Business | Bob Schwartz

December 9, 2019

Cambridge Soundworks Ensemble Speakers: Retiring Another Audio Component

Note: A while back I wrote about replacing an audio receiver after many years (The STR-AV1010 Is Dead ). It was a sentimental moment, since it played such a role in the soundtrack of our lives. This week another of the venerable audio components is retiring, significant not only to us but to the history of audio electronics.

Above is an ad from exactly thirty years ago, introducing the Cambridge Soundworks Ensemble Speakers. Developed by audio legend Henry Kloss, this was a breakthrough in the way quality speakers were marketed. It was relatively inexpensive compared to big-name brands, and it was being sold direct to consumers, without retail stores in the middle. These days, of course, most consumers buy speakers without hearing them first.

New York Times, February 19, 1989:

Now a new approach to speaker shopping is being promoted by a manufacturer who says, in effect: Buy my speaker by mail, sight unseen and sound unheard. If you don’t like it, send it back within 30 days, and we’ll refund your money.

One would tend to distrust such a proposition if it came from anyone less reputable than Henry Kloss, a hallowed name in audio history. During the 1950’s and 60’s – the gestation period of modern audio technology, Mr. Kloss advanced prevailing standards of speaker design with such classic innovations as the original Acoustic Research and Advent loudspeakers, which were among the first bookshelf speakers capable of wide-range sound.

Later he founded KLH, the first company to produce compact components and to make extensive use of transistorized circuits. It was partly Henry Kloss’s ideas from which, a few years later, the Japanese audio industry took its cue and rose to predominance.

I bought the speakers right away. I am not a listener with genius ears, but I appreciate good sound and good value. These speakers have been with us in all our houses, throughout the chapters of our lives. But just lately, I have heard the distortion symptom of one of the speakers failing. It is time for another set.

As with the passing of the receiver, sentiment is balanced with functionality, and so new speakers are on the way. The Ensemble will go back in the same box that arrived at our door those years ago and that they have been moved in again and again. I suspect they will be discarded someday, but not now.

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November 23, 2018

Black Friday: The American Holiday Exclusively Devoted to Buying Things

Note: #GivingTuesday is next week.

Many holidays have been commercialized. But almost all of them struggle to maintain some semblance of their higher purpose and original meaning. Thanksgiving is still about diverse and somewhat antagonistic neighbors and strangers peacefully getting together for a big meal. Christmas is still about the arrival of someone who brings goodness and light to the world. The same abiding of meaning goes for Founding Fathers (July 4^th) and mothers (Mother’s Day)

Black Friday is different. It is exclusively about commerce. The dark name signifies the start of the shopping season that determines whether retailers have a profitable year (be “in the black”). You can look behind the commercial for the true meaning of other holidays. The only thing behind Black Friday is buying. The only way to celebrate Black Friday is to buy things—hopefully at deep discounts.

Some will say this misses the point. Buying on Black Friday is only the preliminary step to gifting on Christmas. Buying cheaper means being able to buy more gifts for more people. That’s what the spirit of Christmas is really about.

Here is a thought for those who participated in Black Friday, in stores or, as is now common, online. Add up all the money you saved by getting Black Firday deals. Donate that amount to the charity of your choice. (Given that Black Friday is the day after Thanksgiving, food banks are one suggestion).

Next Tuesday is #GivingTuesday, a holiday more attuned to the spirit of the season. Americans are expected to spend $90 billion shopping on Black Friday and on the newer holiday of Cyber Monday. If you conservatively guess that shoppers saved just 10% on their purchases, that adds up to savings of $10 billion for those shoppers. So if Black Friday shoppers donated their $10 billion in savings on #GivingTuesday, the meaning of Black Friday would be radically transformed

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May 9, 2018

“This is the business we’ve chosen.”

I watched a news panel discussing reports that Michael Cohen is distraught for his family and realizes that his business and professional life is over—not to mention the possibility of years in prison.

Some panelists expressed compassion for someone in his position. But another was less sympathetic, saying that this was the life he had chosen.

I can’t be sure, but this may have been meant to echo one of the many famous lines from the Godfather movies. In Godfather II, the dying Hyman Roth explains his attitude towards the killing of Moe Green, the man who invented modern Las Vegas. Roth knows that the Corleone family executed Green, but Roth explains to Michael Corleone why he set that fact aside:

HYMAN ROTH: There was this kid I grew up with; he was younger than me. Sorta looked up to me, you know. We did our first work together, worked our way out of the street. Things were good, we made the most of it. During Prohibition, we ran molasses into Canada… made a fortune, your father, too. As much as anyone, I loved him and trusted him. Later on he had an idea to build a city out of a desert stop-over for GI’s on the way to the West Coast. That kid’s name was Moe Greene, and the city he invented was Las Vegas. This was a great man, a man of vision and guts. And there isn’t even a plaque, or a signpost or a statue of him in that town! Someone put a bullet through his eye. No one knows who gave the order. When I heard it, I wasn’t angry; I knew Moe, I knew he was head-strong, talking loud, saying stupid things. So when he turned up dead, I let it go. And I said to myself, this is the business we’ve chosen; I didn’t ask who gave the order, because it had nothing to do with business!

