3D Printer for Christmas

By Lloyd Graff.

An at-home 3D printer by Cubify. www.cubify.com

Is 3D printing going to radically change manufacturing as we know it? I see General Electric investing mega millions in 3D printing of components for jet engines. The top management at GE sees additive technologies as the future of manufacturing. Hewlett Packard sees the 3D printer as their big consumer product of the next 10 years. They think it will stand next to the traditional computer ink printer business as a profit center by the 2020s.

I ask you, the smart folks of old school manufacturing, is 3D the next big thing, or just an interesting adjunct technology like wire EDM, Waterjet, and laser?

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Malcolm Gladwell, the fascinating author of Blink and David and Goliath, calls NFL football a “moral abomination.” He argues that one third of the players will sustain life altering injuries. He sees football losing the interest of young men across the country, except in the Southeast and Texas. He thinks Roger Goodell is clueless about what to do about the players and the sport and that the game is headed toward extinction.

I love Gladwell as a writer, but I think he is overstating the case on pro football. The game is still coining money because the TV Networks are starved for programming that reaches a male demographic. The incredible popularity of Fantasy Football (i.e. legal gambling) has given the game an enormous shot of testosterone. But Fantasy Football does not require a live audience. The games could be played without people in the stands and still provide the statistics for betting.

Personally, I have lost my taste for NFL games, unless an artist like Aaron Rogers or Peyton Manning is playing. The Chicago Bears bore me. The injuries in every game make me feel like I’m in Rome at the Coliseum watching the Gladiators.

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I heard an incredible journalistic piece by Ira Glass and cohorts on his NPR radio program, “This American Life.” Glass followed a car dealership, Town & Country Jeep Chrysler Dodge on Long Island, for a month as it attempted to meet the quota of 129 new cars to be sold in October of 2013. He followed the eight salespeople and the sales manager as they struggled to meet the formidable goal, knowing that their livelihoods hinged on hitting that arbitrary number. Chrysler paid a bonus of $85,000 to the dealership each that it hit its quota, but one less car sold meant the dealership received nothing. Commission and bonuses all were contingent upon hitting the magic number.

Glass found out that the dealership often lost money on sales toward the end of the month as the salesmen became desperate for deals. He interviewed all of the people on the floor, exploring what made one guy, Jason Mascia, a 28-year-old “sharp dresser” with bursting self confidence and off-the-map drive, outsell every other salesperson every single month.

The story absolutely fascinated me from a human interest standpoint, but also from a business point of view. I wrote a piece several years ago for Screw Machine World (predecessor of Today’s Machining World) about a small machining company in Iowa whose management set goals for shipping a preset amount of product each month. If the goal was met, the employees got a shopping spree at the local grocery.

Personally, I have found it difficult to set useful sales goals in a used machinery business selling illiquid but valuable used machinery, but I know that other companies do manage to do it. I have set sales goals for Today’s Machining World, but they are more for me than other people.

I am curious how folks who read this blog use or do not use goal setting to reach financial objectives. What are the consequences of missing the arbitrary goals? Do you lose good people who can’t stand the pressure? Do you make money because there are marks that must be reached?

Question: Are sales quotas useful in your business?

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My Noble Paws

By Emily Halgrimson.

I’m currently at “Peak Dog” with 18 of “man’s best friends” in my home. You are probably thinking “hoarder,” but please don’t dismiss me as a wacko quite yet.

Me and my four dogs: L to R Golden mix Dex, Beagle Penny, Pittbull mix Bean, and Chihuahua mix Max. All rescues, of course.

I got started in dog rescue about four years ago when I adopted my beagle, Penny. She was bought by a dog rescue at an Amish dog auction in Ohio, which is similar to  a machinery auction. Animals used for breeding are numbered and auctioned off to the highest bidder with selling points like “four healthy litters last year!” and “breed in demand!” The Amish are well despised in the rescue community for their treatment of dogs, which to them are akin to cattle. Penny’s feet were splayed wide and raw from the chicken wire she had lived her life on, and at five years old she was emaciated at only 16 pounds (she’s now a happy 40).

A year later, not long after my divorce had been finalized, I fostered Max, a small Chihuahua mix, for a local rescue group. After one week, I knew I had found my second dog. He and Penny bonded immediately and complimented each other. Plus, Max was a man-hater, which echoed my own feelings at that time of my life.

Now, three years later, I’m slated in the next couple months to be the Director of the 501c3 non-profit, Safe Haven Rescue and Adoption Inc., currently out of Portage, Indiana. The rescue began in 2000 and has saved over 500 dogs. It is run by all volunteers and has no shelter, instead using a network of wonderful foster homes that take care of the dogs.

