God’s Hotel

The Book of the Week is “God’s Hotel” by Victoria Sweet, published in 2012. This is a medical doctor’s account of the radical changes that occurred at a county-funded hospital, formerly an almshouse in the San Francisco area that treated mostly disabled and elderly patients who were indigent.

The author describes the series of consequences stemming from an ever-increasing annual budget, a power struggle, office and mayoral politics, and bureaucratic shenanigans. There was a tug-of-war over turning the hospital into a psychiatric facility.

Florence Nightingale summed up the field of medicine in a nutshell when she said there have to be checks and balances in connection with practicing medicine, doing nursing, and handling administration. If doctoring becomes too powerful, patients get overtreated; if administration becomes to powerful, too little doctoring is done. When there is excessive nursing (emotionally and spiritually caring for patients), medical progress suffers.

Over the course of several years, a Justice Department investigation and a special relationship with the mayor’s office prompted the hospital’s executives to increase the administrative staff even as the number of patients fell. The additional staff was required to generate assessments, policies and procedures. When an incident resulted in the death of a demented patient and the media gave the facility bad publicity, the executives pointed to budget cuts that caused the understaffing that led to a compromise in safety. The hospital then hired a PR firm, an in-house director of government and community relations, and an assistant medical director to help with all the new paperwork, decisions and questions. Quietly, even more draconian budget cuts were being made to the hospital. Yet there was still enough money to hire the mayor’s communications consultant.

Read the book to learn how misdiagnosis and home care (rather than hospital care) make healthcare significantly more expensive, and of the controversies surrounding the push for progress on one side, and preservation of personal patient care on the other.

Dragon Sea

The Book of the Week is “Dragon Sea” by Frank Pope, published in 2007. This ebook describes the lives of sunken-treasure hunters– people who go SCUBA diving to recover material assets of ships that have sunk in prior centuries.

Such a pursuit interests marine archeologists, too. They should have knowledge of art, ancient history and the sea. The oil industry has developed the technology that allows the least expense and the fewest complications for conducting underwater research and exploitation of the seabed. However, the exploitation part is still life-threatening and very expensive. A gruesome death might await divers at any time, so they make big bucks.

Many divers take a chance by attempting to retrieve treasures from a sunken ship whose contents might be claimed by its country of origin. They risk confiscated cargoes, impounded vessels and court cases, not to mention plunder, if pirates find out what they are doing before they can finish grabbing the ceramics, coins or other valuables from the ship. Those items might end up at a big-name auction house or at a museum. Or on eBay.

Read the book to learn about the salvaging of ceramics from one particular ship– along with the dangers, complications and conflicts that arose, the equipment used, worker interactions in light of the situations they encountered, and the financial results of the project.

Bonus Post

This blogger skimmed “An Accidental Sportswriter” by Robert Lipsyte, published in 2011. This ebook is a career memoir.

Lipsyte covers a range of topics, including how his father was a role model, and the celebrities he’s written about extensively. He covers controversies, including gay athletes and performance-enhancing drugs in baseball.

Lipsyte writes that he spoke to someone who said it was a dirty little secret that such drugs were used extensively among athletes after 1960. The reason it took so long for the practice to be widely disclosed and frowned upon (wink-wink, nod-nod) was that professional athletes’ incomes have skyrocketed in recent years, so there has been resentment of late that some players were making so much money because their abilities got a boost from an unfair advantage.

The author asks, “Why have no [team] owners had to speak in front of Congress? Why have owners been allowed to keep every penny from the big money, big bopping 1990’s, while players have been put through the thresher?” Sometimes the rogues win.

 

The Strange Case of the Mad Professor

The Book of the Week is “The Strange Case of the Mad Professor” by Peter Kobel, published in 2013. This ebook recounts the sordid story of a petty, vengeful university professor who was passionate about his field of study, lemurs.

Professor John Buettner-Janusch (aka “B-J”), of German and Austrian descent, was born in 1924. He grew up in the United States, but went to jail for evading the draft during WWII. “His desire for attention was enormous, and he never seemed to care much whether that notice was admiration, disdain, or loathing.”

B-J eventually rose through the ranks of higher education while collecting a menagerie of lemurs that were subjected to primate research. People either loved him or hated him. He was like a “Dr. Jekyll and Mr. Hyde”. It became apparent that he was also a sociopath.

Starting in the late 1970’s, he was charged with serious crimes. “…But much of B-J’s pretrial testimony formed a farrago of lies and half-truths, of the incredible or incomprehensible.”

