Returning Home

As someone who lived in Detroit for a couple of years, I thought this short article in today's New York Times was interesting:

Snowbirds Come Home to Roost

By Toby Barlow

Published: February 20, 2010

Detroit

RON AND PATTY COOLEY met and fell in love 42 years ago as students at Eastern Michigan University. After a stint at Ford in the early ’70s, they left Detroit behind, taking over her family’s modest real estate business upstate. The company prospered: for 30 years the two worked together, helping to finance, build and sell more than 1,000 homes.

With their two sons grown, Ron and Patty sold the business and semi-retired down to Naples, Fla. Ron took up golf, sometimes seven days a week, occasionally 36 holes in a day. Patty gardened. Their lives in the Sunshine State were relaxed and tranquil, the sort of serene ending that retirement brochures promise to us all. But, unsurprisingly, the collapse of the housing market had a serious impact on a couple with a nest egg tied up in real estate.

Ron and Patty looked around and did the math. Florida’s economy seemed to be declining even more steeply than the Motor City’s. In Detroit, they had roots, their sons had moved into the city and started a barbecue restaurant, grandchildren had arrived. So, weighing their options, they came back. They moved into a downtown loft, just a few blocks from the empty lot where Tiger Stadium once stood.

I first encountered Ron and Patty at an early morning fund-raiser for a neighborhood charity. Talking to them, I found that just like other new arrivals — the artists and recent college graduates coming here from other towns — they spoke of Detroit’s potential with an almost exalted optimism. Instead of depressing or slowing them down, the move has been a thrilling one and they shared examples of how exhilarating their life is downtown.

Being at the center of things means they can walk to the Avalon bakery on Saturday mornings and to the new Comerica Park for baseball games in the spring. Instead of endless golf, they now go to events like the fund-raiser where we met or lectures on design and sustainable development.

Talking about Florida, Ron sounds like someone who made it onto the lifeboat in the nick of time. Yes, they had to sell their home down there at a loss, but a former neighbor in Naples recently sold a similar house for less than half of what the Cooleys got. Ron estimates that with the nation’s battered 401(k) accounts, it could take decades before Florida returns to any sort of substantial growth.

http://www.nytimes.com/2010/02/21/opinion/21barlow.html

Book Review: "Outliers" by Malcolm Gladwell

This book has been very popular - I noticed this morning that it has been on the New York Times bestselling list for 64 weeks.

It's a quick read. Mr. Gladwell writes for The New Yorker, and to me the book had the feel of a long magazine article.

That said, it was very interesting, and I found myself thinking about some of his observations long after I had finished reading.

For example, Gladwell notes that intelligence is an overrated aspect of success. In fact, he makes the persuasive argument that once a certain IQ level is reached intelligence becomes almost irrelevant. He even suggests (somewhat tongue-in-cheek) that admissions to prestigious schools like Harvard become more like a lottery: all applicants who have demonstrated a certain intelligence level would be thrown into a drawing, with students drawn at random.

Persistence, however, is a quality that nearly all successful people seem to share. Gladwell suggests a "10,000 hour" rule: if one is to become truly outstanding at a particular endeavor, a minimum of 10,000 hours of practice, study and hard work seem to be necessary. This is fairly daunting, once you think about it: if you were a musician who practiced 3 hours a day, 7 days a week, this would imply about 1,100 hours of study a year. According to this rule, then, one would need to spend at least 10 years of intensive study to become truly proficient at a given endeavor.

Gladwell spends a lot of time on different cultures, and the various ways that societies around the globe interact. He has a number of pages studying Korean culture, and the possible ways that the hierarchical way that Korean society interacts may have contributed to at least one Korean airliner crash. On the other hand, Asian cultures have tended to produce more than their fair share of exceptional math and science students, and Gladwell believes that this too is the result of cultural influences rather than innate intelligence.

I'm not a sociologist, so I have no way of judging whether some of his conclusions can stand up to close scrutiny, but most of the book rang true to me.

Using Social Media for Small Business

Good article in this morning's Boston Globe.

Creating buzz, one day at a time

Low-key, low-cost marketing hits social-media sites

By Katie Johnston Chase, Globe Staff | February 20, 2010

Nate Small of Today Real Estate in Yarmouth paid $17 to two men on separate coasts to sport T-shirts with his company’s logo on Jan. 17: The man in Jacksonville, Fla., did so while spouting slogans such as “He slams prices on Cape Cod’’ as he dunked a basketball, while the Los Angeles man vacuumed his living room.

