Author Malcolm Gladwell has this thing he does with his books: He takes conventional wisdom, turns it inside out, and finds a twist or an angle that makes you think about it differently.
His latest, "David and Goliath," explains why underdogs can win ... if they realize they're not really underdogs.
On why Gladwell wanted to talk about underdogs in his latest book:
"We're obsessed with them. Why do we return again and again to the subject of seemingly lopsided conflicts? So one, I wanted to explain that obsession. And two, I thought the ways in which we misread these conflicts are symptomatic of something deeper, which is I don't think that we have a good sense of what an advantage really is. Or a disadvantage. We have those categories mixed up, and I wanted to kind of sort through them and say, 'Things that we have thought were real advantages actually aren't, and things that we think of as overwhelming obstacles actually are incredibly useful.'"
On the success of David Boies, a trial lawyer diagnosed with dyslexia:
"Here we have one of the greatest lawyers in the country, and he is profoundly dyslexic. He reads basically one book a year. He finds reading difficult and painful. Think about that for a moment, he's a lawyer! He's in a profession that has reading at its absolute core. When I talked to him, I said, 'How did you become such a successful lawyer in spite of this disability?' And he said, 'not in spite, I became a successful lawyer because of this so-called disability.' And he explained to me how he spent his life compensating for this."
"He learned how to listen, and he also developed an extraordinary memory. So he would sit in school, and he didn't take notes, he sat and listened to the teacher and remembered everything that was said. Those two skills turned out to be far more useful than you'd think in getting through school, but more importantly, when he becomes a trial lawyer, what's being a great trial lawyer all about? It's about listening very closely to what the person you're cross-examining is saying and being able to summon that in the moment. So he's famous for confronting the witness and saying, 'Three days ago, you said the following thing.' He'd been working on those skills his entire life."
On what happens when 'Davids' become 'Goliaths':
"I talk about these categories as if they're static, and they're not. Microsoft is a great example ... was a classic underdog, was nimble, fast-moving, audacious, all those things that underdogs are, they are not anymore. They are now a massive Goliath encumbered by all of the weaknesses of giants. Slow-moving, lumbering, lacking imagination. It's very difficult for individuals or institutions who were once 'David' to understand they are no longer 'Davids.' In the present world, where adapting to new changes and technologies quickly and effectively is so important, what's wrong with being smaller? Isn't that an advantage?"
Let’s say you wanted to take your dog out on Union Street in San Francisco’s Marina district. First, you pick up Fluffy where you left her that morning -- at the Moulin Pooch “dog boutique and villa.” And while it would be nice to stick around for “Yappy Hour,” there are plenty of other places to find treats. So we’ll head down the street, to Le Marcel Dog Bakery.
“It’s a full-scale bakery for dogs,” says owner Aki Zubovic. “We have 60 different treats for dogs, all made on location by our pastry chef. Birthday cakes come in four different sizes, two flavors."
This is just one street, one tiny slice of the dog services the Bay Area has to offer. There’s a dog-u-mentary photographer and an animal communicator. There are dog reiki practitioners and dog massage therapists. And, this being San Francisco, there are of course entrepreneurs.
Just a few years ago, Anna Gil was a corporate attorney. And she needed somewhere to bring her basset hound, Truman, while she was at work. She saw an opportunity, and in 2009, she opened Dogpile Dogs daycare. Now, she watches between 80 and 100 dogs a day. And she knows all of them by name.
“I retired from Genentech to open this place, and my life savings essentially is into this place,” says Gil. “So I’m very grateful and thankful that it has worked out.”
Gil doesn’t advertise. But she’s attracted so much business that for a while she had to stop accepting new dogs, just to keep the numbers manageable. And she’s earned enough money to start expanding.
“We’re going to open a senior oasis for the dogs,” she says. “A sundeck, gentle sloping steps, wide so they can sleep on them.”
The boom in dog services has also caught the attention of tech startups. Rover and DogVacay, based in Seattle and L.A., are Airbnbs for your dog. Swifto, based in New York City, calls itself the Uber of dog walking. And then there's San Francisco-based Whistle: a little device you can attach to your dog’s collar that records how much she’s moving around each day, and an app that monitors her health trends over time.
