Barrett’s Briefing: Shaking the Globe And Meltdown
by Richard BarrettAmong the annual flood of business and economics books, two recent ones caught my attention.
Shaking the Globe: Courageous Decision-Making in a Changing World
In this book, targeted to execs at mid-to-large businesses, Ms. McGarvie surveys the plethora of challenges and opportunities that companies face in the new century. She details the diversity in three major areas: cultures, nations, and generations.
Simply put, companies no longer have the luxury of ignoring any of these diverse constituencies. Even if a company is not competing internationally, then it is defending its domestic market against a multi-national competitor.
Likewise for multi-generational workforces and multi-generational customer bases. For the first time ever, many companies have up to four generations in their workforces, and possibly four or even five generations in their customer bases. Illustrating this trend, a recent survey identified the fastest growing age-group of employees in the US as people in their seventies.
The book amply documents the simultaneous interconnection and fragmentation of businesses, people and markets across the globe. It identifies various segments and constituencies in each major area, providing a good overview for readers wanting an introduction to the topic. The book concludes with three key messages:
“First, we need to understand how the world is interconnected and that all people in it are interdependent… We need to transcend our nationality.
Second, we must face the financial realities that created this need for going global.
Third, we should become aware of the six forces shaping personal courage if we are to go global. Namely, we experience different cultural norms as evident through beliefs, family, and time horizons; communicate with youth in new ways; tap into the talents of women; understand shareholder interests; capture the entrepreneurial drive for innovation; and respect individuals’ value systems.”
Most interesting are the personal vignettes which Ms. McGarvie uses to illustrate particular topics.
As a reader, I look forward to another book by the author, possibly in a case study format, in which she explores specific situations in much more depth, based on her personal experience.
Meltdown: A Free-Market Look at Why the Stock Market Collapsed, the Economy Tanked, and Government Bailouts Will Make Things Worse
“In both cases [the Great Depression and the current recession] an inflationary credit boom brought about by the Fed’s lowering of interest rates led to massive resource misallocation and a distorted capital structure. The Fed tried in vain to inflate each of these booms back into existence, and grew frustrated with banks that refused to lend out the new money it was pumping into the banking system. In both cases the federal government sought to prop up prices… rather than allowing them to fall to a level that made sense [in the market].”
Comparing this recession to the Great Depression and many other recessions in the 1800’s, the book identifies the common culprit in the boom/bust business cycles – government manipulation of the currency. Although this conclusion is no great surprise, the compelling analysis makes for good reading. He defends free markets, pointing out that the money supply is not a free market, but a government-controlled monopoly.
Mr. Woods makes a damning case against the Federal Reserve, condemning it for hidden dealings, a bias toward inflation, and backroom collusion with banks. His analysis demonstrates that government action not only causes the booms and busts, but that same government action significantly delays and cripples the eventual recovery.
As if on cue, in December the Fed strong-armed Bank of America to complete its acquisition of Merrill Lynch even when that purchase significantly weakened the bank and increased the risk to the economy. Of course these machinations occurred in secret, with no disclosure and no transparency for investors, customers, and employees of either company.
In his conclusion, Mr. Woods calls for the abolition of the Fed, proving that he is an incurable optimist. Failing that, Mr. Woods predicts significant inflation ahead, due to government debasement of the currency. Government tampering with money is not just a recent phenomenon, as the author illustrates with examples as early as the tenth century, of governments (then kings) cheating their subjects by debasing the currency.
Even in the age of the internet and electronic commerce, some things have not changed.
Image credit: Amazon
