Style & the Street

The Man Who Made Street Style Cool...

Bill Cunningham is a legend in the genre of street fashion photography. He is most known for his shots in the New York Times style section, where urbane New Yorkers show off their best and worst clothing choices... These photos can mean huge profits for an unknown designer, or can just be fun to look through over Sunday brunch...

The New Yorker covered his career as Cunningham is about to turn 80. Wonder what doors will be opened and closed in the world of both high and low fashion as the economic crisis lingers and many (including myself) see it lasting for more than a season...

According to the piece: "Cunningham is as interested in the bourgeois as he is in the avantgarde, and the mundane accessories of day-to-day life are as exalted in his photographs as any platform shoe or deconstructed bustle."

""The season is changing, but it’s more than change of season,” he said. “It’s how fashion will reflect the financial change…You just have to stay out on the street and get it. It’s all here.”"

Poetic response to my article... fittingly Irish...

OY BERNIE BOY (HAPPY SAINT PADDY WAGON)
O Danny Boy
WilliamBanzai7 Blog

"Oy Bernie boy, a Ponzi you've been a scheming
From Palm Beach up to Park Avenue
The good times are gone, and all your clients are steaming
'Tis you, 'tis you must to the big house go and we all must watch and smile
But come ye back after the judge has read the sentencing memo
And when the court room's hushed to hear how long you'll go
'Tis we'll be here lurking in the shadows
Oy Bernie boy, oy Bernie boy, we hate you so.

And if you come, when all the other dodgy Wall Street hedge funds are dying
And their NAVs are red as red well may be
You'll come and find the place where all asset managers are lying
And kneel and say an "Alpha" there for me.

And the markets shall hear, tho' soft you tread above
And all those Wall Street Ponzi schemes will warm and sweeter be
If you'll not fail to tell the judge about foolish human greed
We'll simply sleep in peace until the next big Ponzi scheme is seen.

By anonymous   Posted: Mar 13 2009 10:51am ET"

The U.K.'s Topshop Comes into New York Like a Lamb...

Even with Kate Moss at the helm. 

The much anticipated Topshop opening in Soho will be a quiet affair, in reverence to the all-encompassing economic crisis. Kate Moss, the chic discount store's celebrity designer du jour, will be there, but without much fanfare. The shop will sell designer-type threads for those with champagne taste but beer pockets. 

Sir Philip Green, the owner of Topshop, did tell The Daily Mail though that Moss "will hopefully be coming over" for the opening "to give it some glamour."

Keep on Plugging The American Dream

From Expatriate Spook to Mail Order Maverick: Joseph Sugarman Keeps Plugging The American Dream Despite Recent Economic Eruptions

By Joan R. Magee

Joseph Sugarman didn’t dream of being a mail order pioneer when he was a kid growing up outside of Chicago – he wanted to be a journalist like Ernest Hemingway, an alumnus of his high school.  As it happened, his father told him to "get a real job," and Sugarman gave in, attending The University of Miami’s School of Engineering. By 1961 though, The Vietnam War was seething, and the Army drafted him a year shy of graduation. He was the sole student to score 100 percent on a routine I.Q. test, piquing the interest of the C.I.A. He went to spy school in Fort Holabird, Maryland and was shipped to Frankfurt. In 1965, Sugarman helped European acquaintances market ski lifts in the U.S. "There is nothing more powerful than the pen," Sugarman said. Once stateside, he formed the JS&A Group, Inc.  Some of the company’s successes include the world's first pocket calculator, cordless phones and inexpensive digital watches.

His governmental psychological training influenced his sales and marketing schemes. He’s profited from spotting a decent product and marketing it relentlessly. The New York Times called him The Mail Order Maverick. Sugarman, 68, a slight man with curly dark hair, large, white teeth and an elfin face, was in fact the first businessman to allow customers to pay with credit cards over the phone. That’s how he sold his most famous product, BluBlockers. Sugarman first saw a pair in the late 1970s. “The world was clear again,” Sugarman said. “I knew that they'd be a gold mine.” He sold them on QVC and made millions of dollars in one day.  Those millions didn’t come easily. In 1988, SunTiger, Inc. and Biomedical Optics Company of America, Inc. filed a copyright infringement case against JS&A Group, Inc. The company claimed to own the patent for optical lenses that filter certain wavelengths of “visible blue light.” But after 11 years, the case was vacated on Sugarman’s behalf.

He’s now obsessed by what makes people buy. “When you lower the price of a product, generally speaking, with very few exceptions, you’ll end up with an easier sale requiring less justification and less logic,” Sugarman said. In his semi-annual seminars, he teaches entrepreneurs that: “Money is merely a symbol.” Despite the economic downturn, Sugarman defends the American Dream. His philosophies align with the Obama’s: “Because somewhere in America, an entrepreneur is sketching designs for the startup that will revolutionize an industry. Our economic crisis has put these plans at risk, but it has not dimmed the dreams.”

