Intrinsic Value

What is a painting worth?  The materials that go into one cost a few dollars.  The labor cost of the painter is gauged by demand for his work. Most do poorly or barely make a living.  But in the secondary market, long after they are gone, hype can increase a canvas' value many thousands of times.. Thus the Leonardo Da Vinci Salvator Mundi sold for $450 million.  The art world has been shaken by the extraordinary amount.  It was achieved through clever marketing by Christie, the auction house.  Will the buyer ever recover his money if he goes to resell the painting someday?  There is no way of knowing, but one should not be surprised if he doesn't.  Values rise and fall with market sentiment.  There are times not to put a work up for bid and other moments when the Continue reading "Intrinsic Value"

Conspiracy Theory

Sean Hannity has been cited as the top conspiracy theorist on TV.  He is not one whom a PR practitioner would want to approach.  Those who see deceit under every rug are not given to sticking with facts. They have to spin them into a web of insinuation and outright falsehood.  One's client is at great risk of being caught in a warp of opinion presented as truth.  It makes no difference whether conspiracy theories come from the political right or left.  Both are bad.  The media we should approach have a respect for facts and for the most part, avoid opinion. They go where facts lead them, and if facts delineate wrongdoing, they report it.  They don't exaggerate.  They are willing to listen and to report both sides.  What should one do for a client caught in a web of conspiracy Continue reading "Conspiracy Theory"

Why Regulators Are Needed

The argument that markets should be free and unregulated has never been true.  Human behavior is not always honest.  Consider cryptocurrency.  It still is an open and wild marketplace where scams and schemes are prevalent.  For digital coinage to be of general use, it will need to be regulated and cheaters controlled. So too with every other marketplace.  That is why when companies call for free markets, they really do not intend for the them to become Darwinian and capitalist.  They want fairness and equal competition.  This government provides.  Communicators who profess to be free marketers need to be honest with themselves.  Rather than calling for less regulation, they should opt for effective rulemaking that guides behavior but doesn't squelch it. And, there should be penalties for the dishonest.  Free markets have never been free of bad operators.

Lost Reputation

When one loses his reputation, people abandon him -- even if he is on the cusp of victory.  That is the case here.  Five women have now come forward and claimed that Roy Moore, the Republican Senate candidate from Alabama, had molested them as teenagers.  Moore is refusing to leave the race even though Republican senators in Congress have already disavowed him.  He is a man twisting in the wind.  Even if his contention that he is the victim of "fake news" proves correct, there is little to no time for him to recover before election day.  If he should be elected, Senators have already said they will move to deny him his seat by expelling him.  If he did molest these women, that is the least he deserves. Sexual harassment has become the new social sin. There is a confluence of power and Continue reading "Lost Reputation"

The Mighty Fall

Not so many years ago, General Electric was a colossus striding the land.  Its management techniques were imitated widely.  Its former executives went on to run large companies. Now the corporation is struggling to survive, and it has lost $100 billion in market value.  The downfall was relatively swift.  After 2008, its financial arm was disassembled and largely sold off.  It was the former engine of earnings outstripping the industrial arms of the business. Now, GE looks mortal, and there is speculation it might not survive as a conglomerate.   If so, it will be an epic flameout equivalent to the demise of ITT decades ago.  It is a reminder that there is no safety in size or in balance sheet.  Market power can erode stealthily or of a sudden.  A CEO needs a healthy paranoia and to remain on alert for trouble. Continue reading "The Mighty Fall"

Cue The Lawyers

AT&T"s CEO has publicity stated he will fight the Justice Department if it tries to get him to spin off CNN before merging with Time Warner.  This sounds like a legal, lobbyist and PR full employment move.  AT&T needs to gain high ground in public and legal opinion and do so quickly.  Thus, President Trump's allegations of CNN producing "fake news" have already become an issue.  It is hard to say at this point who is favored to win the war, but it is unusual.  Normally, when the Justice Department indicates it is not pleased with a merger, there are negotiations and agreements to do spin-offs or the combination is called off by the two parties. AT&T wants content to flesh out its huge distribution platform.  Hence its will to fight to the bitter end.  It might be a long road.  These Continue reading "Cue The Lawyers"

Acid Test

Waymo, the Google company, is putting its reputation on the line with the announcement that it will send out driverless vans in Arizona as an acid test of its technology. The company has been working toward this day for more than 10 years.  Now that it is here, there are still unanswered questions beyond the robustness of the technology.  Who will insure a driverless vehicle if it is in an accident or suddenly goes rogue?  Are customers ready for driverless technology or will they freak and attempt to steer the vans themselves?  Can the vans find their customers on busy streets where GPS might not be as accurate as needed?
Waymo will be confronting these challenges as well as others that have not been foreseen.  If it is able to conquer fears and to run without drivers, it will be the first in the world Continue reading "Acid Test"