Inside Brett Klasko’s World

I’m finally twittering, tweeting, or whatever it’s called… Anyway, I’m updating that more frequently than this blog, so be sure to check it out and follow me: http://twitter.com/klasko

I just found this article on the rollercoaster ride of emotions and feelings for entrepreneurs.  I can say from personal experience that this piece is spot on.  There are even certain days where I go through all of these stages in just one day!  Being an entrepreneur is not for the faint of heart…

http://www.fourhourworkweek.com/blog/2008/10/03/harnessing-entrepreneurial-manic-depression-making-the-rollercoaster-work-for-you/

By the way, sorry about the lack of updates/posts recently.  I’ll try to change that.

The financial crisis is far from over, and now some are worrying about UBS.  The Swiss bank’s account holders removed $58 billion in the third quarter, and rumors are swirling that S&P may be on the verge of downgrading its credit rating.  Similar series of events have been the downfall for other banks, but UBS is much more globally diversified than Lehman or Bear.  Still, an S&P ratings cut would cause panic among UBS customers and likely result in another huge bank in a liquidity crunch.  But how would the U.S. government react to a Swiss bank (albeit one that conducts quite a bit of business in the U.S.) that is on the fritz?  This whole mess is far from over, folks.

I’ll preface what I’m about to write by saying that this is a pretty random rant.

I keep seeing these GM Employee Discount commercials.  Quite frankly, I don’t believe a word of it.  First off, the people in the commercial are supposed to be GM employees.  But they’re smiling and seem joyous.  They must be actors.  Honestly, can any GM employee be that happy right now?  The company can’t sell a single truck (its cash cow division) and isn’t selling too many cars either.  GM has had quite a few layoffs, and I can’t imagine the environment in Detroit is very jovial, as portrayed on the commercial.

Second, they say: “In celebration of our 100th year anniversary, we’re (the employees) offering you our discount.”  Really?  So the fact that you’re doing deep discounts on cars and trucks you can’t sell at close to full price has nothing to do with the economy and gas prices?  When you offered the employee discount a couple years ago, was that to celebrate GM’s 98th anniversary?

I know this is probably a sensitive topic to GM employees and some others, and I apologize if I’ve offended anyone.  But after seeing this commercial for the 2,000th time, I had to bring up my feelings.

OK, I’m done.  Continue with what you were doing.

Monday was the single worst day for the U.S. stock markets since the first day of trading after the 9/11 attacks.  Dow lost close to 4%, S&P 500 (better measure of overall market performance) was down nearly 5%.  I found a great explanation (in layman’s terms) of exactly what transpired over the past few days and why the market reacted like it did.  It’s written by Ali Velshi, CNN Senior Business Correspondent, in his blog (http://tips.blogs.cnn.com/2008/09/16/the-sky-is-falling/).  Ali also happened to be the one who interviewed me when I was on CNN a few years ago, great guy!

Here’s what Ali wrote:

The average American might be left asking just one question today: Why? After all, there was no national disaster yesterday, Hurricanes Gustav and Ike didn’t do nearly as much damage as expected. Oil prices dipped under $100 a barrel for the first time in many months.

Shouldn’t we be celebrating?

Unfortunately, while the hurricanes were blowing through the Gulf, a perfect storm was descending on the stock market, fueled by bad bets on America’s now troubled housing market.

The financial titans on Wall Street put all their eggs into a basket of mortgaged-back securities and other complex derivatives that depend on home interest payments for income flows.

It was a good ride, until home values started to plummet across the country, sticking homeowners with expensive subprime loans on properties worth a lot less than their mortgages. That has forced many American homeowners to fall behind on their mortgage payments, or worse, filing for foreclosure on their homes.

Things came to a head last week with the government’s unprecedented takeover of mortgage giants Fannie Mae and Freddie Mac that unsettled many. But over the weekend, U.S. Treasury Secretary Henry Paulson refused to help bail out Wall Street’s big banks in trouble over their bets on bad real estate.

Here’s a summary of what has transpired so far:

1. Lehman Brothers has filed for Chapter 11 bankruptcy. The 158-year-old investment bank has accumulated debt totaling $613 billion. It failed to secure a takeover by British bank Barclays or Bank of America over the weekend, and had no choice but to throw in the towel. Lehman Brothers says it’s protecting its assets and maximizing its value by declaring bankruptcy.

2. Merrill Lynch has agreed to a merger with Bank of America. Once B-of-A decided to end talks with Lehman Brothers, it turned its attention to Americans’ largest brokerage and quickly struck a deal to acquire it for $50 billion in stock — a deal that effectively ends Merrill’s independence. Merrill had posted losses of over $17 billion this year.

3. The American International Group announced plans to restructure. AIG — one of the world’s largest insurers — said it would sell off part of its business to help recoup losses from the subprime mortgage crisis. In the past 9 months, AIG has lost more than $18 billion. On Monday night, three credit rating agencies downgraded their ratings for the company, making it harder to raise the funds to get it out of the red.

To put things in perspective, there were five major investment banking firms dominating deals on Wall Street at the start of 2008. Now, nine months in only two remain.

Bear Stearns closed shop earlier in the year in a government-assisted takeover by JP Morgan. Now that Lehman is gone and Merrill is swallowed up by a larger commercial bank, only Morgan Stanley and Goldman Sachs are left to arrange the big deals on Wall Street.

Many believe the current turmoil hitting the financial system is the worst since the Great Depression.

Why does this all matter to you?

More than half of Americans are invested in some way or shape in the stock market, through 401(k) plans, Individual Retirement Accounts and mutual funds. Many of these funds are tied to indices that are heavy with financial stocks now in trouble. So, stay tuned ad the turmoil on Wall Street sends ripples out onto Main Street.

I’ve had this miserable cough turned cold back to cough back into cold for the past 2 weeks that I’m really getting fed up with.  It’s caused me to lose my voice (which my roommates think is a good thing), but I’m really trying to stay productive during the day (some days a big challenge with this thing).  Was supposed to fly to Chicago tomorrow but may delay that flight for a day to try to recover a bit more.

On to business…  my task right now is to devise creative ways for a team to move unsold ticket inventory, whether it be on an undesirable day (early in the week usually), against an undesirable opponent, or in an undesirable section.

One of my friends came up with a really cool way to make an undesirable section more desirable…  can’t really go into details yet but think the Dawg Pound in Cleveland or the 700 Level at the old Vet in Philly.

If you have any ideas, shoot me an email – brett (at) phinaz (dot) com.  Hopefully you can decipher that translation.

Time for some Nyquil-assisted sleep.  I’ll try to start posting more often, especially on starting a business as a tween (getting a bunch of requests for some advice).

Well, I’m caving in…  I’ve been told by many that I should have a blog to discuss my past experiences as a young entrepreneur and current happenings in the industries in which I do business.  Hopefully I can help someone out there who’s starting a company or looking for new perspectives on more traditional thought in interactive media and grassroots marketing, specifically in the areas of finance and sports (where my experience lies).

I’m hoping to post here fairly regularly and will try to carve out the time to actually make my musings entertaining and informative.  If you’re looking to convince yourself of why you should (or shouldn’t) listen to me, check out the “More About Brett” tab above.

I’m heading to Cancun for the next week which should clear my mind and allow me to come up with some nifty ideas for what to do with this blog.  In the meantime, if you have any suggestions, you can hit me up at brett (at) phinaz dot com (hopefully you can figure out what that translates into without all the spammers also finding out).

Enjoy the weekend!

Brett