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April 30, 2018

Explosive New Book: Trump/Russia: A Definitive History

“Kenneth McCallion, a former prosecutor who tracked the flows of Russian criminal money into Trump’s properties, told me, “Trump’s genius – or evil genius – was, instead of Russian criminal money being passive, incidental income, it became a central part of his business plan.””
Trump/Russia: A Definitive History

It was during the Moscow trip that Sater used his Kremlin connections to impress Trump’s daughter. Sater would later boast: “I arranged for Ivanka to sit in Putin’s private chair at his desk and office in the Kremlin.”
Trump/Russia: A Definitive History

Next week, the book Trump/Russia: A Definitive History will be released—and it will be explosive.

Written by Seth Hettena, an award-winning journalist who was a long-time investigative reporter for the Associated Press, it “chronicles the many years Trump has spent wooing Russian money and power. From the collapse of his casino empire—which left Trump desperate for cash—and his first contacts with Russian deal-makers and financiers, on up to the White House.”

The only excerpt available so far was published in Rolling Stone, A Brief History of Michael Cohen’s Criminal Ties. That brief excerpt paints one corner of a bigger picture that we will finally be able to see once the Mueller investigation is complete.

From Trump/Russia: A Definitive History:

Michael Cohen’s bare-knuckled tactics earned him the nickname of “Tom,” a reference to Tom Hagen, the consigliore to Mafia Don Vito Corleone in The Godfather. He grew up on Long Island, the son of a physician who survived the Holocaust in Poland, and like Tom Hagen spent a childhood around organized crime, specifically the Russian Mafiya. Cohen’s uncle, Morton Levine, was a wealthy Brooklyn doctor who owned the El Caribe Country Club, a Brooklyn catering hall and event space that was a well-known hangout for Russian gangsters. Cohen and his siblings all had ownership stakes in the club, which rented for years to the first Mafiya boss of Brighton Beach, Evsei Agron, along with his successors, Marat Balagula and Boris Nayfeld. (Cohen’s uncle said his nephew gave up his stake in the club after Trump’s election.)

I spoke to two former federal investigators who told me Cohen was introduced to Donald Trump by his father-in-law, Fima Shusterman, a naturalized U.S. citizen from Ukraine who arrived in the U.S. in 1975. Shusterman was in the garment business and owned a fleet of taxicabs with his partners, Shalva Botier and Edward Zubok – all three men were convicted of a money-laundering related offense in 1993….

Shusterman, who owned at least four New York taxi companies, also set his son-in-law up in the yellow cab business. Cohen once ran 260 yellow cabs with his Ukrainian-born partner, the “taxi king” Simon V. Garber, until their partnership ended acrimoniously in 2012…

Cohen was able to purchase a $1 million condo at Trump World Tower in 2001, persuading his parents, his Ukrainian in-laws and Garber to do the same in other Trump buildings. Cohen’s in-laws Fima and Ania Shusterman bought three units in Trump World Tower worth a combined $7.66 million. Cohen later purchased a nearly $5 million unit in Trump Park Avenue. In a five-year period, he and people connected to him would purchase Trump properties worth $17.3 million….

A year after Trump World Tower opened in 2002, Trump had agreed to let Miami father-and-son developers Gil and Michael Dezer use his name on what ultimately became six Sunny Isles Beach condominium towers, which drew in new moneyed Russians all too eager to pay millions. “Russians love the Trump brand,” said Gil Dezer, who added that Russians and Russian-Americans bought some 200 of the 2,000 or so units in Trump buildings he built. A seventh Trump-branded hotel tower built up Sunny Isles into what ostensibly has become a South Florida Brighton Beach.

An investigation by Reuters found that at least 63 individuals with Russian passports or addresses have bought at least $98.4 million worth of property in the seven Trump-branded luxury towers. And that was a conservative estimate. At least 703 – or about one-third – of the 2044 units were owned by limited liability companies, or LLCs, which could conceal the property’s true owner. Executives from Gazprom and other Russian natural resource giants also owned units in Trump’s Sunny Isles towers. In an observation that several people I spoke with echoed, Kenneth McCallion, a former prosecutor who tracked the flows of Russian criminal money into Trump’s properties, told me, “Trump’s genius – or evil genius – was, instead of Russian criminal money being passive, incidental income, it became a central part of his business plan.” McCallion continued, “It’s not called ‘Little Moscow’ for nothing. The street signs are in Russian. But his towers there were built specifically for the Russian middle-class criminal.”