“The number one concern for any owner is their dogs’ well-being and their happiness,” says Ben Jacobs, the company’s CEO. “It’s phrased in terms of health but also emotion.”
And our emotions influence how we use our wallets. Whistle launched this month with around 20 employees, and $6 million in startup capital.
One of the things the government does -- when it’s not shut down -- is collect, analyze and publish economic information. Here are some things that won’t get released or collected -- at least for as long as the shutdown continues.
The retail sales report, factory orders, international trade statistics, and what Chris Low, chief economist at FTN Financial, calls “the big daddy of all the economic indicators”: the September employment report. It’s supposed to come out Friday, but as happened the last time the government closed shop in December 1995, the jobs report may be delayed.
All this data is important for investors.
“I think it’s a big jump to say we’re going to miss a huge trend in the pace of recovery by missing just a couple days of data,” says analyst Keith Davis with Farr Miller and Washington.“But if [the shutdown] stretches on for two or three weeks, investment advisors like ourselves are going to be running blind,” he says.
“We’re going to have to make investment decisions without knowing how fast the recovery is going, whether it’s decelerating or accelerating,” Davis adds.
The data vacuum is likely to make markets volatile.
“After a few weeks, it starts creating a lot of uncertainty, and investors will be skittish,” says Chris Thornberg, founding partner at Beacon Economics.
The data that’s not getting collected now, like inflation or jobs for October, may never get collected if the government closure drags on.
There is non-government data out there, but economist Low says that in the past few months, it has painted a misleadingly strong impression of the economy.
“To some extent, we use data to determine how strong the economy is, and from that market interest rates are determined,” he says. “If we were forced to rely on private sector data, interest rates would be quite a bit higher than they are now.”
In a growing economy, investors would shift away from the safe haven of Treasury bills, so those bond prices would decline, thus raising their yield, or effective interest rate. (Mortgage-backed-securities would then have to compete with that higher yield, and so mortgage rates would have rise. Read more about that dynamic here.)
Typically, the economy doesn’t fluctuate wildly in a short span of time, so a few missed data releases in normal times isn’t the end of the world.
“The problem,” says Justin Wolfers, a senior fellow at the Brookings Institution and an economics professor at the University of Michigan, “is if we’re about to face abnormal times -- and Congress appears to be trying to make times abnormal – we won’t be able to see it immediately obviously in the data and possibly not quickly enough to change course on policy.”
So basically, we can’t tell how bad the government shutdown is for the economy because of the government shutdown.
Nearly five million people visited healthcare.gov Tuesday. That's the main website for the new insurance exchanges. Another five million or so are expected today.
Whether they'll have better luck navigating all the technical glitches is anybody’s guess.
But like it or not, buying health insurance online is the future. And while that may be convenient consumers, it's not such great news for the more than 100,000 insurance agents and brokers who depend on commissions for a living.
As the curtain comes up on the new health exchanges, Virginia-based insurance broker Jonathan Katz reports business has been hopping.
“In the last two days, I’ve received over 40 calls and 50 emails a day,” he says. “Current clients asking ‘what are we going to do with my current plan? What’s my situation?’”
Katz knows that questions and sales aren’t the same thing. And with millions of new customers shopping for insurance under Obamacare, a lot of future sales are going to happen on line without a broker.
Still Katz thinks he’s got an edge.
“Have you tried to get on healthcare.gov?” he asks. “Have you been successful? There you go.”
Brokers are hoping the technical glitches, and the complicated nature of health insurance with the premiums, deductibles and government subsidies will drive consumers straight to that quaint office in the neighborhood.
It’s a nice fantasy, says University of Pennsylvania Professor Tom Baker.
“If insurance companies can get enough business through exchanges, where they aren’t going to have to pay brokerage fees, then they are going to prefer to go through the insurance exchanges,” he says.
Fierce price competition on the exchanges could also eat away at insurance company profits, squeezing brokers commissions.
But Baker thinks some insurance agents will adapt and survive.
“Expedia by the way is an example of a travel agent that reinvented itself for the internet world a broker could be similar,” he says.
Baker says the Jonathan Katz's of the world could develop sophisticated websites that allow consumers to shop just like the exchanges do.
