In 2009, I batted .600 in predictions for 2010.  And I thought that was fun. It’s one thing to make predictions; it’s another to look back and see how those predictions fared.

How did I do last year in predicting events of 2011? I was hoping to be maybe 1 out of 7, since most of my predictions last year were of the doom-n-gloom variety. Sadly, I think I’m 4.5 out of 7 for a .642 batting average. Hall of Fame (Infamy?), here I come.

We’ll review my take on the predictions for 2011 after the jump.

1. The Beginning of the End of the Homeownership Society – NO

The trend towards government policy pullback from homeownership remains, but thankfully, we did not see the kind of pullback I was predicting. In fact, Congress acted to keep up support for housing by raising the FHA loan limits in November.

A lot of the news-making that happened in 2011 — the proposal by Treasury and HUD to eliminate Fannie/Freddie, the QRM regulations, the threatened end of the mortgage interest deduction — simply fizzled out in the latter half of the year. That isn’t to say those proposals are dead. But the dysfunction in Washington DC in the grips of an election season meant that nobody was willing to take bold steps backwards or forwards. So status quo it is, at least for another year.

2. Mass Confusion in Real Estate Finance – NO

Once again, thankfully, I was wrong on this prediction. The seeds of confusion and discontent have been sown, and there are lawsuits in various courts making their way through the system, but at least in 2011, we didn’t see an implosion in housing finance of the sort I was worried about. The infamous company MERS at the heart of the crisis withdrew from the foreclosure business in 2011. The institutional lawsuits I was worried about have not blown up; instead, it looks as if the big banks and investors are settling things amongst themselves. We’re not out of the woods (and likely won’t be without a Supreme Court decision), but at least 2011 wasn’t the year.

3. Double Dip in Housing – YES

Unfortunately, I have to say I was right on this one. CNN Money reported on a “double dip in housing” in the summer of 2011. Then we had the most recent report about housing prices sliding in November:

However, worse than expected sales of existing homes also pointed to sluggish housing market recovery. Existing-home sales for November rose 4% to a seasonally adjusted annual rate of 4.42 million units from 4.25 million in October, according to the National Association of Realtors. The reported figure for November was a disappointment given that October sales were downwardly revised from 4.97 million to 4.25 million units.

The average house price in the United States at the end of 2011 is the lowest it has been since 2003. I don’t know what else to call these numbers but a double dip in housing.

4. The Age of Less Will Arrive – SORTA

I think I’m giving myself half a point here. The fullblown Age of Less did not arrive in 2011 — once again, thanks be to God/Zeus/Gaea/deity of your choice here — in large part because predictions #1 and #2 did not come true. We did not see the sort of mass exodus from the real estate industry of brokers and agents.

On the other hand, the industry is continuing to shrink. NAR’s Monthly Membership Report shows that in November of 2010, there were 1.08 million members of NAR; in November of 2011, that number is 1.02 million. It’s another 5.4% drop year over year, as some 50,000 REALTORS either (a) left the Association or (b) left the industry altogether.

Anecdotal reports from various vendors who sell to the real estate industry is that it is getting harder and harder to get realtors to spend money. Many simply can’t afford it; others are taking a wait-and-see approach. Conference attendance numbers are down as well. It isn’t hard evidence, but there you have it.

Either way, based on a 5% drop, I’m giving myself half a point here.

5. The Real Estate Industry Will Fail To React – YES

Here’s what I wrote back in 2010:

Unfortunately, on the whole, I think the real estate industry will fail to react to the Age of Less. There will be exceptions, of course. But I fear that the vast majority of companies, brokers, agents, Associations, MLS, tech vendors, and others will spend an inordinate amount of time and energy rearranging deck chairs on the Titanic. There will be much effort spent focusing on ancillary issues like agent ratings, franchise IDX, the DotMLS domain, QR Codes and so on while the entire infrastructure of contemporary real estate crumbles around them.

You tell me how I got this one wrong.

6. Return of the Broker – YES

A heartening sign is that this prediction appears to have come true in 2011. Brokers large and small are starting to react to changed business realities by reasserting themselves. Two most obvious examples are the Franchise IDX issue and the recent efforts by brokers to regain control over their listing data. Edina Realty’s decision to pull listings off syndication made waves, but that’s just the tip of the iceberg. MRIS, the nation’s second largest MLS, recently put up a guest blogpost from Jon Coile, the President & CEO of Champion Realty. The money grafs:

As their business models matured and our “partners” experienced pressure to create new revenue streams, many of these same companies started quietly selling the right to be positioned on a property results page as “the agent,” as in, “contact the agent for more information on this listing.” The only problem is, “the agent” that these aggregators put forward as an expert doesn’t necessarily know anything about the property, the neighborhood or the community. They are merely agents who have bought the rights to receive a percentage of all listing inquiries for a particular zip code.

…

That erosion of data oversight and accuracy  – plus the variety of methods of inserting other agents on our listings as “the agent” – is why you are now hearing about agents and brokers making the move to remove their listing inventory from the national aggregators. [Emphasis mine]

Actually, it goes beyond that simply because of that “…and brokers”. Why brokers? Under the old model of brokerage — that of warehousing as many agents as possible — why would a broker care all that much? He didn’t for ten years. Why now? Plus, we should have heard a far louder outcry from the actual listing agents themselves; we have not. If anything, the wide disparity of opinion on the wisdom of syndication amongst the agent population suggests that there is nothing like consensus there. So what’s this all about?

To me, the answer is that the broker is reasserting himself. We’ll see how this plays out in 2012, but it happened in 2011.

7. No Groundbreaking New Technology – YES

Yeah…

Nuff said? Feel free to name a single groundbreaking technology from 2011. Coz I can’t.

Forward, Into 2012

I’m working on my predictions for 2012, along with music videos, of course. Feel free to send suggestions my way ( works) or post them in the comments. As always, your thoughts and comments are welcome.

Thanks!

-rsh

Related posts:

1. Seven Predictions for 2011, With Music Videos!
2. Quick: The Prezi From My NRG/HAR Talk Today

Click here to view the embedded video.

Over on Agent Genius, there’s a post about some study done as a marketing tool by Moby (the “let people know where you are” app) with REALTORS in mind. Apparently, September is “REALTOR Safety Month” at NAR, and the good folks there have put together a bunch of materials for y’all.

Now, the study apparently showed (I say apparently because I’m not putting my name/email in to download the said study, thereby ending up in their CRM software) that 1 in 4 men REALTORS carried a knife or a gun with them while “on the job”, while only 7% or so of women REALTORS did so. Lani Rosales, the Editor-in-Chief of AgentGenius, writes:

The above chart outlines Canadian and American answers and although we knew a small portion of real estate professionals would indicate carrying a gun, especially those practicing in the foreclosure or short sale markets, but despite a massive disparity between men and women regarding carrying a gun or knife on the job, it is extremely intriguing that one in four male Realtors indicate they carry a knife or gun while on the job. One in four women carry some form of pepper spray while only five percent of male Realtors do.

The major differences between the behaviors between male Realtors and female Realtors is highly intriguing, but it is most interesting that such a high number of men carry either a knife or gun while they are on the job.

I’m not sure what Lani finds interesting about the difference, but what I find interesting — nay, disturbing and of great concern — is the fact that only 5% of women REALTORS carry a gun while working. If anyone should go about with a concealed firearm while working, it is the female REALTOR.

Violence Against Real Estate Agents

One of the very first posts on Notorious R.O.B., written in February of 2008, was in reaction to the horrifying story of the murder of Lindsay Buziak, a 24-year old REALTOR in British Columbia. She was stabbed to death in a vacant house she was showing to a mysterious buyer who lured her to the high-priced listing:

Rumours circulating in the real estate industry say Buziak was lured to the house, through a phone call on Saturday from a woman with a strong Spanish accent who asked to see properties in the $1-million price range. She allegedly told Buziak she intended to buy that day. Later, Buziak reportedly received a phone call from a man who said he alone would meet with her.

Buziak told friends in her Re/Max Camosun office that she was uncomfortable about the appointment.

The police have not yet arrested anyone in connection with the Buziak murder.

In 2006, Sarah Anne Walker, a real estate agent working for a home builder, was stabbed 27 times and murdered while she was at the model home doing her job. Her murderer, Kosoul Chanthakoummane, apparently targeted real estate agents specifically:

Even more disturbing, the day before Chanthakoummane’s savage attack on Sarah Walker, he had approached another onsite agent…claiming that his car had broken down and asking to use the phone. According to the agent’s statement, he became frightened of her dog and ran away in a fury. Thankfully, she was unharmed and capable of identifying Chanthakoummane from a police sketch…which directly led to his arrest and conviction for Sarah Walker’s murder. Police believe that Chanthakoummane specifically planned to target real estate agents.

Ashley Okland

In April of this year, Ashley Okland, a 27-year old  of Des Moines, Iowa was found murdered in a model home. As of August 8th, there have been no arrests and the police continue to look for clues and leads.

And here, in a post on AOL Real Estate touching on safety, are the stories of Andrew VonStein and Vivian Martin, both of Ohio, who were found murdered in homes they must have been showing.