The two men, from www.iwearyourshirt.com, spent the day tweeting, posting, chatting, blogging, and recording online videos, sometimes talking about a Today Real Estate raffle, other times singing “Barbie Girl.’’ By the end of the day, Small, 36, had collected 75 new e-mail addresses to add to his mailing list.

“I just got so much exposure that day that I really can’t put a price on it,’’ said Small, noting that he’s lucky if he hears back from one person after mailing out 100 postcards.

Some local businesses have turned to iwearyourshirt.com, an enterprise of Florida resident Jason Sadler, 27, to give companies exposure on websites such as Facebook, Twitter, Flickr, YouTube, and Ustream.tv. The company is taking advantage of a wave of social-media marketing that is shifting the advertising landscape from a one-way mode of communication in print and television ads to two-way interaction between companies and prospective consumers on the Web and phone.

Social-media usage has doubled among small business owners in the past year, from 12 to 24 percent, according to a recent study by the University of Maryland and Network Solutions, an online provider for small businesses. But social media is not just limited to tiny firms. A study last year by Forrester Research Inc. found that 60 percent of 204 marketers planned to increase spending on interactive media.

The reasons for the shift are clear. Online and mobile marketing are far more affordable than TV and print ads, allowing small firms and big companies alike to reach lots of people. For instance, Facebook has 350 million members, and Twitter has an estimated 20 million to 50 million - all reachable for free.

http://www.boston.com/business/technology/articles/2010/02/20/low_key_low_cost_online_marketing_taps_social_media_sites/

Reflections on the American Dream - column from the FT

I did alot of reading over the past few days, trying nightly to recover from skiing with my 16 year old daughter. I'll be posting a couple of book reviews this weekend on these books.

When I got home this evening, however, I came across this column from Clive Crook of the Financial Times. It echoes some of the same thoughts that Malcolm Gladwell writes about in his best-selling book Outliers, which I'll review later. However, it is an interesting perspective from a British writer.

Excerpt here, link follows:

Reflections on the American dream

February 19, 2010 11:47pm

Back in November I wrote glowingly in a column for the FT about Creating an Opportunity Society, a new book by Isabel Sawhill and Ron Haskins. Earlier this week I attended a dinner with other journalists, scholars, and policy-makers to talk over some of its ideas. The conversation (off the record, in any event) was frustrating, because the budgetary obstacles to any action requiring outlays are so severe at the moment. If nothing else, though, it moved me to recommend the book again. It’s the best thing of its kind I’ve read for a long time.

The finding that would surprise most Americans is that the American dream is something of a fraud. Intergenerational social mobility–your chances of moving up from poverty, or down from great wealth–are lower in the US than in most of Europe. This is something I have written about before. Research suggests plenty of mobility in the middle part of US income distribution, but not much at the ends. The American dream is a kind of opportunity club, and the very poor and very rich aren’t members.

http://blogs.ft.com/crookblog/2010/02/reflections-on-the-american-dream/

"Random Glenings" Goes on Vacation

I'll be in Vermont for a few days with my wife and daughter skiing. Be back next weekend!

Changing Demographics on College Campuses

My favorite college student in the world attends Wesleyan University (Michael T. Glen, Class of 2013). Since Michael is a student, last week we received the most recent copy of Wesleyan's emagazine.

The article I found most interesting focused on the trends in admissions. Wesleyan has received 6% more applications this year than last, despite the poor economy. The caliber of the applicant pool also seems incredibly high.

From an analytical standpoint, however, what caught my eye was the disproportionate amount of female applicants to males. I have already put a couple of posts up about the changing demographics on college campuses, so this article continues the trend, I guess.

Why aren't more men applying to college? What will male job prospects be in the future, when education plays such an important role in employment? Does this lack of a strong education background help explain why one out of five American men are currently unemployed?

Mind you, I think this is terrific news for American women. I have a daughter who is a sophomore in high school, and I am very excited about the prospects for her future (OK, so I'm very biased - it is Valentine's Day, after all). But I am puzzled by what the younger members of my gender might be thinking.