An emaciated Pittbull I rescued this year from a hoarding case. It look a long time but he eventually found a great family. Wonderful, sweet dog.

Dog rescues act as go-betweens for dog shelters and the public. Shelters are over-run, under-staffed and have limited space, so when they become too full or have a dog that has sat too long, instead of euthanizing, a good shelter will reach out to local rescues to “pull” the dog. Rescues then take the dog straight to the vet for a thorough exam, a heartworm and fecal test, vaccinations, and make an appointment to have the dog altered (spayed or neutered). They find a screened foster-home to commit to caring for the dog until they find a “forever home.” Popular breeds can be adopted out in a week or two, but Pittbulls, Chihuahuas, seniors, and black colored dogs can take months and months to find homes for. A rescue like Safe Haven can handle 10-15 dogs at a time, depending on available funds for vetting and the elusive good, open foster home.

My dogs and my foster dogs watching me in the front yard.

It costs $150-$250 on average to vet a dog, and dogs are usually adopted out for around $200 — less if the dog is a senior, although a senior dog almost always costs a lot more to vet, with dentals and bloodwork. People often complain that adoption fees are too high, but they don’t understand that when they adopt a dog from a rescue they’re getting a fully vetted dog. If they were to do all that vetting themselves they’d spend much more than the adoption fee.

Sites like Craigslist and Facebook’s “Free Pet” Community are a bane to the dog rescuer. “Free” dogs can be scooped up by dog fighters or people selling dogs to research facilities. A dog rescue volunteer often feels like no matter how hard they work, how many dogs they pull, or how much money they collect from sitting for hours at weekly adoption events at Petsmart, they’re barely making a drop in the bucket. The supply of dogs in need never ends.

One of 14 Shih-tzus we helped rescue from a large rural breeder this year. This is what the parents of pet store dogs usually look like.

The need is so great, the way we throw out our senior dogs or our no-longer-cute-puppy 1-year-old hyper dogs, never ceases to amaze. “The greatness of a nation can be judged by the way its animals are treated,” said Mahatma Gandhi. We aren’t doing very well — over 20,000 animals are euthanized each week in the U.S., while we put on our blinders to the suffering we perpetuate and breed and buy and breed and buy.

The consensus in animal rescue is that the longer you do the work of saving animals, the more you dislike people. You’re continually confronted with the selfish and heartless side of people. We get calls for dogs burned with cigarettes, dogs hung up as training bait for dog fighting, dogs tossed out of car windows and over bridges, Mama’s with their newborn puppies on the street with ingrown collars, dogs that can’t walk because their nails have grown in circular from neglect, dogs without a single hair on them because the fleas have had their way so long, dogs that have been starved into complete skeletons, dogs that have their growth stunted because as they grew they never left their crate so their bones re-shaped. Every day there’s another case like this, another reason to cry over the suffering humans inflict.

Pregnant Oreo the day I brought her home from Animal Control

Two weeks ago, I was at a nearby city’s Animal Control on a late Friday afternoon and came across a very pregnant Chihuahua. The conditions of Animal Control vary city to city, but this was Halloween and in Northwest Indiana it was a blustery day. The kennels are made of concrete and have a heavy metal door that drops like a guillotine to separate the inside from the outside. The wind whistled under the door and the very pregnant Chihuahua was curled up in a small dog bed on the concrete floor. I said “crap” under my breath and knew I was in for a long weekend. I scooped her up and brought her home. No question, if Mama Chihuahua (who we named Oreo) had given birth there that weekend she and the pups would have died. Cold drafts are an enemy to puppies, and newborn Chihuahua puppies can fit comfortably in the palm of your hand. I didn’t need this new commitment as I already had a litter of six four-week-old Lab mix puppies I had sunk over $1300 in vet bills into, as two of them had developed serious pneumonia and were hospitalized for a week undergoing nebulizer treatments. (Donate here)

I settled in the poor old Mama, who had been found on the streets as a stray, at my house into a nice comfy crate with a bed, and she gobbled up two large bowls of wet puppy food. She was terrified, but not aggressive, and she flinched when I pet her. Not a sign of an easy life. I was shocked by how old she was — at least six or seven from look of her teeth and frail bones.

Mama Oreo with her five healthy baby girls born November 3, 2014

By Sunday night Mama had gone into labor, and Monday morning at 5:00 a.m. the first baby appeared, dry, feet first, and stuck tight. I knew immediately this was bad and I grabbed Oreo up, put her in the car, and rushed to the emergency vet only a mile or so from my house. The first baby hadn’t had a chance, but over the next five hours I waited in the waiting room while Mama Oreo had five healthy baby girls. A morning off of work and $350 later, we came home and settled Mama and the babies in. She’s a good Mom, and even the runt, who is half the size of the others, is hanging in there.