Then there’s this 2010 story about a horrifying rape of a real estate agent in Orange County, CA. You have got to admire the unnamed victim for her courage, but feel absolute horror at what she had to endure:

She described pleading with her attacker.

“I said I had just dropped my son off at school and didn’t kiss him goodbye,” the woman said. “I didn’t care what he did to me. I just wanted to go home to see my son.”

Yates has pleaded not guilty to the crimes. He could face multiple life sentences if convicted on all charges. His attorney reserved an opening statement until after the prosecution’s case.

According to the woman, a man who identified himself as “Ron Jones” arranged to see the Silvestre Court house at 10 a.m. March 7, 2008. She identified Yates in court as the man.

After walking through the house, the man ordered the woman to the ground while pointing a pellet gun at her. He bound her wrists and ankles with tape and stole her keys, purse and phone.

The man held the gun to the back of her head while he raped her.

Afterward, he beat her on the head with the pellet gun until it shattered and said, “I’m going to kill you now.”

“I was thinking if he was going to rape me, I can deal with that,” the woman said. “I’m not going to let him kill me without fighting. I’m going to go down on my terms, not his.”

The woman started scratching, punching and biting the man while he choked her and pulled a knife, she said.

She tried to barricade herself in the bathroom but he overpowered her. She begged him to let her pray and die in peace.

She said she pretended to be dead after he stabbed her in the neck and side and then left the house.

Yeah, that’s right — the scumbag stabbed her in the neck and left her for dead. Thank God that she survived. Otherwise, she too would be yet another victim of an unsolved murder.

If that’s not enough, you can Google the terms yourself until you are satisfied. 18 real estate agents were victims of homicide in 2009.

Fact of the matter is, real estate agents are uniquely vulnerable. Their whole job revolves around meeting strangers in empty houses. Because of the nature of the business, which necessarily takes place out of the office, there’s no real way not to place one’s self at risk. Furthermore, because real estate is so driven by personal lead generation, by personal marketing, bad guys are easily able to identify victims, stalk them, and get to know all sorts of things about real estate agents that they could not with other professions. Think about it. How many lawyers or dentists put their smiling photographs on every business card? How many real estate agents do everything possible, from personal websites to FaceBook pages to other active social media, to put themselves out there on the ether to generate interest and inquiry?

Those tactics, so useful for cultivating relationships with bona fide legitimate clients, are a real point of vulnerability when it comes to criminals.

At What Price Political Correctness?

So it’s a great thing that NAR is trying to raise awareness about safety with the REALTOR Safety Month. However… I’m just absolutely befuddled and amazed by the near-religious refusal in any of the materials to discuss the single best option for self-defense: firearms. Here are just a few of the guides by NAR produced for the REALTOR Safety Month:

• Fight or Flight (PDF: 69KB)
• Guidelines for Choosing a Self-Defense Course (PDF: 73KB)
• Protect Yourself with a Distress Code System (PDF: 68KB)
• Safety at Open Houses (PDF: 71KB)
• Safety at Property Showings (PDF: 74KB)

Pick any of them. Read through it. All of these are short, so you can quickly absorb it. See if you can find any reference whatsoever to getting yourself a gun.

I am not a gun owner (yet), but is it really that difficult for even the most leftist-minded person to admit that for a small woman of maybe 110 lbs, there is absolutely nothing better than a gun to defend herself? Guide to choosing a self-defense course is great, and if a REALTOR has black belt in jiujitsu after a dozen years of intensive training, I’m sure she’d have little to fear from the 6’2″ 260-lb guy who’s trying to stab her to death… but supposing that a REALTOR doesn’t have the time to devote herself to becoming a martial arts expert, in between showings, marketing, family, having a social life, and so on… WHY WOULDN’T YOU ADVISE HER TO GET A GUN?

A Canadian commenter on AgentGenius mouthed off about the horrible gun culture of the Americans. You know, I’m sure Lindsay Buziak and her family and friends, all good Canadians I’m sure, all wish that she had been armed the day she was stabbed to death. Gun beats knife, every time.

Some of the “safety measures” being advocated by NAR are borderline ridiculous in their uselessness. For example, from “Safety at Property Showings”, we get

“When you have a new client, ask him/her to stop by your office and complete a Prospect Identification Form (an example of this form is online at www.REALTOR.org/Safety), preferably in the presence of an associate. Get the client’s car make and license number.”

Right. We work in an industry where agents don’t want to ask potential clients to register on a website before providing them listing information, for fear that the prospect would find someone else who doesn’t have the “forced registration” thing going. But the advice is to have Mr. Buyer stop by the office and complete an ID form, with a witness present, as if you already suspect that he’s going to rape and murder you? Oh, and ask him for his driver’s license number? That’ll work great for qualifying leads.

How about this one:

“Try and call the office once an hour to let people know where you are.”

Great advice, since most rapes take at least three hours to complete, and stabbing someone a dozen times or so would surely take time.

Or this one from “Safety at Open Houses”:

“Place one of your business cards, with the date and time written on the back, in a kitchen cabinet. Note on it if you were the first to arrive or if clients were waiting.”

When you’re on your knees begging your attacker to let you live so you can go see your son that you had just dropped off at school, as the unnamed rape victim in California had, that business card in the back of a kitchen cabinet will really come in handy.

And then, my favorite advice of all:

“Don’t assume that everyone has left the premises at the end of an open house. Check all of the rooms and the backyard prior to locking the doors. Be prepared to defend yourself, if necessary.”

Defend myself, if necessary, with what??? The business card in the back of the kitchen cabinet? The iPhone with which I’ve been calling the office once an hour, on the hour? Guess what — there ain’t no app for that!

In fact, quite a few of these “safety tips” read more like “tips to help the police solve your gruesome murder after the fact” than actual safety tips.

This is, plainly put, political correctness gone wild. Most of the safety tips are sound, solid advice… but there has to be at least some concession made to reality that when worse goes to worst, and you’re really in a dangerous situation, a gun will be a girl’s best friend. NAR should add at least some sort of tip admitting that yes, as regrettable as it may be, the single most effective form of self-defense for a woman ever invented is in fact a firearm. A gun is the great equalizer, and how big he is, how much stronger, how much faster don’t matter if the petite little blonde is armed.

This sort of PC madness isn’t just some typical real estate internal politics BS, or some big brouhaha about RPR or some such. People have already died, at least in part because of this industry, because they are real estate agents. NAR recognizes it by the fact that it is having REALTOR Safety Month. Well, can we get over whatever personal hangups we might have about guns, and recommend the best course of action for people? Someone’s life may very well depend on it.

Which then leads us to…

The Notorious Safety Tips in Honor of REALTOR Safety Month

Get a gun.

Get properly licensed and trained. Learn how to use it.

Carry it with you when you’re working. If you are fortunate enough to work outside of Illinois, then you have the Constitutional right to concealed carry. But check the local firearms laws.

Unlike the fevered imagination of some, carrying a gun while working does not mean you show up to greet your new buyer brandishing an AK-47. People need never know that you’re packing, unless there’s a reason for them to know. Especially if you’re a woman, and you have a purse with you.

Brokers, Associations, other groups — you oughta think about getting in touch with your local NRA chapter and arranging for a seminar on the proper use of firearms for self-defense. Moby might be a useful tool to let people know where you are, but Moby can’t dissuade a wannabe rapist-killer to leave you the hell alone quite the way Smith & Wesson can. Or if need for actual force does arise, Moby ain’t gonna stop that murderin’ bastard from stabbing you 27 times. At best, it’ll help the cops locate your body.

I’ve been fortunate enough in this industry to have made a number of friends who are real estate agents. They’re some of the best people I’ve ever met. I beg you, please, please go get yourself a gun, get trained, and start carrying it. I know you might not like guns, I know you might think you’ll shoot yourself or a loved one. Get proper training, be careful with them, but have one.

Pepper spray is good; glad to see that many women REALTORS carry that while working. But there’s a reason why police officers carry both pepper spray/mace and a firearm: it doesn’t work on some people. Often, those are the very people you want it to work on. Read the reports of the police officers themselves, and realize that even when pepper spray did work, it took five, ten minutes for the chemicals to kick in….

And while both men and women can become crime victims, women are at far greater risk for obvious reasons. But even non-obvious things make you more vulnerable: advice like fleeing the attacker and escaping is difficult to follow if you’re in a skirt and high heels.

This got long. And the topic is none too pleasant. Yet, this topic goes beyond your typical industry analysis, my typical happy doomsayer stuff about the world, and fun posts on 80′s new wave music. This goes to my friends, those I’ve met and those I have yet to meet, being safe.

Because when seconds count, the police are mere minutes away.

Be safe, you guys.

-rsh

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How's that hopey-changey stuff working out for ya?

One of my pet hobby topics is to fret about the Millenials (the twentysomethings of today). I’ve written about this “largest demographic group like evah” here, here, and here – as well as peppered throughout this blog for a while now. A lot of people — especially in real estate — like to point to the older reaches of the Millenials (the young 30somethings) and think that they are the future of the industry.

