Why Making a Career Change Can Look Good on a Resume
By Diana Ransom / The Wall Street Journal Online / August.22, 2007

Say you want to quit your job in sales to become a bartender. Or maybe you're ready to bag your law practice and open up that café you've been dreaming about since undergraduate school.

Should you or shouldn't you? And what are the implications?

Making a radical career change at any age is risky. But for many workers -- especially those in their 20s -- a career change, not just a job change, can be a welcome addition to your resume, say some career counselors and recruiters.

While sticking to one career demonstrates focus and dedication, changing course "shows a degree of risk taking and self-awareness," which can be attractive qualities to some employers, says Joseph McCabe, a vice chairman for CTPartners, an executive search firm in Boston.

It's also a part of being young, he says, adding that most people "in their 20s right now won't wind up working for the same employer their entire career."

Take a Chance
A younger person usually has more opportunities to change than does someone who has been working for a while, says David Bowman, chairman of TTG Consultants, a human-resources consulting firm in Los Angeles.

And the younger person has less money, which can be a good thing when you don't have to give up a lot to follow your bliss.

"Once you start making hundreds of thousands of dollars a year, you can't readily make that career change and replicate your current salary," says Mr. McCabe.

Employers at this stage also don't necessarily focus on your experience as much as your "core competencies" -- that is, your natural abilities and your capacity to learn. Additionally, younger people often don't have families and other debt obligations that might hamper major changes.

Weigh Costs and Benefits
"You really need to think like a statistician," says Marty Nemko, a career coach in Oakland, Calif., and author of "Cool Careers for Dummies." Consider the odds that your investment of time and money in a change will result in a happier or more lucrative career.

Mr. Bowman suggests seeking the advice of individuals who know you both personally and professionally. They can help you identify pros and cons that you may not have considered.

That's what 27-year-old New York resident Jenna Carl did before quitting her job as a management consultant to go to Spain to teach history.

"It's safer to keep going in the same field," admits Ms. Carl, who is preparing to move in October, "but I would have been denying my passion."

Be Selective
But while young people should feel free to experiment with different careers, too many dramatic moves -- even in today's transitional work force -- can raise red flags to future employers.

Additionally, job hoppers face a possible loss of retirement savings. Your new employer may not offer a 401(k) plan, and if it does, it may not match your contributions right away, if at all.

Another consequence: You could lose pace with your peers. Say you and a co-worker started your jobs at the same time. As you leave in search of greener pastures, your former peer is likely rising in the ranks while you're effectively starting over again.

Get Your Story Straight
Changing careers takes "focus and commitment," says Mr. Nemko. To be successful, carefully consider how each move you make will affect the rest of your career and be able to articulate that for future, and former, bosses.

Once employers see that you thoroughly thought this out, they may not hold one or even two job switches against you.

And whatever you do, don't burn bridges, warns Mr. McCabe: "As long as you leave professionally and gracefully you will likely get an invite back."

Bank of America Invests $2 Billion In Countrywide
By JAMES R. HAGERTY, VALERIE BAUERLEIN and LINGLING WEI / WSJ / August 23, 2007

Bank of America Corp. acquired a $2 billion equity stake in Countrywide Financial Corp., a move aimed at dispelling a crisis of confidence among creditors and investors in the nation's largest mortgage company.

The move, which received quick approval from federal regulators, amounted to a private-sector bailout of the mortgage giant. In recent weeks, it had struggled to raise the financing it needed to fund its business, stoking concerns among investors about its prospects and pummeling its stock. Worries about the fate of Countrywide, which originates one out of every five mortgages in the U.S., have been a major factor in the recent tumult in financial markets.

News of the investment came late yesterday afternoon, just hours after Wall Street investment bank Lehman Brothers Holdings Inc. announced that it was closing down a subprime-lending business and two days after another big lender, Capital One Financial Corp., closed its GreenPoint mortgage arm. Those operations joined scores of small to midsize lenders that have collapsed over the past six months amid growing anxiety over a surge in home-loan defaults and a weakening housing market.

"Countrywide is a survivor," Angelo Mozilo, chief executive officer and co-founder of the Calabasas, Calif., company said in an interview late yesterday.

Indeed, Countrywide had argued that it would endure the current mortgage meltdown and emerge even stronger as competitors vanished. But the company was caught up last week in a storm of speculation as it found it could no longer tap the market for commercial paper, or short-term corporate IOUs, which was a major source of its funding, and an analyst from Merrill Lynch warned in a report that Countrywide could face bankruptcy in a worst-case scenario.

Last week, Countrywide borrowed $11.5 billion from a syndicate of 40 banks to shore up its finances, and it would have survived even without Bank of America's help, Mr. Mozilo said, but he added that this "vote of confidence to the world" will make the company stronger. In after-hours trading yesterday, shares of Countrywide jumped $4.06, or nearly 19%, to $25.88.

Bank of America's investment involved Countrywide nonvoting convertible preferred stock yielding 7.25% annually. The preferred can be converted into common stock, subject to restrictions on trading for 18 months. A full conversion would give Bank of America a 16% to 17% stake in Countrywide's common shares, Mr. Mozilo said.

