Saturday, November 29, 2008

Finance Professor Boyce Watkins Discuss the Ability of The Government To Protect Our Money

By Dr. Boyce Watkins

Media reports show that many Americans are not quite sure of what to do with their money. Watching banks fail left and right, people are logically afraid of what might happen to their savings. This fear is justified, as we are seeing our accounts beaten and stomped by the global financial meltdown.

This grave concern is magnified by the fact that those we’ve trusted are the ones who’ve left us vulnerable. Our most cherished financial experts handled our retirement accounts like flashy vehicles on a Nascar speedway. Our elected officials allowed executives in the banking industry to run rampant like 3-year olds with dirty diapers. Then, when the crash came, a massive bailout package was created for those most responsible for the damage, while the rest of us were left holding the tax bill.

This begs the question: Why in the hell should we trust the government?

I recall that during the failure of Enron, one of the most respected companies in America at the time, the firm made several statements designed to create confidence in the company’s financial condition. Like captains of the Titanic, company leaders explained that there was nothing to worry about, even as they themselves were preparing their lifeboats. When the company failed, those who did not protect themselves reminded us of one grim and fundamental truth: when the “you know what” hits the fan, it’s every man for himself….and every woman too, in case you’re wondering.

In response to such sentiment, the American consumer has been working overtime to protect his/her resources: people have (against my advice) moved their money away from the frightening stock market, they are diversifying money into different banks, and some are taking their money out of banks altogether. All of these actions are occurring in spite of government calls for calm in a world on the verge of financial panic.

The honest to goodness truth is that I don’t blame Americans for being afraid. I don’t blame them for not trusting the government right now. Trust must be earned in any relationship, whether it is a tough marriage of the relationship between a government and its citizens. Our government must work to regain that trust through sound and efficient financial management. It will NOT regenerate the public trust through excessive spending on meaningless wars, selfish pork-filled bills being passed through Congress and budget deficits that strain the resources of Americans everywhere.

I can’t tell you if the government is lying to you, but I can tell you this: There was a time when government guarantees such as FDIC insurance were as pure as the driven snow. There was a time when the United States Federal Government had pockets and resources so deep that even God himself could be bailed out with our cash. The sad truth, however, is that no empire lasts forever, and there is destined to be a day in the future when we are no longer the unquestionable economic super power that we once were. A country that can’t even afford its social security obligations is hardly a nation that has risen beyond economic risk.

Another sad truth is that if the financial world really were coming to an end, the citizens would be the last to find out about any such crisis. We would, simultaneously, be the first ones asked to suffer the burden of irresponsible behavior by our leaders. If that doesn’t justify a bit of skepticism, I am not sure what does.

Dr. Boyce Watkins is a Finance Professor at Syracuse University. He does regular commentary in national media, including CNN, ESPN, CBS and BET. For more information, please visit

Wednesday, November 26, 2008

Consumer Confidence Advice From Finance Expert Boyce Watkins

Dr. Boyce Watkins

If you wish to see a video explaining consumer confidence, which is one of the driving issues behind the recent moves in the stock market, please click here.

This has been an interesting week, with auto execs showing up on private jets to request a bailout from the government and the Dow moving to below 8,000 points for the first time in 5 years. I still hold to the fact that this is a great time to get into the stock market if one has never done so before, especially if you are under the age of 50. By the way - please visit our sponsor, if you are interested in hiring a top notch African American speaker or seeking to become one.

Take care!
Boyce Watkins
Click here to join our money advice list.

If you listen carefully to the words of Treasury Secretary Henry “Hank” Paulson and Ben “Big Ben” Bernanke (chairman of the Federal Reserve) you might notice a trend in their language. The word “confidence” is used a lot when they speak. Many of their monetary proposals are not necessarily valuable for their financial power, but also for their psychological power.

Some of you may wonder what confidence has to do with anything. After all, if you’re broke, confidence doesn’t exactly put money in your pocket. If you’re 100 pounds overweight, confidence won’t help you win the Olympic 100 meter dash. When you are flying on a crashing plane, confidence doesn’t keep the plane from slamming into the ground. But confidence is important to an economy, and one of the most significant drivers of economic growth. In fact, over confidence has driven US economic growth for the past 10 years. Here are some reasons that confidence matters in the minds of Hank and Big Ben:

1) Confident consumers spend money

If you think you might lose your job next year, are you going to max out your credit cards? I certainly hope not. If you are worried about being able to make ends meet, are you going to buy that big screen TV? Not unless you want your wife to leave you. So, even if it doesn’t hold any truth, the mere forecast of a weak economy is enough to make many Americans hold off on consumer spending, one of the great driving forces of the American financial system.