Sugarman hit the jackpot, owning mansions in Chicago, on Maui, and in Las Vegas. He restlessly hunts for the next big thing, along with his 30-year-old beauty queen wife, and is launching a line of stem-cell anti-aging skin care products. The products will apparently transform one’s skin to that of a “nineteen or twenty-year-old.” Sugarman is almost 70, but looks 50. He has been taking fish oil supplements his whole life, to which he attributes to his child-like energy levels, taut skin and mental acuity.  For eight years, Sugarman owned The Maui Weekly as a way to revisit his childhood dream before selling the failing publication. Alas, for now, it’s all about stem cells. “I always tell people that whatever you focus on expands,” Sugarman said. 

Credit Continues Drying Up for All Businesses, Even Fashion

What's Really on the Line Because of Credit Agency Debacles? And how is fashion affected?

By Joan R. Magee

 Admittedly, we're going through a paradigm shift in this country.  The separation of private enterprise and government, much like the separation of church and state, was something adhered to for the most part since our dawn days.

Until now. 

Washington and the private sector have an increasingly symbiotic relationship, as the Feds are soliciting advice from and working closely with the private sector to tackle the a major problem: the big three credit rating agencies. S&P, Fitch and Moody's have been under the gun over the past months, and subject to relentless governmental scrutiny for what can be seen as questionable ratings practices.

Government agencies and quasi-governmental agencies are looking to those outside the old boy's club to figure out how to fix a major contributing problem in what is the worst financial crisis America has encountered in decades.

"The financial markets to make up their own minds as to who are trustworthy sources of information on the creditworthiness of bonds and bond issuers," Lawrence White, the head of the Economics Department at New York University's Stern School of Business. "This would be in contrast to current and past policies, stretching back to the 1930s, in which financial regulators have forced the financial markets to pay attention to a select few credit rating agencies.  It should come as no big surprise that when the sellers in the market (in this case, the market for bond information) are few and are protected, they may grow a bit lazy and careless."

Subsequently, the major flaw with the ratings of senior tranches of subprime CDOs was that the instruments were fundamentally different in kind from corporate bonds and similar instruments to which such ratings have been applied for almost a century.  For one thing, the probability of failure to make all payments of interest and principal on a timely basis was essentially tied to the degree of subordination for a tranche.  

Since the underlying assets had a high mean default rate, such subordination was subject to constant expected erosion, according to David Rowe,  VP of Risk Management at SunGard.  This is quite in contrast to a corporate bond where many companies maintain stable ratings for years based on their continuing success in the marketplace, he added.   

"This change of policy could still be consistent with the goals of financial regulation, which have been to require that regulated institutions (banks, insurance companies, pension funds, broker-dealers, money market mutual funds, etc.) have only safe bonds in their portfolios," White said. 

Q&A with Ron Winckler, Friend of Joe Sugarman's

How did you and Joe meet?

Joe and I met when he assumed ownership of the Maui Weekly, a newspaper I had started a few years earlier. Joe kept me on in a consulting position for about six months after taking over as publisher.

_{What were your first impressions of him?}

_{What struck me in the first weeks of our relationship was his willingness to take risks, not just willingness but a certain enthusiasm about moving into this new venture. He was not going to follow a "tried and true" path. Most significantly, he committed, early on, enormous time and energy in its [the newspaper] reconstruction. He was hands on from the start.}

<sub>What was the newspaper like back then?

The design of the paper, visually speaking,  was the first project, Joe insisted on something "distinctive. I quickly understood that Joe was all about branding. He didn't have a particular look in mind, he didn't turn to other, established, formats for inspiration. Joe simply believed that when the look was right, no, not "right," but "just right," that he'd know it. We came up with numerous layouts, finally deciding on a design that was only vaguely similar to traditional tabloids. The differences were certainly distinctive and accomplished his goal: To capture the eye, not "punch" the eye.