Mr. Mozilo dismissed as "frivolous" for now any speculation that the investment could lead to a full merger between Bank of American and Countrywide, but he said the two companies would explore "where we can provide services to them better than they do themselves, and vice versa.... We'll continue discussions."

Immediate reaction to the deal was positive. "I'm not sure $2 billion will help them a whole lot, but the good news is, hopefully, there will be more to come if Countrywide needs it," said analyst Chris Brendler at Stifel Nicolaus, a securities firm based in St. Louis.

"It shows a sign of faith from Bank of America that they are supporting Countrywide, and that's huge," said Richard Hofmann, an analyst at CreditSights, a bond-market research firm in New York.

Mr. Mozilo noted that Bank of America has provided financing for Countrywide's lending since 1970, shortly after the founding of the home-loan company. He declined to specify when the two sides began discussing the equity investment but said it came together "over a relatively short period of time," and that regulators were kept informed.

The investment puts Bank of America much more deeply into the turbulent but sometimes highly profitable home-mortgage market. In the first half of this year, Bank of America was the fifth-largest originator of home loans in the U.S., with a market share of about 7%, according to Inside Mortgage Finance, a trade publication. Countrywide was No. 1, with a market share of 17%, well ahead of No. 2 Wells Fargo & Co., at 10.5%.

One of Bank of America Chairman and Chief Executive Kenneth D. Lewis's first acts after he became CEO in 2001 was to remove Bank of America from the subprime-mortgage business, which caters to borrowers with weak credit records. Bank of America cited the risk and volatility of that business. At the time, the bank took a $1.25 billion charge, about half of it tied to subprime loans.

But Mr. Lewis has been eager to build scale in prime mortgage loans. Bank of America, the nation's largest retail bank, with 5,700 branches, hasn't been a major mortgage player, relative to its size. It originated $95 billion in mortgages in the first half of 2007, less than half of Countrywide's $245.13 billion, according to Inside Mortgage Finance.

Bank of America, which reached its coast-to-coast size with a dazzling string of acquisitions, is also bumping up against a regulatory cap that bars any U.S. bank from an acquisition that would give it more than 10% of the nation's total bank deposits. That leaves pursuing more mortgage customers as one of the bank's few potential routes to growth. Bank research shows that its customers with a mortgage tend to be credit-worthy and profitable, with an average of five accounts at the bank.

Bank of America in May rolled out a national "no-fee" mortgage program. Under the program, Bank of America doesn't charge borrowers for loan applications, title insurance, appraisals and flood certifications or require them to get private mortgage insurance -- part of a bid to secure customers' long-term business. To qualify, borrowers must have at least one account with Bank of America and obtain their loan through one of the bank's retail channels.

Word of Bank America's investment in Countrywide came as the dwindling number of large mortgage lenders still active in the market sought to regain their balance. IndyMac Bancorp Inc. said it will resume offering large prime loans known as "jumbo" mortgages, those exceeding the $417,000 ceiling on loans that can be sold to government-sponsored mortgage investors Fannie Mae and Freddie Mac.

Over the past two weeks, investors have been so spooked by doubts over possible losses on mortgages that they have shunned even relatively high-quality loans simply because they don't carry a Fannie Mae or Freddie Mac guarantee on payments of interest and principal. IndyMac's move is a sign that the market for jumbo loans might be settling down after a spike that has sent rates on 30-year fixed-rate jumbos to an average of around 7.5% from just under 7% in early July, according to HSH Associates, a financial publisher.

IndyMac said it plans to keep the jumbo loans in its portfolio until demand from investors improves.

Countrywide last week outlined a strategy under which it planned to use its Countrywide Bank unit, a federal savings bank, to fund nearly all its loans, up from more than 70% at present. The bank provides a much more stable source of funding than the commercial-paper market and other short-term instruments that were the only source of funding for dozens of smaller lenders that have collapsed in recent months. The savings bank also can borrow from the Federal Home Loan Banks, government-sponsored cooperatives.

After announcing the Bank of America investment, Countrywide's Mr. Mozilo said Countrywide would proceed with its plan to rely more heavily on its bank.

Bank of America, which earned $21.1 billion last year, has increasingly been willing to take equity stakes in other companies, agreeing in April to join two private-investment funds and J.P. Morgan Chase & Co. in paying $25 billion for student lender SLM Corp., more widely known as Sallie Mae. The Charlotte, N.C., company also agreed last year to pay $2.5 billion for a 9% stake in China Construction Bank, one of China's Big Four lenders.

Bank of America's Mr. Lewis said in a statement that the $2 billion should prove to be a very profitable investment. "We believe that in the current turmoil the stock market has been underestimating the value in Countrywide's operations and assets," he said.

But Mr. Lewis also said the investment was an important step to restore confidence and liquidity in the nation's credit markets. "This investment reflects our confidence in their business and recognizes the importance of the company in providing home financing across the country," he said.

Conspiracy Theory = 음모이론?