Well, to be sure, from pure demographics standpoint, the Millenials do point to the future of the industry. But you should worry about that. A lot. My opinion about the Millenials is that they are the most Screwed Generation in American history who have had their initiative beaten out of them by overprotective parents, teachers and “safety” bureaucrats; their future mortgaged by irresponsible politicians of both parties with full-throated support by the Boomer Generation; their expectations of what is a good life totally unmoored from reality by Hollywood; their options foreclosed by a college-industrial complex that burdened them with absolutely unsustainable student debt (that is not dischargeable in bankruptcy); and of course, they screwed themselves with their attitude of entitlement and superiority complex based on nothing more than the fact that they know how to text message real fast and post pictures to Facebook.

It appears that even the dinosaurs over at the LA Times have noticed that the Hopeychange Generation is actually the Totally-Screwed Generation:

Call it Generation Vexed — young Americans who are downsizing expectations in the face of an economic future that is anything but certain. Career plans are being altered, marriages put off and dreams shelved.

Welcome to the real world, LA Times. Jump right in, the water is freezing.

Generation Screwed

LA Times notes that the unemployment rate for people aged 16-24 is 17.4% (!!!). But that’s the official number. What’s the real number, including those who have given up on looking for a job, or seriously under-employed? As the paper itself notes, a whole lot of recent grads are working at McDonalds and at Home Depot with their $80,000 degrees in Sociology:

But older workers are staying longer in their jobs, forcing twentysomethings to fill up retail, fast-food and other part-time spaces that traditionally give teens their first paycheck.

Can’t really blame the old guys, can you? Their savings have been wiped out. Their retirement dreams are now perma-deferred, which means you young whippersnappers will have to step over some dead bodies to get that “midlevel” job you desperately need to marry that young sweetheart of yours. And of course, since all these 23-year old Psychology majors are working fulltime at Best Buy stocking shelves, all you teenagers can kiss any thought of getting even a part-time job goodbye.

Meanwhile, an employer looking to fill an open position has to consider something important. Say it’s me looking to hire someone to do entry level work of filing, answering phones, and such.

I could hire a 40-something mother with three kids, whose husband was recently laid off, and is looking to get a job to help make ends meet. “Help make ends meet” in this context means stuff like paying the mortgage, putting food on the table, keeping the family minivan fueled up, and making sure the kiddies have clothes for school.

Or I could hire a 20-something youngster who wants a job so she can go clubbing with her friends on weekends, or pay for the awesome new iPad 3 she just absolutely has to have.

Which person, do you suppose, would be more motivated to work her ass off? Which person would be more focused on getting her work done in as short a time as possible, to be as efficient as possible, so she can attend to her personal life?

Now… ask yourself, which of the two is more likely to whine about how the culture of the company is broken, how management just “doesn’t get it”, or believe that if only she were given the chance, she could totally revolutionize the whole industry overnight? Which of the two is more likely to believe that I need to “coach them instead of managing them” and have to cater to their needs for expressing creativity and such?

I’m sure there are numerous young people who don’t have this enormous sense of entitlement and generational superiority complex. I’d like to meet a few of them so I can think about hiring them. But they’re gonna have to go the extra mile to convince potential employers that they’re nothing like their spoiled delusional contemporaries.

Implications

I’m not going to rehash all of the implications of “career plans are altered, marriages put off, and dreams shelved”. I’ve written about all of those topics before, a number of times. But for those in real estate, the topline is this:

The future of real estate is rentals.

The LA Times talks about how these kids are gonna stay away from the stock market, having seen their parents’ 401(k)’s implode. That just shows how out of touch the LA Times is. No, what these kids really saw was their parents get financially ruined because of their mortgages, and they will stay away from homeownership in droves.

Think about it. The 401(k) is a retirement account. It is not mandatory to contribute to it. If you lose your job due to the recession, you can elect not to contribute anything to a 401(k) (of course, you can’t contribute to a 401(k) if you’re unemployed… but you get the idea — ALL retirement accounts are elective.) But mortgages are debts. You have to pay, or else. Lost your job? Too bad, so sad — pay up. Or we’ll be foreclosing on that house.

RealtyTrac says there are 1.6 million homes in foreclosure today. Plus, CoreLogic says there are some 3.8 million homes in shadow inventory (1.8 million that are not current on payments, but banks haven’t done anything, plus another 2 million homes that are underwater). That means some five and a half million families have seen up-close-and-personal the financial ruin that could be homeownership.

How many children, even college-aged children, might those 5.5 million families have? How many of their family, friends, and neighbors might have seen all this unfold second-hand?

Stock market and retirement accounts? Please… think more along the line of housing, mortgages, and debt in general. (Not that the college-grad Millenials with their mountain of debt thanks to college costs increasing by a whopping 300% since 1990 can afford to get mortgages anytime soon, but that’s a whole other story.)

The three factors mentioned by the LA times — careers on hold, no marriages, and ‘dreams’ shelved — all point to a permanent shift in how an entire generation will see housing. Without a longterm career — and as we’ve said, the Millenials got big problems in that department — you can’t buy a house. You may have to pick up and move across the country in pursuit of something other than checkout clerk at Costco. Marriages weren’t really happening anyhow for the Millenials, but the Great Recession makes that even worse. “Yeah, baby, so I’m livin’ at home with my mama at 25, but let’s get married and raise us a family,” isn’t likely to be a great offer even for the men with college degrees. Dreams shelved, yes, well… it’s arguable whether the iPad Generation even thinks of homeownership as the American Dream. Maybe for them, the American Dream is living the Gaea-centered life in organic communes in Oregon.

We’re seeing signs of this already on the Real Estate Web.

Here’s Hitwise’s Top 10 Real Estate Websites for July of 2011:

Here’s the same Hitwise chart for July of 2008:

In 2008, only two of the top ten sites were rental-focused. In 2011, three of them are. But that’s not exactly on point, since the homepage of Yahoo Real Estate looks like this:

Why yes, the big-ass title does say “Find Homes and Rentals“. MSN Real Estate and AOL Real Estate are both optimizing like mad for rentals. Do a Google search and it’ll show you.

Now, even though the consumers — particularly that tech-savvy Millenial consumer that every social media guru is telling you to think about every single day — are expressing a distinct preference for rentals (as evidenced by traffic to the real estate category), the industry thinks of it this way:

One more note about the ‘top 20′ Experian sites – I would suggest not counting rental sites:

6. Rent.com – 2.23%
11. Apartments.com – 1.26%
9. Apartment Guide – 1.26%
20. Rentals.com – 0.83%

Four of the twenty just don’t apply to the real estate ‘for sale’ market real estate agents are competing with for visitors.

True, as far as the market in which real estate agents are competing. But am I the only one thinking this is like buggy manufacturers wanting to compare themselves to each other, while the market literally drives away in the other direction?

It might be a problem if you’re only competing in the ‘for sale’ market, y’all.

Meanwhile, brokers, managers, and agent team leaders tell me every time the topic is raised (with a plaintive sigh, mind you) that they just can’t get their agents to care about rentals because of how little it pays.

Well, keep it up, since at this rate, they won’t have to worry about how little handling rentals pays agents. Someone else will be handling the burgeoning demand for rentals, don’t worry. And when that someone else has trained an entire generation of people to skip using real estate agents for renting (or putting properties up for rent), I’m sure that someone else would never ever dream of entering the ‘for sale’ market. Ever.

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Don't look particularly magical, do they?

I just went to Easter services — the one worship service I make a point of not missing, even though I’m a terrible, terrible Christian in so many ways — at a local church here in Houston. Given that we haven’t yet found a home church, which likely will need to wait until we find a, y’know, a permanent home… it was really quite nice to be just a guest.

But at this service, the absolutely mundane yet absolutely amazing fact of the church choir just struck me. I thought I’d share that with you all.

The Church Choir Is Pretty Amazing, When You Think About It

I grew up in the church, given that both my parents are UMC ministers. One disadvantage of having the church as the family business is that you see the “man behind the curtain”, as it were. While others are focusing on the beautiful sanctuary, the lovely singing, the sermon, and so on, I can’t help but think about the work of committees, staff, the pastor, the lay leaders, the various volunteers that make it possible. I can’t help but look at the printed program and critique it or admire it for professionalism. “Oh, that was well done,” is a thought that crosses my mind often, because I know how difficult it is to pull off a smooth transition from the Offertory to the Doxology. Having seen my parents work on their weekly sermons for decades, I think I’m versed in most of the ways to criticize a sermon, and often look at the techniques and the craft involved, rather than the message itself.

But until today, I hadn’t really thought about the church choir. This is an institution found in just about every single Protestant church of every size and denomination. Some are tiny and marked more for enthusiasm than beauty of performance, while others are massive, and could likely put out professional records. In one church I used to attend in Manhattan (the Riverside Church), the Easter Service would often bring on professional opera singers from the nearby Metropolitan Opera or New York City Opera as well as music schools like Juilliard. But for your everyday Sunday worship, the choir is usually the standard church choir, not studded with ringers.

What’s amazing is that most choirs sound pretty good. Whether it’s the 10 person choir at a tiny country church in a New England town, or the 100-person choir at a major metropolitan church, they all sound pretty decent. That’s actually amazing, when you consider the fact that not one person in that choir is really any good by our heightened standards. Unless you belong to some unusual church, there isn’t likely to be a single recording artist in your choir. Your choir is likely made up of some retired people, some stay-at-home moms, some working professionals, maybe a precocious high school student — all of them volunteers, all of them not pursuing music as a career, all of them more-or-less untrained vocalists. It might be the last bastion of the true amateur musician, doing music simply for his or her own pleasure — as well as possibly the idea that the other parishioners of the church appreciate their efforts.

