Russ: Good morning. This is the BusinessMakers Show heard here and online at thebusinessmakers.com. And this is Episode No. 232 of that show that features entrepreneurs.
John: You got that right, Russ. These entrepreneurs, they call 'em the gallant knights of this and artists of that.
Russ: Yep.
John: But they're like the Marine Corp. they're like a Marine division out there leading the charge to keep this country what made it great in the first place, honoring the self-initiative it takes to be great.
Russ: The whole meritocracy.
John: The meritocracy.
Russ: You bet.
John: It's all there.
Russ: It's good for all of us.
John: That's there.
Russ: And here's our lineup for this morning. First up for the Aflac BusinessMakers Flashback, brought to you by Aflac. We have Ken Dennard and Stephen Gray of Dennard Rupp Gray & Easterly, the upper end investor relations firm that we have had on the show previously, a couple of times to talk about corporate governance challenges. Such as, the Enron meltdown, Sarbanes Oxley, then we even had them one about a year ago to talk about the economic meltdown. But for today they are going to be talking about what is new at their firm, DRG&E. And then for our feature guest segment. First up we have Shobeir Shobeiri, teamfounder of Palo Alto based commercial incubator, PlugandPlayTechCenter.com. This is a real cool venture happening out in the Silicon Valley. And then also, we were on site at the 2009 Fast Tech 50 event, the event recognizing the 50 fastest growing high tech firms in Houston. But first. That's right. It's time for the BusinessMakers School of Business. And like we like to say here, if we don't teach it, you don't need it.
John: No matter whether you're into history or vocabulary or all these other things we bring up.
Russ: Right.
John: We think there's gonna be some nugget of information that you're gonna be able to take –
Russ: Hopefully.
John: – and use it to improve your life.
Russ: Yeah, yeah. And while we're here –
John: Yeah.
Russ: – speaking of that, you should tell 'em that there might more nuggets if they go to thebusinessmakers.com.
John: There's a lotta nuggets 'cause what you're getting here is a condensed version of the School of Business.
Russ: That's right.
John: For the full curriculum for this week's lesson, you need to go online to thebussinessmakers.com.
Russ: Right.
John: That's thebusinessmakers.com.
Russ: Right.
John: And you can sit back, relax, have an apple, and really enjoy and learn.
Russ: Yeah. And if you don't like the way we sound, you could actually just read it instead.
John: You can read it or if you don't like it, then just turn it off.
Russ: (Laugh) That's right. You can do that.
John: Alright.
Russ: And we kick off the School of Business each Saturday morning with a quote of the day.
John: Quote of the day.
Russ: And we're staying consistent with this PJ O'Rourke guy.
John: See, I gotcha hooked on this guy.
Russ: Man, you did. Alright. Well, listen to this.
John: Okay.
Russ: "Feeling good about government is like looking on the bright side of any catastrophe. When you quit looking on the bright side, the catastrophe is still there."
John: That's right.
Russ: Alright. And that brings us to this week in business history. So what happened during this third week of November in business history?
John: Well, I gotta tell ya. This is a legend that allegedly occurred in 1307.
Russ: Wow. This week?
John: Yeah, in 1307, this week in business history in 1307.
Russ: Okay.
John: And there's a guy named William Tell. He's a hero, a folk hero. Nobody really knows whether he really lived or not, okay?
Russ: Yeah.
John: But apparently what happened according to legend is he torqued off some big shot in the town of Uri, Switzerland.
Russ: Yeah?
John: And the guy had enough power to put him in jail.
Russ: Okay.
John: William Tell's punishment for insulting this big shot was that he had to put an apple on his son's head and shoot the apple off his head.
Russ: With what?
John: With a crossbow.
Russ: Okay, alright.
John: With an arrow shot from a crossbow.
Russ: Yeah, alright. That's an interesting punishment.
John: It's a very interesting punishment.
Russ: (Laugh) Yes, it is.