Every puppy (and Mama Oreo) will be completely vetted with checkups and vaccines, spayed, and microchipped. We will then screen adoptive homes for them through applications and vet reference checks, and do home visits for each puppy. Rescues are there to fix the problem of homeless pets, and do not want to leave any chance open that a dog in their care will contribute to the problem of unwanted litters or end up in a shelter. That’s why they’re so picky about choosing adoptive homes.

I want people to be aware that that gas chambers are still used in some states (like Michigan) to kill unwanted animals; puppies bought at pet stores have parents who will suffer horribly their whole lives; thousands of beagles are hooked up to breathing masks and piped in oven cleaners and other chemicals in labs until 50% die from the fumes;  and there are people out there care so deeply and feel the pain of these animals so palpably that they’re willing to sink their life savings into easing their suffering.

It’s a whole new world out there when your eye is on the four-legged creatures that look up at us with such love. “Think occasionally of the suffering which you spare yourself the sight,” said Albert Schweitzer.

Emily Halgrimson is Today’s Machining World’s Managing Editor and Marketing Manager. To support her “Noble Paws” please click here or send a check to: Safe Haven Rescue and Adoption, PO Box 593, Portage, IN 46368.

Question 1: Do you prefer animals to people?

Question 2: What is your noble cause?

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In Dogged Pursuit

By Lloyd Graff.

My father had an expression he often used when the phones were quiet and business was snoozing, “It’s time to start ‘dogging.’” He meant it was time to get on the phone and start connecting with people. Time to make something happen. Lately, I’ve started “dogging” again and the cool thing is that it’s working better than the Internet, prospecting, or that old stand-by, “hoping for something good to happen.” Besides making some deals, I’ve learned stuff by talking to clients or “would be” clients.

Here are a few nuggets I’ve learned recently.

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There is some really terrific technology out there in the metal turning sphere and some of my clients are taking advantage in a big way. I have one client who sees the new technology from Index of Germany as his “unfair advantage.” He has several large diameter Index multi-spindles he bought new over the last few years. Around IMTS he placed orders for four 22mm Indexes for $9 million. He is quite confident this gamble on the most sophisticated turning equipment on the market will pay off big for him. He does not have a guaranteed contract to keep the machines busy, but he believes in himself and believes in the Index advantage enough to commit the investment. This guy has seen his old standby equipment of Brown & Sharpes and Davenports become obsolete with Chinese competition. His answer is to plunk down $9 million on Indexes for his company, which is doing $30 million a year in sales.

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Not far from away from the Index believer is another independent thinking entrepreneur who had followed a similar path of heavy capital investment to stay ahead of the crowd, but now he is changing course to play “small ball.” He heard about a failing screw machine firm, picked up the building for a song and then began buying old 7/16” 6-spindle National Acmes for a $1000 a piece. He refurbished the machines, bought top of the line tooling and accessories, and hired trainees at a low hourly rate. He started selling time on the old cheap multis for a third of what he had been charging at his original factory running the modern expensive equipment. Now he is making good money. He can sell his services cheaply enough to undercut Far-Eastern suppliers. He can even solicit work from other screw machine houses.

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A few other tidbits from around the country.

Business is very good – except where is isn’t. The Oil Patch all of a sudden has heartburn. Business was fabulous for the last four years as the shale boom accelerated, and then suddenly the price of crude oil started to plummet. The Saudis, for internal political reasons and business necessity, raised their output just as the U.S. reached self-sufficiency in oil. The oil sands region in Alberta was hitting its stride even without the Keystone pipeline. Europe was in recession and the Russians had to sell oil to keep their economy afloat and Putin’s ambitions alive. Suddenly we now have $3 gasoline in America. Most of the rigs in the U.S. are still in use but this trend is not your friend if you are making stuff for oil and gas.

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And then there are the farmers who stopped buying tractors when corn and soybean prices fell into the furrows. The $8 corn of the ethanol boom is now under $4 a bushel. The harvest this year and last was epic, but just like in oil, too much is not always a good thing. For the firms doing Agriculture related work, especially in the Midwest, times are tough.

What I’ve learned by getting back on the phones and off the email opium is that contrary to popular opinion, decision makers will actually talk to you if you are interesting and a good listener. And there is a lot to be gained by spending an hour a day doggedly dogging on the phone.