[Why] 누가 대통령을 쏘았는가
이인식의 '멋진 과학'… 케네디 암살에 배후? 달착륙은 조작?
음모이론, 파급력 큰 사건에 잘먹혀

이인식 과학문화연구소장
2007.07.27

미국 주간지 ‘타임’ 7월 2일자 커버스토리는 제 35대 미국 대통령인 존 F. 케네디의 생애와 업적을 회고하면서 그의 죽음을 둘러싼 의혹도 상세히 다뤘다. 1963년 11월 22일 텍사스주 댈러스에서 그를 저격한 암살범의 배후에 미국 중앙정보국(CIA)이 있다고 확신하는 사람들이 아직도 적지 않다고 보도했다. 케네디 암살에 음모가 개입됐다고 믿는 미국인의 비율은 1968년 3분의 2에서 1990년 90%로 껑충 뛰어 올랐으며, 44년이 지난 오늘날에도 75%에 달하는 것으로 나타났다. 1969년 7월 20일, 미국의 아폴로 11호가 달 착륙에 성공하여 우주비행사가 인류 역사상 최초로 달 표면에 발자국을 남기는 쾌거를 이루었다. 하지만 달에 꽂아 둔 성조기가 바람에 펄럭이는 중계 장면이 문제가 됐다. 대기가 없는 달에서는 불가능한 일이 발생했기 때문에 달 착륙은 조작극이라고 주장하는 사람들이 나타난 것이다. 그것은 성조기를 매단 깃대가 흔들릴 때 우주비행사가 손을 대서 일어난 현상이었다. 그러나 소련과의 우주 경쟁에서 승리했음을 보여주기 위해 미국 정부가 속임수를 꾸며냈다고 생각하는 사람들도 여전히 존재한다.

1997년 8월 31일, 영국의 다이애나 황태자비는 파파라치, 즉 유명 인사를 쫓아다니는 프리랜서 사진작가를 피하려다 자동차 충돌사고로 숨졌다. 그러나 남자관계가 복잡한 그녀가 권력을 누리는 것이 마뜩잖은 영국 왕실이 교통사고에 작용했을지 모른다고 의심하는 사람들이 적지 않다. 이처럼 사건의 배후에 보이지 않는 힘이 작용한다고 보는 시각을 ‘음모이론’(conspiracy theory)이라고 한다. 음모이론은 세상을 움직이는 것은 정치권력보다는 대중이 전혀 눈치 채지 못하게 영향력을 행사하는 거대한 힘이라고 전제한다. 사람들이 음모이론에 현혹되는 까닭은 복잡한 쟁점을 극단적으로 단순화하려는 경향이 있기 때문이다. 어떤 일이 발생하건 그 뒤에 거대한 힘이 개입되어 있다고 여기면 복잡한 사건이라 할지라도 이해하기 쉽기 때문이라는 것이다. 2003년 3월 영국 런던대의 패트릭 레만 교수는 영국 심리학회에 발표한 음모이론 연구 보고서에서, 인간의 심리 저변에는 파급효과가 큰 사건일수록 그 원인도 거창할 것이라고 추리(major event-major cause reas oning)하는 성향이 깔려 있는 것 같다고 주장했다. 레만 교수는 대학생 64명에게 신문에서 잘라낸 것처럼 보이는 기사를 제시했다. 물론 이 기사는 가짜로 만든 것이었다. 가상 국가의 대통령에 관해 4종류로 꾸민 기사였다. 첫 번째 기사는 대통령이 총을 맞아 죽는 것으로 되어 있다. 두 번째 기사는 대통령이 피격되지만 목숨을 건진 것으로, 세 번째 기사는 총알이 대통령을 빗나갔으나 알 수 없는 원인으로 피격 직후 사망하는 것으로, 네 번째 기사는 총알이 빗나가 대통령이 살아남는 것으로 작성되었다. 레만 박사는 이러한 신문기사를 읽고 암살범이 단독 범행인지 아니면 배후에 다른 세력이 있다고 생각하는지 물었는데, 대부분 저격수 뒤에 어떤 세력이 있다는 쪽으로 의견을 내놓았다. 결론적으로 사람들에게는 주요 사건에 거대한 원인이 숨어 있다고 추리하는 성향이 농후하다는 사실이 확인된 셈이다.

▲ 이인식 과학문화연구소장
영국 주간지 ‘뉴 사이언티스트’ 7월 14일자에 기고한 글에서 레만 교수는 음모이론이 수그러들지 않는 이유 중의 하나로 인터넷을 지목했다. 다이애나 황태자비의 죽음에 얽힌 이야기를 제공하는 웹사이트가 2004년에 3만 6000개를 넘었을 정도이다. 2001년 9월 11일 미국에서 발생한 테러의 배후에 CIA가 있다고 주장하는 다큐멘터리 ‘루스 체인지’를 웹사이트(www.loosechange911.com)에서 내려 받은 횟수가 1000만 번을 상회한 것으로 집계되었다. 음모이론은 정치적 목적으로 활용되는 사례가 빈번하다. 12월 대통령 선거를 앞두고 상대방 후보를 흠집 내기 위해 갖가지 음모 이론이 인터넷을 통해 기승을 부리지 말란 법이 없다. 16세기 이탈리아 정치가인 니콜로 마키아벨리는 ‘군주론’(1532)에서 정적을 제거하기 위한 음모가 성공하는 확률은 그리 높지 않다고 설파한 바 있다.

