Archive for August, 2011
September Calendar of Events
Sept. 1
Coeur d’Alene Women in Business Network. Network with area women in business. For more information, call 664-0216
Sept. 5
Coeur d’Alene Symphony Concert in the Park. 2 p.m. Cd’A City Park. www.CdASymphony.org for more information
Sept. 7
Post Falls Women in Business Network. Network with area women in business. For more information, call 664-0216
Sept. 8
Cd’A Chamber Membership Appreciation Day. 4-7 p.m. Chamber parking lot. Booths, food and drink. www.CdAChamber.com
Hayden Chamber Business After 5. 5-6:30 p.m. More info: HaydenChamber.org, 762-1185
Sept. 9
Artwalk in Downtown Coeur d’Alene. 5-8 p.m. at participating businesses. 292-1639
Opera in the Plaza Free Concert. 6-7 p.m. Resort Plaza Shops
Sept. 13
Coeur d’Alene Chamber Upbeat Breakfast. 7-8:30 a.m. Coeur d’Alene Resort. Speaker: Pat McGaughey, former Chamber president and CEO on perspective, anniversary of 9/11. $14 with reservation, $19 at the door. Brenda@CdAChamber.com, 415-0110
Sept. 14
Men in Business Network. Network with area businessman. For more information, call 664-0216
Sept. 20
Post Falls Chamber Takin’ Care of Business Meeting. 11:15 a.m. to 1 p.m. Red Lion Templin’s. $13 with RSVP, $18 at the door. 773-5016, www.PostFallsChamber.com
Sept. 22
Hayden Chamber Membership Breakfast. 7-8:30 a.m. Daanen’s Deli, corner of Wayne and Prairie. $10 with RSVP, $12 at the door. RSVP to info@HaydenChamber.org, 762-1185
Coeur d’Alene Chamber Business After Hours. Time Warner Cable. 5-6:30 p.m. Brenda@CdAChamber.com, 415-0110
Sept. 23 & 25
Opera Cd’A presents “Faust.” 7:30 p.m. Friday, 2 p.m. Sunday NIC Schuler Performing Arts Center. Tickets: 769-7780, www.OperaCdA.org
Sept. 23-24
Oktoberfest. 5-10 p.m. Friday, 1-10 p.m. Saturday, Resort Plaza Shops. Tasting stations, live music, food and contests. More info: 415-0116
Sept. 29
North Idaho Legislative Policy Summit. 10 a.m. to 4 p.m. Best Western Coeur d’Alene Inn. $30 for Chamber members, $40 for non, extra $10 at the door. Registration by Sept. 22. Brenda@CdAChamber.com, 415-0110
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Top 30 Under 40 in Kootenai County
They’re business leaders, community servants, mentors eagerly sought out for advice and imparted wisdom.
And dang — they’re young.
The 30 stars featured in this issue are all under 40 years old, which is perfect reason to admire them and hate their guts at the same time. For so many of us, success came later in life — or we’re still searching for it.
But enough from The Geezer Chronicles. This is supposed to be a cheery piece applauding 30 youthful overachievers, so let the admiration shine.
It was positively glowing when our judges, Steve Griffitts and Dan Klocko, settled on these 30. Griffitts, you might recall, is head of the region’s public-private economic development force, Jobs Plus, Inc. And Klocko, a graduate of the University of Arizona, the finest institute of higher learning on the planet (Bear down!), lords over all the hiring at Kootenai Health.
These steely-eyed gentlemen were chosen to judge the competition for two reasons: One, they’re personnel wizards with many years experience on the front lines of employment wars, and two, collectively, they and their wives have produced 892 fantastic children and 14,781 super-human grandchildren. While that might be a tad exaggerated, Klocko and Griffitts, prolific papas both, have keen insight into the makings of superior human beings, not just in the workplace but under their own roofs. They know what success looks like.
At the conclusion of the rigorous judging session, in which dossiers on every nominee had been digested and debated and more than one coin had been tossed, Griffitts and Klocko came away impressed.
“Based upon the quality of the individuals who were nominated, it is amazing to see such professionalism, selflessness and sacrifice,” said a very serious Griffitts. “All of the nominees showed these characteristics.”
What impressed him most?
“The quiet ones that nobody knows but who do so much.”
Klocko, too, was keen on the abundant talent he’d examined, but he also issued a challenge.
“I think they were all very good,” he said. “I’m not going to say excellent because there are so many more under 40s out there who should have been nominated, but weren’t. I’d like to see this program get promoted more so we get some more of those excellent people nominated.”
Fair enough. While readers enjoy the 30 well-earned spotlights aimed at this issue, we’ll work harder to promote and perhaps expand the program next year. That’ll be far easier than deciding which of the judges’ kids are smarter or cuter anyway.
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2011 Top 30 Under 40. Pick up the print edition of the September North Idaho Business Journal for profiles on all selections.
