Hi all,

Australia is normally a couple of years behind the US in terms of technology, TV shows and economic conditions. I think this gap is shrinking with new Globalisations etc...

However I don't think we have seen the full extent of the Economic crisis here as yet. I hate reading the papers due to all the hyperbole I believe is inside them, however I thought this forum may help with a realistic view of the world I could come to see. What should I expect from a Recruiting point of view or business in general?



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We should; it is likely to be followed by an increased number of candidates being denied employment as a result of poor credit referencing...

Maureen Sharib said:
"Banks and card companies are bracing for a wave of defaults on credit card debt in early 2009, and they are vying with each other to get paid first. Besides, the sooner people get their financial houses in order, the sooner they can start borrowing again." More here.

CREDIT CARD DEBT....This issue is hardly discussed right now. The American media is too busy fretting over a 4.9 percent decline in holiday sales. As people lose their jobs, they struggle to pay bills. Unemployment insurance hardly covers a $100K (US) lifestyle. I am worried about a wave of credit card defaults that could drive down more banks. The U.S. Federal Reserve has used all their ammo to jump start the economy.
Dan, there is always a temptation -- when times get tight -- to cut costs. Downsizing usually means dumbsizing. There is rarely any rightsizing! In the U.S., a ridiculous focus on quarter-over-quarter earnings is the problem. Company CEOs do not want some idiot hedgefund executive, who makes money on money -- who has probably never created anything of lasting value in his or her life -- screaming about poor earnings. I wish there were more investors like Mr. Buffett, or more CEOs who had the courage to tell those guys to shove it. But alas, Board members do not want to be sued. They usually cave. So why don't we include prdudent management as a defense from this silliness -- if the company is making money and focusing on fundamentals, some bozo investor whose main drive is greed should not have access to the courthouse, or at least we should put them some considerable risk if they fail with their litigation. Better yet, limit their options to mounting a proxy fight or shut up.

But then I digress...

Spoke with a Wall Street M&A banker last night. His view is that things could begin to improve by July or August. Still, no one knows for sure and his comments were based on a belief that the U.S. economy has probably been in a recession for the better part of a year and that the normal uptick is usually 15-18 months for a bad one.

Personally, I am tired of being BUSHed and 01.20.09 can not come soon enough.

Danuroo (a Sunday morning contraction)-

We've all been in companies where situational leadership has led to new leadership structures; leadership that is good for an incubating company is far different than for a turnaround. The problem I have with a "strong" leader at the top is that with large companies it almost appears to be Stalinistic - drink the Koolaid and follow...or else (I always hark back to GE and Jack Welch). Follow or perish; when the head is gone, there goes the company. Reflection? You bet.

Inspirational leadership is wonderful in theory but inspiration comes in many forms - fear comes to mind at GE under Neutron Jack as one of these forms; Jack also produced great returns so inspiration to Wall Street came in the form of results, human carnage be damned.

Yet culture comes from every level and to place the credit or blame at the top is to deny the power of individuals to become leaders in their own space. A charismatic leader at the top never assures success but a culture where leadership thinking is really promoted and rewarded is more likely to produce superior results.

Dan Nuroo said:
Steve, whilst I cannot disagree with your thoughts on situational leaders, to allow that, don't you need a strong, secure, inspirational leader who can inspire, encourage and allow others to lead. There are always informal leaders around any place, however without the encouragement and recognition from THE leaders the situational leaders will disappear, either going somewhere where they will be recognised, or simple stop contributing as the efforts could seem fruitless. Is a company's culture a reflection upon the leadership of the company or the managements?
But then again, Alan Greenspan was befuddled by the events...

John G. Self said:
Spoke with a Wall Street M&A banker last night. His view is that things could begin to improve by July or August. Still, no one knows for sure and his comments were based on a belief that the U.S. economy has probably been in a recession for the better part of a year and that the normal uptick is usually 15-18 months for a bad one.
Maureen, I agree with you. I think that is why some banks who received bailout money are not lending like drunken sailors or bankers....

Read the New York Times Sunday magazine piece oo assessing risk. http://www.nytimes.com/magazine/

Excellent piece on how the big and small banks who took on risks misread or misused the widely accepted method of risk assessment, a mathmatical formulation called VaR, or Value at Risk. What the article appropriately points out is that this formula could not predict what is called a Black Swan event -- where the risk assessment calculations were based on issues/factors that were not able to account for the current events. So as the big boys at Merrill and Bear Sterns pushed for more risks (which equated to more profits) they relied on a faulty risk assessment tool, or at least that is the claim of some analysts. Hence their current quagmire.

I think we need to take a deep breath and approach how each of respond to this challenges with some common sense, although I realize that common sense in forecasting the short to mid-term economic coniditions may be the world's great oxymoron (right after country music). l think the best leaders will take steps to look at performance and profits, not head county or some arbritary expense target that may allow the short-term profits to look better but could hamper the company's ability over the longer term. I think there is a time when taking losses based on a prudent risk assessment, using P&L for service lines is acceptable, or even preferred, as a management strategy.

We are encouraging clients to lookat the quality of their executive team and use this crisis to cut the so-so performers, and recruit stronger leaders. We also will emphasize our consulting services, helping clients to strengthen their internal recruitment and employment processes for those positions we do not cover. This would include setting standards for outsourcing firms in terms of their placement and client satisfaction guarantees.

A crsis is a terrible thing to waste.

I am concerned but at this point I am not OVERLY concerned. Focus, hard work and innovation will carry us through, I believe.

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