Question: Do you prefer dealing with people on the phone or via email?

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Lighten Up a Little

By Lloyd Graff.

From the book series “Walter the Farting Dog”

The election is over. Thanksgiving is in three weeks. Basketball and hockey are rolling. So it’s time to start thinking how 2015 might be different.

What stands out for me is the sense of disgust and futility amidst what in most years would be considered terrific economic figures. This election was all about “pissed off,” not ideas. Pessimism seems to reign.

I know I feel it in my own business, even though the numbers for the year show a big improvement over 2013. I think for the people I work with the angst also exists.

Why aren’t people happier?

I think it’s a lot about leadership. My beloved Chicago Cubs just hired the effervescent Joe Maddon as Manager because he brings joy into a team, and that translates into money and victories. What struck me about Maddon at his press conference was that this guy is such a rarity. He is happy, ebullient, and shows joy all over his face and body. He is unlike virtually anybody else in the game, including the executives who hired him. But they could recognize that his rare energy works even if they don’t have it themselves.

Fun without substance is a phony façade but if it is in a package of smarts like in Maddon it is gold.

Looking at politics, Barack Obama of 2008 had an energy and upbeatness that sustained him and propelled him to the Presidency. Today he seems to have lost it. The country is looking for a smile and a feeling of energy. It was the strength of a Bill Clinton and Ronald Reagan to make us feel better as a people. An Al Gore or Mitt Romney, and the current Barack Obama come across as flat as white bread.

The task of a good leader is not to be a comic, but to generate confidence and hope. Reagan said you had to be an actor to be President. The Gipper was good at both.

A leader of a business needs to throw off that positive vibe, if not always in public, definitely in one on one meetings. In my own case, I find myself so focused on problems and tasks that I too often give off my personal lunar eclipse. I am fortunate to work closely with my son Noah who can identify my Darth spirit and point me toward a course correction. This is enormously helpful because often I don’t even realize my own dark vibe.

A leader, particularly a President, needs a compatriot who can tell him the truth about himself. The sullen senator Harry Reed could darken a room just by sticking his toe in the door. He should hire a jester to have breakfast with.

Somebody needs to give President Obama and old Harry Reed the gift we sent to my granddaughter Chava who just celebrated her 7th birthday. She is a serious child who became a vegetarian at four and is a conscientious ballet enthusiast. We sent her “Walter the Farting Dog,” who has a wonderful assortment of appropriate sounds. Walter came with a book, too. Chava and her sisters called us in full laughter to thank us for Walter.

Can you imagine Obama bringing “Walter the Farting Dog” to a meeting with Congressional leaders? It’s something Joe Maddon would do. It might change the course of history if Barack Obama tried it.

Question 1: Have you heard a good joke lately?

Question 2: Does the 2014 election matter to you?

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Inflation, I Hardly Know You

By Lloyd Graff.

European Central Bank President Mario Draghi

We are all in this world economy together, and for most of my life the basic rule of money was that it would lose value year after year because inflation would always take its 2-4% nibble. But it is starting to look like that rule, that seemingly immutable act of the god of the economy, has been turned on its head.

The Europeans led by the bone rigid Germans and the limpy wimpy head of the European Central Bank, Mario Draghi, are dragging themselves into deflation. The Japanese, with their country of old people, have been in deflation for almost 20 years and are desperately trying to manipulate themselves out of it with a monetary scheme that unfortunately won’t make more children or import immigrants. The United States has plenty of unused assets, Silicon Valley pushing down prices, a torrent of shale oil gas and coal, and a flat birth rate with a stupidly restrictive lid on immigration. (Fortunately, resourceful people still sneak in to lubricate the economy and provide needed human energy, but it would make more sense to let them in legally).

So here’s the deal. We’re in the “no inflation,” “look out for deflation,” “do you really want a mortgage?” blues for quite a while, and we better figure out how to live with it and make it work for us.

I think we are seeing the reaction to non-inflation in the house ownership rates in the U.S. Despite tax benefits, home ownership is shrinking steadily here. We are under 65% now and dropping quite abruptly. This is partly due to the post 2008 recession, but even with 3% growth in the economy it is still plummeting.  Now the banks are reluctant lenders, but one reason for that may be that they do not see house inflation bailing them out on loan defaults.

Car leasing is now 26% of new car transactions, double the 2009 rate. It is rising virtually each quarter and now used car leasing is starting to catch on. I see it as a reaction to non-inflation, though I will admit other factors are in play — like city life.

