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Way back when.

Isn’t that how most stories begin? It appears that virtually everything that is going on today is a result of something that occurred “way back when.” Last week’s trilogy blog focused on that point.

Public pensions will shortly bankrupt many states unless draconian actions are taken now. Unlike the federal government, states cannot print money to pay off debt or even have unsecured debt on their books. How did we get to this point?

Way back when.

In the first 50 years of the last century (1900-1950), life expectancy never reached past 65. Social security didn’t start until 1935 and even then, benefits took years to make a difference (first payments were less than $1.00 annually).

The employer/employee relationship was mostly harmonious and employees worked for the same employer in many cases for life. Pensions were created to take care of loyal employees when they retired since there weren’t any other options. At the same time, public unions came into existence and they made sure they had at least the same level of benefits as the private sector.

That was way back when.

The second 50 years as you read last week proved to be quite different. Women entered the workplace in droves, the computer was introduced and the employer/employee relationship changed. IBM no longer offered its employees employment for life. People changed jobs. The idea behind the pension withered and made no sense.

As companies foresaw this, so did the government. To supplement Social Security, they passed in 1978 the 401(k) plan which allowed private citizens to invest a portion of their income pre-tax each year. The introduction of the 401(k) plan virtually eliminated pension plans over the next few years.

But that didn’t deter the public unions. They fought successfully to keep their pensions and not be bothered with “contribution” plans. The same was true with health care.

When workers were young, state’s employment numbers kept growing, as did the state’s accumulated surpluses in their treasury accounts. No one paid attention since there was no reason to. As states gathered more revenue, pensions became even fatter.

That was way back when.

Now the day of reckoning is coming and coming fast. States employment numbers are dropping and workers aren’t getting younger, in fact, they are retiring more than ever in the history of the USA. Public workers expect their pensions and health care for life. The problem is life expectancy is no longer 65 but 79 and rising. That is 14 more years of paying pensions and health care the state’s did not consider “way back when.”

So who is going to pay for this now? And that my friends is today’s $100 question. Stay tuned.

Happy Tuesday!

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Just in time, Germany and France along with the other EU countries came to the table over the weekend and took care of business. Interesting thought: The deal may have come together not because of sympathy for Greece but the thought that short traders were destroying the Euro and bonds. I wouldn’t want to be short today.

Saturday was one of the worse weather days of the year. Sunday was 33 at 7AM and today was 34 at 6AM. Will it get warm in Michigan? All we can remember is last year. Ouch.

I watched Julia & Julia and wonder how many blog writers make it big time. I’m thinking that if I published 365 recipes, one per day, perhaps I might get an opportunity. Most likely not, but here is a good one for next weekend:

Spicy Turkey Sausages topped with Spicy Turkey Chili

Makes 6

1 package wheat hot dog buns

2 packages spicy turkey sausages, fresh (Jenno brand)

I 16 oz. can crushed tomatoes

1 6 oz. can tomato paste

1 14 oz. can low sodium chicken broth

1 cup chopped onion

Spices: 1T chili powder, 1T cumin, 1T oregano, 1t hot pepper flakes

1T olive oil

Heat olive oil, add onion, sauté for 5 minutes on medium heat. Add 4 turkey sausages removed from casing. Sauté for 10 minutes until cooked. Add chicken broth, tomatoes, 1/4 cup tomato paste, spices and bring to boil. Reduce heat, cover with lid open slightly for at least 30 minutes or until chili reduces by 2/3. Stir every 10 minutes.

Char grill turkey sausages on medium heat for 15 minutes turning every 3-4 minutes. At end, encase hot dog bun over sausage, cover for 20 seconds. Remove and serve with chili, chopped onion and mustard.

Low fat, low calorie and yummy. Bon Appétit.

Obama selected yet another woman for the Supreme Court. That makes 3. If anyone doesn’t think the world isn’t run by women, think again. Yes dear.

Happy Monday!

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In my final analysis of the book, The Next 100 Years by George Friedman, it is readily apparent that this stuff is intense, mind provoking  and why being a political leader is difficult at best.

