By Lloyd Graff

General Motors is doing more than just making a $500 million investment in Lyft, the ride sharing competitor of Uber. It also appears to me that GM is doing more than just hedging their bets about the future of car ownership and usage.

The company has named its new venture “maven,” which I find both interesting and ironic. “Maven” comes from Yiddish. It means a person who really knows his stuff by accumulating a vast amount of information in a given area. For instance, someone who really knows shoes, boots and sandals could be called a “footwear maven.”

By hiring a team of people from Google, Sidecar and Zipcar and making the investment in Lyft GM is accumulating first hand knowledge of the future of driving. Ann Arbor, Michigan, is going to be the laboratory for the company to test several different types of ride sharing. Maven will rent cars by the trip, like Zipcar does, for as cheap as $6 per hour. It will place them strategically in residential blocks. The vehicles will feature connected car systems enabling music and other preferences to follow drivers from car to car electronically. WhatsApp, the ultra popular phone app for free texting and voice calls throughout the world, will be used to obtain customer feedback.

Eventually self-driving cars will come into play, but this is quite an interesting venture today for the traditionally stodgy General Motors. Looking at Maven from 50,000 feet, it has a head start on its competition—Uber, Zipcar, and potentially Apple and Google. It already has the “content”—the cars. GM is developing the delivery method of its content in a place receptive to new ideas and one right in its backyard—Ann Arbor. I find it exciting, particularly after using Uber myself several times in the last week because of eye issues.

Even where I live in the southern suburbs of Chicago, not the most sophisticated part of the metropolitan area, Uber seems quite efficient and easy to use. My average wait for a pickup has been seven minutes. My trips, 10-17 minutes, cost between $11-$15. If you figure the costs of driving a car in the city Uber is priced competitively, unless you use your car a lot and drive significant distances. The big statistic that GM, Uber and Google are staring at is that most people use their cars less than one hour per day.

I talked to my small sample of Uber drivers about their job. One fellow, who recently moved to Chicago from Los Angeles, said he views it as his full time business. He said he makes good money, has a lot of autonomy and plans to keep doing it long-term. My two other drivers were newcomers to the job. One was retired and looking for something to keep himself busy and earn some dough, the other was a rather uncommunicative woman who prefers to just drive in the area. She had been doing it for four months. Potentially, Uber and Lyft could sop up quite a few people on the outskirts of the workforce who do not want the boredom and cheap pay of a McDonalds or Wal-Mart job.

Question 1: Do you look forward to using self-driving cars?

Question 2: Do you think changes in driving patterns will help or hurt the machining world?

By Noah Graff

Recently I read The 50^th Law, the biography of the famous rapper, 50 Cent, written by Robert Green and Curtis Jackson (also known as 50 Cent).

On April 24, 2000, right before 50 Cent was supposed to release his debut album and finally make it in the music industry, he was shot nine times by a gangster with a grudge against him. His music label immediately canceled the record release because they were afraid of the negative press. Making matters worse, his vocal chords were damaged by one of the bullets, altering his voice. But 50 Cent refused to give up his dream to become a famous rapper and escape ghetto life. Instead, he used his misfortune to his advantage. He embraced the distinct sound of his new voice, used the incident as publicity to demonstrate his credibility as a gangster rapper and distributed his album on the streets for free, where his music and popularity spread virally.

Curtis Jackson, who later would be known by the name “50 Cent,” realized right away that he would need to use the lessons he had learned growing up as a street hustler in Queens, New York, to navigate the often cutthroat “legitimate” business world. As a street hustler (drug dealer) he had learned resilience, how to understand and adapt to a changing business environment and how to stop others from controlling him.

Jackson’s mom disappeared from his life by the time he was 12. At age 16 he started selling drugs. At age 19, after a brief stint in a bootcamp (in lieu of a jail sentence), Jackson came back to the streets to find that a powerful drug lord had taken control of his area of the ghetto. He and all the other small independent hustlers were forced to take jobs bagging crack cocaine for the big boss.