Individually, each choir member is mediocre at best, and horrible at worst.

And yet, when you put all these mediocre people together into a single choir, somehow, all that mediocrity is transformed into real beauty. The whole really is greater than the sum of its parts. It’s the mundane magic of multiple bad voices somehow supporting each other to create a single marvelous sound.

Symbolic of Larger Truth?

I wonder if that mundane mystery is at work in other areas of our lives, of our world. Take flawed individuals — some of them horrible on his or her own — but somehow, blend them together into a single unity working towards the same goal, and marvelous, magical things happen.

Our politics have gotten bitter, divided, full of acid and bile. We focus so much — myself included — on the flaws of individuals, the hypocrisy of this Congressman and the arrogance of that Senator, the stupidity of this gal and the cupidity of that guy. But I wonder, if we took a step back, blended them all into a single thing that’s working towards the same goal… I wonder if we might not see magic.

Why wouldn’t organizations and businesses be the same thing? Maybe it’s not so important that this individual doesn’t get it, or that manager isn’t the best in the world. Maybe what’s important is that everybody is trying to do the same thing, sing off the same page of the hymnal, and somehow, magical things will be created out of totally mundane dross.

Truly wondrous individuals, truly gifted and talented people, have no need for a choir. They may not have a need for a company. They might not even need society to achieve what it is that they seek to achieve. Ah, let them go their own way, I figure. They’re talented; they’ll find their way and make something wonderful.

The rest of us, the rest of us who are individually mediocre, individually wanting, individually flawed… maybe the choir exists for us, not for them.

Have a happy Easter, filled with wonder, everybody.

-rsh

No related posts.

In my first blog conversation post, I wrote about Millenial family formation. That was fun stuff, and Travis Robertson, my dialogue partner, has posted his response. Go check it out; it’s worth a read, and the discussion is fun. But I thought I’d move onto some of the real meat.

Travis claims in the video (embedded in the first post) that companies — and specifically real estate brokerages — have to change the way they operate in order to recruit the Millenials. I don’t think so; I rather think Millenials have to change the way they operate and view the world in order to be recruited by employers, including brokerages (at least the ones that demand something of their agents).

I’m going to be referring to Travis’s posts and his eBook; and I do encourage you to go check them out.

In this part, let’s address the issue of managing Millenials.

Leading vs. Managing, According to Travis

Travis believes that one of the fundamental ways that companies have to adjust is that Millenials need to be led, not managed:

Growing up, most Millennials played at least one team sport. We had soccer moms and little league dads. We were shaped by those experiences to expect coaching – not managing.

If you want to attract and retain Millennials you and your managers have to learn how to become great coaches. Have you ever noticed what sets great coaches apart from good coaches?

• Great coaches care about winning (results) but they know there is no set method for achieving it (methodology). Each game will be different. Each game will require different strategy. Players can’t do the exact same thing in each game and expect the same result.
• Great coaches learn about the gifts and strengths of each team member. We can’t all be pitchers. We can’t all be star outfielders. That’s okay. You need an array of talent. Find out what we’re gifted and talented at and let us work in our strengths.
• Great coaches give players lots of one-on-one attention. They don’t hand them a manual and tell them to “learn the plays.” Instead, they tell them to learn the plays then they work with them day in and day out practicing those plays. Most companies offer little in the way of ongoing training. And very rarely does that come from a manager. Instead, employees are shuffled to a classroom during a lunch hour.
• Great coaches rarely sit in an office. Instead, they are down on the field working with the players. The lead from the field.

What do you think? Are you up to the challenge of becoming a great coach? Is your leadership team? What changes can you start making right now? What things can you stop doing? (Emphasis in original)

Travis cites examples like Martin Luther King, Jr. and the civil rights movement, as well as Jesus Christ and the apostles, rather than the SVP’s of Proselytization.

The fundamental criticism is that “management” is focused on process and method, rather than results. It focuses on controlling variables in performance so as to standardize the output. Travis believes this style of management is rooted in the Industrial Age assembly-line manufacturing, and is outdated for the Information Age knowledge-based service businesses.

The better method, in a knowledge economy, particularly in dealing with Millenial workers, he believes is to empower them, inspire them, and then get out of the way:

If management is focused on process and methodology, leadership is focused on outcome and results. Leaders improve results by leveraging the passion, gifts and talents of a group of people inspiring them to work toward a common goal.

Leaders are part of the team – not above it. They focus on demonstrating and coaching from the front rather than on directing and controlling from above. (Emphasis in original)

I think I captured the general gist of his arguments. Now I take them apart.

Coaches vs. Employers

What Travis leaves out is what sets great coaches apart from employers: they don’t pay their players to create marginal profit. (I’ll assume Travis means your average youth sports coach, rather than big time college football coaches who are in effect working for the minor league of the NFL, since 99.999% of Millenials were not on big time money-making college athletic programs.)

But even if we are talking about using athletics as an example, there’s an enormous missing piece here. Good coaches teach, because their raison d’etre is to introduce a young person to the athletic life. Again, excepting the most extreme examples (Texas high school football, Division I basketball, etc.), even the most competitive of junior high school coaches would recognize that their job isn’t to win games, but to teach the youngsters in their care the love of the game.

In contrast, employers do not hire people in order to introduce them to the joy of accounting. They hire them to make money. They have to, because employers who do otherwise won’t be in business for long. The anti-corporate culture of a certain segment of the population, particularly among the Millenials, is completely missing the point that a company that does not generate a profit does not get to stick around for too long. It isn’t like a youth soccer league that will stick around whether they win every game or lose every game.

The hardest and most valuable lesson a Millenial can learn is that unlike parents, unlike coaches, unlike their teachers, or even their college professors, the employer does not exist for your benefit. Companies do not hire you in order to train you. They do not offer you a job, pay you money, and give you benefits so that you can improve yourself. It’s quite the other way around. They hire you, pay you, and give you stuff so you can improve them. And for a business, the only improvement that matters at the end of the day is the bottomline. Improve the culture? Sure. Improve morale? Of course. Get inspired and all charged up? Absolutely.

As long as all that culture, morale, and inspiration is leading to more revenues, lower costs, and greater profits. Otherwise, all of that crap is out the window.

The examples of MLK and JC are instructive. As far as I know, the Apostles did not draw a salary from the ministry of Jesus. I’ll put this out right now: any Millenial or young person willing to work for 7DS without getting paid a dime is welcome to email me to see if I can inspire you to work towards a common goal: that of making more money for 7DS.

Mechanical vs. Cognitive

A closely related assumption that has to be challenged is the idea that there is such a world of difference between the Industrial Age “mechanical” tasks and Information Age “knowledge” tasks.

The flawed assumption is that every “knowledge” based job is some sort of a creative endeavor to solve problems. Fact is, the knowledge economy is a steep pyramid. At the top, you have the creatives. These are your lead software engineers, the senior managers, the creative directors, the chief architects. These are the men and women who are paid for their knowledge, innovative thinking, creativity, and understanding of business. This is your Steve Jobs and your Jonathan Ive. Below them, you have a group of managers who are valued primarily for Getting Things Done. That requires creativity, leadership, discipline, and knowledge — but they’re not paid for their ideas. They’re paid for executing those ideas.

And then at the bottom, you have legions of coders, junior “designers” (who don’t actually design anything, but just code the designs that the Creatives have come up with), customer service reps, draftsmen, pattern-makers, technical designers, writers, and so on and so forth. At this level, the standardization, process controls, and method are supreme. They have to be.

Take just one example: checking out source code. Every serious software development shop has rigorous methods of checking in and checking out source code. The reason is that you can easily overwrite someone else’s work without these controls. No matter how creative, how inspired, how results-oriented the 22-year old junior coder responsible for one little section might be, she cannot under any circumstances circumvent check-in and check-out.

Junior document review attorneys do not get to be creative with how they’re supposed to read thousands of pages of a currency swap contract. The senior partner has set the legal strategy, the junior partner and the senior associate have formulated what specific elements they need, and what they require of the junior knowledge workers is that they produce those specific data points from a mountain of paperwork. That’s it.

Even Travis’s example of customer service is flawed. In any well-run shop, there are rules and procedures and methods that each and every customer service rep will follow, period, end of story. The young whippersnapper CSR might think it’s cool and hip to use cuss words during a call, y’know, to “keep it real, bro”, and believe that it would achieve the End Result of superior service. There isn’t a manager who wouldn’t fire that CSR on the spot unless the company policy allowed the technician to say things like, “Oh *bleep*, your *bleeping* cellphone is fried again? *Bleep*, that sucks!”

Yes, leadership is great to have, and it’s rare. But let’s not delude ourselves that because you’re a 23-year old tech support rep that the CEO has to change his company culture or move away from processes to retain your services. There are 79,999,999 others just like you (and more — see below on that).

