new, better reality as a goal.
--To create an environment in which people are motivated to move from the former to the latter.

WHO AMONG THE CANDIDATES CAN BEST DO THAT?
(Perhaps John McCain after all--even at age 72?  Or will it be Barack Obama?  Or Mike Huckabee?  Or--ugh--Hillary?)

That's it for 2007--it's over.   No replays; no do-overs.  Now it is up to us--right--you and me, to make 2008 better.  How?   I only know some of the answers to that, and I'll publish them right here every week.  To start with, I'll borrow one from Matthew Kelly's advice:  DO THE NEXT RIGHT THING!

See you in the future.

Happy New Year (we hope)
John

THE ENTERPRISE--MERRY CHRISTMAS FROM KOBE

THE ENTERPRISE--MERRY CHRISTMAS FROM KOBE

Hi.   If you can see the attachment, you can see me.  My name is Kobe, and I am doing THE ENTERPRISE this week so my "Dad" John can take off for Christmas.  I am 9-1/2 years old, and they tell me that this might be my last Christmas because my heart is giving out (I have something called congestive heart disease).  I don't know what that's all about, but I can't play and run around like I used to--I get short of breath and start wheezing and coughing.   They give me pills about 5 times every day--with peanut butter and/or cheese.   I love that part.

Getting old is not so much fun--but I guess that's true for you humans too.  Dad seems pretty sad about me being sick (he says I am only in my 50's in human years), but so far, all those pills are helping me feel pretty good a lot of the time--so what the heck.  After all, us dogs don't expect a lot out of life.  We want to be loved; to be fed and given water regularly, to play, and to lay around in a warm place and sleep (a lot).

Wow, there is so much I hear about, I don't know where to start on this letter.  First of all, I think you humans could learn something from us dogs.  There is so much bickering and fear and anger I hear about.  Politicians fighting with each other; terrorists doing awful things all  over the world; celebrities doing stupid stuff to their own bodies, and more.  Why do you do it.  Aren't you supposed to be the more intelligent species?

For me, let me lick your face or hand, then scratch my belly or behind my ears, and take me out to go potty.  (I get a treat when I come back in!)  Maybe you should try that routine--except don't go out to go potty--the neighbors will complain.

Seriously, it's almost Christmas, so I suggest that you try to put on a smile as much of the time as you can.  When I do that, humans treat me much nicer than when I growl at them.  You should love and appreciate each other too.  You are so busy "doing stuff"--chill out.  Curl up and relax.  Try to snuggle up to someone you love.  Make each other happy.  That's my plan for as long as I can hang around.  They are really spoiling me and I love it.  Maybe you should try to spoil the ones you love.  It works.

Oh, yes, another piece of dog wisdom:  be loyal.  Always be happy to see your loved ones when they come back into the house.  They like that too.  You know, I have learned a lot in my 9+ years, but what I have learned most is that the ones you love and that love you are the most important people in the world.  Treasure them.  Play with them.  Curl up with them.   Spend as much time with them as you can.

Those people you work with may be OK, but they are not your real friends and family (well, maybe a few of them might be).    I've met a lot of dogs in my life.  Some of them are OK, but a lot of them just sniff your butt and move on.  They don't really care about you at all.  But your family and loved ones--that's a whole different story.

Maybe that's why Christmas is such a special occasion.  After all, it's the story of another family, as I hear it.  I don't know of any dogs in that story, so I'm suspicious about it, but so far, many humans seem to really believe in it.

Well, "Dad" (John) just came in and asked me what I was doing up by his computer.  That means I should wrap up this letter.  IF I am still around at Christmas next year, I'll write you another one.  IF I'm not, just remember what I said:  Love your family and those special friends just like baby Jesus wants you to.  That way, when it's your time to write that last Christmas letter, you'll be happy and peaceful, knowing that you were loyal and loving to those that were really important in your life.

Merry Christmas and God Bless you and yours,

Your loyal buddy,
Kobe (Mariotti)

(By the way, I am not one of those fussy poodles.   I am a Maltese!)

THE ENTERPRISE--The Complexity Crisis featured in IBD ... and other news!

THE ENTERPRISE--The Complexity Crisis featured in IBD  ... and other news!