Jackson felt like a slave because it was against his nature to work for someone else. Crack was becoming the trendy drug in the ghetto in the ’90s. Jackson realized that it was an ideal product to sell for an independent hustler like himself because it was easy and cheap to produce. However, to take advantage of this opportunity he needed to build some capital, a seemingly impossible task, now that he was collecting only a small paycheck as a crack bagger, but Curtis found a way.

He taught his fellow crack baggers how to put a little less crack in each bag while still making it look full. He made a deal with his fellow baggers that he would give them all of his paychecks for bagging in exchange for the excess crack they had collected from the bags they had skimped on. Jackson eventually stockpiled enough crack to strike out on his own.

During his tenure as a hustler Jackson got to know one of the oldest, most successful hustlers around his streets, who went by the name Truth. Truth advised Jackson that for him to succeed as a hustler he had to personally get to know his customers, an understandingly daunting task as crackheads can often seem intimidating or at least unpleasant to spend time with. Truth said that unless Jackson made friends with the drug fiends, he would never understand his customers and never understand the constantly changing drug business environment. Knowing and understanding his customers elevated Jackson above his competitors, who remained as outsiders in their industry. When Jackson got to know the drug fiends he realized that they basically had the same feelings and needs as everyone else. He connected with them, and they helped him in return. The addicts gave Jackson vital current information about what was happening on the streets, such as which new drugs were on the rise or the scoop on power struggles between various gangs or bosses.

Truth also taught Jackson a vital hustler technique called “the tester.” The tester is a method a hustler uses when a new shipment of a drug comes in. Before the hustler sells the new drug supply he gives a little of it away for free to a few customers who test the quality. If the quality is good the dealer can charge more. If the quality is bad the dealer knows he must sell it cheaper or change it by cutting it with other drugs. Also, if the quality of the drug is good, the tester can create buzz around the community, increasing its demand.

When 50 Cent entered the music industry in the early 2000s he noticed the industry changing rapidly. Just like he had observed how crack had changed the hustling landscape, he saw that music pirating from the Web and the use of MP3 players were turning the traditional music business upside down. The music industry executives were outsiders without a real knowledge of their customers. Or, perhaps they saw the rapid changes taking place in the industry but preferred to pretend it was still the good old days when customers would shell out $15 for a CD at Tower Records. Jackson understood that to stay successful he would need to diversify into industries other than music. He has acted in films, started a clothing line and invested in a water brand called Glacéau that was eventually purchased by Coca-Cola, among other ventures.

Some of the principles from 50 Cent’s story reminds of me of our businesses. Today’s Machining World had to give up its beloved print edition to finally turn a profit using an exclusively online format. In Graff-Pinkert’s used machinery business we have had to open our eyes to the fact that today’s buyers will not purchase a 6-spindle Acme-Gridley for $100,000, as they may have 15 or 20 years ago. Today we have to create deals with new types of products. We have a choice to make—take advantage of new opportunities in our marketplace or die. I refuse to die, and like 50 Cent, I am not programmed to be crack bagger.

Noah Graff has been a Writer/Editor at Today’s Machining World for 11 years, and has been buying and selling machine tools at Graff-Pinkert since 2011.

Question: How has your business changed in the last five years?

By Lloyd Graff

I was surprised by some of the outraged comments on my blog about the sale of Doosan to a private equity firm and changes in the machinery market which have affected the company.

I wrote stuff that was available on the street for the people in the machine tool industry. There was some inside info I gleaned from reliable sources which gave the piece a newsy flavor. I’m happy I wrote an article that was not all common knowledge. My blog also will never be a vehicle for public relations releases. Today’s Machining World has a space for official company news called “Industry News,” but every Swarfblog is original editorial content.

Publishing two original, provocative articles each week while running two businesses can be quite daunting. Fortunately, I do not do all of the writing. Noah writes really interesting pieces, and I find friends and accomplices to write occasional blogs. But I still do the bulk of the writing. The only way I manage to be as prolific as I am is to follow two simple guidelines I have laid out for myself. I write about things I know and I write about things I care about.

With the Doosan piece, I did know something about the topic because I live in the machine tool world and I talked to people who knew more than I did. I really cared about the piece, too, because the ups and downs of the new machine tool market affect my used machinery business.

