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While many of us have been following the daily deluge of midterm elections, Supreme Court nomination hearings, migrant caravans, and presidential tweets, the following stories slipped through the cracks and fell back between the gossip columns and birth announcements in our local newspapers and online news feeds:

  • Paul Volcker, the Chairman of the Federal Reserve Board in the 1980s (at least three recessions ago), wrote in a Bloomberg Op-Ed that the current Fed Board is looking at managing the economy wrong. The current 2% inflation target used, says Mr. Volcker, is steering the Board to incorrect conclusions. Rising economic growth and unemployment rates near historic lows could signal an easing to monetary policy; in other words, lower the Federal Funds rate. His point seems to be don’t get stuck using the same metrics, and adjust the assumptions as our systems and ways of doing business change.
  • Bank of America CEO Brian Moynihan bragged that he was able to eliminate 100,000 bank jobs due to improvements in technology and changes in consumer behavior. “We had 204,000 (employees) last quarter. Step back and think about that,” Mr. Moynihan said. The reduction is “more employees than Delta (Air Lines) has, I think.” After cutting rank-and-file positions, Mr. Moynihan realized he had too many well-paid managers, so he slashed a third of those jobs, too. He then went on to pontificate to small business owners and CEOs that it would have been better to allow the bank’s natural attrition rate to reduce the human toll of job cuts instead of quick firings. “We realized we screwed up totally,” said Mr. Moynihan. At least the stockholders are happy, as well as the CEO who earned $22 million in salary and $18 million in stock options last year.
  • The new $2.2 billion Transbay Transit Center in San Francisco was temporarily closed six weeks after the grand opening when a cracked steel beam was discovered. This incident follows the Millennium Tower which has sunk 18 inches since it opened in 2009 and cracks found on some anchor rods after they were exposed to water on the new Bay Bridge tower in 2015. When I look at the great skyscrapers in this country and grand old castles in Europe, I marvel at the fact these structures have been standing for centuries. What has happened to American engineering know-how and pride of workmanship that serious problems occur after six weeks?
  • The small Balkan nation of Macedonia recently voted on whether to change the country’s name to…wait for it…North Macedonia. Apparently, Greece felt the name “Macedonia” belonged to them because they have a province in the northern part of their country by the same name. Greece vetoed The Country Almost Formerly Known as Macedonia’s attempt to join NATO and blocked its European Union membership until the former Yugoslav republic changed their name. Many Macedonians feel being included in the EU will help them prosper economically. Meanwhile, Greece has hardly benefitted from their EU partnership. Their debt as a percentage of Gross Domestic Product is exceeded only by Japan. Unfortunately, just over a third of Macedonians voted in the referendum, with 50% needed. The country’s Parliament has since voted to amend the constitution to change the name.

These news clips are less impactful individually than the stories taken in the aggregate. These stories given short shrift by the media affect people’s lives on a day-to-day basis than the so-called “24-hour news cycle” items we routinely see on TV and our smartphones. The more we step back and take a look at the big picture, the clearer that picture becomes.

David M. Green
President/CEO
(925) 335-3802