2) Confident companies invest money and hire workers

Investments involve risk. Your hunch may work out, and it may not. If you don’t believe the economy is getting better, you are not going to consider taking that risk. No one plans to go to the beach if the weather man says that it’s going to rain. When economic rain is in the forecast, companies pull out their umbrellas and hold off on new projects. This reduces the number of jobs in the economy, because nearly every job created in America is the result of someone making an investment.

3) Confident Americans do not take their money out of banks

In case you didn’t know, your bank does not have your money. Your money is part of a large base of financial capital that is loaned out to individuals and consumers seeking to get a good return on their investment. So, without investing, your bank would have no interest in paying you any interest at all. So if, say, 30% of all customers of the same bank decide to get their money out at the same time, the bank would have serious financial problems. It is a lack of confidence that could cause customers to “run” on their bank and take out their money.

4) Confident investors keep their money in the stock market

The stock market is a place where fortunes are made and lost. Some part of that fortune is psychological, given that no asset can have a value which exceeds that which someone is willing to pay for it. When investors lose confidence, they take their money out of the stock market, and reductions in demand for stocks lead to massive paper losses in the market. Additionally, most Americans are “momentum traders”, meaning that when the market goes up, they tend to buy more, and when it goes down, they tend to sell. History shows that it is actually the opposite approach that tends to work best.

5) Confident banks make loans

Banks have to keep a certain portion of their funds on hand at all times to meet federal requirements. If they are fearful that their customers might come and demand their cash, they hold onto their capital to ensure that it is available. If they are afraid that their borrowing customers will not be able to repay loans due to a weak economy, they also hold back on issuing new loans. The truth is that when economic forecasts are grim, conservative bankers become even more fearful than the rest of us.

The bottom line of this article is that confidence matters. So, the next time you hear Ben Bernanke give a speech, you can be confident that he is going to use language that makes you feel more secure. Whether you choose to believe those words is up to you.

Dr. Boyce Watkins is a Finance Professor at Syracuse University. He does regular commentary in national media, including CNN, BET, ESPN and CBS. For more information, please visit To join our money list, please click here.

Friday, November 21, 2008

Your Black World: Barack Obama Wrestles With Self-Hatred

Black Rage, Barack’s Redemption
By: Tolu Olorunda
Staff Writer -

Reprinted From Black Commentator

“In Chicago, sometimes when I talk to the black chambers of commerce, I say, ‘You know… A good economic development plan for our community would be if we make sure folks weren’t throwing their garbage out of their cars.’”

-President-Elect Obama (April 2007).

“Y’all have Popeyes out in Beaumont? I know some of y’all you got that cold Popeyes out for breakfast. I know… You can’t do that. Children have to have proper nutrition. That affects also how they study, how they learn in school.”

-President-Elect Obama (February 2008).

“The previous generation, the Moses generation, pointed the way. They took us 90% of the way there [to equality]. We still got that 10% in order to cross over to the other side.”

-President-Elect Obama (March 2007).

“But if we are honest with ourselves, we’ll admit that what too many fathers also are is missing – missing from too many lives and too many homes. They have abandoned their responsibilities, acting like boys instead of men… You and I know how true this is in the African-American community… Yes, we need more jobs and more job training and more opportunity in our communities. But we also need families to raise our children… Any fool can have a child... [D]on’t just sit in the house and watch ‘SportsCenter’ all weekend long.”

-President-Elect Obama (June 2008)

…“We’ve all said in the black community, we don’t see all of who we are in, in the media. We see snippets… of our community and distortions of our community. So the world has this perspective that somehow Barack and Michelle Obama are different, that we’re unique. And we’re not. You just haven’t seen us before.”