But with more than 100,000 brokers in the mix, he says lots of them are going to be looking for new jobs.
Tom Clancy, master of the political thriller, has died.
Many of his best-selling novels became box-office gold; he lent his names to videogames.
Tom Clancy was a brand. One of the very first authors-as-brand.
People wanted what Clancy had, says Jim Milliot with Publishers Weekly. "They want to go to the movies because it’s a Clancy movie. They want to play the video game because it’s a Clancy video game.”
As an analyst-turned-reluctant-hero-turned-president, Jack Ryan may just be the next James Bond. He’s cool. He’s likeable. He’s all over the world. A combo which could add up to movie-theatre longevity.
“It’s really global political thriller that we’re talking about,” says USC film professor Jason E. Squire, “and what could be better in this age of global blockbuster movies.”
Squire thinks it’s up to the estate and the studio to stay true to the character that Tom Clancy created.
Doing the numbers on Tom Clancy:
4: Actors who have portrayed Clancy's character Jack Ryan -- Alec Baldwin, Harrison Ford, Ben Affleck and Chris Pine.
736: Pages in what is to be Clancy's last published book, "Command Authority," set for release on Dec. 3, 2013.
3: Board games based on Clancy works -- "The Hunt for Red October," "Red Storm Rising" and "Tom Clancy's Politika."
19: Total number of novels published by Clancy.
1996: The year Clancy co-founded the video game developer Red Storm Entertainment, which put out a number of successful video games including the "Rainbow Six," "Ghost Recon" and "Splinter Cell" series.
$215,000,000: Box office total for the 1994 film "Clear and Present Danger," based on the novel of the same name and starring Ford.
Right now Republicans and Democrats aren't just competing over the best public policies to move the government forward. They're also competing over how much money they're making while the government has ground to a halt.
The Democratic National Committee says it's raised nearly $2 million online since the weekend. DNC spokesman Mo Elleithee said Monday alone was record-breaking: $850,000 in 24 hours; 30,000 individual donors, many of them first-time.
“It was our biggest fundraising day since before the 2012 election,” he said. “I think it was a combination of a lot of excitement about Obamacare about to go live, as well as a lot of frustration with the dysfunction in Congress and the Republican shutdown.”
Over at the Republican National Committee, press secretary Kirsten Kukowski sees the Democrats fundraising windfall differently. “We're kind of wondering if the reason they've refused to come to the table over the last couple of days is because they feel like they're getting something out of it monetarily.”
But the Republicans are getting something out of it too. Kukowski says the RNC has raised over $1 million since Monday morning and seen “a great response” on the government shutdown and on Obamacare.
Stephen S. Smith, a political scientist at Washington University, says the money flowing to both parties during the government shutdown isn’t some lucky coincidence. “They've been strategizing about this for months,” he said. “They've prepared mailings. They've prepared emails. They've got fancy websites.”
Lest you get cynical about all the donations that are flooding in to both parties in a moment of self-made political crisis, Sheila Krumholz, executive director for the Center for Responsive Politics says at least it's a sign that people are finally engaged. “Political participation frankly is not a bad thing in and of itself. If we had millions of individuals giving small donations, we'd likely have a much healthier political system.”
Of course, we don't know exactly who is giving the donations right now -- big donors or small -- because the Federal Elections Commission, which monitors that stuff, is shut down.
Microsoft has been struggling to transition in the mobile age and now a new report says some of its top investors are blaming its founder, Bill Gates, for the company's woes. The report says three of Microsoft's top investors want to see the chairman step down.
These investors argue that Gates' iconic presence on the board of directors would deter a more risk-taking person from stepping in as CEO Steve Ballmer's successor, once he retires within the year.
Marketplace's David Gura joins Marketplace Tech host Ben Johnson to discuss. Click the audio player above to hear more.
The government shutdown continues after Congress failed to reach an agreement Monday night. But now there's a greater worry about the debt ceiling.
Who does the U.S. actually owe $16.7 trillion to?
LinkedIn isn’t really set up for blue-collar workers. Now a new site aims to fill the gap.
The government shutdown continues after Congress failed to reach an agreement over a spending bill Monday night. But now there's a greater worry about the debt ceiling, the deadline for which U.S. Treasury Secretary Jack Lew says will continue to stay October 17.
