ASA and the “New School Year”
It is no coincidence that we end our ASA fiscal year in June, and begin the “New Year” at the same time our children are returning to the classroom for their new school year. As I begin my second year-long term as your Chapter President, a few ideas came to mind for my President’s Letter this month.
We all commiserate with our customers and friends about the “lousy” economy, low client profits, and particularly for those without work in this “rotten” job market. Our country has survived some extremely turbulent economic gyrations in the past few years, but few of us can say we are comfortable with matters as they now stand, or are confident in the future. So what can we do about it…?
First, we must regain confidence in our own future, as individuals and as a nation. The United States has grown and ebbed at various rates over our long 235-year existence, but survived and sustained itself to become the strongest democracy and economic model in human history. No other country in the world has ever had more people seeking TO GET IN than get out. If changes need to be made, we make them at the polls, not in the streets.
Secondly, you have the most influence on your own future. It is not the government’s responsibility to take care of us, even when we face a disaster or an economic malady over which we have no control. What have you done for yourself lately that makes you more qualified or desirable as an employee? If you are not enthusiastic about continuing education, you are inviting your competition to eat your lunch.
Third, nobody should honestly believe that “there are simply no jobs out there.” A recent inspiring article in The Wall Street Journal (dated August 22, 2011, titled “For Deloitte CEO, Hard Economic Times Are Nothing New”), Deloitte’s new CEO, Joe Echevarria, describes his own ascent from poverty in the South Bronx to running a service company with annual revenues exceeding $11 billion. He goes on to describe how Deloitte has invested $300 million in opening (in October, 2011) “Deloitte University” in Texas. This, he says, is “a commitment to learning and development of our (own) people.” Those people?: some 18,000 new hires in the current fiscal year.
I constantly read about companies in the United States that simply cannot find qualified employees to fill their workforce needs. A high school dropout in the United States is not “entitled to a job” at any level, let alone one paying the minimum wage. If U.S. employers can fill their employee ranks with qualified applicants offshore, and at the same time get expense and tax advantages, that’s what management is paid to determine. Otherwise, management will be replaced by the stockholders who have “bet” their own capital.
Fourth, I often question what our schools and universities are teaching these days. It may be intellectually great to have a “truly liberal education”; but a degree in the history of glass-blowing (my apologies to you glass-blowers out there) is probably not going to have much interest among potential employers. Financial literacy is sorely lacking in our country. A typical young person, and so many of our older citizens, simply have zero financial sophistication, and cannot grasp the gravity of the crises that we are experiencing as a nation. My nieces and nephews think that every citizen of this country should be entitled to a free education, free health care, subsidized housing and “three squares” a day. What they have not been taught is that the economy (and economics) is a zero sum game: you simply cannot take out more than what has collectively been put in.
Finally, S&P recently downgraded our U.S. Government bonds, and that apparently has been a “big deal” according to the populist press. Ironically, as those debt ratings fell, there was a rush to safety (still seen by most global investors as U.S. bonds); bond prices went up, and interest rates declined. And just who are those guys anyway? --- They are the same rating agencies that got it totally wrong on the sub-prime mortgage debt, sparking the financial crisis explosion. ‘So why should anyone be emphasizing the infallibility of those credit rating agencies?
Franklin Roosevelt got it right when, at the beginning of his first term as President, he said, The only thing we have to fear is fear itself.” The U.S. debt rating decline really began when our politicians began talking about a default on U.S. Government debt, and the market perception became negative, …not when S&P downgraded the debt.
As ASA appraisers, we go though many university classes, a lot of intensive ASA initial training and extensive continuing education to earn and maintain our designations. That training is just one of the elements that set us apart for our competition. Have you made it known to your own clients what it means to be an ASA…? Have you done all you can to provide not just an appraisal, but the perception of quality, high ethical standards and long-term interest in your client’s well-being? Though your Chapter Board may not have solved all our local dilemmas, we continue to tackle them one-by-one. It is a “new school year,” when we learn too. And we always seek and welcome your input. Thank you for your support!
Robert P. Lentz III, ASA NorCal Chapter President 2010-2012
Accredited Senior Appraiser
in Business Valuation
Lentz & Company, Inc.
8 Waldeck Ct.
Oakland, CA 94611-1744