John: But that's how legends get passed down.
Russ: Yeah.
John: What really happened, the son was put in jail.
Russ: Oh.
John: And his head was severed, and the head was put on an apple. And William Tell had to shoot – no, I'm just kidding.
Russ: (Laugh)
John: Okay. But it was a very famous legend, and so much that there was a opera on the whole thing.
Russ: Yeah.
John: And there was an overture called "The William Tell Overture." This week in business history in 1800, John Adams, the first president to move in the White House.
Russ: Wow.
John: And it was a handyman special to say the least, 'cause they were still doing work on it.
Russ: Yeah. But still it was some nice digs, though, I think.
John: That's right. And he was the first president to move out of the White House, okay?
Russ: Okay.
John: This week in business history, in 1841 – man, this is amazing – life preservers made of cork are patented by Napoleon Guerin in New York City.
Russ: Wow. Cork.
John: Yeah.
Russ: It probably wasn't quite as compact as the blow-up kind that we have nowadays.
John: Well, no. actually, it was probably heavier –
Russ: Yeah? Yeah?
John: – even though the cork was in there.
Russ: Yeah. But it floated.
John: It floated.
Russ: That's what's important.
John: Okay. This week in business history, Lincoln delivers the Gettysburg Address.
Russ: Right.
John: That's one of the poignant speeches in American literature or politics or whatever you wanna call it.
Russ: Yes, it's incredible.
John: It is, and it's etched in stone in the Lincoln Memorial.
Russ: Right, you bet.
Russ: Yeah, okay. This week in business history, in 1865, the revolving firearm was patented by Smith and Wesson.
Russ: Wow.
John: H Smith, and DB Wesson of Springfield, Massachusetts.
Russ: Wow.
John: Before that, you had to put the shell and pull it in and jam down with a rod, and put powder in the –
Russ: And they weren't very accurate when it exploded outta there. (Laugh)
John: I know, right. It was awful.
Russ: Yeah.
John: This week in business history, in 1889, a reporter by the name of Nellie Bly, who worked for The New York World, began her attempt to travel around the world in less than 80 days.
Russ: Wow.
John: She finished the trip in January, in 72 days and 6 hours.
Russ: I remember the movie Around the World in 80 Days.
John: Yeah.
Russ: Was that some marker that somebody had set?
John: It was a bet.
Russ: Okay.
John: Yeah, Phileas Fogg bet somebody that was – I think who was played by David Niven in the movie.
Russ: Okay.
John: He ran into Cantee Floss in Mexico –
Russ: Oh, yeah. That's right. But she did this before the movie, right? So –
John: Well, yeah. The movie came out in 1950 or something.
Russ: (Laugh) So she wasn't motivated by the movie.
John: She wasn't – no, she actually was – she read.
Russ: She motivated the movie.
John: She – this was back when people read books –
Russ: Read. (Laugh).
John: – without the help of a Kindle or something.
Russ: Right.
John: Okay. This week in business history in 1896, the power plant at Niagara Falls begins operation.
Russ: Wow.
John: Have you ever been there?
Russ: No, I haven't.
John: Oh, it's really amazing.
Russ: Well, I'm sure it is, and I betcha there's some hydroelectricity produced there.
John: Yeah. I tell ya, the atmosphere is electric there.
Russ: Is it?
John: Yes, it is.
Russ: (Laugh) It is. Alright.
John: This week in business history, in 1904, the internal combustion engine is patented by JF Duryea of Springfield, Massachusetts.
Russ: Wow.
John: This week in business history in 1956, Buddy Holly makes his final recordings for Decca Records at Bradley's Barn in Nashville.
Russ: Wow.
John: He was in town to appear on the Disc Jockey Festival.
Russ: My goodness.
[Music: "That'll Be the Day"]
John: This week in business history in 1960, Ray Charles had his first US No. 1 hit with "Georgia on My Mind." Made it in 1960.
