Monthly Archives: November 2018

Swarfcast Ep. 20 – Scott Roy on Machines that will Think Like Humans

By Noah and Lloyd Graff

In today’s podcast we interviewed Scott Roy, a Senior Staff Engineer at Google who specializes in artificial intelligence.  He also happens to be my brother-in-law (Lloyd’s son-in-law).  One of Scott’s most recent projects at Google is to improve the way machines communicate with people in diverse human languages—last week he was working on communicating in Bengali.

Scroll down to listen to the podcast with Scott Roy.

Scott believes that one day machines may have the sophistication and human-like qualities of Commander Data on Star Trek: The Next Generation.  He says there is a good chance machines will be able to feel emotions like love or the joy of watching baseball, and people will be able to teach them ethics.  Although he recognizes the risks of possible harm to humans by super intelligent machines, his work is motivated by his vision of a relationship in which machines enable people to thrive.

Question: Are you more excited or afraid of super intelligent machines?

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Riding Into 2019

By Lloyd Graff

We are at the 1/16 pole headed to the finish line of 2018.  What does the news tell us about 2019 business?

As usual it is a mixed-up picture – a patchwork mosaic of information and gut feel.

GM announced yesterday that it is going to let go of 25% of its salaried employees.  This is probably overdue for the still bloated Detroit company but, nevertheless, shocking for a company that is making loads of money now.  But GM, like Ford, sees a changed new-car industry within 5-10 years and is shedding its pouch to prepare.  Sales are down a bit now, but this move is not about the American economy at the moment; it is about autonomous cars, also the possibility of electric cars, but mainly it’s about bye bye baby boomers, hello Generation Z, who wants to live in cities and is not particularly enamored of horsepower.

Then there is General Electric as a $9 stock.  When a Wall Street raider smells opportunity it often ends up as chaos on the ground.  Nelson Peltz buys big into GE, and now the company is being dismembered, and the stock falls by two-thirds, and healthy divisions are being scavenged for quick cash to assuage credit jackals.  Do you think that scares top people at GM and Ford?  So we see them try to get out in front by slicing jobs at GM and sacrificing car lines and pushing trucks and SUVs at Ford.  They both smell the autonomous car upheaval and are shaving costs, accumulating cash, and investing in artificial intelligence so they aren’t future casualties.

But for precision-machining people times are darn good right now and generally looking quite promising headed into 2019.

Courtesy of the Boston Herald

But what about housing, another leg of the economic stool?  New home sales are soft, starts are soggy, even used home sales are off, but it does not mean that folks are terribly down on housing.  It’s the bite of higher interest rates which is playing out in soft sales.  Still, plenty of folks are taking money out of their homes to spiff them up.  My wife and I are spending a lot of dough to remodel our 43-year-old home, not because it will enhance its value enormously, but to enhance our pleasure in living in it.  A 4.7% refi may bite a little, but it does not appear high enough to stop the renovation boom.  Check out Lowe’s and Home Depot; they are definitely not suffering.

But then there is the stock market plummeting.  Apple belching on too many phones that are barely better than the previous incarnation, and the company trying to make the Apple Watch the next big thing when it is really the next little thing.

Oil prices are plummeting for no apparent reason except the hedge funds were idiots who believed Goldman Sachs when they made their “big call” that oil was going to $110 a barrel because of Iran sanctions and OPEC hunger.  But they forgot about the ingenuity of dudes in the Permian Basin who have rewritten the drilling rules and resurrected fields that Big Oil had left for dead.  Then the poor hedge fund geese followed the leader and panicked, pushing prices from $75 a barrel to $52.  The price will rebalance in the $60-$65 range after a few more hedge fund tearful mea culpas.

I look for a good 2019 for the machining business if the Fed does not go nuts on raising rates to squelch the inflation that isn’t happening other than wages going up which is a good thing, on the whole, for the economy.

Then there is President Trump, tweeting at 4:00 in the morning and playing his high-stakes games with China.  This does spook me because I doubt Trump knows his endgame, and the Chinese are on their back foot right now and therefore possibly dangerous.  A naval engagement with the United States would not be a good thing for the world economy.

We have Buenos Aires talks coming up in a couple days.  Trump will talk to Xi.  The Dow will go up or down 1000 points.  And the world will go on.

Question: Is automotive work a good place to be in 2019?

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My Gratitude List

By Noah Graff

I am like many people in this world, despite having so many things I should feel grateful for—living in a country with so many opportunities, being born into a well-off family with parents and siblings who love me, having a good career, etc… I still find myself plagued by negative self-talk and being annoyed by what I label as “First World problems.”