Bank of America Acquires LaSalle
By AP / Ieva Augstums / TIME / Apr. 23, 2007
(CHARLOTTE, N.C.) — A year after making a successful $34.2 billion move into credit cards, Bank of America Corp. found yet another multibillion opportunity to grab more customers.

The Charlotte-based bank said Monday it will purchase LaSalle Bank Corp. from ABN Amro North America Holding Co. for $21 billion in cash.

The deal, initially announced by ABN Amro Monday when the Dutch bank agreed to sell itself to Barclays for nearly $91.2 billion, fills a big hole in the bank's nationwide branch network by making it Chicago's largest bank.

It also raises questions about Bank of America, who is up against a federal cap that bars it from making acquisitions that would give it more than 10 percent of all U.S. deposits. The bank, which is the nation's second-largest after Citigroup, recently controlled just over 9 percent.

"I think there is a huge opportunity here, but the near-term costs are what people initially see," said Jefferson Harralson, an equity analyst with Keefe, Bruyette & Woods Inc. in Atlanta. "Long term, it's a great strategic move for them."

The net cost to Bank of America will be $16 billion after a return of $5 billion in excess capital.

Bank of America said it expects the deal to immediately enhance its earnings per share and about $800 million in after-tax cost savings. Restructuring costs also are expected to be around $800 million, the bank said.

Investors and Wall Street offered mixed reactions, sending shares of Bank of America down 53 cents, or 1 percent, to close at $50.51 on the New York Stock Exchange.

Analysts at Friedman, Billings, Ramsey & Co. said "we like this deal, particularly as this strengthens BofA in the third-largest deposit market in the U.S.," referring to Chicago. They maintained their "outperform" rating on the stock.

For the past several months, Bank of America Chairman and Chief Executive Ken Lewis has expressed his bank's interest in the Chicago market, particularly the strength of LaSalle, in speeches and conference presentations.

While not desiring to be the leader in every market in the U.S., "Chicago is attractive to us," Lewis said during a call with analysts. "The opportunity arose and we acted."

Chicago-based LaSalle is a top-20 U.S. bank holding company, with $113 billion total assets.

The combination of LaSalle and Bank of America creates a leading banking franchise in Chicago, the No. 3 banking market in the United States, and in Michigan. Together the banks would surpass current market leader JPMorgan Chase & Co. in Chicago and set up a battle with that bank, the nation's third-largest.

In the last four years, Bank of America has increased its retail presence in Chicago from a single financial center to 56 locations. Once combined with LaSalle's 141 Chicago area offices, Bank of America will have more than 14 percent of the deposit market share in Chicago.

The purchase, which is expected to close later this year, also will mark Bank of America's retail branch entry in Michigan, where it will have 264 offices and be the largest bank with a 23 percent deposit market share. Bank of America also will acquire LaSalle's six offices in Indiana.

While Chicago has experienced a surge in bank branches, Michigan has suffered economically from a loss of auto industry jobs. Last month, Comerica Inc. said it will move its banking headquarters to Dallas from Detroit to be closer to its faster-growing markets.

"The Detroit franchise is going to be a challenge to grow because of the economic backdrop," Harralson said.

Analysts also are questioning how Bank of America will get around the federal deposit cap law.

In 2004, the bank acquired FleetBoston Financial. A year ago it added millions of names to its ledger through its purchase of credit card issuer MBNA Corp. Currently, the bank has pending purchases of wealth management company U.S. Trust Corp. and a stake in the student lender SLM Corp., known as Sallie Mae.

Last month, when the Federal Reserve Board approved Bank of America's plan to buy U.S. Trust, it said the buyer held $612 billion in deposits, or 9.1 percent of the U.S. total before the purchase. With LaSalle's approximately $57 billion deposits and U.S. Trust's $9.4 billion deposits, the bank would appear to be slightly over the 10 percent threshold.

Bank officials said they are confident they can meet the requirements.

"We will not plan on changing our retail deposit strategy," Lewis said.

Ganesh Rathnam, a banking analyst with Chicago-based Morningstar, said the bank will more than likely just "not pay as high on their CDs as other banks do," thereby meeting the requirement, he said.

In all, Bank of America had $1.46 trillion in assets at the end of 2006, second only to chief rival Citigroup Inc. — the nation's largest financial services company with $1.88 trillion in assets.

Harvard Square’s Greenhouse shuttered
by Greg St. Martin / Metro Boston / APR 24, 2007

CAMBRIDGE. As Kathy Nini sat at a table in the Greenhouse Coffee Shop, her late husband’s Harvard Square restaurant, she painfully turned away about 20 customers who walked in during a half-hour span yesterday morning. That’s because yesterday marked the first day in which the popular Cambridge institution had closed its doors for good.