IBD'S "10 SECRETS TO SUCCESS COLUMN" QUOTES "THE COMPLEXITY CRISIS"
The Dec. 17 issue OF INVESTOR'S BUSINESS DAILY (out on Sat. at newsstands) and its column by Cord Cooper, (a regular IBD feature), is almost entirely drawn from my new book, THE COMPLEXITY CRISIS.   That makes me grin.  I am attaching a link for those who either don't get IBD or don't rush out to the newsstand to buy one (I understand!). http://news.yahoo.com/s/ibd/20071214/bs_ibd_ibd/20071214lands01

SOME AWFUL NEWS--A PASTA PROBLEM A little "tongue in cheek" humor:  The cost of pasta (Italian pasta--the good stuff) is up by 60%.  There are investigations about price fixing and speculation and even strikes.  Now many of you will not think that is a problem, but for those of Italian heritage--pasta is a staple of our diet.  Worldwide demand is strong, and the use of crops for fuel instead of food is worsening the problem.  I think I'll stock up on some linguini.

POLITICAL CORRECTNESS RUN AMOK--AGAIN--TWICE
The city of San Francisco has decided to omit gender from ID cards so it will not offend the transgender community.  NO KIDDING!  The new ID cards will be given to anyone who requests one, and include name, birth date, photo, but not "gender."  Will the next thing be restrooms marked, MEN, WOMEN, and "NOT SURE WHICH?"

The New York Department of Motor Vehicles has recalled a license plate that reads "GET OSAMA" on the grounds that it may offend "someone."  They seem to violate a ban on plates "that are derogatory to a particular ethnic or other group."  The person who ordered the plates, a retired NYC cop, said that the only group he could imagine being offended was al Qaeda, and "this is unbelievable."  It is.

WHEN YOU'RE HOT, YOU'RE HOT; AND WHEN YOU'RE NOT, YOU'RE NOT
Let's see, about 5-6 years ago, everything I read (and a lot that I wrote) extolled the virtues of Wal-Mart as the leading retailer, Dell as the leading computer maker and Toyota as the leading auto maker.  That was then, and this is now.  Wal-Mart is getting its proverbial butt kicked by Target, although it is still, by far the biggest global retailer.   Dell is now trailing HP and losing ground,  but still No. 2, while Apple gains on both of them.  Toyota is in the process of dethroning GM as the world's biggest auto maker, and in many minds, is still the best.  But even the vaunted Toyota Production System is showing the strain of its growth and (could it be?) INCREASED COMPLEXITY of expansion in models, places to make them, and option/model variations.  It just goes to show you that being on top is a dangerous place--there's only one way to go from there--down.

ENRON PROVED IT ONCE; THE SUB-PRIME CRISIS PROVES IT AGAIN
The laws of physics are immutable.  You cannot make something from nothing.  No matter how cleverly packaged or in what business, sooner or later, this impossible proposition collapses.  When it does, itt takes all those foolish enough to try it, down with it.   This time is it the largest banks and investors in the US.  What on earth were they thinking?  Make big loans to people who cannot afford them, but let them start with cheap (or free) interest to get them hooked.  (Like drug dealers do.) Then bundle these with a few OK loans into SIVs (Structured Investment Vehicles) and sell them to the next sucker down the line--with the endorsement of the "reputable" rating agencies that these are OK.  What a joke.

FIRE THEM AND TAKE THE ILLICIT EARNINGS BACK
Of course the CEOs of these foolish companies should be fired or resign--but they should forfeit most of their golden parachutes as they leave.  They'd probably prefer that to the fate of the Enron,  WorldCom, et. al. gang who got jail time as well.  It's not just the CEOs that are to blame either.  They are just the ones at the top who are ultimately responsible.  Many others are hiding, laying low, hoping to avoid the notice that they were the architects and perpetrators of this (nearly?) criminal fraud.  The Mafia loan sharks at least admit that they are doing illegal stuff. A

RECESSION IS NOW A 50-50 BET
The ripple effects of astronomical oil prices, ridiculous financing practices, and a sliding dollar, fueling inflation are going to combine to make 2008 a very "flat" year.  I mean flat like a bottle of Coke, opened 3 days ago, where all the "fizz" is allowed to escape.  How do you manage through a recession?  Very carefully, and using the best business practices.  A good first step: (you guessed it) REDUCE COMPLEXITY--getting rid of the "fat" --products that cost more to keep than you make on them; customers that cost more to serve than they add to your profits; locations you never should have opened in the first place (close them); and so forth.  Yes, some people will lose their jobs--because when you cut the complexity-driven waste--and work--you have to cut the overhead you added to do it--and that is mostly people.  Sorry--that's what happens in a downturn.