As this min-series is being written, yesterday saw the biggest one day plunge of the NY stock exchange in history. In little over an hour the market sank nearly 1000 points and then came back to close down “only” 350 points.

The SEC is investigating. What Friedman’s message in his powerful but short 253 page book reveals is that events such as yesterday’s crash, Greece’s riots, ongoing wars and soon, the new space frontier are all part of a natural 50 year cycle. Those that are strategic survive, those that are not wither.

Stock markets are crucial for investment, growth, well-being, capitalism and rewards for risk taken. They are the true financial indicator of a country. Stock markets are important to salons and spas not necessarily because hairdressers and manicurists are investors, but because their clients are. The better the markets, the more money and optimism in the economy. People are happier, spend more and get more services. The worse the markets, people panic (like yesterday), are depressed and spend less.

In many ways, stock markets and wars are similar. If you look back in history, the end of a major war has mostly resulted in growth, well-being, capitalism and rewards for risk taken. The end of World War II set the stage for the USA to become the wealthiest, most powerful and successful country. Even the recent Iraqi war which no longer gets headlines (thanks to the USA military once again) has produced a vibrant and economic Iraq that for the first time in memory is becoming self-supportive. Chrysler’s new dealerships are sold out with waiting lists. Markets, boutiques, housing and most importantly, oil, are all flowing once again.

But Friedman’s biggest eye opener in the book is his thoughts on the future of space. His contention is that the USA will take Star Trek and make it real. NASA will build “space battle stations” in strategic areas around the globe that will have the ability to fire supersonic missiles with deadly accuracy. The missiles will be both offensive and defensive. These will be done no later than 2030 and no other country will be within 20 years of compromising the system. That will further the USA’s role as the most powerful nation on the planet.

Alas, Friedman predicts a third world war coming in 2040 most likely with either Japan, Turkey or Poland involved. This too will set the stage for the next 50 year cycle and will have a similar effect as the last world war.

But in the year 2010 when American’s think everything is so bad and the USA is in such bad shape, perhaps those same American’s should read this book or better yet, read local newspapers from Athens, England, Moscow and Mexico City. Perhaps then we will appreciate how lucky we are to be Americans and how lucky we are to be the most powerful country in the world.

Happy Friday!

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Yesterday the topic was Greece, the EU and why what happens across the Atlantic matters. BTW: Switzerland was the correct answer to yesterday’s question.

One of the biggest issues going on in the USA today is immigration. We all know what is going on in Arizona and when you have college students protesting, you know there are issues.

According to George Friedman, author of The Next 100 Years, Arizona has it all wrong. In fact, now is the time for the USA to come up with a sensible immigration policy. But to understand why, you have to go back into history.

First, we know that virtually all early American’s immigrated from Europe, Russia and other Eastern bloc countries. This is one reason why we have the best food and culture. The USA was a melting pot of immigrants.

In the period of 1700 through early 1900, most families in the USA survived on farming. The average woman had 8 children, but many died due to disease before age 21. Life expectancy was 40. The family needed children to work the farm and they started working at the age of 6. Population expanded as settlers moved across the USA. Women’s key function was to have babies and take care of the house.

Without getting into too much detail, the next 50 years from 1900-1950 changed drastically as the USA turned from a farming country to industrial country with the introduction of trains, cars, roads, factories and so forth. Women had fewer children since they weren’t needed on the farm and survival rates after birth increased. Women’s primary role was still the same.

After World War II, the next 50 years changed again and brought us to where we are today. Women now have on average 2.1 children and worldwide, the number is closer to 1.7. Women’s primary role is no longer to stay home and have kids. In fact, there are now more working women than men in the USA. This had had remarkable consequences.

USA and world population growth is actually in a decline and will continue for another 50 years. This is bad news. One reason why is that largest group of the population, Baby Boomers, is getting ready to retire. Due to the economy, they have put off retirement and are working longer which is bad news for the 20’s generation looking to advance.