Management vs. Leadership

Finally, and perhaps most importantly, Travis is taking down a straw man. He paints the picture of the “manager” as the clueless pointy-haired boss from Dilbert who has to buckle down on methods and process, because he doesn’t get that results are what matter, while the “leader” is this charismatic cat who knows how to earn loyalty, work one-on-one with even the most junior staffer, and inspires them to new heights of personal satisfaction.

That’s not a difference between a “manager” and a “leader”; that’s the difference between a crappy manager and a great manager.

Let’s look at a “knowledge-based service delivery” organization that happens to be extremely good at delivering its particular “service”: the United States Marine Corps.

The officers of the Marine Corps have responsibility for the lives of their men and women. They have impossible pressure to find, defeat, and kill the enemies of the United States in hostile territory where making a mistake doesn’t mean that the quarterly financials are off by 3%, but that they don’t get to go home ever again along with their fellow soldiers. They work in an environment where methods and procedures are almost certain to change: as is often said, no plan survives contact with the enemy. If group of managers/leaders cares more about achieving the best possible End Result with minimal losses, I’d like to know who that is.

Do we think these officers skip over fire team procedures, or weapon inspections, or drills and exercises because those are mere methods and processes? Do we think that they don’t manage the inputs and control variables because they are leaders who get out in front of their platoons carrying a rifle with them? Do we seriously believe that they’re not directing and controlling from above? General Petraeus isn’t in the field carrying an M-16.

Every single effective manager I have ever worked for, ever seen, ever met is also a leader. And that isn’t restricted to knowledge-based companies. Nor is it something new to Millenials. The effective manager of some assembly-line factory floor isn’t just some guy sitting behind a desk issuing memos. He’s a real leader who does everything Travis is describing in terms of inspiring, disciplining, teaching, and the rest of it — but he also manages the process, because that is how success is built.

In fact, in my experience, managing people is the single hardest thing anyone can do for a living. It’s really, really, really hard to do right. And I confess that I have not met a single leader in the mode Travis describes, able to inspire the staff, who wasn’t also an extraordinary manager.

There is nothing new to this dynamic of management and leadership. Millenials didn’t invent this. We Gen-X went through the same thing. And before us, the Boomers, and the Greatest Generation, and so on and so forth. Managing the Roman legions was, I’m certain, a difficult job for Julius Caesar.

What is new with Millenials is the idea that it isn’t they who have to change and adapt and get used to being managed (as well as being led) and following processes they don’t fully understand or agree with, but the manager and the company who put in those processes, usually for some very good reasons.

And the notion that because Millenials are so numerous, because employers have to hire somebody and the only option will be these Millenials, the companies are the ones who have to do the changing is sadly out of touch with reality.

Globalization of Labor in a Knowledge Economy

The most important reality is that in a knowledge economy, in the Information Age, there are really very, very few jobs that requires a company to hire someone here in the United States. And the jobs that requires physical location are normally not the kind of jobs Travis is talking about (e.g., plumbers, lawn care, babysitters, etc.).

The big news about the workplace for Millenials is that virtually every service-based industry can be outsourced. That website lists Designers, Programmers, Consultants, Admins, Writers, Marketers, and Finance. Law firms are turning more and more to outsourcing for routine work that they would have hired a young junior associate to handle at one time. Here’s an article Millenials ought to find very very applicable; the money quote:

You no longer have to imagine a company whose finance team in the United States is made up of only the controller, treasurer, and CFO, with their staff in India. This is already happening.

And guess what the young twentysomethings in India, China, Ireland and elsewhere never had? Helicopter parents, trophies for participation, a safe cocoon to shelter them from the realities of the world. They are not Millenials, these global competitors, but more like anti-Millenials: hungry, ambitious, and ruthless. They’re not whining about work-life balance, or demanding that companies change their culture so that they can feel inspired. Speak to an elite young professional from overseas, particularly someplace like China or South Korea, and you’ll quickly discover that they are full of confidence, think their American counterparts are badly spoiled children who would rather spend time dreaming about getting inspired, while they will put in extra hours, make managers happy, and advance their careers.

Here’s the thing: information and knowledge based companies can utilize outsourcing far more effectively than a manufacturing company, because their “products” and “services” can be delivered over the telephone and the Internet. There is no shipping container full of clothing from Hong Kong. So wake up, and recognize that your choices are as follows:

1. Become a high-value Creative as quickly as possible; or
2. Quit yer bitchin’ and get with the program; otherwise the entire department might be outsourced to Ireland

So why is it that Millenials think that companies have to cater to them, exactly, especially in a knowledge economy?

As it happens, real estate is one of the few industries where physical geographic location is important. Hard to have someone in a Mumbai call center show you a house in Texas (although, with advances in mobile video… don’t bet on it never happening). But Travis, in his RETSO speech, got it exactly wrong when he said the reason why Millenials don’t go into real estate is because they look at brokers and see a bunch of white haired no-clue folks. The reason why Millenials don’t flock to real estate is because a real estate agent doesn’t get paid. Oftentimes, in a real estate brokerage, the agent is not the employee whom the broker pays, but the customer who pays the broker.

So in that sense, Travis has a message that will resonate with real estate brokers: change your culture so that you can get more buyers of your brokerage services. That message, however, does not translate to just about any industry other than real estate brokerage.

Wrapping Up…

We can go on and on, but let me wrap up. Here’s the deal about the workplace of the 21st century, and it is something I hope the Millenials will understand sooner rather than later.

• Companies do not hire you to improve you; it’s the other way around
• Not all “knowledge workers” are the same
• Good managers are also leaders, and both manage methods and procedures, often for a good reason
• Your competition is not with other members of the Lost Generation, but with hungry, ambitious, and highly disciplined young men and women from India, China, Korea, Ireland, Poland, Argentina, etc. etc.
• Globalization is far more effective for a knowledge-based company than for a manufacturer

My conclusion? As I’ve said in my first post, before the Millenials will change the world, the world will change Millenials.

Over to you.

-rsh

Related posts:

1. Coaching and Managing: On Gen-X

First, let me urge you to watch Travis’s speech at RETechSouth. It’s an hour long, but it’s fully worthwhile, if only for yours truly being mentioned in an amusing context:

Click here to view the embedded video.

This is going to be a topic we won’t settle in one post. But longtime readers know that I’ve been skeptical about the Gen-Y’s future for a variety of reasons. I’m already on record as suggesting that real estate won’t be saved by the Gen-Y; Travis agrees, but suggests Gen-Y will change real estate.

Well, every generation changes the world around it. But what I’d like to challenge is the phenomenon of Millenial Triumphalism, in which the Gen-Y and its enablers make the kind of statements about why Gen-Y is unlike any other generation that came before it, and talk as if the Millenials are the change that they’ve been waiting for. My admittedly more tempered view is that before the Millenials will change the world, the world will change Millenials.

In this post, let’s talk specifically about family formation — the topic that spawned my comment about polygamy — as one of the driving factors behind home sales is family formation: people meeting, falling in love, getting married, and starting a family.

Gender Imbalance in the Millenial Population

Travis is well-aware of the facts of the incredible gender imbalance within the Millenials. Numerous people, myself included, have commented on some of these never-before-seen numbers:

• 60% of college students are women
• 60% of adults holding an advanced degree are women
• Women earn more Master’s and Ph.D. degrees than men
• Women make up the majority of the workforce today

And Travis himself says that the majority of first-time homebuyers in 2010 were single women, Millenial or otherwise.

Unsurprisingly, the educational achievements are having an economic impact as well. The Census Bureau reports a direct correlation between degrees and income:

The data also demonstrate the extent to which having such a degree pays off: average earnings in 2008 totaled $83,144 for those with an advanced degree, compared with $58,613 for those with a bachelor’s degree only. People whose highest level of attainment was a high school diploma had average earnings of $31,283.

And the current Great Recession is actually the Great Mancession.

Chart by Mark Perry, Univ. of Michigan

So the news is wonderful if you’re a female professional competing in the labor market. In the eternal back-and-forth between men and women, it is clear that American women have won the battle, and pretty decisively. Economically, Millenial men are at a disadvantage compared to Millenial women in pretty much every conceivable way.

It turns out, however, that male disadvantage has real consequences to women… at least the ones who actually like men and want to marry one of ‘em one of these days.

The Numbers of Love & Marriage

At the most basic level, the fact that 60% of college students are women means that there are only two men for three men in college. That’s leading to some interesting dating dynamics on college campuses:

It is tautological that if 3 of 5 college students are women, then 3 of 5 people who have college degrees in the big metropolitan areas in the country will also be women. Indeed, the dating scene for these highly educated, accomplished women is not exactly full of options even after their bright college years are over. From Slate:

But just as critical is the fact that a significant number of young men are faring rather badly in life, and are thus skewing the dating pool. It’s not that the overall gender ratio in this country is out of whack; it’s that there’s a growing imbalance between the number of successful young women and successful young men. As a result, in many of the places where young people typically meet—on college campuses, in religious congregations, in cities that draw large numbers of twentysomethings—women outnumber men by significant margins. (In one Manhattan ZIP code, for example, women account for 63 percent of 22-year-olds.) [Emphasis mine.]

Why does this matter for family formation?

Female Hypergamy and Male Disinterest

These socioeconomic trends matter because of the phenomenon of female hypergamy. Women throughout the known human history have always, always, always sought to marry up. This has been true of every human society, East and West, North and South, of every language, every culture, every religion.