David Kelly, Chief Global Strategist at JPMorgan Funds, says markets hate uncertainty and that will weigh on the stock market. He says globally, many economies are growing at the same time, which makes the situation even worse.
"It's tremendously frustrating that the biggest obstacle right now to stronger U.S. growth is what's happening in Washington," he says.
David Kelly, Chief Global Strategist at JPMorgan Funds, joins Marketplace's Mark Garrison to discuss. Click the audio player above to hear more.
Current Italian Prime Minister Enrico Letta survived a confidence vote by a wide margin on Wednesday. Stocks are up in the European nation because the government still stands after former Prime Minister Silvio Berlusconi attempted to bring it down. He backed off after he couldn't rally the votes.
Marketplace's European bureau chief Stephen Beard joins Marketplace Morning Report host Mark Garrison to discuss. Click the audio player above to hear more.
Although investors are worried about the government's current shutdown, there's greater concern about the debt ceiling -- the $16.7 trillion dollar limit on how much the U.S. government can borrow. If the limit isn't raised by October 17th, it could create a potential economic disaster.
Marketplace's Paddy Hirsch says while we often think of our debt as owed to foreign countries, America owes a lot of money to sources closer to home -- namely ourselves. Large institutions, individual investors, social security -- are all big buyers of U.S. bonds. But even regular Americans indirectly own a large chunk of our national debt -- through their 401(k) plans, retirement accounts, etc. They're buying U.S. bonds, which is lending money to the government.
"So in actual fact, we are lending money to ourselves and we’re actually borrowing money from ourselves," he says.
Hirsch says if we default on our debt, we won't be able to pay the interest on the money that we already owe. If the government doesn't raise the debt ceiling, borrowing costs will go up, and as a result Americans would have to spend a lot less.
"And that means we'll have to shrink government to a really, really small size," he says. "We’d be laying off millions of people who are employed by the government right now, which would sent unemployment through the roof, and then we’d risk a really serious depression."
Marketplace's Paddy Hirsch joins Marketplace Morning Report host Mark Garrison to discuss. Click the audio player above to hear more.
And so, the partial shutdown of the federal government continues. Today, President Obama is meeting with executives from some of the world’s biggest banks. It’ll be a chance for them to give Obama their take on the shutdown and the upcoming debate over raising the debt ceiling.
The way politicians have handled those two issues doesn’t instill much confidence in government.
“I think people in the business community are starting to get restless about this,” says Paul Argenti, professor of corporate communication at Dartmouth’s Tuck School of Business.
Today’s meeting is an opportunity for executives to convey that restlessness to the president. John Graham, a finance professor at Duke, says Washington dysfunction “is very troubling to the business community.”
“They want politicians to work together, to compromise,” he says. “And the two key words -- they want politicians to find solutions.”
Companies have trade groups in Washington, and according to Argenti, executives and lobbyists are on Capitol Hill, meeting with lawmakers. They are calling upon old friends.
“I think the business community probably supports the real Republican Party,” he says. “I don’t think the business community necessarily supports the radical wing of the Republican Party.”
More than anything, Argenti says, executives want “rational answers to these difficult questions,” and those answers aren’t coming from politicians on either side of the aisle.
Millions are going online to the Affordable Care Act health care exchanges that opened up for business Tuesday morning. There's been talk about glitches and other logistical challenges, but what about beyond the initial phase of signing up? There are a variety of problems that could arise once newly insured Americans try to actually visit a doctor too. Primary care doctors are already in short supply and will be stretched even further when all the insurance policies are put to use.
Dr. Lesly D'Ambola, medical director at St. Luke's Catholic Medical Services in Camden, New Jersey, describes her work as a calling.
"Nobody's getting rich working here, including me," she confesses.
And it's easy to see why. The child poverty rate in Camden is nearly 40 percent, and median household income is 58 percent below the New Jersey average rate. There are six times as many violent crimes in Camden than the state average. Camden is a challenging place to practice medicine.
The clinic helps over 1,400 patients each year and is in dire need of another doctor to share the workload. Dr. D'Ambola often stays late to see patients, whose needs vary wildly from diabetes and obesity to mental health problems. Overcrowded and understaffed, St. Luke's workers have to get creative about how they use their space, holding meetings in their cramped kitchen.