-First Lady-Elect Michelle Obama (May 2007)

“[T]here’s always… doubt in the back of the minds of people of color, people who have been oppressed, who have never been given the real opportunities that you never really believe, that you believe somehow that somehow someone is better than you, you know deep down inside you doubt that you can really do this cause that’s all you’ve been told is no… And I think it’s one of the horrible legacies of racism and discrimination and depression you know it keeps people down in their souls in a way where you know sometimes they can’t move beyond it.”

-First Lady-Elect Michelle Obama (Nov. 2007)

A close look at the above-listed quotes would strike a curious chord in the reader. How can it be that a married-couple with identical political characteristics provoke such discord in their views on Race, and Black identity? After much deliberation, I’m convinced that President-Elect Obama’s disturbing perspective of the African-American community is not motivated by malice or cowardice, but simply a result of his upbringing. In other words, his distinctly condescending attacks on Black consciousness are merely a product of the overwhelming, disproportionate influence his White mother and White grandparents had on him. In contrast, Michelle Obama, raised by Black parents and nurtured in the womb of Black America, is prone to persuade a more empathetic view of the African-American community. It is virtually impossible for Barack Obama to have emerged from the loving arms of a woman who, “once confessed her fear of black men who passed by her on the street, and who on more than one occasion has uttered racial or ethnic stereotypes that made me cringe,” and not have inherited some of such Negrophobia, which has cast dark shadows on Black male psyche. In Just Walk on By, Author, Brent Staples wrote of the degree of “lethality nighttime pedestrians” attribute to certain Black males who fit the kinds of cringe-worthy stereotypes which Obama’s grandmother (God rest her soul) must have expressed constantly. The impact of this on the young Barry cannot be overlooked.

Obama was also never immune to the toxic wrath of White-supremacy as a child. Whilst being called “Negro” at school, it is reported that he was “teased more than any other kid in the neighborhood - primarily because he was so different in appearance.” A neighborhood friend recalled how Obama, as a young man, was “built like a bull. So we’d get three kids together to fight him.” An outcast amongst his lighter-skinned friends, he was once thrown into a swamp, when a group of neighborhood rascals grew disturbed that he had decided to tag along with them. Being Black, in this young man’s mind, must have resonated more as a negative, than a positive. It is inconceivable for a love-starved bi-racial kid to undergo such traumatic experience, without incurring an indelible stain of self-hatred. It is in this vein, I believe, that President-Elect Obama attempts to win a battle with his childhood, by scapegoating the Black Community.

Barack Obama’s nonchalance toward Black folks can also be a product of his elite educational background. It is no secret that Ivy-League institutions, such as Harvard and Princeton, promote a deficiency in diversity, vis-à-vis the student/faculty body. Having bathed in the muddy waters of a racialized childhood, it is no insult to suggest that Obama was baptized in the Holy waters of white-dominated institutions, such as the Harvard Law Review, to cleanse all remembrances of his “dark” past, and start anew. On the other hand, Michelle Obama, though privileged with an equivalent share of elite education, had a much different take on life at diversity-deprived institutions: “Predominately White universities like Princeton are socially and academically designed to cater to the needs of the White students comprising the bulk of their enrollments… My experiences at Princeton have made me far more aware of my ‘Blackness’ than ever before. I have found that at Princeton no matter how liberal and open-minded some of my White professors and classmates try to be toward me, I sometimes feel like a visitor on campus; as if I really don’t belong.” It is, at this point, clear that the singular difference between Barack and Michelle’s racial ideologies is the background which supports them.

It must be noted that Sen. Obama’s irrational display of self-hatred is not an anomaly in a community literally taught to hate itself. Just this past week, TV Judge and Activist, Judge Mathis, hosted a Black Woman who claimed that 90% of the Black Women she had encountered embarrassed her so much that she often hoped to be white. Mathis, growing disgusted, recommended that this particular lady, just “get her face bleached” and get it over with. Mathis then felt the urge to question her: “If you could kill yourself and come back as white, you would do it, wouldn’t you?” And to total shock of the studio audience, the plaintiff responded in the affirmative, “Definitely.” Regrettably, this attitude is not uncommon to the Black experience in America. It has scarred the fabric of our humanity for generations, since slavery. Many historians would agree that every ailment which afflicts the conditions of Black America today is directly traceable to the horrific conditions that buried the dignity of Black folks for 400 years, and beyond. Self-hatred has proven to be a successful escape route for those Blacks/Browns seeking repair to their damaged self-esteem. This is why a president, who values the humanity of people of culture/color, must be acutely aware of the words he/she chooses in remonstration against such communities. If Barack Obama is unaware of this reality, well-informed counsels such as Michelle Obama and Valerie Jarrett must take a personal interest in educating him.