The restaurant, known for its cake, all-day breakfast and unique painted mirrors to create the feel of an actual greenhouse, opened in 1977 and only closed twice annually — for Thanksgiving and Christmas. But, after Nini’s husband, Joseph, passed away recently, she’s been told the restaurant would have to close down.
“I’m glad my husband wasn’t here to see this. He’d be devastated,” Nini told Metro. “All our regulars have said is, “Where are we going to eat our breakfast?”

When reached yesterday afternoon, Richard Getz, the property’s manager, would only say the restaurant is closing because the owner passed away, and there are a few “exciting options” as to what will move into the location.

Over the years, a handful family-run businesses in Harvard Square have given way to larger corporations. But, according to Denise Jillson, the Harvard Square Business Association’s executive director, a lot of thought is put into keeping local businesses in the area when others leave.

“I think there needs to be a good mix,” said Jillson, adding there are 350 retail stores and 90 restaurants in Harvard Square. “You need the larger corporations as an anchor. You couldn’t just have locally-owned businesses because people come to depend on the Gap or Origins, which was even locally owned until a few years ago.

“When you’re dealing with so many property owners, it’s a challenge,” she said. “But there’s a really thoughtful process that takes place about who takes the space available."

Creating a Creative Climate

Creativity does not happen in an intellectual vacuum nor in the emotional icebergs that many companies fashion for themselves.

Research around creative culture and general climate has led to the identification of key areas on which companies can focus to develop an effective climate in which people are not only creative, but where they are motivated to develop these ideas into value-adding contributions to the success of the whole organization.

If a company wants to become more creative, rather than just encouraging people or teaching tools, then perhaps the best way is to develop the organizational climate. Rather than telling the plants to grow, this is about tending to the soil in which they can become what they are capable of becoming.

Motivation

To do anything, people must feel motivated, an internal need to act. The climate of the organization thus must provide the cues and forces that lead people into the deep motivation that is required to push through from idea to end product.

Challenge
People feel challenged, that there is a basic drive to extend their personal boundaries, develop latent talents and explore new possibilities.

People who feel challenged emotionally engage in their work. It becomes a part of them, not just something they do. They feel the need to get out there and act, not just to sit back and dream or mope.

Organizations can challenge people by linking a deep understanding of individual talents, potential and motivation with the strategic intent of the company. MBO (Management By Objectives) got itself a bad name in the 1980s, mostly because it was done badly. Done well, it means telling people what is wanted (the Objectives) and then letting them do it in any way they see fit. The trick also is in giving high-enough level of objectives that people feel excited and challenged, not constrained and directed.

Fun
Having fun is not always realized as being a productive state. Yet look at little children. Their 'fun' is almost all learning and discovery. We get this beaten out of at an early stage in school, where learning is supposed to be serious.

A climate where a certain (child-like, but not childish) playfulness is in the air lets people try things out without knowing what will happen.

Another important characteristic of a fun-loving culture is humour. You can see such climates simply through the smiles that people almost always seem to wear on their faces as they tease and joke with one another. Jokes are about unexpected things, as are creative ideas. Making jokes is, in itself, a very creative activity, and develops the 'creative muscle' needed to constantly innovate.

Empowerment

Once people are motivated to be creative, they need the environment in which they can be creative.

Freedom
People empowered to act in ways that are not tightly constrained by narrow job descriptions and management oversight. They have the personal freedom of choice and resource that gives them true authority to achieve the challenge they have been given.

Empowerment has been slated and abused, for example where the power is retained by managers whilst individuals are asked to achieve things without the power to act. Done well, however, it truly delegates power and the freedom to choose what to do and how to do it within a significant part of people's jobs.

Time
Discovering and developing ideas takes time. They need to incubate in your subconscious for a while, like hatching an egg or a dastardly plan. When people are tightly constrained, working a full nine-to-five (or more) job, then they will not have the ability to go beyond basic ideas, which in their base state are usually not valuable, but would be with a certain amount of developmental effort.

When people have a certain amount of unallocated time in their timetables, then if they feel challenged and feel freedom to act, then they will use that time productively to develop those ideas. Some companies deliberately leave a proportion of time, even up to 10% or more (and particularly in some parts of the organization) in which ideas may be developed.

Support
When I have spent time and freedom in working to achieve the challenges I have found, then I will at some time reach the stage when I need further help, for example to allocate additional resources for development or in presenting the idea to people who may not be that ready to change their entrenched viewpoint.

In these situations, the person developing the idea needs the gravitas, the authority, the wider capability of more senior managers. In fact the more valuable the idea, the more support it is likely to need, as it may lead to entire changes in direction for the whole company.

Dynamism

Alongside a motivated and empowered organization, a harder edge is needed that drives forward towards towards success.

Energy
Getting an idea from first notion to final product can be a long and arduous process. This requires a dynamic environment in which people are energized and constantly pushing forward. You can walk into many workplaces and feel the lack of energy and enthusiasm, whilst others have a definite, almost palpable buzz about them.