[Music: "Georgia on My Mind"]
Russ: Yeah.
John: This guy was a genius.
Russ: Boy, he was.
John: He hit the top ten a year earlier with "What I'd Say," "Hit the Road, Jack."
Russ: Yep.
John: His biggest song, which was a combination of soul and country and western, "I Can't Stop Loving You" –
Russ: I know.
John: – which is a great tune.
[Music: "I Can't Stop Loving You"]
John: This week in business history in 1962, "Big Girls Don't Cry," by the Four Seasons was No. 1. Did you ever see that Broadway show Jersey Boy?
Russ: No, but I –
John: Oh, you gotta see it.
Russ: – every time we get close to this thing, you bring it up.
John: That's right. And "Walk Like a Man," "Ragdoll," "Oh, What a Night."
[Music: "Walk Like a Man"]
Russ: But they had real people up there singing live on stage all songs with that real falsetto kind of voice thing.
John: Well, the one guy had the falsetto, the guy that plays Frankie Valley.
Russ: Yeah. And he did it well?
John: Of course, 'cause it's a big hit.
Russ: Alright, cool.
Russ: Okay? This week in business history in 1969, Wendy's Hamburgers opens.
Russ: Wow, the square hamburger.
John: The square burger.
Russ: I wonder if they were square from the beginning.
John: Okay. This week in business history in 1971, a Japanese company named Busicom wanted to build a new line of calculators, approached a fledging American firm, Intel.
Russ: Intel.
John: Yeah, and asked for 12 silicon chips. As a result, the first microprocessor was invented, but the rest is history.
Russ: Cool. Absolutely, big history.
John: This week in business history in 1972, the Dow Jones closes above 1,000 for the first time.
Russ: My goodness. And that was a big step back then. Jeez, 1,000.
John: I know.
Russ: Forever – it's hung around 600 forever.
John: Well, not forever.
Russ: Well, a long time.
John: A long time.
Russ: Yes, okay. (Laugh) Okay.
John: Okay. This week in business history in 1973, President Nixon authorizes construction of the Alaskan Pipeline.
Russ: Well, now that was pretty controversial at the time.
John: Very controversial.
Russ: Yeah, yes, and huge. But thank goodness we did it, because I mean, it has supplied our country with millions of barrels of oil.
John: Okay. This week in business history in 1976, crackpot Soviet biologist, Trofim Denisovich Lysenko, died. He did enormous damage to Soviet science and agriculture.
Russ: Yeah.
John: And contrary to teaching the genetics, Lysenko believed that he could grow that he could grow in entirely new strains of wheat by adjusting the environment in which the wheat grew.
Russ: I remember what – you reported this story last year, and it was so weird because he controlled so much of the Soviet agriculture, they kept trying his weird techniques, and nothing would grow. I wonder that's what really made the Soviet Union fall. That's why the grocery stores didn't have any food on the shelves.
John: Yeah. Okay. This week in business history in 1977 – this is very ironic that this happens 'cause Ford's been in the news lately.
Russ: Boy, and doing well.
John: Okay. Doing well. They made $1 billion this last quarter and – but anyway, back to this. The 100 million, 100 millionth Ford was built in this week in –
Russ: This week in 1977? Wow.
John: Nineteen seventy-seven at the Mahwah plant in New York.
Russ: Man, I think we should celebrate Ford even more. They took no bailout money.
John: I know.
Russ: And they're succeeding.
John: I know. They are. I guess they're building good products are they wouldn't be selling.
Russ: It's a cool, cool story.
John: This week in business history in 1979, ABC TV announces it would broadcast nightly specials on Iranian hostages.
Russ: Oh, which was the beginning of Nightline –
John: Nightline, right.
Russ: – with Ted Koppel, right?
John: Yeah. But it was like – every night, it would be Day 5, Day 20.
Russ: My recollection is that it was good reporting. I mean, we were all interested and curious, and then it stuck and stayed on. It's still on today.