Eventually the Boomers will retire, the 20’s generation will be in their 30’s and the most unlikely of events will occur: Boomers will be spending their retirement money consuming more goods than ever and the generations behind them will have to produce those goods for them along with the rest of the population. The problem is that there will not be enough workers to supply the needs and every country including the USA will be desperate for workers come 2020.

In 2020, countries will be begging for immigrants and even offer incentives. Those trained in technical skills and general labor will be in highest demand.

We already see the effects of history and 2020 today. Men are having more difficulty than ever getting jobs as women are taking them in earnest. Companies only want to hired skilled and talented labor and only when as needed. Unemployment is stubbornly high because of this.

The paradox is that we have high unemployment today and no one wants more immigrants because they will take available jobs. While Arizona is focused on Mexican immigrants (Mexico is a strategic ally that sooner than later will emerge), there are plenty more immigrants from Asia that are trained and skilled that want to come as well. And the irony is that due to our tough policy, many immigrants who did come to the USA to take advanced learning are now leaving the USA and taking those newfound skills to their country.

Once unemployment drops significantly, we will see a new take on immigration. In the meantime, many thought the world would never hold the population just like many thought we would run out of food, oil, and other commodities. History repeats itself and cycles seem to cleanse perceptions. Interesting.

Happy Thursday!

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What’s going on in Greece was not only predictable but inevitable. Now Portugal and Spain among others may join Greece’s biggest hurdle in more than 50 years.

No, I’m talking about indigestion after eating too many coneys, fat-laden Greek salads or someone spilling saganaki on a diner (ouch). What I’m talking about is D-E-B-T.

In one of the more fascinating books I’ve read, The Next 100 Years by George Friedman, Friedman outlines history from long ago and forecasts events that will take place in the next 100 years. I don’t know about you, but I’m not going to be around then, but the next 20 years is what this blog is about through the rest of the week.

Greece, Portugal and Spain are all part of the European Union (EU). While many readers most likely don’t know the countries included in the EU, knowing the significance of the EU is more important. For nearly 500 years, England and the European countries ruled the world.

If you think of the USA, we are a very young country and certainly younger than any country on the other side of the Atlantic. If you know anything about history, you know we fought many countries to gain the land needed to create the 50 states that make up the USA today.

And if you think of where the USA is located on the world map, we are the only country surrounded by both the Atlantic and Pacific oceans. This is one reason why acquiring both Alaska and Hawaii were so crucial: The USA controls the waterways through its superior Navy which means ultimate power. No other country can strike the USA by sea.

If you think we have problems today and think going back in time to “gentler and simpler” days would be better, pick a period of time that you would go back to. Truthfully, you would not find that time. Without laboriously reviewing World War I and World War II, the end result is what is significant.

Germany lost both wars. The USA is the country that provided the effort to win both wars. More significantly, neither war was ever on USA soil except for Pearl Harbor. This attests to our military strength, strategic abilities and why the USA is by far the most powerful country today.

After World War II, Europe was heavily damaged including Germany. Guess who helped them rebuild? Good guess. The USA. Guess who helped rebuild Japan after they attacked us? Good guess. The USA. The net effect of World War II was that England and Europe officially lost their power after 500 years. And if they were going to rebuild and survive, they had to do something.

One result was the formation of the EU. Fast forward and the EU decided that if they were going to grow up in the shadows of the USA, they had to create a common currency (the creation of the Euro), and have a national policy for emergency events. Unfortunately for the EU, they couldn’t come up with a plan for all countries to merge into one union like the USA so each country still has its own political system, police and so forth.

Germany is by far the biggest economic country but having lost two wars, the last thing they want to think about is another. France is second but they too had enough of wars. That is one reason why the USA is so involved with wars while other countries watch on the sidelines: They simply don’t have the wherewithal to be involved. Again, another reason why the USA is the most powerful and will be for at least another 100 years.