The machine tool market is also a place where we are seeing flat or receding prices. Swiss CNC prices have fallen in recent years for both new and used. The strengthening dollar versus the Yen and Euro will exacerbate this trend. The Yen is at a 7-year low, 112 to the dollar. The Euro is down 10 cents or 8% in the last 90 days.

Think of what you can buy a Haas VF-3 for today, new. Inflation, I used to know you.

Wages – we all know the routine. Flat, flatter, flattest, unless you can program or know the recipe of a secret sauce. In the face of non-inflation Al Sharpton and Elizabeth Warren and every joker who wants to run for President will push for a higher minimum wage. There is a social argument to be made, but the economic likelihood of it actually helping more people than it hurts because the number of low wage employed recedes, makes the higher minimum wage hard to support.

So how do you play it if you believe that we have non-inflation and Europe and Japan are wallowing in deflation for what looks like the next several years?

The U.S. stock market averages hit record highs on Friday. Money has poured into stocks because savers cannot afford to buy low interest bonds or put money in a non-saving bank account. If real estate appears stagnant better to be a renter unless you can find a hot local area. Gold? You couldn’t pick a worse place to bury money with non-inflation.

If you have a business or a skill it may make sense to invest if you really believe in yourself.

For a retiree this is a tough moment. Inflation hurts a Social Security income. Non-inflation is neutral. But people with nest-eggs they need to invest are almost forced into dividend paying stocks. People who have much of their savings in their homes face a real quandary. Do you sell now into a weak market and look for a rental that may not be as nice as your home, or do you live in your homey home that has rising property taxes and shrinking equity? Tough choice.

Question: Inflation. Deflation. Which is worse for you?

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I Hate “Steady”

By Lloyd Graff.

I hate the word “Steady.”

We call our customers and politely interrogate them about their machinery needs. We often ask them a simple question, “How’s business?” The answer we often hear these days is, “It’s steady.” “Good,” we respond. But what I’d really like to say is, “What the heck does ‘steady’ mean?”

“Steady” is one of the most meaningless words in the English vernacular. It is a dodge, a way to say “it’s none of your business so I’m going to politely tell you to mind your own business.”

I’ve never seen a steady business. Each day is a struggle to get product out the door, put out fires, make mistakes right, and somehow collect more than you spend. It’s a balancing act of minor calamities, labile egos, flighty small talk and emotional bruises, mixing together on the shop floor to the tune of discordant air compressors whistling Dixie off key. Steady?

Maybe steady is in a bookkeeper’s or banker’s vocabulary because they absorb numbers, not faces. But if you are hustling customers, harvesting quotes figured to the second decimal point, or trying to measure a purchasing agent’s nose hair, there is only volatility soaked in hot sauce.



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The sweet economic numbers are filtering in like the smell of a pumpkin latte with whipped cream. Frankly, a little too sweet for my taste. Confidence is the best since 2007, gas prices under $3 a gallon, unemployment shrinking, the Dow back up to 17,000–almost triple the 2008 bottom. Inflation is under 2%, the 10-year bond around 2.3%. Is this nirvana headed into Christmas? People even think they can quit their jobs and find a new one.

But it doesn’t feel that way to me when I talk to real people. Jobs may be available, but wages stink for the average Jane. They can’t get any money for their house and they struggle to save. Going into the election the mood smells sour and the negative advertising is so malicious from both sides, I just cringe and deaden the sound on the TV.

Yes, Virginia, we have an election in a few days. I’m so unexcited. What are the Koch Brothers and the Labor Unions and the doctors and lawyers spending a billion dollars on? The next Supreme Court Justice appointment is important, I suppose. The structure of ObamaCare (it’s not going to be repealed) will be debated. But we’ll all have gridlock in 2015, and I am quite happy with stalemate in Washington.

Two more years of thwarted politicians. I’ll take it. I wish the Koch Brothers and trial lawyers would just play volleyball. Everybody’s mood might improve.

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I guess nobody’s watching but me and my barber, but this has been a wonderful World Series. Giants versus Royals. Kansas City has remarkable speed, the best outfield defense since Willie Mays played, and an almost perfect bullpen. San Francisco has one of the best left handed pitchers since Sandy Koufax and a group of guys who just know how to win ballgames. To a baseball lover it’s the best thing since Karmelkorn. I wish the series was best of 17 so I could revel in it for two weeks more.

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The Dos Equis beer commercials with “the most interesting man in the world” are my favorite TV ads. I occasionally try writing my own copy. My lines are not quite as crisp, even to me, but I’ll share some. I challenge you to do better.

“Supreme Court Justices ask him for an opinion.”

“He blows bubbles that never burst.”

“Dolphins ask to swim in his pool.”