John: This week in business history in 1987, Dire Straits become the first artists to sell over 3 million copies of an album in the UK when their album, "Brothers in Arms" passed the mark this week in business history. It contained five Top 40 singles, "Money for Nothing," "Walk of Life," "Brothers in Arms," "Your Latest Trick."
[Music: "Money for Nothing"]
John: This week in business history in 1992, Dateline NBC airs a demonstration showing a General Motors trucks blowing up on impact. Later, it revealed that NBC rigged the test.
Russ: Yeah, rigged it big-time. Put little rockets on it.
John: Put a little rock in there.
Russ: (Laugh) Man, that hacked me off so much when it happened.
John: Well, it happens all the time.
Russ: I know, I –
John: They don't get caught.
Russ: Yeah.
John: Okay, alright. This week in business history in 1993, the US House of Representatives approves NAFTA.
Russ: Which I'm definitely glad.
John: Yeah, one of Clinton's bright spots in my estimation.
Russ: Yes, yeah. And even Al Gore played a role in getting that –
John: Absolutely. That debate he had with –
Russ: Ross Perot.
John: Yeah, right.
Russ: He killed him. Yeah.
John: And then, finally, this week in business history in 2004, Kmart Corporation announced that it's buying Sears Roebuck & Company for $11 billion.
Russ: Yep. And change the name –
John: To the Sears Holding Corporation.
Russ: Yeah, yeah. That was very unexpected by me, at least.
John: Why?
Russ: – in a significant –
John: You were probably in the midst of buying something at Sears.
Russ: (Laugh) Yeah. All of a sudden I started at Kmart and Blue Light Special.
John: Blue Light Special.
Russ: (Laugh) Right.
John: Alright.
Russ: Alright. Does that wrap this morning's history lesson?
John: Hey, I did all I could.
Russ: Alright. Good job.
John: All – I do what I do for knowledge.
Russ: Good job, fantastic, alright. And that brings us to Navigating Business Jargon. This is our vocabulary lesson.
John: That's right.
Russ: And if John gets it right, we proclaim him a winner.
John: A winner, yes.
Russ: And if he gets it wrong, he's a loser.
John: Big loser, baby.
Russ: Alright.
John: Alright.
Russ: Now wagering, please. Here is this morning's word. It's a two-word piece of jargon. Banner blindness.
John: Banner blindness.
Russ: Yeah.
John: Hmm. That is when you – you're so blinded by a banner that you crash your car as you're looking out the window looking at, "Oh, isn't that nice?"
Russ: (Laugh) No, no, no, no, no, no. you're totally wrong. Think online.
John: Oh, right. The banners pop up, and they pop up here. They pop up there. They travel across the screen. They do all kinds a crazy things.
Russ: Okay, now –
John: Before you know it, you're like, "I can't see any more."
Russ: Now you're –
John: I'm blind.
Russ: You're kinda right. But we're not gonna give you a win anyway, 'cause you were so wrong in the beginning. But what it is, it's the tendency of online users to ignore ad banners even when they may contain information the users are actively looking for. And you've just seen so many of 'em, that you ignore 'em completely. It's kinda like those noise-reduction headphones. (Laugh) Just kinda banner blindness makes 'em just go away. Alright. And up next, Dumbest Moments. Do you have a dumb business story for us this morning?
John: We've talked about this before as a dumb moment.
Russ: Yeah.
John: But I bring this up because rarely do we ever have a perspective dumb moment – a verify –
Russ: A real one?
John: – verified so quickly.
Russ: Okay.
John: And the imperial evidence 'cause who you're talking about, this is about three months ago.
Russ: Yeah. And you were saying this is dumb, and now it's proof.
John: Yeah. We were talking about the way they were raising taxes in New York City and they were in danger of losing people.
Russ: And there's a report that says that's true.
John: There's a report between the Year 2000 and 2008, New York had a domestic outflow of more than 1.5 million people.