Read the book to learn what became of this colorful character.

Mule

The Book of the Week is “Mule, My Dangerous Life as a Drug Smuggler Turned DEA Informant” by Chris Heifner, published in 2012.

This suspenseful ebook is a personal account of someone who drove truckfuls of marijuana across state lines for tens of thousands of dollars per trip. In a college class, the author happened to meet a guy who ran a large smuggling operation. In the late 1990’s, this illegal business was booming in Texas, partly because some members of the Mexican army were accomplices. One time, when Heifner drove a load to Mexico, he witnessed the crash of a prop plane. The military rushed over to remove its contraband cargo before attending to the injured pilot.

Drug smuggling is a heartless business in which no one completely trusts anyone. Initially, the fear of getting caught was hard to stomach for the author because the punishment was so harsh, but the lure of the vast quantity of easy money was addictive. Read the book to learn what transpired when he did get caught.

The Real Deal

The Book of the Week is “The Real Deal, My Life in Business and Philanthropy” by Sanford Weill and Judah S. Kraushaar, published in 2006. This career memoir describes how, over the course of about fifty years, Weill became a major change agent in the American financial services industry. His specialty became leading the execution of mergers and acquisitions for the investment, banking, and insurance companies of which he was an executive and board member.

In spring 1960, he started a securities brokerage, actually on Wall Street, with three partners. The stock market was bearish in 1962 and 1963. Interesting Side Note: “The typical stock in the Dow Index had a price 23 times its earnings as this downturn began, compared to a multiple of only 10 times in the early 1950s.”

Through the years, he gained more and more power and accumulated more and more wealth. When he attended events at which he had to speak to stockbrokers, he adopted a policy of brevity, saying, “You’ve heard enough speeches– what questions do you have for me?”

Although the author fostered a corporate culture of informality and “Management By Wandering Around” at his own company, in many instances, he failed to take into consideration the culture of the target company. His strengths lay more in bringing the top executives of the parties together to do the deals, and negotiating the new management structures. It was ironic that he was such a poor judge of how the two cultures would mesh once the integration process began.

At times, Weill tapped the power of his friends in high places, one of which was the government. It helped him change federal law to allow transactions to proceed. For instance, prior to 1999, certain banking and investment banking services could not be legally offered by the same company, due to financial conflicts and possibilities for abuses. He and his cohorts had a hand in making the historic change so that people within the same company could offer their clients all kinds of financial services.

Weill describes a whole bunch of instances that provided evidence for the necessity of strict financial auditing laws. In just a few years at the turn of the 21st Century, greed had spun out of control in the industry, leading to the accounting scandals of Enron and WorldCom, the dot-com crash, and a major hedge-fund crash that required a bailout. A terrorist attack didn’t help, either. By 2002, the chickens had come home to roost in the form of a bear market. “The regulators, the press, and politicians of all stripes…” played “the game of pointing fingers.”

And yet Weill writes, “…governance rules mandated by Sarbanes-Oxley (enacted in summer 2002) made it seem likely that bureaucratic needs would trump the fun of the business.” He also complains that businesses would have to spend more money preparing their financial statements. Sorry about that, Mr. Weill. Yes, pesky, bureaucratic, expensive laws reining in greed are no fun.

Six years later– same song, different verse… a whole lot worse. Need it be said– The more things change, the more they stay the same. History will continue to repeat itself, given human nature.

Read the book to learn the details of Weill’s career ups and downs and trials and tribulations. This blogger skipped the last chapter, in which Weill merely rambles on stating his opinions, and the endnote, which is an interview with his wife, whom he lavishly praises as loving and supportive throughout this ebook.

Why I Left Goldman Sachs

The Book of the Week is “Why I Left Goldman Sachs” by Greg Smith, published in 2012.

This career memoir details how the author experienced the change for the worse in corporate culture of stock brokerage Goldman Sachs (GS) over the course of a little more than a decade, from 2000 to early 2012. The company lost its way in terms of its mission and values, which embodied fiduciary duty and integrity.

In 2000, the author completed the selective, elitist, highly coveted summer internship program at the brokerage. He saw how principled the money managers were in recommending truly suitable transactions to their clients; not necessarily the most profitable ones.