He’s the most interesting man in the world.

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Happy Halloween. Welcome back NBA and Derrick Rose.

Question 1: How are you feeling today? Steady?

Question 2: Royals or Giants?

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Book Review: Eleven Rings

By Noah Graff.

Baseball season is finally almost done, and it’s time for the greatest athletes in the world to take the NBA floor. In honor of the upcoming basketball season, I am reviewing former NBA coach Phil Jackson’s fascinating biography, Eleven Rings: The Soul of Success.

Many basketball fans know a little bit about Jackson’s unconventional techniques for getting his teams to win. Jackson’s book fleshes out the methods and philosophy he used while he coached and gives the reader inside baseball, or in this case “inside basketball,” into what actually happened while coaching the Bulls and Lakers dynasties and when he was an important bench player on the New York Knicks of the late ’60s and early ’70s. Jackson was a member of the only two Knick teams to win NBA championships in 1970 and 1973.

The sometimes counter intuitive philosophy Jackson discusses in the book is thought provoking for any type of team leader. The challenges he describes often seem quite relevant to those encountered when running a business.

Jackson believed it was essential to teach his players to think for themselves. When the game was in a pressure situation, he wanted the players to feel confident making their own decisions. It is not uncommon for basketball coaches to have a book with 50 different plays that players have to memorize. The coaches yell the various plays from the sidelines the entire game. The Triangle Offense Jackson is famous for using serves to keep the team constantly moving organically around the floor. The players have a constant set plan of how to space themselves and set up plays they have practiced, but the system also leaves space for superstars like Michael Jordan and Kobe Bryant to create their own shots.

Eleven Rings, by Phil Jackson

It is common practice for NBA coaches to call timeouts after the opposing team goes on a 6-0 run. Yet, when possible, Jackson liked to let the game go a little bit longer than that before he called a timeout because he wanted the players to learn to figure out how to get out of a jam on their own. Jackson says that many coaches don’t want their players to think for themselves because they want the game to go exactly how they’ve envisioned, but Jackson recognized that no sports play, nor any aspect of life goes exactly according to plan, so the best approach is to come into the game as prepared as possible and then to simply live in the moment.

To prepare his players Jackson emphasized being ready for chaos and the unexpected. He is famous for conducting Bulls practices with the lights off or in total silence. He also liked to have scrimmages in which he would create two lopsided teams and then only call fouls on the better team. This frustrated Michael Jordan, who hated to lose any game, even when he knew it was rigged.

Before the Bulls played their nemesis, the Bad Boy Detroit Pistons, in 1990, Jackson showed the players a montage of clips from The Wizard of Oz. He showed a clip of BJ Armstrong driving to the basket and being clobbered by the Pistons’ front line, which he followed with a clip of Dorothy saying, “This isn’t Kansas anymore Todo.” Another clip showed Joe Dumars beating Jordan off the dribble, followed by a clip of the Tin Man lamenting not having a heart. He showed a clip of Isaiah Thomas driving by John Paxon, Horace Grant and Bill Cartright, followed by the cowardly lion wining about not having courage. The Bulls lost to the Pistons in seven games that year. Sometimes the best mental preparation can’t overcome body slams by Bill Laimbeer and side swipes from Dennis Rodman.

The book discusses three concepts of Zen which Jackson, also known as the “Zen Master,” tried to incorporate when coaching.

1. Give up control: Give players space to do what they want, even to be mischievous. Watch the players, and never ignore them, and never try to control them. This was a philosophy he used while coaching Dennis Rodman.

2. Trust the moment: Pay attention to what is happening at the present moment. The past is gone and the future is not here.

3. Live with compassion: A concept emphasized by both Buddha and Jesus. Lay down your life for friends, and take care of yourself as well. What you do for yourself, you do for others. What you do for others, you do for yourself.

I believe that Jackson’s Zen played a significant role in the six Bulls championships and five Laker championships. Teams with that much talent may have been able to win with different great coaches, but it took a special leader to win 11 times. To deal with 20 different egos the size of Texas and overcome amazing competition year after year requires a unique leader who can create a cohesive team of players with engaged hearts and minds.

Jackson starts his new job this season as team president of the New York Knicks. Will Jackson’s Zen principles and Triangle Offense transmitted down from the Knicks’ front office bring the first championship to New York since he played on the Knicks’ 1973 Championship team? Jackson is not to be underestimated, but my bet is it will take many more years and more patience than it did when he coached the Bulls and the Lakers.

Question:  Who do you think is the best coach of all time? (All sports, professional and amateur)

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Little Boxes Made of Ticky Tacky

By Lloyd Graff.