Buzz and energy comes from the leaders of the organization. This includes the formal management and informal social leaders. People look to these leaders for cues in how they behave. If the leader is full of energy and enthusiasm, then this emotion will 'infect' others and the motivation will spread through the organization.
Conflict
Ideas in action almost always bump into other ideas as well as natural conservatism that seeks to preserve the status quo. People attach themselves to idealistic positions and will act to defend them, sometimes by pre-emptively attacking what they see as threats.

A climate where conflict is allowed, enables these felt challenges to be voiced and for people to argue their cases. In a creatively supporting climate, the conflict is mostly about the problems of the organization and the viability of ideas, and is most certainly not about personalities and the value of different characters. When conflict turns to personal attack, then ideas and their value go out of the window.

Creating healthy conflict requires both an openness to challenge and then a focus on the problem, not the people. A respect for the individual thus is a fundamental element of creative cultures.

Debate
Conflict and debate are very close, and again the basic concern is to focus first on the idea. In debate, the pros and cons of ideas are discussed openly and challenges are welcomed and analyzed to see what additional benefits they may bring.

Debates can also go on across boundaries of time and space, and thinking about an idea can engage an entire company.

Openness

Experimentation
It is one thing to think up a idea, it is another to put it into practice. Ideas that are not explored and experimented with will either never see the light of day or may well fail on their first outing.

An experimenting culture has a strong bias for action in trying things out. It does not expect things to work first time but it does expect to learn through careful trials and subsequent analysis.

Experimental companies often extend this culture out into the marketplace. They do many trials with customers. They release many different products to see what sells and what does not.

Trust
Trust is the bedrock of human interaction. If I do not trust others then I will not believe them and will put a lot of my effort into protecting myself from their potential attacks or callous lack of concern.

In the development of ideas, trust is needed on both sides of the house. The person with the idea must feel they can speak their minds without fear of criticism or punishment. The person on the other side also needs to trust that the person with the idea has the company's best interests at heart and will not abandon their other work in the sole pursuit of a very shaky idea.

Trust thus has to develop across the organization. It is a fragile thing, that when lost through betrayal of trust is not easily restored, and thus needs very careful management.

Risk
Offering ideas and trying out experiments requires the ability and motivation to take risks. Individuals and the entire company need to be able to stick their necks out and 'give it a go'. Personal risk is thus reduced so people can be open and experimental.

Rather than blind risks, successful cultures manage these in a way that takes a realistic view of the real exposure of the company. Big risks are mitigated carefully. Small risks are recognized as such and may more easily done as 'blinders' to see what happens. Risk and potential reward are thus balanced and managed carefully as a single unit.

Source: http://creatingminds.org/articles

A Word of Advice During a Housing Slump: Rent

Homeownership may be the American dream, but the real estate downturn is calling into question the view that it is a can’t-miss investment.
By DAVID LEONHARDT
The New York Times April 11, 2007

A promotional spot for the National Association of Realtors came on the radio the other day. The spot, introduced as something called"Newsmakers," was supposed to sound like a news report, with theassociation's president offering real estate advice.

"This is the best time to buy," Pat Vredevoogd Combs, the president, said cheerfully. "There's a lot of inventory in the marketplace. Interest rates are low. It's a wonderful tax deduction."

By the Realtors' way of thinking, it's always a good time to buy. Homeownership, they argue, is a way to achieve the American dream, save on taxes and earn a solid investment return all at the same time.

That's how it has worked out for much of the last 15 years. But in astark reversal, it's now clear that people who chose renting overbuying in the last two years made the right move. In much of thecountry, including large parts of the Northeast, California, Florida and the Southwest, recent home buyers have faced higher monthly costs than renters and have lost money on their investment in the meantime. It's almost as if they have thrown money away, an insult once reserved for renters.

Most striking, perhaps, is the fact that prices may not yet have fallen far enough for buying to look better than renting today, except for people who plan to stay in a home for many years.

With the spring moving season under way, The New York Times has done an analysis of buying vs. renting in every major metropolitan area. The analysis includes data on housing costs and looks at different possibilities for the path of home prices in coming years.

It found that even though rents have recently jumped, the costs that come with buying a home - mortgage payments, property taxes, fees to real estate agents - remain a lot higher than the costs of renting. So buyers in many places are basically betting that home prices will rise smartly in the near future.

Over the next five years, which is about the average amount of time recent buyers have remained in their homes, prices in the Los Angeles area would have to rise more than 5 percent a year for a typical buyer there to do better than a renter. The same is true in Phoenix, LasVegas, the New York region, Northern California and South Florida. In the Boston and Washington areas, the break-even point is about 4 percent.

"House prices have to fall more before housing becomes a clear buy again," says Mark Zandi, chief economist of Moody's Economy.com, a research company that helped conduct the analysis. "These markets aren't as overvalued as they were a year ago or two years ago, but they're still unfriendly. And that's one of the reasons the market is still soft - people realize it's not a bargain."

There is obviously no way to know what home prices will do in the next few years. But there are two big reasons to doubt the real estate boosters who insist that it's once again a great time to buy.

The first is history. After the last big run-up in house prices, in the 1980s, a long slump followed. In the New York area, prices peaked in early 1989 and then fell 9 percent over the next three years, according to government data. (Adjusted for inflation, the drop was much bigger.) Not until 1998 did prices pass their earlier peak.