The Doosan piece was a fairly unusual one for me, however, because I do not usually spend my days hunting for scoops about the industry. If I was a full-time journalist it might be fun to do that, but I’m not, so the Doosan story was an exception to the usual Swarfblog.

My blogs generally reflect my passions, introspections, joys and fears.

The ones that really touch people, I think, are pieces where I let my humanness show – the ones where I cry a little when I write them, and honest tears are left on the page when I photograph the copy with my iPhone and email it to Emily Halgrimson for transcription.

I know it’s a bit dangerous to get down to the bones when I write this blog for 50,000 people, most of whom I do not know, but I have learned that honesty and pain and self-searching is what it’s about in life and in writing about life. I may fake it in business at times to move the ball, but in this work I want it to be from my heart. I want to be as straight with the readers as I can be.

My daughter Sarah is a Rabbi in California. She prepares for months mentally and emotionally for her big sermons. We usually confer while she writes them, always at the last minute. I find her messages almost always incredibly powerful because she weaves the stories of people she knows around powerful, emotional themes. Her stories connect with her congregants because they puncture the skepticism and cynicism people arm themselves with when they hear other supposedly spiritual messages that are not really authentic.

I have learned a lot from her. Speak from your gut but do it with stories, not admonitions. People reject lessons, but they learn from stories.

The empty page on the legal pad is always a challenge for me. I know I fail more than I hit with these columns, but it is an amazing feeling to occasionally nail one, even if the readers don’t always comment or blister me with vitriol.

I’m going to continue to write what I feel. I hope it works for you.

Question: Trump? Sanders? Third Party?

Lloyd Graff is a Writer and the Owner of Today’s Machining World, and also runs Graff-Pinkert, a used machinery firm in Oak Forest, IL.

By Lloyd Graff

Hiring good people for your business or organization is one of the most difficult tasks in management. I think a lot of the problem stems from not really knowing what we are looking for and the job candidate not knowing how to explain what he or she is providing.

I recently read a brief blog by Seth Godin, one of the most insightful practical philosophers of our day. He made the argument that we should hire for “resilience.” How easily do you bounce back from a disappointment? He calls it a skill, one that is more valuable than most.

I’m not sure I would call resilience a skill – it is more of a character trait – but it is enormously important in work and in life. I do not know how I would teach it other than telling others how I have dealt with adversity myself.

I do think you can look for it in an applicant, although probably not on a résumé. In an interview, I think a logical first question would be to ask the person about a major hardship in her life and how she dealt with it and continues to deal with it.

It might be a failed marriage, a business that went bust, a job she got fired from or the death of a loved one.

I believe a truly resilient person does not deny failure or loss. The person does not try to totally forget it or just rack it up to experience. Resilience that really counts means accepting a loss and not denying it.

In the used machinery business it seems like most of the deals we work on, often for months or even years, end up for naught. Sometimes the losses are devastating. I take them home with me. I wake up at 3 a.m. and can’t go back to sleep wondering why and how we blew it. Sometimes I talk about these failed deals with my wife, Noah or associates, but other times I just try to bury the thoughts and hope they don’t come up for me again.

The leader of an organization owes it to his people to be resilient and upbeat, but I think it is unrealistic to expect the leader to never show disappointment or fear if he or she wants to be seen as authentic and real.

Noah and I were talking about this over dinner recently and he recounted the personal story of rapper 50 Cent, whose autobiography he had just finished. Noah took inspiration from his story of going to jail, navigating warring drug gangs and recovering from 9 gunshot wounds. At least one of the bullets struck the rapper’s neck, permanently altering his voice. The shooting also caused his record label to disassociate with him and stop the release of his debut album. His story is one of true resilience, even If you condemn his criminal past.

The refugees who are fleeing the Middle East or El Salvador like my ancestors who left Russia and Lithuania need tremendous resilience to survive and prosper. Many will have the bounce back quality and others will lapse into depression.