Not knowing Joe well, I suggested it might be a good idea to garner broader consensus before committing a final design to print. Sugarman responded with a brief explanation of his business philosophy. 
"Ron, standard wisdom encourages the 'ready, aim, fire' approach. In some cases, I take the 'ready, fire...'  then 'aim' approach. Let's pull the trigger on this one."</sub> 

_{Now published by the Maui News, the Maui Weekly continues in the exact format as that which we (mainly Joe) created some seven or eight years ago. This is significant for the following reason. One, long established newspapers have definite ideas about format. To take over an existing publication, especially a weekly publication without making substantive changes is rare.}

_{What was it like to work with Joe on the paper?}

_{Joe also appreciated the 'flavor' of content, both pictorial and textual. Digital cameras were just becoming popular and Sugarman purchased a number for the staff. He gave these to layout, editorial, sales and news staff and told them to shoot}

_{anything and everything that struck them as unique. The candid, "man on the street" shots that resulted, gave the Maui Weekly a --unique-- local look and appeal. Joe recruited "reporters" at every opportunity. He knew the man/woman on the street possessed perspective and subtle insights that often escaped the writer with a "J" degree. Like the paper's staff, the general public was now enfranchised. Today, on cable and even mainstream news outlets, you see the same thing, soliciting the viewer, and reader, as informal reporters. Years after Sugarman opened his pages to qualified, public input beyond the letters to the editor.}

_{How were you able to hold onto good weekly reporters?}

_{The inherent burnout factor that affects weekly news reporters is reflected in technically correct but boring content. This was all but eliminated by the above steps. Story ideas, good ones, pictures and even advertising ideas in effect, expanded the limited resources of this paper. As content poured in, it became clear that Joe really shined as a manager of ideas. Not many people move through the realm of ideas, random ideas, and effectively wrestle them onto the printed page. Joe did so effortlessly, he loved input from staff and general public, and the dynamic interaction between the paper and its unofficial columnists and reporters.}

_{How did Joe's sense of humor factor into his management of the Maui Weekly?}

_{Editorial content was also approached with a different eye. Joe didn't take himself, or the paper, too seriously. This is important and one of the principle things I appreciated about him. That's not to imply that Sugarman wasn't a serious publisher, he was. But he never shied away from opportunities to have fun; readers appreciated it even as some claimed to hate it. It was a fabulous 'toilet read,' exactly what Maui wanted. But his commitment to "serious" issues provided an anchor that kept the Maui Weekly from drifting into gratuitous sensationalism...usually.}

_{"Rocky Kapu" is one example. Rocky was one of the Maui Weekly's columnists. Somewhat sexist, as politically incorrect as they come, Rocky offended pretty much everyone; conservative, liberal, male and female, his column generated lots of letters. The column was a political/social cartoon in text form. Eventually, Joe would respond to critics and announce that, regrettably, that he would have to fire Rocky. But Rocky held a spot in Joe's heart and was always rehired. His columns
would start out just fine, interesting and colorful, but always  devolve into the boorish, albeit hilarious, writer he truly was.}

_{Now, here's the kicker.}

_{Rocky existed only in the imagination of Joe Sugarman. His 'column' poked at the sacred cows of local life and even national news. While Joe never said so, I suspected it was his way of encouraging others to lighten up and "get over themselves." I think, he also enjoyed the fulminations of Maui's other, "serious," writers who castigated the lack of journalistic "integrity" of the Weekly. Mostly, however, their fulminations had more to do with the fact that people were reading our paper, religiously.}

_{As stated, local issues of a serious nature received his full attention as well. He understood better than most the mission of a weekly publication: That local issues were important and needed to be covered, even championed. In the late '90s, abandoned cars were blighting Maui's landscape. This became a cause celebre, one of many, of his publication. Again, he enlisted the help of the 'everyday' reporter, encouraging readers to take pictures of abandoned autos and send them, along with the location, to the paper. Pictures poured in and every week a different wreck was prominently highlighted. He even enlisted the support of a local wrecker who agreed to haul the pictured hulk away.} 

_{As it turned out, hauling abandoned autos from public highways was illegal and that part of the effort came to a speedy halt. But the growing blight on this beautiful island was faithfully reported, every week, on the pages of Joe's paper. The county finally responded [it's a long story as to how the problem began] and started hauling the obvious and growing number of eyesores away. There are many more examples of his commitment to local issues.}

_{How would you summarize Joe's life outlook?}

_{To summarize Joe's "philosophy" as pertains to current times: Perspective.}

_{He looks at things others no longer notice; everyday things that, on the surface, seem unremarkable. He takes that everyday object and twists it --just a little-- until that object catches the light in a way people aren't used to and, in the bargain, catches the eye of the passerby. The unremarkable becomes remarkable, and he really didn't change anything but --perspective.}

While the visual format of the Maui Weekly was an obvious change, this wasn't what caught, and held, the attention of readers. The Maui Weekly, as published today, is proof. Visually, it remains the same. But the soul of this publication has returned to the sterile state of a typical, weekly paper. Perspective is everything.

.