- Cheri Bloom
- Jame’ Davis
- Ryan Davis
- Joel Elgee
- Christi Fleischman
- Rafael Daniel Flores
- Kimber Gates Travis
- Fonda Jovick
- Pamela Langenderfer
- Tom Latham
- Buddy Le
- Nick Lilyquist
- Luke Malek
- Mary Marano-Wolfinger
- Ryan Mattison
- Amanda Miller
- Charlie Miller
- Anne Mitchell
- Mike O’Brien
- Joel Pearl
- Heidi Potter
- Danielle Quade
- Mark Randolph
- Will Sando
- Amy Spoelstra
- Michael Tanneberger
- Britt Towery
- Kyle Ward
- Craig Wilcox
- Kory J. Wilson
The job picture in Kootenai County
By Alivia Body
Regional Economist
The number of jobs available through the local Idaho Department of Labor office is up 20.5 percent in the first half of this year compared to the first half of 2010. That is an increase of 440 job openings.
A large portion of them were from temporary employment agencies under administrative and support services, which does not clearly paint the picture of which jobs were available. But it does show that while businesses are becoming busier, they are still reluctant to hire permanent staff.
The first half of 2011 has been a good sign for the rest of the year. The fact that it outperformed the first six months in 2010 is astonishing considering last year marked a 72 percent increase in job openings from 2009.
Health care and social assistance jobs appear to be the common denominator in the overall encouraging job picture. In just the past month, 93 jobs were listed under health care and social assistance. In 2010 those listings totaled 536, up 26 percent from 2009. The majority of jobs listed were for home health care services, individual and family services and nursing care facilities.
Increasing backlogs for local manufacturers have resulted in more stable employment over the past couple years. The number of job openings increased 58 percent from 2009 to 2010. While the number of openings has slowed, net employment has steadily increased since the second quarter of 2010, holding at 4,100 in the first quarter of this year.
Hot jobs are based on data from the department’s occupational projections for 2008-2018. These are the jobs that on average rank high in their abundance in the economy, their annual growth rate and how much they pay.
The hottest jobs include customer service representatives, registered nurses and computer support specialists. The largest concentration of customer service representatives is in administrative and support services. With a high turnover rate, customer service representatives are projected to produce 110 positions annually in Idaho’s five northernmost counties.
Approximately 50 openings a year are projected for registered nurses and 40 for computer support specialists. The health care industry is one of the largest employers in the region and has the most workers 55 and older, nearly 22 percent.
The high number of people employed coupled with the number of annual openings both new and replacement and the higher wages make registered nursing the region’s hottest job. The number of nurses is projected to grow 24 percent, an annual rate of 2.4 percent, through 2018.
According to Labor’s Idaho Nursing Overview 2011 report, North Idaho College graduated 52 registered nursing students, and of those who have received their licenses, 70 percent stayed to work in the region.
The telemarketing sector employs a large portion of computer support specialists, customer service representatives and all other types of service representatives. Jobs in those occupations have a high turnover rate but are also expected to increase in demand. Service representatives in other fields are primarily working for wired telecommunications carriers. The transition to the telemarketing sector is expected to outpace the current trends.
On August 2, CNBC reported the top 10 hardest jobs to fill nationwide:
- Engineers
- Sales representatives
- Machinist/Machine operators
- Accounting & finance staff
- Skilled trades
- Mechanics
- Technicians
- Laborers
- Information technology staff
- Production operators
Locally, the demands are similar. Of the few local IDOL staff interviewed, the following occupations were affirmed as being some of the hardest jobs to fill in Kootenai County:
- Engineers
- Small engine repair mechanics
- CADD technicians
- Occupational therapists
- Dental assistants
- Psychiatrists
A complete list of long-term occupation projections in northern Idaho are at www.lmi.idaho.gov.
Here are the region’s hot jobs reported and the needed training for each, according to the Bureau of Labor Statistics:
- Registered Nurses: Annual openings – 52, Median Hourly Wage – $30.75, Educational or training level – Associate degree
- Sales Managers: Annual openings – 13, Median Hourly Wage – $34.65, Educational or training level – Bachelor’s or higher, plus work experience
- Sales Representatives, Wholesale and Manufacturing, Technical and Scientific Products: Annual openings – 14, Median Hourly Wage – $33.10, Educational or training level – Work experience in a related occupation
- Computer Support Specialists: Annual openings – 40, Median Hourly Wage – $17.01, Educational or training level – Associate degree
- Accountants and Auditors: Annual openings – 17, Median Hourly Wage – $21.39, Educational or training level – Bachelor’s degree
- Dental Hygienists: Annual openings – 9, Median Hourly Wage – $34.43, Educational or training level – Associate degree
- Customer Service Representatives: Annual openings – 113, Median Hourly Wage – $12.01, Educational or training level – Moderate-term on-the-job training
- Sales Representatives, Services, All Other: Annual openings – 14, Median Hourly Wage – $23.04, Educational or training level – Work experience in a related occupation
- Management Analysts: Annual openings – 9, Median Hourly Wage – $27.30, Educational or training level – Bachelor’s or higher degree, plus work experience
- Pharmacy Technicians: Annual openings – 20, Median Hourly Wage – $15.52, Educational or training level – Moderate-term on-the-job training
How they hire
Job search from the hiring perspective
By Tyler Wilson
NIBJ writer
It’s hard out there for job seekers, no doubt about that.
But the sparse job market is also tough on employers who now often receive hundreds of applications for a single position.
It’s an employer-market, meaning job applicants need to be thinking about the hiring perspective.
Where there are jobs, like within sectors of the medical community, finding the right employee is as daunting as ever. Dan Klocko, vice president of human resources at Kootenai Health, said their organization is fielding as many as 1,500 applications a month for all levels of employment.