Evolutionary psychologists believe that hypergamy is derived from the different investments that a male and a female make in producing offspring. Women want the man who will be the father of their children to provide some resources for their joint offspring, particularly since having a child is so seriously disruptive to career plans, earning potential, even health and survival (harder to flee the sabertooth tiger if you’re carrying a two year old infant):

Much of the research on human mating is based on parental investment theory, which makes important predictions about the different strategies men and women will use in the mating domain (see above under “Middle-level evolutionary theories”). In essence, it predicts that women will be more selective when choosing mates, whereas men will not, especially under short-term mating conditions. This has led some researchers to predict sex differences in such domains as sexual jealousy, wherein females will react more aversively to emotional infidelity and males will react more aversively to sexual infidelity. This particular pattern is predicted because the costs involved in mating for each sex are distinct. Women, on average, should prefer a mate who can offer some kind of resources (e.g., financial, commitment), which means that a woman would also be more at risk for losing those valued traits in a mate who commits an emotional infidelity. Men, on the other hand, are limited by the fact that they can never be certain of the paternity of their children because they do not bear the offspring themselves. This obstacle entails that sexual infidelity would be more aversive than emotional infidelity for a man because investing resources in another man’s offspring does not lead to propagation of the man’s own genes.

And before you start commenting that your aunt Sally, a doctor, fell in love with an unemployed construction worker and married him and they have a wonderful life, and so on… I’m fully prepared to admit that individual cases of non-hypergamic behavior may exist. When you fall in love, you fall in love, and damn what may come. But at a societal level, there has never been any record of a human society of any duration or significance, where women did not seek to marry up in some way.

Even were we to assume that 21st century American women, liberated from all the phallocentric patriarchy of the past, no longer seek to marry up… we probably should assume that they’d want to marry an equal. Hillary Clinton, after all, did not marry a blue collar construction worker with a GED; she married a Rhodes Scholar she met at Yale Law School.

Remember those 138,000 highly successful women with advanced degrees? They cannot meet a man who is their equal in education; it is mathematically impossible. But even those in the 339,000 women who can mathematically meet a man with an advanced degree are not in a great situation for the reason that Slate points out: men have far more options due to plain old supply and demand.

The terms of contemporary sexual relationships favor men and what they want in relationships, not just despite the fact that what they have to offer has diminished, but in part because of it. And it’s all thanks to supply and demand.

That is, because so many other men are unacceptable to highly successful women, the few successful men find it ever easier to get laid. And when you’re a young, healthy 30-year old investment banker in New York… why would you ever want to settle down and limit your options to just one girl? It has to be true love indeed. Especially since the minute this young man enters into a marriage, all of the advantage he enjoyed evaporates in our contemporary family law system.

The strange thing is not that the marriage rate is decreasing by 1% a year for the past decade; the strange thing is that some young men are getting married at all.

Answers?

So that was the context behind my half-joke about polygamy being legal in 30 years. Because I don’t know what the impact of the gender imbalance we are seeing now in the Millenials is in terms of family formation. I’ve had this debate with Travis — and others — as to what they think the social consequences would be.

There are usually two responses I get.

One, Millenial women will simply marry down.

I’ll believe that when I see it. Perhaps Dr. Sally Jones would marry “down” to be with Mr. Joe Smith who only has a college degree. I could see that. But I simply do not buy that a college-educated woman would marry a high-school grad (unless he’s a rock star, movie star, or a professional athlete of some sort). The socio-cultural differences are simply too large. College has come to mean far more in our society than just a piece of paper; it’s where you go to learn about culture, about literature, the arts, and the finer things in life. Skilled tradesmen, like electricians and plumbers, make a good living… but they don’t sit around Amalgamated Plumbing Local 218 discussing Jacques Derrida or American foreign policy in Pakistan; college grads do. College grads go to the Film Forum for the Fellini retrospective; non-college grads do not. (And again, yes, exceptions exist, blah blah blah.)

And economically, as the Census data indicates, the earning gap is simply too large to believe that a successful woman earning $60K a year would marry some guy who works in a maintenance garage at $32K a year, since children would reduce her earning potential far more than his. Sure, it’s possible, but I’ll believe it when I see it.

Two, education is not the only path to success — young men without college degrees can start businesses and do other things to become attractive to more-educated women.

The idea is that Millenials are an entrepreneurial, technology-empowered generation, and they will not be chained to hidebound conventions of ye olde New England. The problem here is that without at least a college degree, the number and kinds of businesses that one could start are pretty limited — after all, you can’t start an accounting firm without a degree in accounting. You have the skilled trades — but again, see above about socio-cultural differences. Restaurants and retail do not require a college degree. Real estate doesn’t require a college degree (yet). And there are a number of small business opportunities (hair salons, pet care, telemarketing, etc.) that exist. You also have some specialized technology-related services, like web programming and so on; after all, we’re often told that Bill Gates did not graduate from college, and Mark Zuckerberg did not use his Harvard degree much in creating Facebook.

The trouble is, first, in America today, not getting a college degree — even from a community college or a University of Phoenix — is usually indicative of a lack of drive and a lack of discipline. Getting into college isn’t difficult, even if getting into the ‘right’ college is like winning the lottery. So it’s difficult to imagine that the majority of those young men who didn’t go to college would suddenly discover this entrepreneurial spirit, this will-to-succeed at all costs mentality that starting your own business requires.

Second, unless said high-school grad comes from family money, getting the capital together to start a small business is no easy task, especially at the lowered earnings that the lack of education represents. How much can you really save out of $32K a year towards starting a business? Is a bank likely to give a business loan to someone who doesn’t even have a community college degree?

Again, exceptions exist — but would enough Millenial young men suddenly find the drive and gumption to start all sorts of businesses, despite not caring enough about their future to go to college, to meet the demands of the one out of three college-educated women who mathematically cannot meet a college-educated man? I don’t see it. Not yet.

Challenge to Millenial Triumphalists

So here’s the challenge, now that I’ve laid out my case for why I believe the Millenials will see far lower rates of family formation than any we have seen to date.

Given the above facts and data, how do you see the Millenials dealing with this issue? Because it’s not a small issue of just boys and girls getting together; family formation drives housing and to a large extent, drives the economy. Men with children work far harder, far longer, than men without — simply because their priorities change the instant they lay eyes on their son or daughter for the first time.

The 230,000 women in the Class of 2008 who cannot mathematically meet a man who is a college graduate… what do they do when time comes to find a husband (or at least a long-term committed boyfriend, willing to provide for her and her children)?

Over to you.

-rsh

No related posts.

I don’t often do book reviews on Notorious, although I do read quite a few of them, but when the author is a man I respect, a good friend in bad times, and an all around great guy, and his publisher sends me a review copy… well, the least I could do is give my impressions of the book.

The book, of course, is Surviving Your Serengeti: 7 Skills to Master Business and Life by Stefan Swanepoel. I read the thing in one night, because… well, that’s just how I roll, baby.

No, seriously, the book is written for the mass audience. It’s an easy read that blends storytelling with travel writing with solid business advice. Large chunks of it read like a novel, because… well, it’s sort of written like a novel, and you find yourself just turning one page, then another, then the next.

Longtime readers of Notorious know that I’m nothing if not honest — some might say “brutally honest”. There will be no exceptions just because I admire the heck out of Stefan. Read on for my impressions.

The Good

Fortunately, the good of Serengeti outweighs almost everything else.

The book is written as a fictional account, mostly from the perspective of Sean and Ashley Spencer – a Los Angeles based renewable energy entrepreneur and his wife who was laid off from a school teacher job. (Because the characters are fictional, I suspended disbelief that a Los Angeles school teacher would ever get laid off. But then, Stefan doesn’t say Ashley is a public school teacher, a member of the all-powerful teacher’s union, so maybe it’s a private school.) They go on an African safari trip to the Serengeti, where Sean runs into a former roommate of his at the London School of Economics, a Zachariah Makena, who used to work for the African Wildlife Foundation.

Zachariah, it appears, has translated the survival skills of the animals of the Serengeti into business principles, and the rest of the book is essentially a series of stories interspersed with the Lesson from each animal.

Stefan writes in a breezy, travelogue style. The characters are reasonably realistic, given the constraints of what he’s trying to do — impart life lessons from the stories of animals. The stories of finding and seeing the animals are vivid. Here’s one passage as an example:

The lionesses crept slowly along the edge of the bushes toward a small group of trees on the perimeter of the clearing where the zebras were feedings. Two younger lionesses stayed with the cubs, which were still lying in the tall grass like little statues. It was difficult to see the lionesses as they crouched down and slowly edged toward the browsing herd.

The book is filled with such vivid descriptions, and the reader just moves along almost able to picture the scenes as our protagonists are seeing them.

There are seven animals that Stefan covers, each with its own unique “survival skill”, and after each section, he summarizes the skill, defines it, tells you what traits you would identify in yourself to see if you fit that animal’s skillset, and gives advice on how one might maximize that skill. The seven animals and their skills are:

• Wildebeest: Endurance
• Lion: Strategy
• Crocodile: Enterprising
• Cheetah: Efficiency
• Giraffe: Grace
• Mongoose: Risk-Taking
• Elephant: Communication

I’m not going to go into depth here since you should buy the book and read it for yourself. But each skill and each animal are well-matched, especially coming at the end of a vivid story of how Sean and Ashley discover those skills through seeing them in nature with Zachariah.