Cohen joined the Trump Organization around the time that the second Sunny Isles tower was being built. A few years earlier, he had invested $1.5 million in a short-lived Miami-based casino boat venture run by his two Ukrainian business partners, Arkady Vaygensberg and Leonid Tatarchuk. Only three months after its maiden voyage, it would become the subject of a large fraud investigation. But Cohen was saved from his bad investment by none other than Trump himself, who hired Cohen as an attorney just before his casino ship sank. A source who investigated Cohen’s connections to Russia told me, “Say you want to get money into the country and maybe you’re a bit suspect. The Trump organization used lawyers to allow people to get money into the country.”…

Michael Cohen’s in-laws, the Shustermans, also bought real estate in Sunny Isles. The development was paying off. Trump’s oldest son, Don Jr., would later note, “We see a lot of money pouring in from Russia.” There is no question Trump owed his comeback in large part to wealthy Russian expatriates.

Cohen and Felix Sater have known each other for nearly 30 years. They met in Brighton Beach when Cohen started dating his future wife, Shusterman’s daughter, Laura, who Sater says he knew from the neighborhood. When Cohen joined the Trump organization, Sater had become a fixture in the office. Sater was developing Trump SoHo, a hotel-condo in lower Manhattan that later would be consumed by scandal, and had earned Trump’s trust. Trump asked him to look after his children, Ivanka and Don Jr., on a 2006 visit to Moscow. (It was during the Moscow trip that Sater used his Kremlin connections to impress Trump’s daughter. Sater would later boast: “I arranged for Ivanka to sit in Putin’s private chair at his desk and office in the Kremlin.”) When Sater’s criminal past was exposed in The New York Times, Trump suddenly looked and acted like a man with something to hide. Despite laying claim to “one of the great memories of all time,” he seemed to be having trouble recollecting who Sater was. “Felix Sater, boy, I have to even think about it,” Trump told The Associated Press in 2015. “I’m not that familiar with him.”

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March 18, 2018

Normalizing Corruption: “Kushner Cos. filed false NYC housing paperwork”

Associated Press:

Kushner Cos. filed false NYC housing paperwork

NEW YORK (AP) — When the Kushner Cos. bought three apartment buildings in a gentrifying neighborhood of Queens in 2015, most of the tenants were protected by special rules that prevent developers from pushing them out, raising rents and turning a tidy profit.

But that’s exactly what the company then run by Jared Kushner did, and with remarkable speed. Two years later, it sold all three buildings for $60 million, nearly 50 percent more than it paid.

Now a clue has emerged as to how President Donald Trump’s son-in-law’s firm was able to move so fast: The Kushner Cos. routinely filed false paperwork with the city declaring it had zero rent-regulated tenants in dozens of buildings it owned across the city when, in fact, it had hundreds.

While none of the documents during a three-year period when Kushner was CEO bore his personal signature, they provide a window into the ethics of the business empire he ran before he went on to become one of the most trusted advisers to the president of the United States.

“It’s bare-faced greed,” said Aaron Carr, founder of Housing Rights Initiative, a tenants’ rights watchdog that compiled the work permit application documents and shared them with The Associated Press. “The fact that the company was falsifying all these applications with the government shows a sordid attempt to avert accountability and get a rapid return on its investment.”

Set aside the specifics of this particular corrupt practice. Ignore the fact that Jared Kushner’s father Charlie, founder of Kushner Cos., once pled guilty to 18 counts of illegal campaign contributions, tax evasion, and witness tampering, and served fourteen months in federal prison. Ignore the business, legal, political and personal practices of Donald Trump, Jared’s father-in-law and boss, and President of the United States.

Focus on this. When corruption is practiced within the context and four walls of a corrupt enterprise, corruption is normal. The only things wrong are any words or actions that brings any of those corrupt practices to light or causes an unfavorable light to shine on them. Everything else is okay, because within those four walls, corruption is normal.

Corruption is not normal. In business. In government. In politics. In the White House. It is as clear as ever that some people don’t know that, don’t believe that, and never will.

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February 21, 2018

Goodbye Hourglass! Lucky Charms Adds Magical Unicorns!

Timeless magic that’s cosmically delicious!

From General Mills:

For the first time in 10 years, Lucky Charms is introducing a new and permanent marshmallow – the magical unicorn! The magically delicious brand tapped into the imagination and creativity of young minds to hand select the newest charm and the decision was unanimous.

“Our goal is to not only create a cereal that families and cereal fans will love and enjoy, but to inspire magical possibilities and help spark imagination and fun no matter what the age,” said Josh DeWitt, marketing manager of Lucky Charms. “That’s why, after 10 years, we decided to introduce a new charm with the help of the keepers of magic themselves – kids. They spoke, and after hearing their love for the magical unicorn, we listened.”