“Our biggest struggle is trying to weed out the overqualified,” Klocko said. “We’ve got so many people coming in situations where the minute things have changed they will move on to another career.”
Employers are seeing numerous candidates with the same level of quality experience, making personality and initial contact with hiring managers all the more important for job seekers.
For management-level positions, Klocko looks for extremely motivated individuals who can be a self-starter and work comfortably with all types of people. For non-leadership positions, Klocko said it comes down to work ethic and reliability.
“I want them to be engaged,” Klocko said. “I want them to come in engaged, and we want to keep them engaged by giving them the materials for success.”
Vicki Isakson, manager of the Kootenai County office of the Idaho Department of Labor, said job seekers should be mindful of their appearance and demeanor at every step in the application process.
“The initial impression an applicant makes is extremely important, whether it is someone just viewing their resume, or a face-to-face contact with a person at the front desk,” Isakson said. “You can bet that whomever the applicant first comes in contact with will provide feedback to the person making the hiring decision, because they won’t want to work with someone who made them uncomfortable, treated them rudely and didn’t put off a good vibe.”
Bill Jhung, director of the Idaho Small Business Development Center through North Idaho College, believes hiring for character matters more than hiring for experience.
“Most are in a hurry and tend to hire based on skill and experience, but eventually the character of employees comes out and it could be painful,” Jhung said.
To Klocko, a few wrong choices can really damage an applicant’s chance at a position they may be perfectly qualified for. He encourages job seekers to answer every question on an application regarding previous work experience. The information will get out eventually, so it’s best the information comes from you, Klocko said.
Another big no-no: Complaining about a sour experience at a previous job.
“Don’t walk into your next employer and complain, that’s a real turnoff,” Klocko said. “I need you to come in and sell yourself. What are you going to bring to the organization? That’s what I want to hear about.”
Isakson said the smallest gestures can help an applicant stick out in a crowded market. These include being early or on time to scheduled interviews, showing genuine knowledge of the organization in which you are applying, and dressing a level up or step up from what you typically see from the place of business where you are interviewing.
“A thank you card dropped off or mailed to the interview team after the interview can sometimes make a difference in being the one chosen for a job,” Isakson said.
Isakson also suggested keeping resumes tight by tailoring it specifically to the job they are applying for by highlighting the specific skills the employer posted in their listing or ad. For professional positions, a cover letter should be used to highlight how a person can immediately impact a company.
Klocko said the crowded market doesn’t necessarily mean it takes longer to hire the right individual.
“The pure volume of applicants is bogging it down, but I’m going to get somebody out of all these applications,” he said. “We’re getting the same quality, just a little sooner.”
The Idaho Department of Labor offers interview classes for job seekers, and Isakson encourages all to consider the refresher.
“We have developed those classes based on feedback we get daily from employers and what they are looking for,” Isakson said.
For more information, visit www.Labor.Idaho.gov and click on Kootenai County in the office directory. Phone number is (208) 457-8789.
Getting back in the job market
By Jessica Bauman
There’s no time like the present to lay the groundwork, start networking, and update your resume to get back in the job market.
More than two-thirds of small-business executives don’t plan to hire new employees in 2011 or 2012 according to the U.S. Chamber of Commerce survey. Another 12% indicated they actually plan to cut jobs. Only 19% indicated that they plan to hire before the end of 2012.
The main reason for the reluctance to add to their payrolls was economic uncertainty, with an additional 30% citing a lack of sales and 7% blaming credit problems.
These findings support the recent Labor Department report which showed that few jobs were added in June and unemployment is on the rise again. According to the Small Business Administration, small businesses employ 50% of private sector workers.
Although there is not a lot of new growth in companies, there are replacement situations which could lead to the right opportunity for you. Let’s start with a few tips for getting back in the job market and position you to be in the top candidates considered:
Set goals for your job search
Goal setting will help you target your job search and better know what you want. Do you want something part-time? How important is a flexible schedule? Do you have time to look for a dream job? Do you need something quick so you can pay the bills? Do you want to work for a nonprofit or a corporation? Write out your goals and post them on the refrigerator or bathroom mirror as a daily reminder.
Network, network, network
Let people know you’re looking for a job. E-mail your contacts your résumé, and let them know what type of job you want. There are numerous professional and civic organizations that provide networking opportunities, get involved in your community, volunteer with organizations that your passion supports.
Consider staffing organizations, they work on your behalf to get you back into the workforce; many offer Direct Hire, Evaluation Hire, and Temporary/Contract positions in various industries.
Additionally, several social online networks for job seekers are available. For example, MyWorkButterfly.com is a social network for moms returning to the workforce.
Social media also provides a great opportunity for your job search. Companies often have Facebook, LinkedIn and Twitter accounts. You can connect with people on those sites to keep up with company information and contribute to the online conversation with people at those organizations.
Update your resume
Take a hard, constructive look at your resume, ask peers around you to critique, and update it according to your goals. The competition is steep; do not let a grammatical error pull you out of the running.
Express Employment Professionals offers complimentary handbooks with many job search tips including effective resume writing. It might even be worth the cost to have a professional resume writer develop your resume so it stands out from your competition.
