Saturday, 17 September 2011

Just Unemployment Chatter

"You have a lot of kids graduating college, who can't find jobs.  That's what happened in Cairo. That's what happened in Madrid. You don't want those kinds of riots here."

-- Mayor Bloomberg, New York City

I sat and pondered over unemployment this week.  The Bloomberg quote kinda stood out.  I tried to imagine a bunch of college kids acting out what went on in Cairo, and I'm pretty much at a loss to imagine such a scene.  The problem is that jobs do exist in different parts of the country....it's just that the salary level that college kids dream of....might not be available.  So the question is....are they willing to work for thirty thousand dollars, instead of the forty or fifty thousand they've dreamed of?  Are they willing to work as a intern manager of a small mall complex in some town in west Texas?

The Wall Street Journal had an interesting comparison chart this week....unemployment around the world.  So the stat's are in and this is factual numbers.  While the US is sitting there with 9.6 percent unemployment.....Poland is sitting there with 12.1 percent, and Greece has 12.5 percent.  There are various countries with alot worse than what we have.

On the other hand....if you live in Australia....you've got barely 5.2 unemployment.  Hong Kong?  They sit with 4.4 percent.  Then you come to Monaco....with 0.0 percent unemployment.

Imagine being a pizza start-up enterprise in Monaco?  You need seven full-time and ten part-time employees....and there's a zero percent unemployment situation.  The odds of you finding folks?  It might take four months and you might have to pay a pretty fair wage.

Thailand?  They sit there with 1.1 percent unemployment.  Basically....any guy who raises his hand....can get a job within two weeks.

Then you come to Cuba, with 1.6 percent unemployment.  Imagine the US embargo ended today and three hundred American businesses opened within six months in Cuba.  Where would they even find the folks to work in these new business operations?

The truth to the unemployment situation is that people who are willing to pack and move....will likely find employment.  True, you might have to give up life in California and just accept Georgia accents.  You might have to accept the fact that jobs in New York City are scarce but there's a golden opportunity in North Dakota.

So my advice to Mayor Bloomberg and the wussie college kids who might be suggesting riots.....you might want to consider what it takes to move 1000 miles to find decent employment.  That's be alot simpler than getting all worked up, burn down some buildings in New York City, and just make yourself look like idiots on TV.  And if you were really desperate for a job.....remember, there's always Azerbaijan with it's .9 percent unemployment.  There might only be two flights a week from the US to Azerbaijan....but it might be the place to find a job.

Solyndra Analysis

Over this week, I've studied the whole Solyndra business failure....which is gripping the media and the administration 

There are four simple failures built into this deal which a banker would freak out on and ask huge questions before loaning out money.

First, while they had a great concept....they needed exceptional engineers and developmental personnel.  The best of the best.  Sadly, you only find these guys out in southern California, which has high taxes, high costs of employment, and high property taxes.  When they went from development to production....they built the plant right there in southern California and continued on.  In my humble opinion, they wasted twenty-five percent of their cost.  If they'd gone to Mississippi or Alabama....it could have been done for less.

Second, once in the production stage....they had issues in producing 100 percent quality.  They had a very delicate procedure and they were having a small number of solar panels coming off the line each day which were failures.  They never could crack the case of these failed production items.  These added more to the cost of production.

Third, some idiot came up with the idea of distributors throughout the US selling these.  So they acted as middle-men.  You have to give them a cut on the deal....so you lost more money.  They've admitted in public that they were making the items and actually selling them at a loss, just to get started up.  You'd have to be a total idiot to think that makes good business sense.

Fourth and final, most folks readily agreed that once they got the $500 million loan from the government....that really spooked the business world capitalist guys.  Most folks agree that once the government loan happened, it really ended the rest of the possible options.

So here's the funny thing.  They are going toward bankruptcy with a great idea in their hands.  The judge will put everything up for an auction and sell.  There are patients here....very strategic and significant patients.  You can imagine the auction where two Chinese guys show up and buy most of what's left of the plant and the patients....and just walk away gleefully smiling.

The White House?  I suspect they really didn't know much about business and their inside guy who was all doped up on green jobs....just bought this hook, line and sinker.  Does it hurt the President?  I suspect that when the smoke clears on this deal.....250k voters who might have voted for the President across the US....will not vote for him because of Solyndra.  It's not a huge deal....but it makes the experts in the White House look idiots.

My humble advice to any future administration.....when some company or start-up wants to meet with you about loans for their business....just smile and hand them a pen.  Don't give them cash or a loan.  If they've got a great idea....they will find bankers who believe in it.