GET THROUGH THE DOWNTURN IN THE ECONOMY AND COME OUT STRONGER
I'll cover more on this topic, including some specific ideas on "how to," in future editions.

For now, it's time to stop the doom and gloom.  You can enjoy the holiday season with loved ones and don't have to break the bank on what you spend for gifts.  Make the time together a gift for everyone.  Enjoy it, laugh, go to church, sing carols, and just be together.  That can be a very special gift to everyone. Finish by taking 10 amazing minutes, fire up your web browser and watch the videos noted below.

SOME "FEEL-GOOD" ENTERTAINMENT
This is incredible! 

www.youtube.com/v/QZFkZiwMLZ4> 
The first one, "Hero," is 6 minutes long so wait until you have ten minutes to watch both.  The second one to watch is titled "Patriotic 2-1/2 minutes"--2-1/2 min. long.  (Wait until the frames show at the bottom after the first one finishes and move to the right arrow.)  Enjoy, and pass it on.  The artist's name is Michael Israel.   I guarantee you will watch spell-bound until the last drop of paint is put in place. Make sure your sound is turned up.  And you will be proud to be an American.

All the best of the season, John

THE ENTERPRISE--ORDER THE COMPLEXITY CRISIS NOW

THE ENTERPRISE--ORDER THE COMPLEXITY CRISIS NOW--(while quantities last)

SURPRISE!  MY NEW BOOK IS "OUT."
I came home from a trip to find a big surprise--the publisher must have been able to squeeze in the print run of my book, THE COMPLEXITY CRISIS...and here they are--available now--before Christmas!  That means I will devote this edition of THE ENTERPRISE to encouraging you to buy quantities of the book and use them as Christmas gifts, (or handouts) to your clients, your organization, and your friends.

UNIQUE AMONG MY BOOKS
This book is unique among my books.  Most of them talk about how to do things "Strategically" or explain what topics like Branding, Marketing and Partnerships are all about.  This one tells you how to SAVE MONEY!  AND MAKE MORE MONEY!

THIS BOOK, IF READ AND APPLIED, CAN SAVE EVERY COMPANY A HUGE AMOUNT OF MONEY.  The book retails for $20, and can be bought nearly everywhere for under $15.  The return on that small expenditure (presuming the book is opened, and even part of it is read and applied) will be $15,000 savings or a 1000 to 1 return.  That's not bad.  In larger companies, the return will be even bigger than that!  I know--I have seen it happen.  A 10,000 to 1 return is a nice thought to consider, isn't it?

USEFUL FOR EVERY TYPE OF POSITION
If you are a consultant, give them to your clients--but give them enough for the people one level below the VPs (that's where the real work gets done)--but be also give them to the VPs and Presidents too.

If you are an investor, make sure to get books for that level of management in each company in which you have an equity position.  Once again, the cost is minimal compared to the return from just some of the parts of the book being read, understood, and the practices implemented.

If you are a manager or executive, this book is the perfect Christmas gift.  It will help the people in the company become more effective both at work, and personally.  And your company will perform better.  Get copies especially for your suppliers... and for your customers too. 

If you are an educator, plan a portion of a course based on the book's content.  You will be among the first in the country to do so. (Did you know there is a Ph. D. in Complexity offered at one British College?)

If you are a friend or colleague--just "buy some" and use them for Christmas gifts. Everyone from college age kids on up will be able to understand most parts of the book.  Everyone who works in any kind of job will learn enough to be more effective.

TIPS ON ORDERING:
Right now, I know amazon.com has it in stock at a good price, as does www.bamm.com. 
The other sites listed on my web page (http://www.thecomplexitycrisis.com) will also likely have them in the next few days.

As I learn more, I will release updates. 

Well, don't just sit there.  Make a list of who gets them and how many copies you need. ;-)  If the first print run sells out quickly, there may be a wait before a second run gets into distribution.