"What we really need is a new building," admits Dr. Lesly.
Dr. D'Ambola has worked at St. Luke's on Camden's State Street since 2000 and says she arrived well-prepared for life 'in the trenches.' She completed her training in an urban setting at St. Michael's Medical Center in Newark, NJ. And as Assistant Professor of Medicine at the University of Medicine and Dentistry of New Jersey, she makes sure her students get the same exposure to inner-city practice as she did.
"Camden is difficult, and it's dangerous," she tells me. "We had a lot of murders last year. Despite all the bad things you hear about Camden, a lot of good people live here."
To hear from Dr. Lesly D'Ambola, medical director at St. Luke's Catholic Medical Services in Camden, in her own words, click on the audio player above.
This final note today, cribbed from our friend John Carney at CNBC.
John blogged today about a new dress code at Barclays -- super-casual Friday, it's called. Jeans: fine. T-shirts: fine. Even sneakers: also fine.
Not fine at all, though, with some of the old-timers. "I didn't become an investment banker to dress like a perpetual teenager," said a veteran of Lehman Brothers. Said another: "It's ridiculous. Please make them stop. It's like working at a start-up but without the IPO."
Or, y'know, public radio.
For Randall Wickus, electrician, welder, appliance installer, and all-around handy dude, advertising his services can be a tricky task.
"I don't advertise in the newspaper, because that's a dying form right now," Wickus said, adding that Craigslist and LinkedIn haven't been much help either.
"If you're a white-collar guy, and do IT work or whatever, there's plenty of places for you to look for a job, lots of different headhunters," said Wickus. "But not, that I've noticed, for the blue collar industry."
James Dunbar and Patrick Cushing, who work in tech in Silicon Valley, noticed the same thing. Both men are from blue-collar familes, and when they perused job networking sites, they realized something was missing.
"There's a lot of great tools and apps that have come out recently," Dunbar said. "But nothing for people like our brothers who work with their hands for a living.
So Dunbar and Cushing created WorkHands, a job network for skilled tradespeople -- carpenters, machinists, painters, and all-rounders like Randall Wickus. Unlike traditional job sites, where you upload your resume, on WorkHands, professionals can upload pictures of projects they've worked on. And that's crucial to people who work with their hands.
"You can upload images of projects that you've worked on in the past," said Dunbar. "You can upload licenses and certificates that you've earned and list the tools that you know how to use."
Randall Wickus has been a member of WorkHands for a few weeks, and hasn't landed any work just yet, but he says he has referred a lot of his blue-collar buddies to the site.
President Obama is expected to sit down Wednesday with members of the Financial Services Forum. The group represents some of the world’s biggest banks and insurance companies -- among them Bank of America, Goldman Sachs and JPMorgan Chase.
One inevitable topic of conversation: the looming deadline to raise the $16.7 trillion federal debt ceiling. That’s the amount of money the U.S. Treasury can legally borrow to pay its bills. Congress has until October 17 to increase it or risk a potential economic disaster.
Wall Street doesn’t just want Congress to raise the debt ceiling, says Chris Krueger, Washington analyst for Guggenheim Securities.
“Ideally they would like to see Congress eliminate the debt ceiling, so we don’t continually have these situations where Congress threatens these showdowns,” Krueger says.
Whether bankers can do much about it is another question, he says. The shadow of the financial crisis still hangs over Washington, and Wall Street isn’t exactly popular with either party.
It won’t be lobbying that gets a divided Congress to work together, says Karen Petrou with Federal Financial Analytics.
“I think it’s ultimately going to be the markets that I hope don’t have to teach them a lesson, because it could be a very costly one to all the rest of us,” Petrou says.
If the U.S. government can’t pay all of its bills, Petrou predicts stock prices will drop sharply, interest rates will spike and that could slow down economic growth.
The social news and entertainment website Reddit has grown exponentially in recent years. It now accepts 19 million up or down votes every day on links to everything from celebrity advice to pornography. This weekend, thousands of the website's users will be going offline to gather in the real world for Reddit's second annual Global Day of Service. Redditors -- as the site's users are called -- plan blood donation drives in Sydney, Australia and park clean ups in Austin, Texas.