From magical and lucky to cool and colorful, both boys and girls agreed that these mythical creatures had timeless magic that was the perfect fit for the only truly magical marshmallow cereal. The new unicorn charm, which features hues of bright purples and blues, is the first-ever marshmallow to be inspired and created by kids.

With the entrance of the new magical charm, consumers will have to say goodbye to the hourglass marshmallow, which has been a staple in the magical line up for more than a decade. Lucky Charms marshmallow blend will continue to feature eight lucky charms including hearts, stars, horseshoes, clovers, blue moons, rainbows, red balloons and now magical unicorns.

The cosmic significance of this change can’t be overstated. The hourglass is the symbol of time, in all of its inevitably and finitude. That’s gone. The unicorn represents “timeless magic” and will “inspire magical possibilities and help spark imagination and fun.”

If there was ever a time for unicorns, at breakfast or whenever, this is it. Thanks General Mills!

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January 25, 2018

The Godfather Part II Presages the Trump Presidency

“All my people are businessmen; their loyalty is based on that…and on that basis, anything is possible.”

“Free to make our profits without the Justice Department, the FBI…looking for a man who desperately wants to be President of the United States.”

The Godfather Part II

The Godfather Part I and Part II are more than near-perfect movies, two of the most critically-acclaimed films of all time. They are compelling pictures of the unrestrained grab for power and money, fueled by mutual self-interest and governed by no other values.

These two quotes from The Godfather Part II (1974), more than forty years old, encapsulate where America finds itself today:

MICHAEL CORLEONE
“All my people are businessmen; their loyalty is based on that. One thing I learned from my father is to try to think as the people around you think…and on that basis, anything is possible.”

HYMAN ROTH
“If only I could live to see it, kid; to be there with you. How beautifully we’ve done it, step by step. Here, protected, free to make our profits without the Justice Department, the FBI; ninety miles away in partnership with a friendly government. Ninety miles, just a small step, looking for a man who desperately wants to be President of the United States, and having the cash to make it possible.”

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April 29, 2017

New CEO: “I thought it would be easier.”

Imagine that you hired a new CEO for your very, very big company (annual budget: $3.8 trillion). The job he takes is universally considered the most difficult job in the world.

Imagine that not all the shareholders approved him. In fact, the shareholders were very, very divided on his being hired.

Imagine that in his early days, he demonstrated some serious gaps in his knowledge and ability to do the job.

Then imagine the new CEO is interviewed and says this:

“I loved my previous life. I had so many things going. This is more work than in my previous life. I thought it would be easier.”

Would you:

Keep him and expect him to get better at his job.
Excuse him because he is new on the job.
Fire him.
Pray.

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April 26, 2017

Sometimes I Think I Must Go Mad: ‘Much-loved’ giant rabbit found dead after United flight to O’Hare

Oh, sometimes I think I must go mad. Where will it all end?
Groucho Marx as Professor Quincy Adams Wagstaff in Horse Feathers (1932)

Here is the story in today’s Washington Post.

Here is the summary: A woman in the UK raises giant rabbits. Darius is 4 feet, 4 inches long, a Guinness World Record (see photo above). His 10-month-old son Simon is already 3 feet 5 inches long. Simon was sold to a buyer in Chicago and shipped via United Airlines. Simon died sometime during the trip.

Not a day goes by that doesn’t hint at some degree of craziness, or scream about it. Maybe it is always like this or maybe we are now more sensitized to it from frequent exposure.

Where will it all end?

Minister of Finance: Here is the Treasury Department’s report, sir. I hope you’ll find it clear.
Rufus T. Firefly, President of Freedonia (Groucho Marx): Clear? Huh. Why a four-year-old child could understand this report. Run out and find me a four-year-old child, I can’t make head or tail of it.
Duck Soup (1933)

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January 22, 2017

What If We Took on the Character of the Places Our Clothes Are Made?

pyramids

I try to buy clothing made in America, but as a practical matter that’s very hard. Most of the basic, reasonably-priced items are made globally. Maybe that will change sometime, but it has been the trend for decades.

One thing I do, however, is look at the labels of the global clothes I wear. As I looked today I wondered: what if, in some of kind of magic, the clothes imparted the wearer with some of the character of the places they began?

Here is today’s lineup:

Shirt: Egypt
Jeans: Mexico
Briefs: Nicaragua

That itinerary does change from day to day, and includes Vietnam, Bangladesh, China, Honduras and other ports of call.

Is the spirit of Egypt in my shirt, and does it pass through my skin? How about my Mexican jeans? And what about Nicaragua, so very close to my very important parts?

Something to think about as we wrestle with the impact of globalism.

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Category: Business