And now, to President-Elect Obama or any campaign staffers reading this: There’s only a certain amount of discomfort the Black Community can afford after being robbed of its culture, identity, intellectual contributions and pride. Many African natives come to the American shores and thrive in ways that, unintentionally, insult the dignity of their African-American family. This ability for African success in a foreign land often stimulates the claim that the problem lies not in the practice of racism, but indecision, by Blacks in America, to pick themselves up by their bootstrap and take personal responsibility for their actions.

Such inference is an assault on the legacy of the not-so ancient history of legal/physical slavery, which consistently strides to stifle the potential of Black/Brown peoples in our society. We did not ask for this. This truth, however, escapes many white brothers and sisters, who act as though Black people are preoccupied with excuses, and possess a fundamental lack of determination for success. President-Elect Obama, it is incumbent upon you to arrest this notion. Not advance it. The reason Black folks are so enamored of the concept of a Black presidency is because they have searched, endlessly for a public official who can take into account the integrity of their dignity and contribution to society. If the next administration is unable to do so, there is little hope left for this democratic experiment.

To anti-Obama Black progressives: President-Elect Obama is our brother – even though he’s acted in ways that contradict this reality. Whilst he might not exhibit an impassioned concern for the Black Community, his background mirrors one oh-so many of us were enshrouded in. I propose, humbly, that Obama be forgiven for his rabid attacks on the Black Community, and granted a chance at redemption. There’s no doubt that his outspoken, generalized and unilateral critiques of Black folks are unmerited. But I am convinced, however, that deep-down, he appears to hold dear the conscience of the Black Community. What our brother, President-Elect Obama deserves is re-education, not retaliation. For a man who, at childhood, was deprived substantive interaction with the other side of his DNA, there’s certainly much need for a reorientation of who/what the Black Community is.

Monday, November 17, 2008

Let's Trade: Black Presidency For These Things

by Dr. Boyce Watkins

Barack Obama’s voice booms high into the clouds as our nation’s president. But it is also a voice that is sometimes muted by policy, distorted by conflicting agendas and distracted by the complexities of the world in which we live. I find myself mildly disturbed by the excessive celebration within our community, as if winning this political popularity contest has somehow finally validated us as a people. It is scary when the measure of a Black person's success is captured by the degree of favor he has obtained with his historical oppressors. I will never believe that winning the White House is the greatest achievement in Black History, nor was it the greatest sacrifice. The greatest achievements were made by those who worked for us to be truly empowered and the sacrifice was made by those who died to clear President Obama’s path. Achieving prominence on the plantation is not nearly as meaningful as achieving independence.

Before we conclude that we live in a post-racial America, we must remember that many of the men and women who voted for Barack Obama would not be happy to see your Black sons dating their daughters. While we see that the White House has a Black face, we must remember that the majority of our nation’s most esteemed universities still only bring in Black people to dribble basketballs (if you went to college, count the number of Black Professors you had during your 4 years who were not in an African American studies Department). Most of the media outlets you watch on TV are controlled by people who are not Black, yet they consistently impact the self-perception of Black children by bombarding them with negative Black imagery (i.e. DL Hughley's new show on CNN). Most of our nation's wealth is controlled by the descendants of slave masters, with poverty being inherited by descendants of slaves. There is a lot of work to do, we can’t forget that.

So, while having a Black President is a wonderful thing, it’s not the most wonderful thing I can think of. I would GLADLY trade a Black President for any of the following:

Another Malcolm X – Malcolm is likely the most under-appreciated American in our nation’s history, since his legacy is not as amenable to the excessive commercialization and mainstream comfort of Dr. Martin Luther King, Jr. Dr. King achieved political gains and Barack gave us the White House, both of which can be taken away in an instant. Malcolm gave us something far more permanent – our self-respect and desire for economic independence. Since America will never give Malcolm much respect, it is up to us to remember that he is every bit as significant as Barack Obama and Martin Luther King, Jr. We should all memorize Malcolm's birthday right now.