Above all, Stefan weaves such a vision of hope, of overcoming difficulties, and of promise that it’s hard to be entirely cynical about the world, about business, about problems, and about difficulties as you read Serengeti. As I believe that to be one of his main purposes in writing the book — reminding stressed out First World people that their problems can be managed — I think he succeeds marvelously there.

The Bad

There really isn’t much to complain of in this book. Is it a great work of literature? No. But I don’t believe Stefan set out to write Out of Africa. He set out to write a series of modern fables, using fictionalized characters and fictionalized stories to make his point. And he does that well. So is it “bad” that the characters speak like perfect lectures? Not if you understand the book as an allegorical tale.

The natural cynic, like yours truly, might have fun with some of the lessons. For example, the Wildebeest embodies Endurance, and Stefan spends quite a few pages pointing out that the Wildebeest’s journey is fraught with peril, with no guarantees of survival, but exults in the fact that the Wildebeest overcame all of those dangers to become the most populous animal on the Serengeti. I couldn’t help but think, however, that the species as a whole may endure, but individual Wildebeests get eaten. Thousands of them. So one wonders if the real skills of the Wildebeest are (1) fertility, and (2) willingness to sacrifice the weak.

But that’s nitpicky, and the kind of stuff one would chat about at book clubs or something, because it’s fun to talk about little details. The big picture point that Stefan makes remains, and it remains an inspiring one.

The Ugly

There isn’t one. This is a solidly written book, offering a message of hope to people at a time when they probably most need it. The lessons, the skills, mostly make sense, and the stories move along quickly, entertaining all the while.

Overall

Surviving Your Serengeti isn’t a “business book” filled with statistics and studies and academic language. There are plenty of those in the marketplace. It’s a personal growth book, if you will, and one that is fun to read, easy to read, and has inspirational messages throughout. Plus, Stefan’s own passion and love of the Serengeti comes shining through in some of his descriptions. I couldn’t help but think that many of the adventures that Sean Spencer has, and many of the amazing sights that he and Ashley witness were precisely the adventures and sights that Stefan himself may have witnessed in person.

A very nice read, especially for those in need of some positive inspiration.

-rsh

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Thanks!

-rsh

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It's high time we brought back these classes...

Apparently, some legislators in South Dakota are pulling a political stunt by introducing a bill to require that all adults buy a gun upon turning 21. I say it’s a political stunt because the whole point of the exercise apparently is to say that Obamacare is unconstitutional, just like a an individual mandate to buy a gun would be:

Rep. Hal Wick, R-Sioux Falls, is sponsoring the bill and knows it will be killed. But he said he is introducing it to prove a point that the federal health care reform mandate passed last year is unconstitutional.

“Do I or the other cosponsors believe that the State of South Dakota can require citizens to buy firearms? Of course not. But at the same time, we do not believe the federal government can order every citizen to buy health insurance,” he said.

Well, what I find really disturbing about this is that a frikkin’ state legislator is so ignorant of the Constitution that he can make statements like this. We need to bring back civics education and do some sort of teaching on basic, fundamental constitutional law. Our nation is starting to suffer because of the low level of knowledge and education on the part of the citizenry on the most fundamental document that governs our political lives: the U.S. Constitution.

A Politician Ought To Know What Federalism Is

Fact is, South Dakota can require all adult citizens to buy firearms. That may be a terrible idea (because, well, it is), but there is nothing unconstitutional about such a law. Why? Because the Constitution is a restraint on federal power. In our system of government, the states are sovereigns; they may be restrained by their individual state constitutions, but the U.S. Constitution only limits them to the extent that their laws would run afoul of its specific mandates — such as the 13th Amendment.

Put another way, the federal government has enumerated powers specified in the Constitution, and in theory, any power not given to the Feds by the Constitution is reserved to the states. The states, on the other hand, have plenary powers and can do pretty much what it wants to do, unless prohibited by a specific clause of the Constitution.

Given the Second Amendment, there is no reason to think that a state cannot require its citizens to buy a firearm. That’s basic federalism. An elected official ought to know what basic federalism is. So it is profoundly disturbing that at least Rep. Wick (a fellow Republican) does not know that.

The People Ought to Know Basic Constitutional Law

Anytime some blog removes a comment that its proprietor finds objectionable, you get cries of CENSORSHIP! And various ill-educated morons start going on about freedom of speech.

Even regular citizens ought to now that the First Amendment applies to governments, not private individuals or companies. I can censor to my heart’s damn content, and it isn’t unconstitutional. People ought to know this. They should know that there is no Constitutional right not to be offended. There is no mention of the words “privacy rights” in the Constitution.

Some of the most contentious issues in modern American political life have to do with unsettled issues in Constitutional interpretation. If we’re going to have a debate about how we should tackle thorny issues through dialogue (vituperative as it may be at times) and debate (including some name calling as is natural in these things), then at least we should have some basic understanding of the Constitution and what it says and what it does not say.

People should know that the Constitution specifies a way to amend it, that it can be changed, that if we wanted a right to play video games, we can amend the Constitution to say just that. The sucker is a couple hundred years old, but it was never meant to be eternal or unchanging.

We All Should Agree On Some Fundamentals, No?

I started getting disturbed by this watching the NFL playoffs, and noticing that during the national anthem, many of the players on the sidelines were just standing there with their hands at their sides. A few knew that when the national anthem is being sung, you salute the flag — either with a military salute if you’re active or retired military, or with the right hand on your chest if you’re a civilian. Can we agree that no matter what our differences may be, we all should salute the flag during a national anthem? Non-citizens are exempt, of course, as we do not expect them to salute our flag.

Without civics education, it falls on the parents to teach their children these basic fundamentals of citizenship, of community. But given that we are a nation of immigrants, it’s awfully hard to say to someone newly arrived (legally!) in this country to teach their kids the basics of American citizenship. Given the importance of shared basic assumptions, shared basic knowledge, and shared basic behavior, I do think it’s time we bring back some heavy duty, real-deal civics education, including basic Constitutional law.

My suggestion? It’s likely too much, but here’s what I’d like to see:

• 9th grade: Basic civics, such as our system of government, difference between a democracy and a republic, our founding documents, saluting the flag, etc.
• 10th: Government 101, such as municipalities, county government, state and federal governments; executive branch, legislatures, and the courts; difference between police and military, etc.
• 11th: Basic Constitutional Law, plus more on the separation of powers, and federalism
• 12th: Law and Society, including rights and responsibilities of citizens and legal aliens; how laws and regulations are made, challenged, enforced; civil lawsuits and criminal prosecutions; more advanced topics in Constitutional Law, including controversies such as privacy rights, extent of Commerce Clause, etc., introducing all sides of the debate.

I’m obviously not a teacher, but a lot of these things can be taught to high school students without dumbing it down too much. I just feel it’s time we somehow train the next generations on some fundamentals.

What do you think? Am I going too far, or just plain nuts, or absolutely on the mark here?

-rsh

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Farewell, And Thanks for All the Fish!

So tomorrow is going to be my last day in New Jersey as a resident, unless something really dramatic happens and I get incarcerated here. I have a bunch of random, somewhat conflicted, thoughts going on and figured I’d share four of them here with you.

This got long, partly because I’ve gone through quite a bit, and partly because I’m going to be driving sixteen hours a day for the next three to four days. So blogging will be difficult, to say the least.

1. You Don’t Know It’s Home, Until You Leave It

I have to admit that I never fell in love with our house. It’s a small, 3BR/1BA, split-level that my wife and I bought as a starter home. And unlike so many, I don’t know that I ever fell into the whole “I’m a HOMEOWNER now” deal. I never enjoyed mowing the lawn. I never got into the Mr. Handy thing. And most of all, I regarded the place as a starter home, not our permanent home for the next thirty years. It became evident during this whole relocation that my wife was having a lot of emotional issues with leaving our home, while I was looking at the place as just another step towards our permanent home, and a possible investment property.

Yet, today, as I’m cleaning out the last of the trash from all of the rooms (my wife and kids are already in Texas), putting them all in bags for pickup tomorrow, and closing the door for the last time… I felt a little twinge of something. That little house is where we had our two boys, where we built a life, a family, a home. It’s where we’ve had ups and downs, where I’ve ruined more than one meal until I figured out what I’m good at and what I should never attempt, and to where I’ve dragged my bags after yet another long road trip.

And only after I’ve emptied it of all of our possessions, cleared it and cleaned it out of anything that is me and my family… only then did I realize, “You know what? This was home.”

Home may be where the heart is. But sometimes, you don’t know where your heart is, until you leave.

2. The Local Expert Is Whom She Knows (Corollary: The Staff Is the Realtor)

These days, in real estate, a popular topic of conversation — and indeed, the advice of many coaches, thought leaders, and the like to real estate agents — is that of becoming a local expert. All the focus on local markets, price changes, and all of that is important of course, but as I was moving out of my house, I became acutely aware of something else: the local expert knows local people.