I've been telling you all about this for most of a year.  Now it's here.

Best, John

PS:   IF YOU WANT TO BUY SOME NOW AND THEN GET MORE LATER, YOU CAN GET 2008 OFF TO A GREAT START BY USING THIS BOOK AS THE TOPIC FOR JANUARY DISCUSSIONS IN YOUR COMPANY.  FUTURE EDITIONS OF THE ENTERPRISE WILL ADD "HOW TO TIPS."

THE ENTERPRISE...Mistakes, risks and complexity

THE ENTERPRISE...Mistakes, risks and complexity...

NEW LOOKS--NEW BOOKS--(THE COMPLEXITY CRISIS)
If you haven't been to my web site lately, please click on it and go take a look.  http://www.mariotti.net is the address, although if you use http://www.thecomplexitycrisis.com you'll get there too.  Perhaps you read THE ENTERPRISE in the direct email version I send out each week.  Did you realize that past editions are posted to a blog--yes, I confess, I am a blogger now!)  (If you wonder why I keep repeating the term complexity in what I write, it is self-serving.  To register on the first page of searches, this term needs to become associated with my web site and blog...that is the way things are these days.)

ANOTHER FIELD CRIPPLED BY COMPLEXITY
A friend was kind enough to send me this "heads up" on yet another area where complexity is crippling companies and where some kind of significant change has to occur.
-------------

From an article by Max Kalehoff  (my emphasis added)
    "As we enter the inevitable clichéd wasteland of year-end reflections and New Year's predictions, I can't help but conclude that 2007 was the year of complexity for online advertising. Nothing else stands so strong. From new online ad formats, splintering media sources, devices, intermediaries, distribution and targeting platforms, it's getting to be a pretty darn complicated ecosystem to get your head around -- especially if you're an advertiser.
    ... this complexity epidemic has spread to virtually every corner of online advertising -- not just search. The result is a darkening cloud of frustration, inefficiencies and skepticism building among many marketers small and large, despite undisputed benefits and unprecedented ROI. I'm not suggesting all the great new advertising technologies and capabilities aren't wonderful and exciting, but the blunt, underlying pain of convolution is nearing its threshold. Marketers don't need any more features, options, solutions or clutter. What they need is relief and clarity.
    It is for that reason that I'll go out on a limb and suggest that 2008 will be the year where complexity gone amuck will drive some of the most important innovations in online advertising."

--------------

TERRORISM RISKS ARE TOO NUMEROUS TO COUNT & DHS IS NOT HELPING
FROM STRATFOR.COM:  "An explosion and fire on the Enbridge pipeline system Nov. 28 halted nearly a fifth of U.S. crude imports, leading U.S. crude futures to rise more than $4, Reuters reported. The explosion occurred three miles southeast of an oil terminal at Clearbrook, Minn. All four Enbridge pipelines in the vicinity were immediately shut down and isolated. "  This was just an accident.  Imagine if it wasn't.   We are vulnerable to terrorists in so many places, that only constant vigilance by all Americans can be enough watrchfulness.  And the Department of Homeland Security?  Forget it.  It is now such a massive bureaucracy that it DEFINES A  WHOLE NEW LEVEL OF COMPLEXITY-INDUCED ineffectiveness.

WITH FRIENDS LIKE THESE, DO WE NEED ENEMIES?
China refused to give our aircraft carrier USS Kitty Hawk entry to Hong Kong over the Thanksgiving weekend.   It was not a misunderstanding, a Chinese Foreign Ministry spokesman said. "Reports that Foreign Minister Yang [Jiechi] said that it was a misunderstanding do not accord with the facts," the spokesman told a news conference.  At least they told it the way it was.  The Chinese are looking out for China--anyone who thinks otherwise, simply isn't paying attention!

NOT THAT RIGHT SIDE...THE OTHER "RIGHT" SIDE
There is a phrase, "you don't have to be a brain surgeon to know..., but it appears some of them confuse right and left too often.  A Rhode Island hospital was recently fined ($50,000) and reprimanded after its THIRD instance THIS YEAR, of a doctor performing brain surgery on the WRONG SIDE of the patient's head.  For years, we have been admonished to take a permanent marker and write YES and NO on the sides of the body to be operated on...just to help the surgical crew get it right. 