10 Black Warren Buffets – my good friend and wildly successful money manager, Bill Thomason, brought up an undeniable point: if we as African Americans do not get ourselves together financially, we will never have true power. America is a capitalist democracy, and we cannot forget that money makes this world go round. Rather than teaching our children to get jobs, we need to teach them how to CREATE jobs. Rather than trying to wiggle our way up the corporate ladder, we should be creating the buildings that the ladders lean against. Wealth is more powerful than racism any day of the week.

An era of enlightened and educated professional and college athletes – The Black male athlete possesses many keys to the economic and social liberation of Black America. Many HBCUs can’t pay the light bill, but Black Athletes earn at least $2 Billion dollars per year for universities that don’t hire Black coaches or Black Professors (March Madness, for which athletes are not paid, earns more ad revenue than the Super Bowl and the World Series COMBINED). The powers that be know the potential influence and reach of an educated and empowered Black athlete, which is why they work overtime to keep them uneducated: when many athletes come to college, coaches pick their classes for them and some can’t even read at graduation. They keep them focused on the bling so they will take their eyes off the prize. These young men are taught like sheep to embrace intellectual mediocrity so their handlers can earn fortunes at their expense. They are granted the greatest power in our society as long as they prove that they are unwilling to use it. If these men were to ever wake up and fight for something bigger than themselves (as Muhammad Ali and Jim Brown once did), it would be absolutely earth shattering.

A Quality Public Education System – Rather than declaring a War on Terror, we should declare War on inferior inner city education. Instead of bailing out the rich guys on Wall Street, we should be bailing out our children who are stuck in the preschool to prison pipeline. Hundreds of thousands of potential Barack Obamas are being tossed in an educational landfill every year, as Black boys are 5 times more likely to be placed in Special Education as White kids (I was one of those boys). This is a damn shame.

Complete Overhaul of the Prison System – If you ever want to see slavery in the 21st century, one only need look as far as our nation’s prisons. There is little effort to rehabilitate, and the impact on the physical health and socio-economic stability of the Black family has been devastating. President Obama and others should confront the prison industrial complex immediately and stop the human rights abuses taking place in our nation's prisons.

Now that people are saying that President Obama’s success implies that there is no more racism, our job becomes much more difficult. President Obama and others must be consistently asked to pull their weight so that we can get a return on our investment in the Presidential popularity contest. But while we expect President Obama to lead us, we must also remember that it is important to lead him as well. The fight is just beginning.

Dr. Boyce Watkins is a Finance Professor at Syracuse University and author of “What if George Bush were a Black Man?” For more information, please visit To join the Dr. Boyce Money list, please click here.

Friday, November 14, 2008

Your Black World: Barack Obama Underlines Black CommUNITY

Barack Obama: The Test of Black CommUNITY
By: Tolu Olorunda
Staff Writer -

“But we must understand that we are now at a stage of struggle for a People’s Democracy… The mass support of Obama by the national Afro-American movement, especially its progressive sector, will reinvigorate our struggle… We must enter into that mainstream struggle & make our own demands, utilize the pressure of our needs & our numbers. We are almost 50 million people with the 16th GNP in the world... almost 600 Billion dollars a year. We have the muscle and the money. We need to make our move.”

- Renowned Poet and Activist, Amiri Baraka, in a speech earlier this year.

The Black CommUNITY has laid its bed and must now lie in it. To be sure, this author is not particularly pleased with the 95% level of unconditional support from the Black CommUNITY, vis-à-vis Obama’s presidential bid. Nevertheless, Obama’s unpredictable popularity within the Black CommUNITY is a testament to an often glossed over, deep-seated desire/potential for divine unity of the Black CommUNITY. Obama’s candidacy, thankfully, buttressed this reality in unequivocal terms. Many have privately joked, over the past week, about the seeming impossibility of the Black CommUNITY agreeing on any specific agenda, let alone a political one. Some have quipped that the last time such unprecedented levels of support was rendered in favor of anything, O.J. Simpson was on trial for double murder. The comedic value of such statement notwithstanding, its veracity is unquestionable. Having rallied around this man, with unwavering support, let there be no more excuses for our disunity, or inability to remain unified around the ultimate cause: Total liberation.