Erik Martin, Reddit’s General Manager, says Redditors meet offline often for various organized events -- as often as every day in major cities. Many of those smaller meet-ups are service-oriented too, but declaring a single day can encourage more regular engagement.
“The bigger goal is to get more people involved in something that matters in their local communities,” Martin says.
Erik Martin, Reddit’s General Manager, joined Marketplace Tech host Ben Johnson to discuss.
Click on the audio player above to hear the full interview.
It’s a big day for the Affordable Care Act -- and also a glitch-filled day.
Today was the first time Americans could sign up for health insurance via federal and state-run exchanges. But a host of problems, from website hiccups to unanswered telephone help lines, meant some people couldn’t actually sign up.
The glitches weren’t necessarily a surprise -- even the president warned there could very well be technical difficulties on the first day. The Center for Medicare and Medicaid Services reported they had 2.8 million visits to healthcare.gov on opening day.
For some, the technical difficulties meant the details of the health care plans are still a mystery.
"We still don’t know a lot about what the coverage will look like, so what the deductibles and co-pays for prescription drugs will be," says Larry Levitt from the Kaiser Family Foundation.
But computer glitches aren't the only reason confusion around Obamacare remains.
"How’s it really going to help? What’s it going to take? How much coverage can it give you?" asks Gwen Howell in Camden, N.J. She doesn’t have insurance and wonders, "Is it really gonna give you coverage?"
There’s been so much political noise around Obamacare, it’s hard for regular people to understand what’s going on. That should change going forward as word of mouth and government-led education initiatives spread.
People like Gwen Howell will start to make their way to the exchanges – it’s a marathon, not a sprint.
But problems with the exchanges are bad advertising. At the end of the day, continued glitches could be a real problem in getting people signed up.
“Glitches.” If any single word said it all today, that was it. The long-awaited healthcare exchanges finally opened, and many of them promptly froze. Consumers, reporters and healthcare officials from California to Minnesota to Connecticut tried to register online, or at least check out the options, only to be met with technical problems.
The government’s Centers for Medicare and Medicaid Services (CMS) said www.healthcare.gov, the gateway to the federally-operated exchanges, got 2.8 million visits.
Calling the help lines for the paralyzed sites wasn’t too productive either. Wait times were epic, if you could get through at all. (Here’s a link to one group that’s monitoring the problems.
To be fair, glitches were expected...folks have been talking about them for weeks.
Some were clear ahead of time. Last week, the government announced the Spanish-language version of Healthcare.gov, www.Cuidadodesalud.gov , would be delayed until later this month.
CMS Administrator Marilyn Tavenner summed up the government’s response to all the problems with this: ‘Consumers must remember this is a marathon, not a sprint.”
People have six months to enroll. If they want their coverage to kick in by January 1, however, they need to have everything wrapped up by December 15th.
Whether that will require a kind of Tech Special Forces remains to be seen.
But here’s the thing. Even though people rushed onto the sites today, in many places it’s going to take time just to get people moving. I’ve spent three months covering Camden, N.J., watching the ACA roll out, and getting a read on what it looks like on the ground. Camden is one of the poorest and most violent cities in America. People who don’t have health insurance in this city don’t just hop in their cars and drive to some office and enroll. Getting on the bus, making arrangements, getting all your personal affairs in order so you can fill out the forms, is harder to do here than most places.
The question is, at what point will all these tech problems and delays start to drive people away. People like the so-called “young invincibles, ” those healthy twenty-somethings who are already a tough sell. They’re used to getting information on the web, quickly and easily. And, at this point, it’s still impossible to know what a lot of the insurance plans are going to look like. How big are the deductibles, the co-pays, the networks of doctors.
That’s something to watch over the next few days.
One day after the biggest employer in the nation’s capital shut its doors and sent “non-exempt employees home, Washington's other businesses are trying to figure out what they’ll do without their regular customer base.
What happens to the sandwich stackers, cupcake bakers, convenience store clerks, and cocktail shakers when a city full of government workers stops coming to work?
That’s the question in downtown Washington, where local businesses faced an afternoon of light foot traffic and quiet lunch hours. We asked what they've noticed, and how they’ll cope.