However, if it is not feasible to do that, an easy tip is to incorporate your accomplishments and statistics of how you met or exceeded project goals into your resume. This will show a potential employer that you are results-oriented and can bring solutions to the table.
Once you’ve positioned yourself to get back into the job market, make it your job to get a job.
Remember, your resume is only part of capturing a potential employer’s attention. Ask permission to bring your resume into the organization, dress for success and be ready for anything. Be prepared to explain any gaps in employment, examples of your accomplishments, additional references to contact, and questions to ask the employer to display genuine interest in becoming part of their team.
It is tough to hear you are not the right candidate, but don’t give up on your job search; be yourself while being professional. Be confident in your capabilities and the skills you have to offer an employer, focus on what you do well, and, most importantly, keep networking.
For more information and to explore opportunities for you, please contact our local Express Employment Professionals team at (208) 777-4554, check us out on the web: www.expresspros.com or stop by 201 E 4th Ave., Ste. 100 Post Falls, ID 83854. WE ARE HIRING.
iDesign
Jonathan Ive, left, Apple's vice president of design, and Jon Rubinstein, Apple's senior vice president of engineering, pose behind five iMac personal computers, at Apple headquarters in Cupertino, Calif., in March 1999. Apple CEO Steve Jobs may be the company's most recognizable personality, but much of its cachet comes from its clean, friendly-looking designs - the product of its head designer, Jonathan Ive.
SAN FRANCISCO – Steve Jobs has been Apple’s most recognizable personality, but much of its cachet comes from its clean, inviting designs. For that, Apple can credit its head designer, Jonathan Ive.
Ive, a self-effacing 44-year-old Brit, helped Jobs bring Apple back from the brink of financial ruin with the whimsical iMac computer, whose original models came in bright colors at a time when bland shades dominated the PC world. He later helped transform Apple into a consumer electronics powerhouse and the envy of Silicon Valley with the iPod, the iPhone and, most recently, the iPad.
In the wake of Jobs’ resignation as CEO, Apple must show that it can keep churning out head-turning products even without its charismatic leader. Apple’s chief operating officer, Tim Cook, is now CEO, taking on the role of Apple’s public face.
But in many ways the real pressure will fall on Ive to make sure Apple continues its string of gadget successes.
Ive, known to his friends as “Jony,” has led Apple’s design team since the mid-’90s. Working closely with Jobs, Ive has built a strong legacy at Apple, ushering in products that are sleek and stylish, with rounded corners, few buttons, brushed aluminum surfaces and plenty of slick glass.
Apple’s pride in this work is evident even in the packaging: Open up any iPhone box, for example, and see Apple proudly proclaim, “Designed by Apple in California.” Six of Ive’s works, including the original iPod, are even part of the collection at the Museum of Modern Art in New York.
People who have worked with Ive describe him as humble and sweet, quiet and shy, but also confident, hard-working and brilliant. Paola Antonelli, senior curator of architecture and design for MoMA, said she knows “hardly anybody that is so universally loved and admired” as Ive.
“Products have to be designed better now for people to buy them because of Jony Ive and Steve Jobs and Apple,” Antonelli said. “All of a sudden people have gotten used to elegance and beauty, and there’s no going back.”
Design, as well as software that makes the gadgets easy to use, is a crucial part of setting Apple products apart from those of its rivals. Apple didn’t make the first music player or smartphone, but it blew past rivals by making ones that looked cool and worked well.
Ive started out far from Apple Inc.’s Cupertino headquarters. He grew up outside London and studied design at Newcastle Polytechnic (now Northumbria University) in Newcastle, England. After finishing school, he co-founded a London-based design company called Tangerine. There, he designed a range of products including combs and power tools. It was through Tangerine that he first got to work with Apple.
In 1992, while Jobs was still in the midst of a 12-year exile from Apple, the company’s design chief at the time, Robert Brunner, hired Ive as a senior designer. Thomas Meyerhoffer, who worked under Ive at Apple in the ’90s, believes Ive came because he understood Apple was different from other computer companies.
“He came to Apple to take that even further,” Meyerhoffer said.
And Ive did, but not right away. Ive quickly became a leader, working as the creative studio manager and helping to build Apple’s design team during a period in which the company struggled to innovate.
Apple declined requests for an interview with Ive. But during a 1999 interview with The Associated Press, Ive said that for years, designers would produce foam models of computers only to be sent back to their drawing boards because of managers’ fixations with focus groups and marketing figures.
“We lost our identity and looked to competition for leadership,” Ive said at the time.
Brunner left in 1996 and suggested that Ive take over the post, even though Ive was only 29. When Jobs returned from his exile and became interim CEO in 1997, he named Ive as senior vice president of industrial design.
With Jobs again at the helm and Ive as his style guru, Apple refocused around design and produced a hit that got the company back on track. Apple shook up the personal computer industry in 1998 with the candy-colored all-in-one iMac desktop, the original models shaped like a futuristic TV.
Unlike previous product attempts, the iMac concept was immediately embraced by the top decision makers at Apple, and the design went through very few revisions.
“We knew we had it when we saw it, and with Jobs’ support we were able to make it happen,” Ive said in 1999.
At a time when most computers were boxy and largely black, beige or gray, the iMac was bulbous and flashy. People snapped up 150,000 of them in the first weekend following its release. Apple sold 800,000 iMacs by the end of the year.