After getting a recommendation from many self-help books and podcasts I started making a gratitude list almost every morning since July of this year. Most of the time I write down 7-10 things into my iPhone. Often the lists repeat themselves with things like, “I’m grateful for my wife Stephanie, I’m grateful for my family, I’m grateful I woke up in a warm home, I’m grateful I am healthy enough to get out of bed, and I’m grateful I get to create blogs and podcasts and broadcast them to thousands of people.” I have found that when I make these lists I genuinely feel better throughout the day than if I had not done so.

Noah’s Gratitude list on his iPhone

Right now I’m listening to a book by A.J. Jacobs, a favorite author of mine, called Thanks a Thousand. The book follows Jacobs in his quest to thank 1,000 people who contribute to his morning cup of coffee. He personally thanked the barista, the coffee farmers, the people from the water company, the people who build the skids to haul the coffee, the people who cut down the lumber that makes the paper for the coffee cups—you get the gist.

Jacobs discovered that when he told people he was grateful for what they did he felt happier.

In a podcast Jacobs quoted a Benedictine monk who said, “Happiness doesn’t lead to gratitude, gratitude leads to happiness.” It sounds paradoxical but studies by psychologists have shown this to be true. Studies have also shown that people who are the most grateful are those who help others the most.

Maybe you feel crappy today. Maybe things are just not going well in your life right now. Consider making a gratitude list or just telling someone that you are grateful for them. You may be surprised how you feel afterward.

Question: What three things are you most grateful for right now? (I would appreciate it if we refrained from politics.)

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Swarfcast Ep. 19 – Rick Rickerson on Educating Engineers to Understand Machining

By Noah and Lloyd Graff

Scroll down to listen to the podcast with Rick Rickerson.

Rick Rickerson is in charge of the machining lab at Purdue’s Northwest Indiana campus in Hammond.  In today’s podcast he talks about why he loves his job. “It’s all about students” he says.  His passion for teaching beams throughout the interview.

Rick has been doing this job for 14 years.  His department has a half-dozen South Bend lathes (now made in Utah), but the students gravitate to the Haas VF-2 vertical machining centers.

The part of his duties that really gets the students’ juices going is the Purdue Northwest racing team.  Every year students all over the country build a Baja-type racing buggy with the same Briggs and Stratton engine.  They build it from scratch and are responsible for every nut, bolt and weld.  Thousands of hours go into the preparation for two races in the spring presided over by SME judges.  The preparation is strenuous, and the races are exhausting for the students and Rick, but he loves it.  The judges grill the student builders and racers about the vehicles.  Once they get on a track the buggies invariably break down, and the kids have to rebuild them on the spot.  It’s a fantastic learning experience.

Question: Is building a Baja-type racing buggy from scratch a good way to learn machining?

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Buying and Selling Machining Businesses

By Lloyd Graff

I’m writing this blog to announce a slight shift in my business career, which has been evolving this year.

Several longtime clients of Graff-Pinkert have asked me to help them find machining businesses to acquire and other owners have requested I find them a buyer for their businesses because they felt that I had the right network and skill set to do it. My initial inclination was that I’m purely a machinery dealer, not a business broker. But then I thought, why not try this. Perhaps I can add value for some people who I really care about. If I hit a dead end I’ll know soon enough. Currently I have four deal deals in process and have completed two.

Lloyd Graff, Owner of Graff-Pinkert and Today’s Machining World.

I have not approached this task like a traditional business broker who would contact private equity groups because my clients have preferred that I not publicize their decision to the world, thus jeopardizing their long-term relationships with customers and employees. Such a broad gage approach can also be toxic as far as tipping off the seller’s competitors who are good at sniffing out situations and taking advantage of them. Despite nondisclosure arrangements that supposedly insure anonymity in the market, a business broker soliciting offers is going to inadvertently leak a potential seller or elicit rumors.

I have been able to keep a lid on leaks and rumors by connecting with prospects directly, because I have stuck primarily within my extensive network of relationships within the precision machining industry rather than try to cover the gamut of businesses in the marketplace. I also have focused on companies doing $20-million-in-sales or less, because I do not feel comfortable right now with bigger transactions.

One trend which has surprised me is how many foreign firms are highly motivated now to enter the American market in this field and are looking for businesses in our sweet spot. Our extensive network of users, suppliers and other dealers worldwide has served us well in this search. To Europeans, South Americans and Asians America truly looks like the land of opportunity, and in many cases their existing customers are asking them to do business here.

I don’t want to take on a lot of projects, because they are quite time consuming and I want to be able to give them the attention they deserve. I would like to work on 6 or 8 a year that I think I can shepherd to conclusion.

I may not be long on mergers and acquisitions experience but I know the people in the machining business. It appears that my ability to “talk the talk” and really listen to people explain their needs resonates today in this field.