When he began working there as a full-fledged staff member the following year, he took to the work, possessing the right combination of talents, skills and abilities to focus for long hours on conferring with clients and doing what was financially best for them. The goal was to build trust in order to foster a long-term relationship. It stands to reason that that is a more profitable course of action than seeking to rake in maximum money in the short term– which would provoke disloyalty from the client, when the client realizes he’s been taken advantage of.

Smith writes that a gradual change was occurring at his workplace around the start of 2005. At the time, he admittedly was “drinking the Kool Aid” like everyone else. The megabucks were multiplying because conflicts of interest were increasing betwen the brokerage and the government and other entities with which the brokerage was associated in various ways. The CEO and COO of GS were all for it. Their yearly letter to shareholders reasoned that such conflicts were inevitable, and were a sign that business was good. A telling example: GS netted approximately $100 million when it helped its client, the New York Stock Exchange merge with publicly traded, electronic exchange Archipelago in a $9 billion deal.

In the early 2000’s, one trend in the securities industry that would contribute to huge financial losses for the big firms including GS, was automated trading via software. The autotraders of the different firms were programmed to engage in largely the same behavior. They sought to trade in obscure, off-the-beaten path investments in markets in which it was difficult to find a buyer when it came time to sell. And they were all trying to sell at the same time. That was not a condition the autotrader creators had anticipated.

Another aspect of the big picture was that the people selling the financial products– more specifically, derivatives– did not themselves, understand what they were selling. It might be recalled that a derivatives debacle plagued the securities industry in 1994. Apparently, in 2007-2009, the greedy people involved in this rerun of a financial catastrophe failed to read their history, or had short memories. And governments of entire countries like Libya, were suffering losses of billions of dollars, thanks to GS, in 2007.

Read the book to learn much more about the outrageous occurrences borne of avarice witnessed by the author and the world during what became for him, an ordeal, characterized by the saying, “The fish rots from the head down.”

Bonus Post

This blogger “clicked” through the ebook, “Webs of Power: Notes from the Global Uprising” by Starhawk, published in 2002.

The ebook is the author’s description of what her activism is about. She explains that the way globalization is currently occurring is wrong because big corporations are favoring money over people. Greedy corporations (and governments) are destroying the earth and life on earth.

One specific way governments are allowing this, is through the World Trade Organization. The United States joined the Organization and signed the trade agreement called GATT. That agreement lets the Organization, whose member-countries’ representatives, appointed via cronyism, make laws whose disclosure is denied to the world. No hearings of their proceedings are permitted. The actions taken by this secret society affect workers and human rights worldwide and of course, the environment.

The negative consequences have included, for example, allowing poisons to permeate the world food supply, endangering species and keeping drug prices high, all to the benefit of global corporations. What is not a secret is that those companies have, in recent decades, increased their profitability by moving their production facilities to nations where they can get labor at minimal cost while avoiding pesky health, safety and environmental laws. The author argues that this has also resulted in significantly increased income inequality the world over.

Read the book to learn of additional ways greed and power hunger are wrecking the world, and the role the author has played, through planning and organizing protests, training protesters, protesting and writing in trying to prevent further harm; and of her various proposals for governance and allocating resources in ways that do the greatest good for the greatest number.

Diary of a Hedge Fund Manager

The Book of the Week is “Diary of a Hedge Fund Manager” by Keith McCullough and Rich Blake, published in 2010. This sloppily proofread ebook is about McCullough’s passion for ice hockey, and personal experience on Wall Street in the the single-digit 2000’s.

McCullough grew up playing hockey in the Thunder Bay area of Canada. He had a dream of playing professionally, but built a career in the stock market in the United States instead.

At the turn of the 21st century, Ivy-League college connections allowed McCullough to get a job with money managers. He spent a short time at a few places, having been lured to the next place by more money. The companies were able to run legalized Ponzi schemes because they had “… access to institutional channels, corporate and state pension funds, nonprofit foundations, and university endowments, not to mention the world’s wealthiest individuals…”

Most of the hedge funds of that period engaged in poisonous groupthink– cartelizing behavior (but apparently were never taken to task by the government for price-fixing/monopolistic practices)– they all bought the same stocks to overhype them and push up their prices artificially. They “… had devolved into nothing more than highly touted engines for producing excessive compensation.”

Read the book to learn:

  • the steps McCullough took to co-found a hedge fund and how he and it fared;
  • what else he has been doing;
  • how he defines a trade, a trend and a tail; and
  • the method he uses and philosophy he espouses to sense what is going to happen in the market.

Here are two hints: He thinks closing share prices and integrity are very important.