Keep in mind that the 2000-5 boom was even bigger than the '80s boomand that house prices on the coasts, according to the official numbers at least, have fallen only slightly so far. So it is hard to imagine that prices will rise 5 percent a year, or another 28 percent in all, over the next five years.

The second reason for skepticism is that buying has never been quiteas beneficial as Realtors - and mortgage brokers, home builders and everybody else who makes money off home purchases - have made it out to be. Buyers have to pay property taxes on top of their mortgage, while renters have the taxes included in their monthly rent bill. Buyers also face thousands of dollars in closing costs (and, in Manhattan, co-op charges). Renters, meanwhile, can invest what they would have spent on closing costs and a down payment in the stockmarket, which hasn't exactly delivered a bad return over the last 20 years.

And that famous mortgage-interest tax deduction? Yes, it reduces the borrowing costs that come with a mortgage, but it doesn't eliminate them. Renters don't face any such borrowing costs.

Almost two years ago, I interviewed a thoughtful 37-year-old man named Tchaka Owen, who happens to be a real estate agent. (Whatever the sins of the Realtors' association, there are a lot of smart, helpful agents out there. Just remember that they have a financial interest in getting you to buy a house.)

Mr. Owen and his girlfriend, Polly Thompson, had recently moved from the Washington suburbs to the Miami area and decided to rent a two-bedroom apartment with spectacular bay views. "You can get so much more for your money, renting instead of buying," he said at the time.

Sure enough, house prices soon began to fall in South Florida, and Mr.Owen and Ms. Thompson started to think about buying a place. A three-bedroom Mediterranean-style house that they liked was originally listed for $620,000 last year, but the price was later cut to$543,000. They bought it in June for $516,000. Since then, the markethas fallen further, but Mr. Owen said he didn't mind, because theyplan to stay in the house at least a decade. "We love it," he told me.

Clearly, there are benefits to owning a house beyond the financial, like the comfort of knowing you can stay as long as you want or can fix the roof without permission. But real estate has been sold as more than a good way to spend money. It has been sold as a can't-miss investment. Back in 2005, near the peak of the market, the chiefeconomist of the Realtors' association, David Lereah, published a bookcalled "Are You Missing the Real Estate Boom?" The can't-miss argumentwas wrong then, and it may still be wrong today.

After hearing that radio spot, I called Ms. Combs and asked her whether she thought there was any chance that she and her fellowRealtors had gone a bit too far in promoting the boom. "I absolutely disagree," she said, still cheerful. "We help people look at the marketplace."

So I asked what advice she gave her own clients in Grand Rapids, Mich., where she is an agent. "We often tell people that they need to stay in a house five to six years for it to make sense," she said.

That's a nuance that didn't make it into her "Newsmakers" interview. In Grand Rapids, where the median home costs $130,000, it is probably good advice. In a lot of other places, it may still be too optimistic.

Bank of America To Buy
U.S. Trust
Josh Lipton 11.20.06, 5:02 PM ET

Bank of America announced Monday will that it will buy U.S. Trust, the wealth-management subsidiary of Charles Schwab in all cash deal for $3.3 billion. The resulting entity will be the largest manager of private wealth in the U.S.

Based on assets under management by private banks, Bank of America is currently the second largest manager of private wealth in the U.S., while U.S. Trust is the fourth. The combined entity will be first, according to Bank of America, with a total of $261 billion in assets under management.

Schwab first bought U.S. Trust for about $2.8 billion in 2000, but the purchase never worked out well for the mass discount brokerage, according to Goldman Sachs analyst William Tanona.

“The sale of U.S. Trust will be viewed very positively by the street,” the analyst wrote in a client note. “Schwab has long struggled to turn this business around since it acquired the firm and the segment has the worst pretax margins of any of Schwab’s three business segments.”

U.S. Trust’s return on equity was paltry according to Tanona, “generating only mid to upper single digit returns.” He described the sale as “positive news.”

Standard & Poor’s Equity Research analyst Frank Braden agreed that the purchase made good sense. He reiterated a “strong buy” recommendation on shares of Bank of America. “We view the proposed acquisition favorably, as Bank of America has been seeking to expand its more profitable private banking business,” Braden wrote in a client note. “However, we believe there may be some short-term difficulties as Bank of America integrates the two cultures.”

Schwab estimates that it will record a pre-tax gain on the sale of about $1.9 billion and that after-tax proceeds will total approximately $2.5 billion. Closing is expected on March 31, 2007, pending approvals.

Bank of America wasn’t the only company gobbling up money managers. In other news, Lehman Brothers announced that it is buying New York-based money manager H.A. Schupf & Co. H.A. Schupf, which has $2.5 billion of assets under management, will merge into Lehman’s Neuberger Berman unit, which has $50 billion of assets. Terms of the deal were not disclosed.

"No Asshole Rule: Building a Civilized Workplace and Surviving One That Isn't"
by Robert I. Sutton, Ph.D.