The iMac changed the way consumers thought about personal computers and about Apple itself. It gave Apple a vital boost that helped it usher in a new era of consumer electronics that were quirky, fun and colorful. The marketing team even teased consumers by encouraging them at one point to collect all five – strawberry, blueberry, grape, tangerine and lime.
With Ive in charge of design, Apple then bought out the first iPod in 2001, the iPhone in 2007 and the iPad in 2010. In recent years, the company has largely dropped the bright color palette (though you can still find it on some iPods) in favor of black, white and silver hues. Yet they retained simplicity that made them approachable to everyone – from the tech geek to Grandma – as well as the curves, shiny surfaces and expensive appearance.
As a result, Apple’s products are more popular than ever, allowing the company to surpass rival Microsoft Corp. last year as the most valuable technology company in the world.
“He wasn’t responsible for them, but they definitely couldn’t have done them without him,” said Leander Kahney, who has written about Apple in several books and on his “Cult of Mac” blog.
Ive and Jobs have worked hand in hand and, in many respects, have contributed to each other’s success. Ive has always been in contact with Jobs and speaks the same language as him, Antonelli said, and they clearly have chemistry.
Don Norman, who worked at Apple in the ’90s as vice president of the company’s advanced technology group, said that while Ive had good design ideas “sitting on the shelves,” he needed Jobs to get those designs off the shelves.
“Jony has always been Jony – brilliant,” Norman said. “What he needed was a Steve Jobs to say, ‘Make this happen.’”
Now, the test will be whether Cook can continue to keep that focus at Apple and encourage Ive to continue creating hits.
In a sense, the challenge won’t be as difficult as it had been in the 1990s. Now that Apple has developed a style, it can build on it rather than try to reimagine it with each new product.
And that, Norman says, is now in Apple’s DNA.
Jobs waves goodbye to Apple CEO duties
In this March 2, 2011 file photo, Apple Inc. Chairman and CEO Steve Jobs waves to his audience at an Apple event at the Yerba Buena Center for the Arts Theater in San Francisco. Apple Inc. on Wednesday, Aug. 24, 2011 said Jobs is resigning as CEO, effective immediately.
SAN FRANCISCO (AP) – Steve Jobs, the mind behind the iPhone, iPad and other devices that turned Apple Inc. into one of the world’s most powerful companies, resigned as the company’s CEO on Wednesday, saying he can no longer handle the job.
The move appears to be the result of an unspecified medical condition for which he took an indefinite leave from his post in January. Apple’s chief operating officer, Tim Cook, has been named CEO.
In a letter addressed to Apple’s board and the “Apple community,” Jobs said he “always said if there ever came a day when I could no longer meet my duties and expectations as Apple’s CEO, I would be the first to let you know. Unfortunately, that day has come.”
Jobs’ health has long been a concern for Apple investors who see him as an industry oracle who seems to know what consumers want long before they do. After his announcement, Apple stock quickly fell 5.4 percent in after-hours trading.
The company said Jobs gave the board his resignation Wednesday and suggested Cook be named the company’s new leader. Apple said Jobs was elected board chairman and Cook is becoming a member of its board.
In this Jan. 24, 1984 file photo, Steven Jobs, chairman of the board of Apple Computer, leans on the new Macintosh personal computer following a shareholder's meeting in Cupertino, Ca. Apple Inc. on Wednesday, Aug. 24, 2011 said Jobs is resigning as CEO, effective immediately. He will be replaced by Tim Cook, who was the company's chief operating officer. It said Jobs has been elected as Apple's chairman.
Jobs’ hits seemed to grow bigger as the years went on: After the colorful iMac computer and the now-ubiquitous iPod, the iPhone redefined the category of smart phones and the iPad all but created the market for tablet computers.
Jobs, 56, shepherded Apple from a two-man startup to Silicon Valley darling when the Apple II, the first computer for regular people to really catch on, sent IBM Corp. and others scrambling to get their own PCs to market.
After Apple suffered a slump in the mid-1980s, he was forced out of the company. He was CEO at Next, another computer company, and Pixar, the computer-animation company that produced “Toy Story” on his watch, during the 10 years before he returned.
The January leave was Jobs’ third medical leave over several years. He had previously survived pancreatic cancer and received a liver transplant.
The gold standard
In this undated handout file photo from Newmont Mining Corporation, gold nuggets and bars are shown. In December 2007, gold for about $840 an ounce. A little over a year later, it rose above $1,000 for the first time. It climbed gradually for the next two years. Then in March 2011, it began rocketing up.
NEW YORK – For what is normally a sleepy month, there are so many customers at the Gold Standard, a New York company that buys jewelry, that it feels like Christmas in August. Uncle Ben’s Pawn Shop in Cleveland has never seen a rush like this.
Welcome to the new American gold rush. The price of gold is on a remarkable run, setting a record seemingly every other day. Stomach-churning volatility in the stock market this month has only made investors covet gold more.
Some want it as a safe investment for turbulent times. What worries some investors is that many others are buying simply because the price is rising and they want to make money fast.
“Is gold the next bubble?” asks Bill DiRocco, a golf company manager in Overland Park, Kan., who shifted 10 percent of his portfolio earlier this year into an investment fund that tracks the price of gold. He stopped buying because the price kept rising.
