Paul Huber of Comex comments on the recent Bosch auction in which 75 Escomatics were sold by Asset Sales Corporation. Paul came to the U.S. as a Tornos service engineer and is now the wise man of the Swiss screw machine industry.
Derrick Perkins of Liberty Research in Gonic, New Hampshire, has a creative approach to customer acquisition. He targets a long running job which he feels he can refine and then virtually own once he cracks the code.
His approach is to design and build his own equipment to elegantly and efficiently run the component in play. Perkins and his team of designers and toolmakers essentially invent the machine to make the part. He would rather build a special machine than buy existing technology in many cases because he is always looking for the “unfair” advantage versus his competition.
He has successfully constructed rotary transfer machines up to 24 stations with an off-the-shelf Hirth coupling and built-from-scratch units.
Derrick is also in the archery products business with a company called American Broadhead. Always the independent entrepreneur, he is attempting to build a name for his brand despite being an outsider to the big box buyers of such hunting equipment.
I think that for entrepreneurs like Derrick Perkins the joy is in doing the next to impossible, whether it is inventing a new machine or building the best arrow.
Domien Van Buynde & Wildebeest
(Hunting equipment from American Broadhead)
By Lloyd Graff
With the machining community so riddled with woe at the moment, the guns and ammo boomlet is manna from heaven.
It’s a great time to be in the gun business. The buzz on the Web is that Barack Obama is going to push for a ban on assault riffles, something households need more than refrigerators.
Evidently, Obama’s campaign reference, that “bitter” small-town Americans “cling to guns or religion,” has fueled a tremendous surge in gun and ammo sales. People are buying AR-15s, the civilian version of the M-16 military rifle, like 42” HD televisions. At $1000 a pop (sorry) they are pumping out of the gun shops and gun shows. Wal-Mart is struggling to keep ammunition in stock because the NRA is implying that a big tax will soon be coming on each ammo box.
The high profile mass murders in Binghamton, N.Y. and Pittsburg are reinforcing a sense of insecurity, even panic, while right wing commentators foment unease as the economy slides.
But the gun run is a great boon to the Swiss CNC business as manufacturers rush to cash in on the gun bubble. While hunting rifles are currently dead, hand guns are the new Rolexes as folks look to show off their fancy shooting hardware.
It is still quite doubtful that Obama is going to risk his political capital in a quixotic joust with the gun lobbies. But the power of fear, for the moment, trumps rationality.
By Noah Graff
Last week I went to Detroit to shoot a video spot for an advertiser of Today’s Machining World. A melancholy vibe permeated the city that I can only compare with the one I felt when I was last in New Orleans. When I arrived there were only three taxies and two limos sitting outside. Five vehicles to serve the entire Detroit Metro airport? I decided to query the empty rental car buses driving by to see if they had any cars available. I asked Hertz, Avis, and Budget, and every driver claimed that there weren’t any cars. Evidently so few people are traveling to Detroit Metro that the rental car companies have transferred their fleets to other more bustling cities.
Yet amidst all of its depression and desperation, Detroit now has an unexpected grassroots movement, attempting to revitalize the city’s housing market. At this moment, artists from around the world are buying houses in the Detroit ghetto for a few hundred dollars each.
Four years ago, artists Mitch and Gina Cope, bought a broken down house on Detroit’s North side for $1900. The house had been ravaged by scrappers who stole everything from copper plumbing, radiators to electrical lines. But the Copes bought it anyway and decided to turn it into what Mitch Cope calls the “Power House Project.” “Our idea — instead of putting it all back and connecting to the grid, we wanted to keep it off the grid and get enough solar and wind turbines and batteries to power this house and power the next-door house,” Cope says.
He thinks he can make the whole place operate “off the grid” for around $60,000, a cost he hopes to help cover with grants. He plans for the first floor to be a neighborhood art center and the second floor to be a bedroom for traveling artists. Of course, his grand vision is for the entire neighborhood to transform itself into an artist community using dirt cheep real estate as a magnet for new settlers. Cope has already convinced around a dozen artists from countries around the world such as the Netherlands and Germany to buy houses. Jon Brumit, a prominent artist from Chicago just bought a house in the area for $100.
You may find this story uplifting yet then put your nose up when you remember only 12 homes have been bought. But maybe manufacturers can learn from what these artists are doing. The bottom line is that the real estate in Detroit is going for practically nothing, Michigan is going out of its way to give tax incentives for new development, and there is an abundance of laid-off, skilled workers who potentially would jump at the chance to work at a job shop, even for a modest wage. Sounds like an opportunity for some creative types.
Listen to a podcast of the story at NPR.org
By Noah Graff
What if instead of giving all the bailout money to the reckless, untrustworthy banks and incompetent automakers our government just gave the money to the people? I’m not talking about 500 dollar “stimulus” checks. Say all of this aid money, maybe about $10,000,000,000 ($10 trillion!), was distributed to 100 million tax paying units in the U.S.? The people – our people, rich and poor, would get $100,000 each, and surly they would do some awesome things to stimulate the economy. Think about what people might use the money for – cars, houses, college educations, stocks, bonds, starting new businesses – not to mention depositing the money in the bank. So the banks would get their liquid too! What if people got half that amount, a quarter? What would you do with $25,000?
Personally, I’m very skeptical that the recipients of the current bailout plan are going to use the money wisely. Like so many people, I am scared that they will not learn from their mistakes. I fear we may be throwing our hard earned dollars into a black hole.
I say let the people fix the economy!
Question: Would giving $100,000 to every U.S. tax payer be a better way to save our economy?