Chapter 1

Who deserves to be branded as an asshole? Many of us use the term indiscriminately, applying it to anyone who annoys us, gets in our way, or happens to be enjoying greater success than us at the moment. But a precise definition is useful if you want to implement the no asshole rule. It can help you distinguish between those colleagues and customers you simply don't like from those who deserve the label. It can help you distinguish people who are having a bad day or a bad moment ("temporary assholes") from persistently nasty and destructive jerks ("certified assholes"). And a good definition can help you explain to others why your coworker, boss, or customer deserves the label-or come to grips with why others say you are an asshole (at least behind your back) and why you might have earned it.

Researchers such as Bennett Tepper who write about psychological abuse in the workplace define it as "the sustained display of hostile verbal and nonverbal behavior, excluding physical contact." That definition is useful as far as it goes. But it isn't detailed enough for understanding what assholes do and their effects on others. An experience I had as a young assistant professor is instructive for understanding how assholes are defined in this little book. When I arrived at Stanford as a twenty-nine-year-old researcher, I was an inexperienced, ineffective, and extremely nervous teacher. I got poor teaching evaluations in my first year on the job, and I deserved them. I worked to become more effective in the classroom and was delighted to win the best-teacher award in my department (by student vote) at the graduation ceremony at the end of my third year at Stanford.

But my delight lasted only minutes. It evaporated when a jealous colleague ran up to me immediately after the graduating students marched out and gave me a big hug. She secretly and expertly extracted every ounce of joy I was experiencing by whispering in my ear in a condescending tone (while sporting a broad smile for public consumption), "Well, Bob, now that you have satisfied the babies here on campus, perhaps you can settle down and do some real work."
This painful memory demonstrates the two tests that I use for spotting whether a person is acting like an asshole:

Test One: After talking to the alleged asshole, does the "target" feel oppressed, humiliated, de-energized, or belittled by the person? In particular, does the target feel worse about him or herself?

Test Two: Does the alleged asshole aim his or her venom at people who are less powerful rather than at those people who are more powerful?

I can assure you that after that interaction with my colleague-which lasted less than a minute-I felt worse about myself. I went from feeling the happiest I'd ever been about my work performance to worrying that my teaching award would be taken as a sign that I wasn't serious enough about research (the main standard used for evaluating Stanford professors). This episode also demonstrates that although some assholes do their damage through open rage and arrogance, it isn't always that way. People who loudly insult and belittle their underlings and rivals are easier to catch and discipline. Two-faced backstabbers like my colleague, those who have enough skill and emotional control to save their dirty work for moments when they can't get caught, are tougher to stop-even though they may do as much damage as a raging maniac.
There are many other actions-sociologists call them interaction moves or simply moves-that assholes use to demean and deflate their victims. I've listed twelve common moves, a dirty dozen, to illustrate the range of these subtle and not subtle behaviors used by assholes. I suspect that you can add many more moves that you've seen, been subjected to, or done to others. I hear and read about new mean-spirited moves nearly every day. Whether we are talking about personal insults, status slaps (quick moves that bat down social standing and pride), shaming or "status degradation" rituals, "jokes" that are insult delivery systems, or treating people as if they are invisible, these and hundreds of other moves are similar in that they can leave targets feeling attacked and diminished, even if only momentarily. These are the means that assholes use to do their dirty work.

The Dirty Dozen
Common Everyday Actions That Assholes Use

01. Personal insults
02. Invading one's "personal territory"
03. Uninvited physical contact
04. Threats and intimidation, both verbal and nonverbal
05. "Sarcastic jokes" and "teasing" used as insult delivery systems
06. Withering e-mail flames
07. Status slaps intended to humiliate their victims
08. Public shaming or "status degradation" rituals
09. Rude interruptions
10. Two-faced attacks
11. Dirty looks
12. Treating people as if they are invisible

The not so sweet thing that my colleague whispered in my ear also helps demonstrate the difference between a temporary asshole and a certified asshole. It isn't fair to call someone a certified asshole based on a single episode like this one; we can only call the person a temporary asshole. So while I would describe the colleague in my story as being a temporary asshole, we would need more information before labeling her as a certified asshole. Nearly all of us act like assholes at times; I plead guilty to multiple offenses. I once became angry with a staff member who I (wrongly) believed was trying to take an office away from our group. I sent an insulting e-mail to her and a copy to her boss, other faculty members, and her subordinates. She told me, "You made me cry." I later apologized to her. And although I don't demean one person after another day in and day out, I was guilty of being a jerk during that episode. (If you have never acted like an asshole even once in your life, please contact me immediately. I want to know how you've accomplished this superhuman feat.)

Copyright © 2007 by Robert Sutton

About the Author
Robert I. Sutton is Professor of Management Science and Engineering in the Stanford Engineering School, where he is Co-Director of the Center for Work, Technology, and Organization, an active researcher and cofounder in the Stanford Technology Ventures Program, and a cofounder and active member of the new "d.school," a multi-disciplinary program that teaches and spreads "design thinking." Sutton is also an IDEO Fellow and a Professor of Organizational Behavior, by courtesy, at Stanford Graduate School of Business.