In October 2007, it sold for about $740 an ounce. A little over a year later, it rose above $1,000 for the first time. This past March, it began rocketing up. On Monday, it traded above $1,900 an ounce, before closing the day at $1,888.70.
Meanwhile, stocks, despite rising sharply in the last two and a half years, are only slightly higher in price than they were a decade ago. Since hitting a record high in October 2007, the Standard & Poor’s 500 index is down 23 percent.
Gold hits a sweet spot among the elements: It’s rare, but not too rare. It’s chemically stable; all the gold ever mined is still around. And it can be divided into small amounts without losing its properties.
Ultimately, though, gold is valuable because we all agree it is. It was used around the world as a currency for thousands of years, and then it gave value to paper currencies for a couple of hundred more.
Now, in a time of turmoil, from the credit downgrade and debate over raising the debt limit in the U.S. to the growing financial crisis in Europe to worries of slow growth across the globe, gold is dazzling investors.
Since the financial crisis in 2008, central banks around the world have bought gold as a hedge against their foreign currency holdings. Earlier this month, South Korea announced it had bought gold for the first time in more than 10 years.
Gold is “an effective hedge in a world where there is too much debt and uncertainty,” says Jim McDonald, chief investment strategist at Northern Trust, which owns $2.8 billion of gold in a gold fund.
The last time gold prices rose so precipitously was a few years after President Richard Nixon ended a decades-long fixed relationship between the value of the dollar and the value of gold.
In those days, the price of gold was fixed at about $35 an ounce. And many foreign currencies were pegged to the dollar. Gold gave the dollar its value, and the dollar gave everything else value.
Then the U.S. began running a trade deficit, and dollars piled up abroad. Central banks could redeem dollars for gold. But it was a poorly kept secret that the U.S. didn’t have enough gold to cash out every dollar in circulation.
To head off a rush, Nixon “closed the gold window,” essentially saying that confidence in the U.S. government, not gold, gives the dollar its value. Gold and the dollar began to rise and fall freely, and gold earned its place as protection against the falling dollar when confidence lags.
As inflation worsened later in the 1970s and dollars were worth less, the price of gold took off. Gold hit its high in 1980 – $850 an ounce, or more than $2,300 in today’s dollars.
This time is different because gold is rallying against all currencies, not just the dollar, says Jim Grant, editor of Grant’s Interest Rate Observer.
“Gold is the reciprocal of the world’s faith in the world’s central banks,” Grant says, and right now, “the world is in a pickle.”
Gold prices will probably keep rising until the U.S. and Europe get their finances in order, he says – and Grant doesn’t expect that to happen soon. He predicts inflation, low for the moment, will soar, further eroding the value of the dollar and leaving only gold as a good investment.
Cetin Ciner, a professor of finance at the University of North Carolina-Wilmington, disagrees. He thinks gold is near a peak and people who buy now are blindly chasing the rising price.
“I’m thinking of it as like the dot-com stocks,” Ciner says.
Both Ciner and Grant caution, however, that when it comes to gold prices, no one really knows. That’s because gold doesn’t have intrinsic value. It doesn’t offer an interest rate, like a bond, or represent a share of a company, like a stock. It is inherently speculative as an investment: You only make money if the price goes up.
Amy Robinette, who owns Gold Buying Girl, a network of 70 women in six states who throw parties for people to sell their gold jewelry, says her clients “don’t realize how much their gold is worth.” She gets a cut of the sales.
“Once they sell, it kind of creates a frenzy,” says Robinette, who quit a career as a personnel recruiter to start the business two years ago. “They either want to find more or tell their friends and their friends start selling.”
Sharlett Wilkinson Buckner, of Humble, Texas, recently took an old bracelet, ring and necklace to her local jeweler and walked out with $1,070.
“I couldn’t wait for my husband to come home,” she said. “I fanned my money in front of him and said, ‘Look what I got for my gold.’”
The next day, he sold an old gold necklace for $650.
If Peter Hug is right, this frenzy for gold is likely to continue. The director of the precious metals division for Montreal-based Kitco, one of the largest dealers of precious metals, says gold is no longer “just for the crazy people” – Henny Pennys expecting the sky to fall.
Hug says that until the U.S. tackles its debt and deficit problems, there’s no limit for the price of gold.
“As long as people are terrified that their purchasing power is going to be eroded, gold goes to $3,000 an ounce,” Hug says.
Whether or not prices climb that high, many people are deciding it’s as good a time as any to sell Grandma’s jewelry. Pawn shops and gold brokers report a surge of people cashing in their gold.
In the past two years, Tansky, who runs Uncle Ben’s and is president of the Ohio Pawnbrokers Association, says gold sales have doubled or tripled. That figure actually masks how hot gold is right now, he says, because others who would have come to his store have gone instead to unlicensed brokers that are trying to cash in.
“I saw a barber shop that had a sign, ‘We buy gold,’” he says. “A barber shop! Can you imagine?”
Burger King mascot dethroned
Burger King CEO John W. Chidsey, background center, watches as "The King" mascot of Burger King Corp., arrives at the New York Stock Exchange in New York in May 2006.
PORTLAND, Ore. – The King is dead, but the burger lives on.