This is a fascinating new gig for me, and I have Noah and Rex Magagnotti adding their knowledge and networking to help make it work.

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Swarfcast Ep. 18 – Jerry Levine on Why Global Warming is Not a Problem

By Noah and Lloyd Graff

Scroll down to listen to the podcast with Jerry Levine.

In today’s podcast we interviewed Jerry Levine. A chemical engineer, Jerry Levine’s working career stretched from polyester to politics. He led the team at Amoco Chemicals that conquered the production problems in making polyester in the 1960s.

Jerry then learned what it was like to live under Communism when he helped set up a polyester plant in East Germany well before the Berlin Wall came down.

He later returned to Amoco’s corporate office in Chicago, finding his niche as a lobbyist for the company and “Big Oil.”

Jerry holds the view that Global Warming fears have been fueled by faulty and sometimes deliberately contrived data to protect scientific jobs and reputations, and to build political careers. He feels that ardent advocates of Global Warming theories often have “no growth” philosophies which mask hidden Socialist agendas.

Question: Do you believe global warming is mostly caused by human activity?

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Why I Didn’t Vote

By Lloyd Graff

It’s November 6, and I’m sitting at Starbucks writing this piece, across from the polling place I chose not to vote at in 2018.

For over 50 years I have voted at every opportunity. I’ve voted for Republicans, Democrats, Independents and Idiots. But this year I’m not going to be an idiot and participate in an exercise that does nothing positive for me or my community and wastes almost two hours of my precious day.

In my America of 2018 the political system has evolved into a fat duopoly (a dual monopoly) of parties that vie for the spoils from the willing masses who lemmingly abet them.

Maybe I would feel differently if I had just one actual race where I felt my vote would matter, but in my Chicago south suburb of Olympia Fields this year the political institutions, Democrats, Republications and a cynical press have totally turned me off. For Illinois Governor I have two centimillionaires who have been throwing dirt at each other for six months. Bruce Rauner, the Republican, has been an impotent failure trying to move an utterly recalcitrant legislature. J.B. Pritzker, the Democrat who inherited a real estate fortune, seemingly has done very little in his life except “live large”—in his case 300 pounds worth. For my choice for Congress I have none. Robin Kelly, a pleasant lady and Democrat who I wouldn’t recognize if she was standing in front of me at Starbucks, is unopposed. She is a professional unknown, perfect for my locale which elected Jesse Jackson Jr. for a decade before she inherited the job.

I have come to see our National and Illinois political scene as a well-orchestrated charade game played by the insiders of both political parties. It appears they do hate one another, and they fight hard for the right to collect the spoils of power.

Photo courtesy of fee.org

The lobbyists will pay greater tribute to the winners than the losers, but the sad fact is that neither party really cares about the poor and sick and dispossessed because they are regarded as just tools to be used to amass power and win the GAME.

Donald Trump is an interesting intruder into the political duopoly, but he has embraced the Republican Party and they have embraced him to stay in the game. Trump has done a lot of good things for the country in two years, but his narcissism and ego make him prone to major miscalculation in the world arena. If I could vote for Trump on today’s Illinois ballot I would vote, but on today’s ballot there is nothing for me to vote for. So here I am at Starbucks, bitter that America has a political system that rewards greed and voter laziness.

I will watch the returns come in tonight hoping for a stalemate in the Congress. Trump needs restraint, and a Democratic House will provide that. A Republican Senate will restrain the lefty loonies in Congress and hopefully keep the economy on track.

But until we break the grip of the haters in both parties and attract some people who actually care about doing good, not just keeping power and accumulating spoils, I think I’ll just boycott elections and drink my coffee.

Question: Does the state of American politics make you sick?

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Swarfcast Ep. 17 – Making it in America with Armand Barnils

By Noah and Lloyd Graff

Scroll down to listen to the podcast with Armand Barnils.

In today’s podcast we interviewed Armand Barnils, plant manager of the U.S. division of Ventura Precision Components, a multinational precision machining company headquartered in Barcelona, Spain.

Armand grew up on the outskirts of Barcelona and studied Industrial Engineering in Spain. Through a foreign exchange program he came to the United States and earned a Masters Degree in Industrial Technology and Operations at the Illinois Institute of Technology.

At age 23 he moved to Pasadena, Texas, just outside of Houston, to work at Ventura Precision Components. Two years later his boss left, and at just 25 years old he became the shop’s plant manager.

In the interview Armand recounted his life’s journey from Barcelona to Chicago to Pasadena, Texas, and opined on the career opportunities he believes are unique to the United States.

Question: Do you believe in the American Dream?

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