There’s a growing demand for rental units in the Bay Area. Courtesy of www.baycitizen.org

The stats tell us a lot about the economy, which is erratically bouncing along. Housing starts are up 6% over last year in the latest figures, but multi-family is jumping up 17%. In Palo Alto, California, this week, visiting my daughter, I’m getting a birds-eye view sipping my coffee while listening to the buzz and hum of construction tools in Silicon Valley. There is an occasional single-family house going up, but there are hundreds of apartments, hotel rooms and condos being built down El Camino Real, which bisects towns like Palo Alto, Mountain View and Cupertino where Stanford, Google and Apple call home.

The single-family home is not a relic yet, but the hamstrung banking system is still making the mortgage market a minefield, despite already low interest rates.

But the trend toward apartments is not just about the mortgage market. I think many folks, including young and old, are choosing renting versus owning in both real estate and other large expenditures. Real estate ownership for many people has been a losing proposition. I know it has been for me. My wife and I bought our home in the south suburbs of Chicago in 1979 for $130,000. It is a nice 3,000 square foot single-family home, two story, 5-bedroom with a full basement. Today it is worth under $200,000 and we’d struggle to find a buyer. We’ve paid off our original 8% mortgage and the 6% mortgage we took out to make our basement into a gym and rec-room.

Real estate has not been good to us. And for a million people who lost their homes after 2008, buying another house may not seem like a great idea.

For young people, building a nest egg with a 20% down payment is nearly impossible in the neighborhoods they find attractive. And retirees often prefer the safety of a rental after they’ve struggled to unload their home in an unfriendly market.

A change of lifestyle is another reason for the trend toward multi-family rather than single-family homes. Many young people are deferring marriage until well into their 30s. They live together rather than tie the knot. The lack of the official commitment of marriage dissuades putting down roots on a piece of property. But even if young people do have the inclination and the money to marry and buy a house, they may opt for an urban environment where single family homes are exorbitant or almost non-existent.

An interesting trend in the urban milieu is the conversion of old factories into lofts for housing, along with retail buildings being torn down to make space for new multifamily units. I certainly see that on El Camino Real in Silicon Valley. Mom and Pop stores and unsuccessful groceries make way for apartments, condos and hotels. Not much office space going up today, even in Palo Alto. Still plenty left over from the overbuilding of 10 and 20 years ago.

The non-ownership theme also rings true in the vehicle market. For the high number of young people in dense urban areas, owning a car is a luxury. Companies like Uber, Zipcar and Enterprise provide substitutes for owning a vehicle. Biking is also big in cities, as are home offices or shared office space.

The suburbs are not dead. Single family homes are not dead, but the tide is pounding against them. In the machining world, this works against the big earth movers like Caterpillar and the lawnmower makers, but every apartment and hotel room needs a toilet and sink, and there is plenty of demand for outlets for phone chargers.

Change with time or fade away like the white rhino.

Question: Has your home been a good investment?

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Is Business Good?

By Lloyd Graff.

Two to three 100-car crude oil unit trains a day now arrive in the Pacific Northwest.

My impression is that business is slowing a bit in our machining world, though IMTS exhibitors moved a lot of iron. Auction prices have trended softer for the last several months. The recent Belden sale brought prices considerably lower than I had expected during the summer when the company was taking bids from auctioneers. The recent mini collapse of oil prices has sent gasoline prices under $3.00 per gallon in low tax states like New Jersey. While this is something to be thankful for ahead of Thanksgiving, the oil patch is suffering from heartburn, adjusting to $80 crude. Break even for fracking in some places is in the $60 range, so the marginal producers are starting to fret and the makers of the drilling gear are already feeling their angst. Oil pricing may be part of a non shooting war with the U.S. and Saudi Arabia against Russia and Iran. Vladimir Putin and the Russian economy are beholden to oil pricing to keep the economy afloat. The U.S. Iran nuclear negotiations are at the crucial stage now. Obama does not like soldiers shooting, but drones and oil are weapons he may be willing to use. The hacking epidemic of credit cards emanating from the Kremlin is likely another front in the engagement with the Russians.

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The Keystone Pipeline may be permanently derailed in Obama administration infighting, but the Alberta oil will find a market. Now the big talk is that a trans-Canada pipeline will be built to Canada’s East coast starting in 2016. All those pipeline building jobs will stay up North, but Warren Buffet’s trains will keep inefficiently schlepping oil to the American West Coast.