We've had this almost happen in our life, years ago, as my wife was preparing to undergo a "lumpectomy" the technician placed the x-rays upside down on the viewer screen.  Fortunately, my wife was still awake and aware enough to tell them that they were looking at, and poking around the "wrong side of her body."  It happens thousands of times each year. So, if you or a loved one are scheduled for surgery, go get yourself a permanent marker and make your mark!  It could save a life--or just a lot of discomfort and a repeat surgery.

After covering Brain Surgery (mistakes), China, complexity (in a couple of areas),  and terrorism (risks), that's about enough for one edition. 

The last word will be the answer everyone asks when I start talking about complexity.  What do I do about it.  The first step...is "sort it out."  Just as you would if cleaning out your closets (your personal micro-lab of complexity at home).  Once you sort it out...then ...well, that's another story, for another issue.  Stay well and enjoy life--it's the holiday season--do something charitable for someone.  It feels really good.

Best, John

Economic Week in Review
©The Vanguard Group, Inc.

Real GDP advanced very strongly in the Q3, though downbeat economic reports signaled tougher times on the horizon, in part because of the troubled housing market. With these concerns hanging in the air, the stock market plunged Monday. At the end of the day, both the Dow Jones Industrial Average and the Standard & Poor's 500 Index had fallen 10% from their October records—a traditionally defined "correction." Yet the markets snapped back with a vengeance on Tuesday and Wednesday and ended the week on a positive note.

The nation's total output of goods and services soared in Q3, increasing by 4.9%, the fastest growth rate in real, or adjusted-for-inflation, GDP since the Q3 of 2003. Major factors were a growth in exports, aided by a declining dollar, robust overseas markets, and a buildup of inventories. Inflation, as measured by the GDP price index, or "deflator," slowed to a 0.9% increase from a 2.6% increase in the Q2.

To help counter anxiety over the availability of credit, the Fed said on Monday it would provide $8 billion in loans to help banks meet liquidity needs over the upcoming holidays. On Thursday, remarks by Fed Chairman Ben Bernanke suggested that the FOMC might be inclined to cut interest rates at its next meeting on Dec. 11.  Bernanke noted that "renewed turbulence" in financial markets has "resulted in a further tightening in financial conditions, which has the potential to impose additional restraint on activity in housing markets and in other credit-sensitive sectors." In addition, he said, "I expect household income and spending to continue to grow, but the combination of higher gas prices, the weak housing market, tighter credit conditions, and declines in stock prices seem likely to create some headwinds for the consumer in the months ahead."

The Conference Board's index of consumer confidence fell more sharply in November than analysts had expected, to 87.3, the fourth-straight monthly decline and the largest month-to-month decline since Hurricane Katrina. "Consumers' apprehension about the short-term outlook is being fueled by volatility in financial markets, rising prices at the pump, and the likelihood of larger home heating bills this winter," said a research official at The Conference Board.

Americans' personal income increased 0.2% in Oct., the lowest monthly growth rate since April and below expectations. Personal spending rose by 0.2%, weak growth that reflected lower spending on durables. New orders for durables fell 0.4% in Oct.—a surprise for analysts who had expected no change, and the third straight monthly decline. New orders for nondefense durables excluding aircraft, a measure which is viewed as a proxy for trends in capital spending by business, dropped by 2.3% in October and are 1.7% below their year-ago level.

Sales of existing homes declined 1.2% in October—the 8th straight monthly drop—and 21% lower than a year earlier. By contrast, sales of new homes increased by 1.7% in Oct., the first increase since Apr., reflecting heavy discounts by builders. Compared with a year earlier, however, new-home sales were 24% lower. The supply of unsold existing homes stood at 10.8 months, and the inventory of unsold new homes was 8.5 months. Compared with a year earlier, median prices declined 5.1% for existing homes and 13.2% for new homes.

Total spending on construction declined 0.8% in October, faster than analysts had expected. Within the private construction category, which fell by 1.4%, the drop was greatest for residential construction. Compared with a year earlier, private residential construction has tumbled 16.2%. In contrast, public, or government, construction increased 0.8% in October and is up 14.6% year-over-year.