Nobel Prize Winner Stiglitz Talks Recession at the UN

Nobel Prize Winner Stiglitz Talks at the U.N. about the Global Financial Crisis

By Joan R. Magee

February 24, 2009

More than a 1,000 people registered for an event at the U.N. today to hear Professor Joseph Stiglitz, Columbia University Professor and winner of the Nobel Prize in Economics in 2001, speak about the global financial crisis. He wrote “Globalization and its Discontents,” which outlined the problems with globalization.

It was not so long ago that the world economy seemed to be booming, so what happened? And what are some ways out of the crisis? To put it simply, in the U.S., we had a bubble. That bubble was broken and the banks are broken, according to Stiglitz.  There will be a continual unraveling as the process of deleveraging goes on.

In other words, the worst is yet to come.

This notion lends itself to what Professor Stiglitz calls the greater macroeconomic crisis. The flood of liquidity and lax regulations in other countries bled into an underlying global concern: insufficiency ofaggregate demand.

Nonetheless, GDP indicators didn’t give notice that we were living on a false basis, which is a critique of our GDP indicators, and more widely, regulation. 

Stronger and deeper regulation will cause controversy, says Stiglitz, because many people in the Wall St. system have walked off with millions, sometimes hundreds of millions due to the past system of lax regulatory bodies.
“They will talk about the harmful effects of regulation on innovation,” says Stiglitz. But the financial system in the U.S. before the credit crunch and economic downturn was “bad,” according to Stiglitz. 

“It didn’t mobilize savings,” he says. “It didn’t allocate capital beyond peoples ability to afford and created risk rather than mitigate it. It innovated in ways that led to temporary high profits, but not in ways for average Americans to manage risk. A simple one: How to stay in your house without being kicked out.”
There are deeper reforms needed then. There’s a problem with the plumbing and the problems are yet deeper. The problems are symptomatic of modern versions of American-style capitalism.

“The banks had grown too big to fail and it becomes a one side heads or tails,” says Stiglitz. “Heads I win, tails you lose and now people are losing.”

What are the two reasons we have an insufficiency of global aggregate demand?

In terms of globalization, all countries are closely linked. “We exported our toxic mortgages and thanked the rest of the world for buying all the garbage,” says Stiglitz. “We exported deregulation.”

Disorderly unwinding

Part of the story of these global imbalances is the fact that many emerging markets have felt a need to have a build up of large reserves. In the past eight or nine years, it’s been trillions of dollars, in Asia and the Middle East.

“We mismanaged the last global financial crisis of 1997 and 1998,” says Stiglitz. “I talked to a lot of ministers from emerging markets, and they said never again will we give up our sovereignty to the IMF and we have to protect ourselves.”

There’s no global system of insurance, so countries built up income people earned, but didn’t spend to create a buffer. Individually, it makes sense, but globally, it means a lack of aggregate demand worldwide.

The one country that was the consumer of last resort was the U.S. “The richest country in the world can’t consume beyond its means to keep the world going. It’s very flawed and it’s what we had. And if we don’t do anything about this, it will get worse,” says Stiglitz.

He says that even more reserves will be saved if reforms on the global reserve system. The U.S. dollar to a two-currency or three-currency reserve system could make the system even unstable. According to Keynes, the IMF should have been the global reserve system. The U.S. vetoed it, which Stiglitz called “short-sighted.”
Though we didn’t do it in 1944, now is the time to do so, according to Stiglitz.

Looking ahead

One of the innovations of the financial markets was to allow people to spend way beyond their income, and this was, obviously, a recipe for disaster. Being cognizant of the problem of inequality is important, but some of the solutions and bailouts may exacerbate the problems.

“We are bailing out bankers, and cutting back on our social security system,” says Stiglitz. “The
amount of money going down the drain without showing anything for it is staggering and we’ve gotten nothing for the billions spent on TARP.”

There was a myth of decoupling, that China would keep growing. But according to Stiglitz, in a global, integrated economy you can’t have a crisis in the largest economy without exporting it elsewhere. 

During American’s boom time, some countries didn’t follow the advice of the U.S. and didn’t open or
deregulate their markets and are now doing better than the U.S. But no financial system can be resilient against a deep enough economic downturn. It then ricochets against the U.S. and so it’s in the interest of the U.S. for a global economy. There are impediments to doing that. The first problem is that the developing countries don’t have the resources. China does, but the poorer countries don’t. 

And now America is spending close to a trillion to try to get out of the hole; other countries can’t do that. If the U.S. doesn’t give them the resources, Stiglitz concludes, then the developing nations will
stay impoverished and only prolong the ever-worsening American recession.

“For economists, this is the most exciting time,” says Stiglitz. “I think we’ll come to realization that institutions created 60 years ago are not up to the task. So we’re looking forward to a new Bretton Woods moment and prevent a recurrence in the future of this downturn.”