I have edited the article, but here's the key points in my opinion:

Applications Up By 6 Percent Over Record Year

Feb. 8, 2010 by Olivia Bartlett Drake

This year, 10,645 seniors from around the world applied to Wesleyan University, an increase of 6 percent from 2009, which was a record year for applications, despite the sour economy.

“Last year we reached an all-time high for applications, up by 22 percent, and this year is 6 percent over that,” says Greg Pyke, senior associate dean of admission.

Of these students, 41 percent are male and 59 percent are female.

The applicant pool contains 362 candidates for the Freeman Asian Scholars program, 860 for early decision admission and 9,423 applications in the regular review process. Two-hundred-and-twenty-nine of these students are alumni sons and daughters.

Compared to 2008 data, this year Wesleyan received 203 more applications from the Midwest, 266 more applications from the South and 619 from the West. Applicants from the Northeast increased by 392 since 2008.

The Office of Admission.

So, why are so many more people applying to Wesleyan? According to a Jan. 29 blog on “Admission and Recognition” by Wesleyan President Michael Roth, it isn’t easy to point to any specific factors with confidence.

“Clearly, we have benefitted from positive press thanks to the great work of our faculty, students, staff and alumni. Our admissions and communications departments have been in high gear making sure that we get the word out about what makes Wesleyan an extraordinary institution,” Roth wrote. “The campus looks great, and investments in our physical plant have had compelling results. We have been emphasizing some of the distinctive aspects of a Wes education, and above all, students and their families have been talking to others about their own experiences.”

Twenty-two percent of the Class of 2014 applicants hail from New England; 20 percent are from New York; 13 percent are from the mid-Atlantic; 7 percent are from the Midwest; 7 percent are from the south; 19 percent are from the west; and 13 percent are from elsewhere in the United States. Twelve percent of the applicants are international.

The applicants come from diverse racial backgrounds. Eleven percent of applicants are Asian or Asian-American, 8 percent are black or African-American, 8 percent are Latino or Hispanic and 1.2 percent, or 125 students are Native American. Sixteen Native Hawaiians also applied to Wesleyan this year.

Of the 10,645 applicants approximately 745 are expected to join the Class of 2014. Sixty-three percent of the applicants, including Freeman Scholars, applied for financial aid.

The median ACT score for the applicant pool is 31 and the median SAT scores are 690 for critical reading and 690 for math. About 25 percent of applicants are sending ACT scores, Meislahn reports.

It's a Good Year to Be Generous (at least as far as Estate Taxes)

Interesting note in this morning's New York Times:

February 14, 2010

That Fog Still Hasn’t Lifted From the Estate Tax

By CONRAD DE AENLLE

THE estate tax isn’t dead. It’s resting.

The tax has been eliminated for 2010, but the estates of people who die before the year is out may still not pass free and clear to their heirs. The complexities of the tax system and the likely return of the estate tax next year — maybe even sooner — are creating confusion for accountants, lawyers and many families.

Possibly greater expense, too, and not just for the wealthy. Odd as it may seem, tax specialists caution, the absence of an estate tax could result in greater liability on smaller fortunes than on bigger ones.

Say that someone worth $10 million dies on Dec. 31 this year. Because there is currently no estate tax for this tax year, the beneficiaries divide the whole amount, although they may also inherit liability for capital gains tax on some of the assets.

But what if the person in this example doesn’t die until Jan. 1, 2011 — when the estate, apart from a $1 million exemption, is due to be taxed at 55 percent? There will be a lot less to share.

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

Whatever the legal backdrop, what can people do to ensure that the greatest amount of wealth possible goes to heirs and not to the Treasury? A few steps might put the odds more in their favor.

“Give gifts as much as you can this year,” Mr. Shane suggested. “You want to give as much to the kids and grandkids this year as possible.”

Gift givers will be taxed at 35 percent this year and probably 55 percent in 2011. As with the estate tax, exemptions apply. You can give up to $13,000 per recipient this year before the tax kicks in, up to a $1 million lifetime exemption.

http://www.nytimes.com/2010/02/14/business/yourtaxes/14estate.html?adxnnl=1&ref=yourtaxes&pagewanted=print&adxnnlx=1266163231-IpxZeTgvua13ZWa3e1VVdw