Russ: Wow.
John: That's the largest exodus of any state. Most of these people left New York City. Now here's the kicker. In a statewide basis, the families who left had income level 13 percent higher than those moving in.
Russ: Uh-oh.
John: Where in the Manhattan, New York County, they call it, the differential was 28 percent.
Russ: My goodness.
John: The moving – the people moving out of the city, out of the state, had an average income of $93,000.00, which is 28 percent higher than the $72,000.00 earned by those coming in.
Russ: My goodness.
John: Now the thing is, what this means is in 2006 – okay, this – we're talking about over a long period of time, 2000 to 2008. But in one year alone, that's swap meant that the state lost $4.3 billion in taxpayer income.
Russ: My goodness. What happened to –?
John: And if you add that up from 2001 to 2008, that means a loss of about $30 billion. So by raising taxes, we get to this static analysis versus dynamic scoring.
Russ: Are you saying static analysis doesn't work?
John: It may in some cases.
Russ: But it doesn't here.
John: If you're evaluating something that's static, like static electricity, for example. Okay? There, no matter what you say about static electricity is probably true.
Russ: Right.
John: But, people's behavior changes based on stuff you do to them.
Russ: Yeah. So you raise – you raise –
John: Now, if I came – for example, if I came over there and start punching you in the arm as hard as I could, would you sit there and take it?
Russ: (Laugh) No.
John: No. You'd either fall of your chair and writhe in pain –
Russ: Right.
John: – and sue me.
Russ: Or jump and knock the crap out of you.
John: Or you'd jump and hit me and knock the crap outta me.
Russ: (Laugh) Right.
John: That's what dynamic scoring is all about.
Russ: Right.
John: Static analysis assumes that you're just gonna sit there and take it.
Russ: Yeah. So they raised the taxes, thinking they needed more money.
John: Yeah.
Russ: And people just left.
John: They're not paying as much.
Russ: Right.
John: They pulled an Atlas Shrugged on these people.
Russ: Okay.
John: Those of you who have not read Atlas Shrugged, this a perfect example –
Russ: Exactly.
John: – of what happens.
Russ: Alright. Alright.
John: And that book illustrates it in probably one of the marvelous ways that you could ever think of.
Russ: You bet, with Rearden Steel.
John: Reardon Steel and Dagny Taggart.
Russ: You bet.
John: Yeah.
Russ: Alright. Before we wrap up this morning's School of Business, it's time for very popular PKF Texas Entrepreneur's Playbook. And let's welcome Greg Price on the piano.
Russ and John: A one and a two and a –
Greg: This is Greg Price with PKF Texas' Entrepreneur's Playbook
We are all aware of the economic downturn in the past 2 years. It is especially troublesome for those 70.5 years of age that are required to sell off portions of their portfolios held in retirement accounts to fund Required Minimum Distributions (RMDs). In early 2009, Congress passed a provision to relieve the RMD requirement for 2009 so that these taxpayers could wait for the market to recover. However, many taxpayers were unaware and withdrew their RMD early in the year. Fortunately, there are a few tax saving strategies available for those taxpayers in the next few weeks.
- RMD Roll Over Provision: The new provision, which expires shortly on November 30, 2009, provides a means to rollover 2009 distributions into an IRA without having to include it in your 2009 taxable income and without RMD penalties.
- RMD Transfer To Charity: Taxpayers subject to RMD's may transfer up to $100,000 of IRA funds to a qualified charity by December 31, 2009 without including the withdrawal in taxable income or being subject to charitable limitations as long as it is a direct transfer from the financial institution.
Be sure to speak to your accounting service provider about these timely tax provisions. To read and comment on the PKF Texas' Entrepreneur's Playbook, visit my blog, fromgregshead.com. PKF Texas – The Fit That's Right
Russ: And that wraps up this morning's School of Business. You're listening to the BusinessMakers Show, heard here and online at thebusinessmakers.com.