By September 2008, China had owned 585 billion U.S. dollars in U.S. government bonds, becoming the largest creditor of the world’s largest economy, according to the latest statistics from China’s Ministry of Finance. It bought new US national debts every month during 2008’s first three quarters. (news.xinhuanet.com)
For years, China has had a surplus of money, which its national bank gleans from its high export to import trade imbalance. It takes the dollars it makes from U.S. consumers and then needs a reliable place to invest them, and it has historically invested heavily in U.S. treasuries along with private U.S. assets.
But now many of China’s investments in the U.S. have gone awry, as they were screwed by Freddie Mac and Fanny Mae, and reckless derivative trading. Naturally, like most people in the world, they have lost some trust in the once supposedly rock solid U.S. economy.
I believe that Americans will keep buying Chinese goods for a long time – although maybe slightly less because people here are struggling. Nevertheless, at least 90 percent of the goods Americans take for granted in their daily lives are made in China. Read the book, A Year Without Made in China, (reviewed by Today’s Machining World) and this concept is clear.
China’s government should have plenty of money to invest overseas for years to come. The question is … has the U.S. economy gotten so bad that they will put a lot of it elsewhere. Personally I don’t think so.
By Noah Graff
A recent column in the Wall Street Journal made a comparison of U.S. government policies in the present economy to those in the classic novel, Atlas Shrugged, written in 1957 by the anti-government, ultra capitalist Ayn Rand. Rand’s dogma which transcends all of her works has the fundamental principle that when government steps in to “bailout” incompetent businesses for the sake of the “common good” it causes a tumultuous domino effect.
Wall Street Journal Columnist Stephen Moore summarizes the book’s moral as the following: “Politicians invariably respond to crises — that in most cases they themselves created — by spawning new government programs, laws and regulations. These, in turn, generate more havoc and poverty, which inspires the politicians to create more programs … and the downward spiral repeats itself until the productive sectors of the economy collapse under the collective weight of taxes and other burdens imposed in the name of fairness, equality and do-goodism.”
Sound kind of familiar? Tarp? Auto company bailouts? A bunch more “stimulus plans”? I know. It’s scary right now. Desperate times. And I believe the government must step in somehow to stop a catastrophic loss of jobs and halted workflow that a bankruptcy of the Big Three would entail. And yes, it has to create liquid for the banks. But just like in the book, large companies are getting a free pass on their incompetence in management and law breaking. A money infusion gives them an opportunity to change their ways, but there is a definite chance it could create a downward spiral just as Rand envisioned. Does GM have a plan for how to spend the new money, other than to survive the next few months? Do the banks know what to do with their new capital? All of a sudden they have to figure out new ways to lend it, because now we know that the ways they were using it — such as granting sub-prime mortgages and trading recklessly with high leverage won’t work. The economy can only stabilize when these companies get their act together, and then, when the people regain trust in them. I don’t see either one happening soon.
Question: Do you have faith that the U.S. government’s new stimulus plans are going to create economic change for the better in the near future, or will they exacerbate our problems by allowing incompetents and crooks to continue their ways?
By Noah Graff,
Mitchell Lee Marks, a teacher at College of Business at San Francisco State University, wrote an editorial in today’s New York Times challenging an often used company mantra in a period of downsizing, “The company will identify ways to ‘work smarter’ and not just ‘work harder.’” He brings up the point that when people see coworkers laid off, they become averse to risk, holding back trying new, creative ideas which often require trial and error before they can become successful.
He also argues that having less people will mean less brainpower to come up with new solutions, which will stifle a company’s potential to make it out of the doldrums.
Marks says, “research shows that downsizings result in one-time-only cost savings to employers, but leave them no better able to compete in the marketplace. Downsizing has been referred to as corporate anorexia — companies that downsize get thin, but it’s no way to get healthy.”
Playing devil’s advocate – unfortunately sometimes “one-time-only cost savings” is the only thing that can save a company from going under that vary day. In the case of a manufacturing company which simply has no jobs going at the moment, letting go of people may be the only option to keep its doors open.
But I truly do believe that when a company, or team, or even an individual, has to compete with less resources, they often surprise themselves with what they can accomplish, and even do great things they might not have tried had they had their previous resources.
Today I am blessed to be one of those lucky individuals posed with the challenge of working harder, and smarter at an organization with less resources. I will take risks and try new things. If I don’t, there will be no future for Today’s Machining World.
Question: Do you believe that downsizing more often stifles creativity or encourages it?
The Celtics lost for the sixth time in eight games last night. Although that may be depressing for Bostonians, it’s a lot less gloomy news than what’s going on in today’s manufacturing economy. Today I’m taking a break from opining on the Big Three to show you this beautiful display of waterjet technology.
Question: What’s the most interesting product you’ve seen produced with waterjet?
By Noah Graff
Chicago Public Radio discussed a study today showing that employees giving gifts to bosses generally improves their treatment at work, even if bosses know they are trying to kiss up.
Ron Deluga, Professor of psychology at Bryant University in Rhode Island, surveyed 150 people and their bosses. Bosses graded their employees on a scale of one to five on a variety of ingratiating behaviors like giving compliments, gifts, agreeing with opinions etc. The employees also graded themselves on that same behavior.
Even though both the supervisor and the given subordinate agreed on the extent to which that subordinate would kiss up it actually seemed to be effective. When Deluga crunched all the numbers on the surveys and employee evaluations, he calculated that employees who kiss up receive a five percent premium for their efforts. Not enough to overcome poor performance, but maybe enough to give them an edge when applying for a promotion.
Question: Have you ever found that kissing up to a boss benefited you in the workplace?
Or, do you think that you as a boss have treated employess better because they kissed up to you?