Fast forward to today and here is why Greece, Portugal and Spain debt issues matter to hairdressers, manicurists and in reality, everyone in the world. They are all part of the EU. The reasons why Greece is in debt don’t matter although government pensions will be the undoing of most governments including California’s. What matters is how the EU manages this crisis and most importantly, what Germany does. Germany needs to step up to the plate and fund most of it and so does France. They hate doing it and so far, haven’t committed. Not good, not good at all.

Greece is on strike since the government announced plans to cut pensions and cut costs so they can get the billions needed to survive. The unions don’t want any part of it so schools, airports and shops are closed. Civil wars are a possibility. And if this can happen in Greece, it can happen in Portugal, Spain and even California.

The future of the EU is critical to the USA, Japan and the UK. Any doubt of its survival will send shutters through Wall Street and Main Street. We haven’t seen anything yet. Bottom line: Germany and France must step in now and do what it takes. This is one mess the EU needs to handle without the USA’s support. Let’s see if they can clean this up while we clean up the Gulf of Mexico.

Happy Wednesday!

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The sun was out, the air was warm, the waves were serene and the Fontainebleau’s pools were packed with slim bikinis, frozen drinks with umbrella straws, all providing the perfect setting for the Spring Intercoiffure event.

Deborah Carver and her team did an outstanding job putting the event together. Both the lunch and alfresco dinner were outstanding and everything was well organized. The members enjoyed the hotel, Atlantic ocean, and being around other members.

The event which spanned two days (Sunday was the main day) drew some 300 plus members from around the USA. What they came for was hair. Not business, spa, or makeup. Makes sense.

Vivienne Mackinder was true to her spirit and did a great job with her look’n’learn presentation on stage and she followed up with her hands-on workshops. Vivienne is truly one talented hairdresser. I remember having Vivienne at our Academy over 10 years ago and she has been here several times since.

I was one of five guest panelists for the early 9AM event. My topic was the future of distribution. In a nutshell, I explained that multi-billion dollar global companies such as L’Oreal and Procter & Gamble control over 80% of the brands sold in our industry. I then went to say that multi-billion dollar global companies such as L’Oreal and Sally Beauty Holdings control over 80% of the distribution in our industry.

In short, the days of the independent family owned distributor are limited unless changes are enacted. And who better to enact the change first than Intercoiffure members? In one respect, they will determine the future of distribution.

Here is the irony of it all: Neither L’Oreal, P&G or any other global company wants to own salons, they only want to control them. Why own them if salons have to buy your brands from your own distribution network? Their strategy is brilliant.

I didn’t see a single L’Oreal or P&G executive at the event. However, they spent a bundle to sponsor the event and single-handedly pay for the Intercoiffure magazine with their advertising dollars. Again, brilliant strategy on their part.

Here is my idea for Intercoiffure: As the best of the best in our industry, you are the leaders. Now is the time to take the leadership position and help bring back the roots of our industry. Thank L’Oreal and P&G for their past sponsorship. Bring in exclusively independent companies to the spring and fall events. Allow independent companies to be the exclusive advertisers in the magazine. They will be happy to participate and provide young, fresh talent to get members even more motivated, engaged, and excited.

Sponsorship and advertising money is like drugs: Difficult to give up. But if something isn’t done shortly, the end result will be painful for all except you know who.

Happy Tuesday!

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The second Sunday in May is always Mother’s Day. No one can remember which Sunday in June is Father’s Day.

They say Mother’s Day is the busiest day of the year for restaurants. Enormous brunches and gala dinners, you would think it was Thanksgiving (the second busiest day).

We love to take Mom out for Mother’s Day. It’s the one day a year she doesn’t have to cook. I get that.

But many Mom’s color their hair and do their nails at home too. And have you ever tried to give yourself a full body massage? This makes Mother’s Day the perfect opportunity to buy gift cards at your favorite salon/spa and include them in the perfunctory greeting card. It sure beats flowers and/or candy.

So with May 9 right around the corner, what are your plans? And if you want to know, I have been informed by my mother to pass on the flowers and buy a Kindle certificate instead. That’s what I get for buying a Kindle for her birthday. Moral of the story: If you buy technology, make sure it doesn’t need to be reloaded!

Happy Monday!