On at least three key issues, the world will need the assistance of the Black CommUNITY to emerge victorious: AFRICOM, GLOBAL POVERTY and RACIAL INEQUALITY.

On Africom, a militarization and heist of Africa’s natural resources, Obama’s thin record is troubling, at best. Sen. Obama has suggested that, “There will be situations that require the United States to work with its partners in Africa to fight terrorism with lethal force. Having a unified command operating in Africa will facilitate this action.” These “partners” in Africa knew better than to accept the offer to host Africom in their country. If the Black CommUNITY is to avoid being perceived as enablers of the rape and ravish of their brother/sister’s land, it must act now to prevent the germination of this unholy scheme. Inaction is not an option.

On Global Poverty, Sen. Obama has been extremely vague when addressing the plight of the impoverished. Ever since Sen. John Edwards dropped out of the presidential race, the issue of poverty dissipated into a nameless agenda. Edwards’ campaign of highlighting the ranging disparities between the Two Americas, as he called it, swiftly found itself under the rug. With John Edwards’ disappearance, following news of his extramarital deeds. Sen. Obama, having arduously solicited Edwards’s endorsement in the primaries, saw no more use for the man who launched his campaign in Hurricane-stricken New Orleans. Worse than the truncated highlights of poverty in the presidential race, was the narrow-minded belief that poverty in the U.S. best represents the world’s trauma. But long before folks in the U.S. were losing their jobs, humanity was at a loss for words, with people in Haiti, Cuba, Somalia, Ethiopia etc. living on less than a dollar a day. The Black CommUNITY must see to it that the struggle to put an end to global destitution is addressed within the next 48 months.

Racial Inequality has been, regrettably, sidelined in the course of the 2008 presidential bid. One esteemed newspaper would, upon Obama’s victory, declare racism a “myth.” The Black CommUNITY is, however, not amused. For a people who have suffered the brutal tyranny of oppression for centuries, such uninformed inferences are only a sobering reminder of the daunting task ahead. In the course of Obama’s presidency, there will be those who would seek to use a Black presidency as the avenue to make claims that Blacks have overcome every impediment put in way of their progress. The appropriate response should be to confront such challenges to our humanity head-on, but to also keep in remembrance our duty to achieve racial equality for every faction of society whose livelihood is daily suppressed by the egomaniacal appetite of big money corporations. We must side with our Latin-American brothers/sisters, and encourage them to fight, even harder, for the God-given right to a livable wage. We must, as well, consider the dignity of our Arab brethren as sacrosanct. Any and all attempts to dismiss their integrity should be forcefully admonished. The beauty of the Black CommUNITY lies in its inherent ability to fight on behalf of those who once oppressed it.

If President-Elect Obama’s recent appointments are any signal, it is clear that our unity is the only strategy capable of guaranteeing stability in the next 4 years. If we end up, 4 years from now, in worse shape than we are now, the blame must be squarely placed on our shoulders. Mass organizing, unrivaled in human history, seems to be the only solution for the dilapidated levels of humanity in which our people are presently entrenched. It would be a shame, a damn shame, if our judgment is clouded by the emotional pull of a Black presidency. Change certainly doesn’t come by wishing or hoping – the civil rights movement taught us that. It is written in one of the holy books, that “Faith without works is dead.” The neo-liberal fan base has displayed, following Obama’s victory, a sheer unwillingness to question, let alone to criticize, let alone to condemn any policies of an Obama administration, deemed deleterious to the internationally disenfranchised society. Editorial Board member and Columnist, Dr. Lenore Daniels, expressed concern about this in her Election Special column, stating: “The day after, the Black Philadelphians on Chilton Avenue are still smiling. Still shouting Obama, Obama! It’s still incredible. An African American in the White House! In the meantime, President-elect Obama offers Congressman Rohm Emmanuel (D-Ill) the position of White House Chief of Staff. Pro-Israel, pro-war, Emmanuel! And the Left, waving a victory flag, says it will offer criticism - starting in January!” There’s no doubt that our work is challenging and confronting. However, if the Black CommUNITY was capable of transporting a relatively unknown Senator to the highest seat of the land, let there be no excuses for our negligence to do likewise in matters concerning, Social Justice, Economic Independence and Racial Equality. In the words of a departed civil rights hero, “Can we do it? We can do it, we shall do it!”

Reprinted From Black Commentator