Burger King Corp. on Friday said it is retiring “The King” mascot, a man with an oversized plastic head and creepy smile who in recent years has been shown in ads peeping into people’s windows and popping up next to them in bed.
The move is an effort by the struggling fast food chain to boost slumping sales by focusing its marketing on the freshness of its food rather than the funny-factor of its ads. It’s rolling out a new campaign on Saturday sans The King to tout its fresh ingredients and new products like its California Whopper, which has guacamole.
“We won’t be seeing The King for a while,” Burger King spokesman BJ Monzon said Friday.
The new focus is a departure for Burger King, which long has targeted its ads to male teens who like to chomp its chargrilled burgers and gulp its milkshakes. The economic downturn has battered its core customer – young males have been particularly hard hit by unemployment – and Burger King is looking to boost declining sales by appealing to the mothers, families and others that rivals like McDonald’s Corp. have successfully courted.
“I think it’s great they are doing something as opposed to just withering away,” said Joel Cohen a restaurant marketing consultant. “They are taking an approach that is like not that much different from what McDonald’s is doing and growing up.”
The new focus comes as Burger King attempts to regain its edge. While competitors have grown by updating their offerings, Burger King largely stuck to its menu of burgers and fries.
McDonald’s, for instance, has worked to portray itself as a healthier, hip place to eat, offering wireless access in restaurants, updating decor and introducing smoothies, oatmeal and yogurt parfaits. And Subway has grown quickly by emphasizing fresh, quick and affordable food. Burger King also has faced competition from other burger chains, like Sonic, Carl’s Jr. and Five Guys Burgers and Fries.
As a result, Burger King, which was once in a neck-and-neck competition with McDonald’s, has been eaten up by rivals. In 2010, the top three U.S. restaurant chains – McDonald’s, Subway and Starbucks – all reported strong revenue gains, while fourth-seat Burger King’s revenue fell 2.5 percent.
In the second quarter, Burger King’s net income fell more than 13 percent to $42.8 million.
Its revenue fell 4 percent to $596.2 million. During the same quarter, McDonald’s profit rose 15 percent to $1.4 billion and its revenue rise 16 percent to $6.9 billion.
“Whatever they are doing isn’t working, so it’s time to do something different,” said Bob Goldin, analyst at Chicago-based food consultancy Technomic. “There is a sense of urgency to get back on their feet.”
That Burger King is looking to its mascot for change is not surprising. Other restaurant chains recently have begun to use their longtime mascots less __ or ditched them completely __ to freshen up the brand.
Under scrutiny of its marketing to kids, McDonald’s has moved away from its emphasis on Ronald McDonald, its clown mascot festooned in red wig and shoes. And the Wendy’s chain no longer plays up in ads its Wendy character, which has red hair and matching freckles.
Cohen, the marketing consultant, said a chain’s mascot should give a brand a better sense of identity by connecting it with consumers while entertaining them. The King, he said, did not do that. Cohen said others, such as Jack In the Box’s ball-headed “founder” and Jack or Chik-Fil-a’s black and white cows that encourage people to “Eat Mor Chikin,” do.
“When you think of it, the difference between the two, The King was creepy,” Cohen said. “There is a cool factor to the cow and there is a cool factor to Jack. They both come off with a wry sense of humor, which is appealing.”
Burger King has used The King mascot since 1955 when his image appeared on the sign at its first store in Miami. He’s taken various forms since then, including going animated in ads and running with a crew of other food-themed royalty like “Sir Shakes a Lot.”
This is not the first time The King has gone on hiatus. The company had him step down in 1989 to let a “Kids Club Gang” have a try. He returned in 2004 when the company hired a new advertising agency, Crispin Porter + Bogusky, which is known for its edgy work.
Since then, The King had become a more central __ and decidedly creepy __ part of ads. The mascot showed up in a variety of odd scenarios in ads, including lying next to a man in bed. But as sales fell, the company looked in a new direction.
Miguel Piedra, a spokesman for Burger King, based in Miami, said the decision to get rid of The King came as the company began looking at the business as a whole after it was acquired by investment firm 3G Capital last year. As part of that, Burger King switched ad agencies in July to mcgarrybowen.
Gordon Bowen, chief creative officer at mcgarrybowen, said the new ads celebrate good taste and the ingredients Burger King uses. Piedra said the company and agency decided to make the ads food-centric after finding that the reason people love its brand is because of the quality of its food.
“This is just the beginning of our journey a reintroduction of burger king brand to consumers,” Piedra said.
As for The King, Burger King said their mascot may not be banished from the kingdom forever. He may come back at in the future in a different form. In the meantime, the company will still carry paper crowns in stores.
Here we go again
Trader Gregory Rowe, left, and specialist Gennaro Saporito work on the floor of the New York Stock Exchange Thursday, Aug. 18, 2011.
NEW YORK – Just when Wall Street seemed to have settled down, a barrage of bad economic reports collided with fresh worries about European banks Thursday and triggered a global sell-off in stocks.
The Dow Jones industrial average fell 419 points – a return to the wild swings that gripped the stock market last week.
Stocks were only part of a dramatic day across the financial markets. The price of oil fell more than $5, gold set another record, the government’s 10-year Treasury note hit its lowest yield, and the average mortgage rate fell to its lowest in at least 40 years.