I recently saw the movie “Brooklyn” about a spunky Irish immigrant in the early 1950s who came to New York and struggled to find her way, went back to her family in Ireland and then found the resilience and stamina to come back to America. I loved the story and the young actress, Saoirse Ronan, who had the lead.

As attractive as resilience appears in the theatre, politics and sports it is still an elusive quality to bottle and drink heartily from. But it is certainly one to search for in an employee and to nurture in yourself.

Question:  What have you bounced back from?

By Noah Graff

American football has had a fascinating evolution over its century-plus existence.

The Real All Americans, by Sally Jenkins, illuminates the story of the game through the lens of Carlisle College, the school founded by Richard Henry Pratt in 1879 to assimilate American Indians into modern American society. Carlisle will always be associated with football for its legendary star player Jim Thorpe, considered one of the greatest all-around athletes ever, but there is much more to the school’s place in football history than Thorpe.

American football was born in the late 1800s. The sport was mainly comprised of competitions between Ivy League schools, and often dominated by Yale. The game was simplistic and brutal. The forward pass was illegal and teams were given three downs to move a necessary five yards to reach a first down. It was a game for privileged blue bloods to knock the the snot out of each other with little creativity and grace.

In 1893, the Carlisle College Indian Industrial School played its first football season recognized by the NCAA. The Indian students, whose culture had been forcibly stripped away when they enrolled at Carlisle, discovered football to be an outlet in which they could embrace their natural warrior spirit which still burned within them.

The Carlisle College players were small and scrawny compared to the brawny Ivy league players, who used their strength to pound the ball forward on every down. But Carlisle players had guile, speed, and heart, and in the early years of their program they nearly beat powerhouse Yale a few times, sometimes losing because of corrupt racist referees.

In 1899, in order to compete with the more experienced schools with bigger players, Pratt hired the now famous Cornell alum, Glen S. Pop Warner to be the team’s head coach. It was a radical move at the time, as few college programs before had paid money to bring in an expert coach from the outside. In football’s early days, college teams usually were coached by alumni, college faculty or the student athletes themselves.

Warner knew that for the Carlisle players to have a chance to beat the Ivy League schools comprised of bigger, stronger players, they would have to play to their unique strengths and outsmart the competition. Warner’s strategies and creativity were so innovative that he practically reinvented the game. He employed the game’s first trick plays, such as his infamous “Hidden-ball Play,” which Carlisle used against Harvard in 1903. On the kickoff for the second half, the Carlisle players formed a circle around the returner. Dillon, the returner, was outfitted with a special jersey with a pocket inside which held the ball. The other Carlisle players then spread out on the field, each pretending to be carrying a ball. Harvard’s players went after all of the players who appeared to have the ball, while Dillon, the one Carlisle player whose hands were free of any ball walked into the end zone untouched. Warner was instrumental in the expansion of football’s rulebook because after he employed many of his creative plays and strategies new rules had to be created to outlaw them.

In 1905 football’s violent nature resulted in the deaths of 19 college players on the field. Columbia University stopped its football program and other schools were on the verge of doing so as well. President Theodore Roosevelt decided he needed to step in to deal with the situation. He was a football fan himself and his son had recently been badly injured while playing. He threatened to ban the game unless action was taken to limit its brutality

Roosevelt called the presidents of various colleges to Washington and insisted that the rules of football be modified. In the new rules, instead of three downs to advance the ball five yards for a first down, a team had three downs to advance the ball 10 yards (four downs came a little later). More importantly, the forward pass was legalized to try to loosen up the brutal pile which ensued on almost every play while teams tried to run through one another. However, passing was still discouraged by the early rules. If a team attempted a pass and it was incomplete, the offensive team received a 15 yard penalty, which was a horrible blow when coupled with the other rules of those days. But Warner, the renaissance football coach, still embraced the passing game. Legend has it that he invented the spiral throwing technique in his garage in 1906, which perhaps was even more important in that time period then today because early footballs were far less aerodynamic than today’s balls. They resembled rugby balls, fatter and harder to get one’s hands around.