In my move out, I needed a painter, a cleaner, a home inspector, a handyman, and a couple of strong guys to help me move furniture. I suppose if I had used a moving company instead of trying to do it myself, Id’ have saved on the couple of strong guys, but I still would have needed all the other people. In the Internet era, it’s possible to do all the searching yourself for a house, a community, a mortgage, whatever — and even servicepeople, I suppose. But what a pain in the ass it would be to have to go deep dive into the Web to find a house painter.

It was here where my agent (longtime friend, colleague, and sometimes client, Sue Adler) saved me. Or rather, to be much more precise, here’s where Dawn Preziosi, Sue’s transaction manager and right-hand woman, who seems to know everyone of use in and around the town of Millburn, saved me. Now, I’m sure Sue knows all those people too (except for the 20something big boys Dawn found somehow, who had time on their hands), but Dawn was like my guardian angel through the incredibly painful process of packing everything up, making the house presentable, and getting crap out of the building.

And I realized something. Sue is an amazing agent; one of the best I’ve ever seen. But I don’t know that she would be half as successful without someone like Dawn keeping her clients happy and relatively stress-free. The staff is the agent. You’re really only as good (or as bad) as the people you have working for and with you. That extends, of course, to brokers — but that’s a slightly different story.

3. I Do Put A Price on Freedom

If you think of freedom, as I do, as the ability not to have to deal with random arbitrary bullshit from government workers, then y’know… freedom is really worth something. This is a true story from this past week.

It snowed here in NJ quite a bit last Thursday. Our town has an ordinance that prohibits on-street parking after 2:00 AM. Given that I had two large u-haul pods sitting in my driveway, I had to park on the street. I got the permit allowing me to do just that. But with the snowstorm on its way, I got a phone call from the police telling me that they’re canceling the permit for the night so that the streets can be plowed, and that I should move the vehicle to a municipal parking lot about a mile away. No problem at all with that — there was a storm on the way, they gave me an alternate (as inconvenient as it was for me), and I happily moved my car there.

Well, it’s now the next day, and we had only gotten about four inches of snow. The streets are cleared, the sun was out during the day, and by evening, it looked as if it hadn’t snowed at all. I call the police to let them know that I need to park out front. The officer who answers first tries to transfer me to the parking bureau, and not finding anyone, gets back on the phone and the following conversation takes place:

Him: “Sorry, Sir, but overnight parking is not permitted tonight.”

Me: “What? Why not? It’s not snowing tonight, and there’s no snow in the forecast.”

Him: “I know that, but overnight parking is canceled.”

Me: “For what reason?”

Him: “You’re going to have to find somewhere else to park the vehicle, sir.”

Me: “Okay… well, where can I put it? Is the muni lot open tonight as well?”

Him: “No, that was only for the snow emergency last night.”

Me: “Uh… okay… so where am I supposed to park this car then?”

Him: “I don’t know, sir — you’ll just have to find an alternate location.”

Me: “…” <– (This is stunned silence on my part)

Him: “If you don’t, you’re taking the chance that you’ll get a ticket.”

Me: “Wow”

Him: — Ringtone –

This was a totally arbitrary, unexplained decision. I’m not even sure it was a decision. It could have been that this cop didn’t want to track down the traffic bureau people, and just decided to tell me some bullshit. There is no alternative offered, and because he’s a policeman, I know that it would be far too annoying and troublesome to try and track things down. Besides, the last thing I need is to get on some shitlist of local cops.

Now, I don’t know if the culture in Texas is different than the one in New Jersey. I’m going to go out on a limb and guess that it is, judging strictly by how the two states look at legal firearms. But man, I hope it is.

I’m no anarchist or some ideological libertarian nut. I think I’m a normal, law-abiding guy who is happy to move his car to a parking lot a mile away when I understand the reason behind it. But modern life seems to have far too many of the arbitrary rules, nonsensical bureaucratic whims, unexplained regulations, and tiny intrusions into personal freedoms. Like cutting down my tree in my yard that I paid for, without needing the permission of some clerk in a government office (which I need to do in my old town).

With the 2010 census results, there are quite a few political types who think that people are fleeing blue states for red states because of high taxes and high cost of living. Maybe. But also, maybe they’ve just gotten fed up with all of the minor, tiny, yet daily restrictions and intrusions and bureaucratic bullshit. Maybe some part of them remembers a time when people had certain freedoms they took for granted.

I’m willing to pay a price to try and get at least some of those freedoms back.

4. The Town-Gown Relationship Exists After School

I went to Yale University, an elite university, located in New Haven, CT, a decidedly non-elite municipality. One is a bastion of wealth and privilege, and the other is the kind of poverty and crime-stricken city that residents of Detroit would find familiar. When I was at school, the relationship between the mostly wealthy (and white) students, faculty, and administrators who attended or worked at Yale and the citizens of New Haven who were largely poor, uneducated, and black was so bad that the university took on numerous projects to try and improve town-gown relations.

Other university towns, except those already in tony wealthy suburbs (such as Princeton, NJ or Palo Alto, CA), have similar problems.

Well, as it turns out, I think some of the wealthier suburbs around the United States has a “town-gown” problem too. It’s not something that real estate people ever talk about (likely because it would be against some law or some regulation somewhere), and it isn’t something that draws much attention from the media, but I think it’s real and growing.

My town, Millburn, is a very wealthy suburb that lies on the Midtown Direct train line from New York City and has the top school district in New Jersey year after year. The median family income supposedly is $158,888, but that has to be old data or horribly incorrect. $160K a year would likely place you in the bottom 10% of the families in Millburn (which includes the Short Hills section). Most of the residents work in New York in the finance, media, or law industries in mid or senior level positions.

But what about all of the people who work in Millburn, especially in public sector jobs? The police, firemen, sanitation workers, township employees, the clerks in the tony stores in town, all of the service people who make it possible for us to enjoy a great life there? Taxes are high, and I’m sure these blue collar workers get paid well, but I highly doubt they can afford to live in a town where the smallest starter homes start at half-million bucks. No, they’re probably living in nearby communities where prices aren’t quite as high, the schools aren’t anywhere near as good, and stores quite as nice.

One of the young men I hired to help me move stuff was a local lad, but he didn’t live in Millburn; he lived in a nearby town called West Orange with a median family income of $106,233. He was a nice enough kid, smart, responsible, and I liked him quite a bit. We get to talking and he tells me that he’s a college dropout who does a bit of work here and there in construction. He was going to college to get a degree in physical therapy, until he met a friend who had a job with a 20 hour course, rather than a four-year stint.

Let me tell you now that parents in Millburn/Short Hills would be absolutely horrified at the thought of their child dropping out of college, unless (a) he invented the next Facebook, (b) was drafted by the NFL or NBA, or (c) had his band’s album just go double platinum.

There was a cultural difference between this young man and my neighbors in town that was every bit as obvious as the cultural difference between Yalies and New Havenites in 1991.

What I wonder about is whether some of the ticky-tack bullshit I was encountering from various functionaries and bureaucrats stemmed from conscious or subconscious resentment from the “townies” to the “gownies” in my little suburban enclave. The guys at the town dump giving me all kinds of trouble, requiring this permit from that office which happened to be closed, the cop with the no-overnight-parking thing, and the rest of it, I wonder if it’s small bits of retribution from people who know for a fact that they would never be able to afford the kinds of houses and lifestyles that these pampered, over-educated Ivy League types with their fancy-ass City jobs could and do.

Why do I wonder that? Because when I was with my local lad friend, somehow those issues disappeared. He knew someone, you see, at the town dump. Suddenly, gates that were closed turned out to have a back way in. Permits that were required were overlooked. And, he told me that he knew virtually everybody on the police force such that when they busted up a party, they’d arrest a bunch of kids, but let him and his friends walk. He went to school, went to the bars, went to the Jersey Shore, with some of these guys, did a construction job or two with some of them, and was in-and-of that community. The rest of us, who actually lived in the town, were more like transients and implants – guests in a strange resort of sorts.

I got no proof of any of this, of course. It’s just random thoughts on the night before I depart for good. But if I’m right about what I saw and felt and experienced… Millburn is hardly unique. The better suburban towns, with their academically inclined schools, professional dual-career parents, and upper-class cultural values… who works at their McDonalds and their garbage dumps? Who paves their streets and takes care of the sewer lines? For sure it ain’t the Harvard-bound youngsters who are far too busy practicing piano or doing yet another extracurricular to buff up their resume for college.

I honestly don’t know if things are different in places like Palo Alto, or Laguna Beach, or Greenwich. But you know, I suspect they are not. I suspect that those places have the same town-gown issues that we have.

And… I’m Out

Perhaps we’ll return one day, because despite the two bitch-fest sections above, we have loved living here. Who knows how the country, the states, the town, and my family will change over the years and decades. And now that I am leaving, I realize that this was home. I’ve been here, in this house, in this town for six years — the longest I have ever stayed in one zip code. And that counts for something.

I’ll miss the people, the sights, the sounds, the familiarity of the place. I’ll miss the Millburn Deli, the Diner, the Tinga’s, Taylor Park, the ice cream shops, the street, the neighbors, and yes, even the fickle town dump.

Then again, I will never, ever, ever miss not having to shovel snow ever again.

Farewell.

-rsh

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