The selling began in Asia, where Japanese exports fell for a fifth straight month, and continued in Europe, where bank stocks were hammered because of worries about debt problems there, which have proved hard to contain.
On Wall Street, the losses wiped out much of the roughly 700 points that the Dow had gained over five days. Some investors who bought in the middle of last week decided to sell after they were confronted with a raft of bad news about the economy:
* More people joined the unemployment line last week than at any time in the past month. The number of people filing claims for unemployment benefits rose to 408,000, or 9,000 more than the week before.
* Inflation at the consumer level in July was the highest since March. More expensive gas, food, clothes and other necessities are squeezing household budgets at a time when most people aren’t getting raises.
* Sales of previously occupied homes fell in July for the third time in four months – more trouble for a housing market that can’t seem to turn itself around. This year is on pace to be the worst since 1997 for home sales.
* Manufacturing has sharply weakened in the mid-Atlantic states, according to a report from the Federal Reserve. Manufacturing has been one of the strongest parts of the economy since the recession ended in 2009, but its growth has slowed this year.
The manufacturing news was especially bleak on an already bad day, said Dan Greenhaus, chief global strategist at brokerage BTIG. He called the Fed report “an atrocious set of numbers.”
“That really set the market on its head,” he said.
Wall Street and other financial markets have wrestled for several weeks with fears that a new recession might be in the offing. Morgan Stanley economists said in a report Thursday that the U.S. and Europe are “dangerously close to recession.”
“It won’t take much in the form of additional shocks to tip the balance,” they wrote.
Worries about European debt also hang over the market. A default by any country would hurt the European banks that hold its bonds, plus American banks that have lent to their European counterparts.
Renewing the fears, The Wall Street Journal reported Thursday that U.S. regulators are looking at the U.S. arms of big European banks to make sure they have enough money for day-to-day operations.
“I don’t want to pretend that the market knows what it’s thinking about too much,” said David Kelly, chief market strategist at JPMorgan Funds. “We live in an environment of sell now and ask questions later.”
Asian markets started Thursday’s drop. Japan’s Nikkei 225 index fell 1.3 percent. The main stock indexes in South Korea and India each dropped a little more, then Europe more than that – 4.5 percent in Britain and 5.8 percent in Germany.
In the United States, the Dow fell 419.63 points, or 3.7 percent, to 10,990.58. The Standard & Poor’s 500 index fell 53.24, or 4.5 percent, to 1,140.65. The Nasdaq composite fell 131.05, or 5.2 percent, to 2,380.43.
The cycle of selling picked up again early Friday in Asia, with the Nikkei off another 2 percent.
The Dow is down 13.6 percent since stocks began falling July 21 – four weeks that have rattled Americans watching their retirement savings and other investment accounts shrivel.
Lee Applegate, a retired sales executive from Cincinnati, watched the latest market plunge uneasily but said he was planning to stay the course with his investments. He and his wife have several retirement accounts.
He remembers the mistake he made in pulling his money out of stocks in early 2009, just before the market started its two-year surge. Since March 9 of that year, the S&P 500 is up 68.6 percent.
“I think things are going to get worse before they get better,” Applegate said. “But I’m still going to ride it out.”
The selling Thursday was immediate. The Dow plunged from the opening bell and was down 528 points about a half-hour into trading. It essentially moved sideways for the next six hours.
New York Stock Exchange volume was 6.2 billion shares – busy for a summer day, but not as busy as during the worst of the selling earlier this month, when volume sometimes hit 9 billion.
Last week was one of the wildest in Wall Street history. The Dow moved more than 400 points on four straight days for the first time. But stocks had been relatively stable this week because investors were calmed by strong earnings reports.
The Dow fell 76 points Tuesday and rose four points Wednesday – the first time in nearly three weeks that the average rose or fell by less than 100 points on two straight days.
That ended Thursday. And with stocks down big, money flooded into U.S. Treasurys and gold, both considered safer investments.
The yield on the 10-year Treasury note briefly fell below 2 percent for the first time. It hit 1.98 percent before rising to 2.07 percent. Investors are willing to accept a lower return on their money in exchange for safety.
The price of gold reached yet another high – $1,829.70 per ounce. Gold keeps setting records bcause some investors are looking for stability and others are simply looking to cash in.
The price of oil fell $5.20 to $82.38 per barrel after the economic reports raised concern among traders that demand for gasoline would fall. One survey this week found Americans have already cut back on gas 21 weeks in a row.
And the average rate on a 30-year fixed mortgage fell to its lowest on record. The rate on the most popular mortgage hit 4.15 percent – just below the 4.17 percent reached last November. The last time long-term rates were lower was in the 1950s, when 30-year loans weren’t widely available.
Nicole Sherrod, a managing director at broker T.D. Ameritrade, said the market volatility has led more clients to put automatic protections in place to sell a stock or an investment fund once it falls below a certain value.
“Our clients are saying that this is not a buy and hold market,” she said. “This is a buy and protect market.”
In addition, computer systems that are programmed to analyze charts, capitalize on tiny changes in price and execute trades with no human intervention are making the market rougher.
High-frequency trading programs make up about half of the trading volume in a normal market day but 70 percent or more on a volatile one.
AP Business Writers Dave Carpenter in Chicago and Matthew Craft and David K. Randall in New York contributed to this report.