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The average “Announced crowd” at Cubs games in 2014 was close 33,000, but the real number of people who may have actually attended a day game in a lousy season like this one might be around 20,000. The announced attendance at IMTS last month was 114,000, but the registration of attendees who were not working the show was 59,000.

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Grainger Corporation has provided 800 $2000 scholarships in the last six years for skills training in machining and other important trades. Grainger is a multi-billion dollar corporation, but they should be lauded for their contribution to the field. I recently talked to Erik Anderson, who has two machining firms in central Wisconsin. He is doing in-house training and working with local schools to bring skills into the company. If the Feds and the States can’t move the ball, at least for-profit firms are contributing to the public good while looking after their own bottom lines.

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A shout out to Tony Bennett, the wonderful singer. He just came out with a new album with Lady Gaga, singing a duet of “Dancing Cheek to Cheek.” I watched him sing “God Bless America” without accompaniment at the San Francisco Giants first playoff game. It was a perfect solo. I was moved to tears, and got up from my seat to sing along with the 88-year-old master.

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Eric Kester is writing a memoir about being a ball boy for Chicago Bears games. I read a powerful op-ed piece in the New York Times by him, talking about the players arriving at the games so hung over they could barely put on their socks. He describes the incredible physical beating they endure each game. The players certainly are modern gladiators, and we fans love their passion and all-out effort on the field. The bad behavior of the Ray Rices and Adrian Petersons can never be excused, but writing like Kester’s behind the veil view of their suffering, as we cheer, is fascinating and illuminating.

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It is estimated that 41 million people, almost all guys, play fantasy football. While the offensive lineman may be the most important players on the field, other than the quarterback, they do not make anybody money in Fantasy. It’s a pity. They need a stat. Anybody have an idea how to give them a Fantasy point?

Question: Is Business Good?

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Creative InTuition

By Lloyd Graff.

Chinese students at Wayne State University

I am watching an intriguing phenomenon in American education that has long-term implications for our economy and China’s political life.

There is a large and increasing influx of high-paying Chinese students from China coming to the United States for high school and college.

The University of Illinois has 600 students from mainland China in the Freshman class, 10% of the enrollment. Other colleges have taken a similar course. On average, the international students are paying twice as much as in-state students.

There is also a significant flow of high school students attending private schools around the country. Some have sprouted up specifically to attract affluent Chinese, who will pay over $40,000 a year in tuition for elite schools.

The media often decries American higher education for dumbing down the requirements for a degree, and many stars in Silicon Valley say college is for dummies. After all, Steve Jobs, Bill Gates, and Mark Zukerberg all dropped out after Freshman year to start their companies. But Chinese parents and kids crave the American high school and college experience.

Anecdotally, they say the reason they come here is to find “creativity,” which they see as the Holy Grail missing from Chinese education. Ironically, the Zuckerbergs and Gates’s left college for the same reason. Peter Thiel, the venture capitalist who backed PayPal and Uber and other phenomenally successful new enterprises, has made a public splash by advocating that creative young people forsake the college path to follow their muse and their dreams rather than getting bogged down in Botany. But the Chinese are pouring in because they think “creativity” is in the soil in Champaign and Bloomington and Austin.

Those Chinese parents and Peter Thiel are probably both right. For a Harvard dropout like Zuckerberg, Cambridge, Massachusetts, is sterile compared to an Animal House in Palo Alto where he lived while growing the nascent Facebook. But for 15-year-old kids from Shanghai, the intellectual freedom available at an elite American high school could be a boon.

On the other hand, for the Chinese elites running the Communist Party and trying to cope with ferment in Hong Kong, thousands of American educated young people heading back to the country from years of freedom in American universities may be rather scary.

The Chinese experiment with an authoritarian state apparatus and an economy fueled by independent entrepreneurs may be headed for a big collision. The Chinese government leaders have to be wary of a Jack Ma, the charismatic founder of Alibaba who found backing from Jerry Yang of Yahoo and Japanese entrepreneur Masayoshi Son to grow his phenomenal online business. Jack Ma is a one-in-a-billion guy who could somehow finesse his business around the Communist Party and endless government meddling to grow the company a million fold in a few years. A former English teacher, he is a self-taught entrepreneur. He did not find his creative mojo at Stanford or Urbana.

Will there be an English teacher like Jack Ma coming out of the 600 kids enrolled at University of Illinois in the class of 2018? Highly unlikely. Most of the students are starting out in Math and Science, with 3% in Liberal Arts.

Meanwhile, I await the pushback from Illinois parents and young people who missed the cut at Champaign because of 600 full tuition payers coming from the Chinese Mainland.

Question 1: Is college worth the debt?

Question 2: Can you teach creativity?

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