The housing boom has been stagnating lately, yet it is still at an all-time high, misleading people to continue in the misconception that they still have something to fall back on in old age. Unfortunately, Americans are enjoying a very high standard of living based on others' hospitality, mainly East Asians and the oil-rich countries. Can the Americans keep borrowing from abroad ad infinitum? What will happen when the housing bubble ruptures?
These risks are real and threatening. Uncared for, they will likely lead to a global recession, or even a catastrophic world financial crash. Americans should learn from others the beauty of thrift.
Tan Boon Tee
I live in the Netherlands, where we simply have the highest energy prices in the world. Gasoline costs around $6.60 (??5.50), and diesel $5.40 (??4.50) per gallon. Natural gas for heating and electricity kilowatt hours have high eco-taxes. Of course, as individuals we do complain. But compared with the U.S., this has some major advantages. Tax incentives encourage very low energy usage and encourage environmental friendly alternatives, including highly efficient natural gas-heaters and very high insulation values.
I am by no means an eco-freak. But high energy prices promote an energy-sensitive lifestyle. I commute 110 kilometers a day in a General Motors Opel Astra Diesel, and burn around 5.3 liters of diesel per day. A Volkswagen Golf Diesel would do the same, a Passant diesel almost. These are not dinky toys -- they have five seats, air conditioning, and all options. Most European subcompacts would average 35-40 mpg. It is a blessing in disguise. Get used to using instead of wasting energy!
Geldrop, The Netherlands I agree in part with Gim P. Hom's observations concerning parallels between Microsoft and Digital Equipment Corp., ("Reading between the lines at Microsoft," Readers Report, Oct. 17, replying to "Troubling exits at Microsoft," Cover Story, Sept. 26). But employee benefits, even if expensive, would not have sunk the company -- how much did DEC's turkeys cost per person anyway? There must have been something else.
As an almost 20-year alumnus of DEC and currently a professor of management and strategy, my observation is that what ended DEC was primarily two factors: the inability (or refusal) to recognize, accept, and adapt to the changing reality of the environment, and a failure of leadership. By the late 1980s, it was apparent that DEC was headed into serious difficulty. By the early '90s, it was increasingly clear to many of us that the company would probably not survive. Companies that do not adapt to the changing reality of their environments disappear. Companies that do not have clear, insightful, and effective leadership crumble. That then is probably the important parallel to be found -- the lesson to be drawn for any company.
Mark Louis Uhrich
P??le Universitaire L??onard de Vinci
Paris The production and quality woes of DaimlerChrysler that you report seem to be crippling most of the automotive industry these days ("Mercedes' new boss rolls up his sleeves," European Business, Oct. 17). Running a large assembly line is an extremely complex task. Yet commercially available tools are now capable of optimizing production lines and drastically improving their efficiency. The savings obtained with the optimization can reach tens of millions of dollars per year in a single assembly line.
Eckhard Cordes slowed the production lines to allow for more in-line quality tests -- but couldn't sustain the reduced productivity. Yet if he chose to optimize the lines instead, he could not only squeeze the additional testing into the line without slowing it but could also make it run even faster -- without the need for additional personnel or a costly redesign of the cars. Clearly, the economies generated would have been huge. These optimization tools, although available right now, are only slowly being adopted.
Founder & Managing Director
Optimal Design Belgium