According to the book, Carlisle was the school that truly introduced to the world the beautiful wonders of the forward pass. In 1907, Carlisle defied the conventional football wisdom of the time and embraced a throwing offense. On the last game of the season Carlisle played the University of Chicago, considered the best team in the country that year. The game was a premier sporting event for the time, attended by 27,000 people.

To stifle Carlisle’s throwing game, the University of Chicago’s players employed a strategy of hitting the crap out of the Carlisle receivers every time they came off the line of scrimmage. To counter this tactic, Warner designed a special play for Carlisle’s star receiver, Albert Exendine. When the University of Chicago blockers forced Exendine out of bounds, he remained behind the sideline as he ran down field. He ran around the players’ bench, spectators, and probably the band. Then he reappeared on the field to catch a beautiful spiral in front of the end zone. The beauty of the perfect long pass had debuted on the world stage. Not to mention, a new regulation outlawing running downfield out of bounds had to be added to the rule book.

It’s spontaneous magical moments like these that make me love sports. They are the moments when I know I have been blessed to experience extraordinary feats that will never be duplicated.

Question:  What are your favorite sports moments that you feel blessed to have experienced, as a spectator or player?

By Lloyd Graff

GM is buying a $500 million stake in car sharing service Lyft

General Motors is making tons of money in an 18 million car year. The company has $25 billion socked away. And their stock price stinks – straight as a string for years as they coin money.

On Monday, they announced they were investing $500 million in the distant #2 ride sharing firm, Lyft. With the funding Lyft has a valuation of less than 10% of the $62 billion of industry leader Uber, but with GM President Dan Ammann joining the board, and the former #3 entrant in the ride sharing industry, Sidecar, giving up, it looks like a legit two car race right now in ride sharing.

GM is also a player in the driverless car derby, which will be important in the long run for Lyft, but in the immediate future General Motors will have a chance to get more of its cars on the street. Lyft desperately needs more drivers. Those drivers, in many cases, cannot afford to buy new cars, but with GM’s assistance in financing and leasing, Lyft will be able to expand its fleet of both cars and drivers.

On paper, this is a very clever deal for both parties. GM moves nicely into the ride sharing game without all of the startup headaches. They get more cars in the game and develop some interesting relationships with Lyft partnerships in China, India and Southeast Asia.

Ride sharing’s early adopters are in big cities like New York and San Francisco, but GM believes it will soon spread to the suburbs and much, much further.

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Alcoa has won the fastener sweepstakes with the announcement of a $2.5 billion contract from Boeing over five years. Alcoa has long had close ties with Boeing, but this has to be good news to the many machining firms who work with Alcoa, particularly in the Los Angeles area.

Automotive, Aircraft, Medical and Ammunition are the four strongest legs in the machining world now with the commodities crash sapping the gusto from the rest of the market.

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How long will it take to adjust to the current commodities crash? It is fairly easy to see the oil adjustment phase. Saudi Arabia and Iran are in a near war state. Riyadh keeps pumping oil at $35 a barrel because they can’t stand Iran taking market share when the U.S. sanctions go off. They also need the money. The Iranians probably do not like $35 either, but it is a lot better than not selling into the world market (legally), so they’ll take it. Meanwhile, the rig count keeps dropping in the U.S., even though output is holding up pretty well. The drillers keep the most productive wells pumping so they can pay their bills even at $35. You sell the family jewels to keep the house warm in the winter, if necessary.

In the metals world steel scrap is in the toilet, but value added products have not dropped precipitously. It should make for fatter margins for producers like Carpenter and Schmolz & Bickenbach. Cheap natural gas, wind and solar have translated into falling power costs, helping profits for producers and perhaps making them willing to discount for market share. The strong dollar gives an opening to Asian and European producers of value added metal. For the buyers at warehousers like Central Steel it should be a sweet time if they can keep their volumes steady.

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Germany took in around one million refugees last year from the Middle East. America let in 2500. Did Angela Merkel make the right call?

I am fascinated by Merkel’s gamble on refugees. If it works, she wins the Nobel Prize and deserves it. Interestingly, German business leaders really like it. With very few available workers in the country, all of a sudden Germany has a cushion in the workforce. The skills are pretty weak compared to the Turks, who came in the ‘60s and ’70s to fuel the booming economy of that period. But the Syrians can push brooms and clean bathrooms as they start to develop more valuable skills.

The Germans are paying them 14,000 Euros a year as they adjust to Bavarian winters. All of that money gets spent quickly on food and necessities, so their economy is getting a nice stimulus as the rest of Europe stagnates.

Question:  Do you enjoy using ride sharing services like Lyft or Uber?

By Lloyd Graff

This piece is really two articles. The first is the one I ought to write—the politically correct, optimistic, let’s start the New Year off right and knock ‘em dead blog. The second blog is about what I’m really feeling at the moment as I get ready to embark on the year—my concerns about the known and unknown challenges that scare me more than I’d like to admit.

The optimistic Lloyd sees a blank slate of opportunity in 2016. Last year is history. The export killing rise of the dollar is mostly behind us, oil has taken its hit and can’t get much lower than $35 a barrel. The consumer is going to spend the extra $1000 gas savings on a 75-month lease on a Ford pickup truck and the Millennials will start buying houses and condos.

Yes, probably all true, but my queasy gut is worried about a shaky China and Europe. They have lost their appitite for more stuff that machines churn out of metal. Cars today last too long, Volkswagon can’t play without cheating, and the Chinese are more focused on cleaning up their filthy backyard than buying American steel scrap for building more smoke stacks to burn coal.

The optimistic Lloyd relishes the excitement of a remarkable American election season where we really do get a choice to move this country out of the Obama funk of cautious indecision. But my shaky gut is telling me that we will get Obama Light in Hillary Clinton, the recklessness of a crazy narcissistic Donald Trump, or the cynical power trip of a cunning Ted Cruz. All three of those options would be either bad or terrible for our business, much less our freedom in this wonderful country.

My optimistic self tells me we will get through it. The country is resilient. A President Trump would overreach and be impeached, or a President Hillary would be thwarted by gridlock. But it would get awfully messy and the stock market would free fall. When that happens folks will stop buying new Silverados.

The happy Lloyd looks back at the last 50 years of race relations in America and the enormous advance in the acceptance of African Americans in our society. At my high school prom, even at my liberal Chicago private school, black kids and white kids would rarely slow dance together. Today, it’s totally different. Yet gang warfare in Chicago is more violent than ever and the police are so fearful that they take a shoot first approach way too often. It has opened a gaping rift between the cops and Black people, at least in Chicago. It’s a scary time.

Personally, my optimistic half goes into 2016 glowing about my new grandson and my three thriving granddaughters. My three children make me proud every day as I see them doing well and doing good in the world. But I wonder what kind of meaningful work will be around 25 years from now, as machines become as smart and soon smarter than humans. Climate change does not worry me, we’ll adapt to a warmer Greenland, but will we adapt to the iRobot of 2040? That scares me for them.

I talk a good game 7.5 years past heart surgery, but every day I read the obituaries of people my age or younger and it triggers my morbid moments. Fear of dying or just decaying takes up way too many of my valuable hours. I combat it by working and exercising and zoning out on the iPad and TV sports. But fear of dying wakes me up at night and doesn’t want to go away. Maybe most people fight morbid thoughts in their 70s, but it is something that seems to be taboo to discuss, so I’ll identify it in this blog and ask if anybody has found a useful antidote for the blues.

The closest thing I’ve found lately to cancel out the negative is reading and talking about my Chicago Cubs. This off-season has been glorious. The team just gets better and better on paper and they are the favorite going into next season. It is really fun to picture my Cubs as 100 game winners, capable of winning a World Series. I gobble up every blog and search for new stats about the Cubbies’ projected supremacy. But deep in my skeptical gut I fear the team will be this year’s Washington Nationals—perfect on paper and then collapsing during the long season.

Folks, that’s how I’m really feeling going into this new year. I’ve got my game face on. I have hope. I can pull a smile out of my behind and make it look honest. But deep down I am scared. At least I’m not too scared to admit it.

Question 1: Are you feeling positive or negative about the new year?
Question 2: How do you deal with your dark moments?