Rick and Ilsa will always have Paris; George and I will always have baseball

By Mark Yost
Stay Thirsty Media

“When I was about 18 and my dad and I couldn’t communicate about anything at all, we could still talk about baseball.”

That quote from the 1991 buddy movie, City Slickers, resonated with a lot of fathers and sons. But I think it has special meaning for my son, George, and me.

We’ve been going to Major League Baseball games since George was about seven. First in Minnesota, then in Chicago. Mostly to see the visiting New York Yankees, the team I cheered for in my native Brooklyn when I was his age.

They were great times for us.

Day games.


Eating hot dogs.

I taught George how to keep score.

Stay Thirsty 4But about four years ago, we took our passion for baseball to a whole new level. We began what I like to call The Great American Hajj – the quest to go to every Major League stadium.

Originally, it was pretty easy because we drove every summer from Chicago to New York to see family and friends. So we’d simply plan it out so that we could hit stadiums along the way.

Detroit – a pretty nondescript ballpark in the middle of a decaying city. We saw our Yankees there.

Cleveland – another so-so park in a rust-belt city barely hanging on.

Cincinnati – about as bland as they come, but, again, we saw the Yankees there.

Stay Thirsty 1And Pittsburgh – probably our favorite ballpark outside of New York. Pittsburgh is a city on the rise. It’s remade itself, it has energy again. PNC Park is one of those retro ballparks – like the original, Camden Yards in Baltimore – that works.

It sits on the banks of the Allegheny River.

Just beyond center field is the glorious Sixth Street Bridge, one of a handful of Depression-era brides that make Pittsburgh unique.

Just beyond that is the revitalized Pittsburgh skyline.

But best of all, prices are still reasonable (or, at least they were before they Pirates had their first winning season in 20 years).

Which brings us to Yankee Stadium.

Stay Thirsty 2I grew up a Yankee fan. Some of my best memories with my friends are going to “The Stadium” (yes, to us, it was The Stadium, capital T, capital S). And I’ve long known that the Yankees are all about money. But the new stadium has driven me away.

Thankfully, George was able to go to the old stadium before they tore it down. When we went, I made sure that we took the No. 4 train, because it stops at 155th Street and then goes through the subway tunnel and comes up just before 161st Street and Yankee Stadium. So, like me when I was a kid, George stood on the left side of the car as the train came out of the tunnel and saw the stadium rise up as the train pulled into the station.

We had some great memories at the old Yankee Stadium. Mostly with my friends, Angelo and Nino. I have pictures of George in the centerfield bleachers during batting practice. Him and three other New York kids about his age, living a rite of passage for generations of New York kids, including the moment when a home run came right toward them and a guy about 30 pushed them all out of the way and caught the ball.

George has been to the new Yankee Stadium, too. We went during the inaugural season. It looks a lot like the old stadium, but to me, it’s not.

Again, the Yankees have always been about money. But the $16 mixed drinks in the Hard Rock Café and $45 to park during the playoffs was too much for me. I’ve since become a big Dodger fan, harkening back to a team that once called Brooklyn home (and, yes, I know they now have the highest payroll in baseball at about $250 million).

Stay Thirsty 3I think George and I showed our true commitment to this journey when we went to Fenway Park. We saw the Dodgers play there. I was doing a story for The Wall Street Journal on renovations to the stadium ahead of the 100th anniversary. Because my mom is from Boston, we were able to put our partisanship aside and have a good time. It’s a great old ballpark, and the sausage and peppers on Yawkey Way are some of the best.

The sausage and peppers at Wrigley Field are pretty good, too, but the baseball fans leave a lot to be desired. They’re mostly 20-something hipsters who prove the old adage that Wrigley Field is the biggest bar in Chicago, there just happens to be a baseball game going on there.

George and I were at Wrigley once watching the Pirates (we’re sorta fans since we like PNC Park so much). A.J. Burnett was throwing a no-hitter into the 8th inning. When the Cubs finally got a hit off him, fans applauded – not for Burnett, their noses buried too much in their iPhones to know what was going one, but because the Cubs finally did something. One vapid girl nearby turned to us and asked, “What just happened.” I said, “Robbie Gould [the Bears kicker] just kicked a field goal.” She smiled, said “thanks” and went back to texting.

Last summer, we went to L.A. and hit the Dodgers, Angels and Padres in about four days. It was a great trip. The Dodgers played the Yankees, so George was in his Yankee jersey and I was in my Dodger t-shirt. The Yankees won, and we got to see Mariano Rivera come in and close out the last game of his career in the Chavez Ravine.

I love Dodger Stadium. It’s a bit expensive, but it’s a great old ballpark. And like Wrigley, the fans really don’t know much about baseball. They arrive in the third inning and leave in the sixth.

A few days later, George and I saw the Yankees again in San Diego. That’s a great ballpark.



Great atmosphere.

George and I are true baseball nerds; i.e. we keep score. And most other fans look at us like we’re doing math on an abacus. But I was pleasantly surprised when I walked up to a stand in San Diego and asked for a scorecard and the girl behind the counter just handed it to me.

“How much?” I asked.

“No charge,” she said.

George is a sophomore now and we have 11 ballparks left: Baltimore, Washington, Atlanta, Tampa, Miami, San Francisco, Oakland, Seattle, Colorado, Arizona and the Texas Rangers.

I think we’ll make it by the summer after his senior year. I may go broke, but I think the memories will be worth it.

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Where’s Houston? Somewhere between Kissimmee and Philadelphia

By Mark Yost
The Houston Business Journal

Houston is the fourth-largest city in the country, but according to one 2012 survey by Cvent (GHCVB is a member) Houston is ranked 22nd in terms of best convention cities, just behind Kissimmee, Fla., which sits in the shadow of Orlando and Walt Disney World, and just ahead of Philadelphia, home of “Rocky” and the cheesesteak.
Many of these surveys are merely popularity contests, and in that category, Houston seems to be improving.
Houston“Up and coming,” is how John Rose described Houston’s image in the convention world. He is president of J.C. Rose & Associates Inc., a South Carolina firm that provides exhibits to conventions, and a consultant on USA Today’s rankings of convention cities (Houston is 19th in the 2013 survey).
“Houston has a lot to do within very close proximity to the convention center,” Rose told HBJ.
He said that downtown Houston’s concentration of hotels, restaurants and the three professional sports stadiums are amenities that appeal to convention-goers. Working against Houston is the long commute to downtown from the two airports, he said.
But if Houston is improving in terms of its popularity, it has a long ways to go in terms of budget and economic impact.
In 2012, Osceola County saw a total economic impact from tourism of about $3.1 billion, according to the Experience Kissimmee website. Philadelphia claims tourism contributed about $9.75 billion to its economy in 2012.
GHCVB doesn’t give a total economic impact number, but adding up the figures from one of its rack cards, tourism was about a $500 million business in 2013.
Here’s the breakdown:

$345 million from convention sales
$77.6 million from international sales and tourism
$6 million from event development
$47.1 million in domestic leisure tourism
$18.2 million from the Houston Film Commission

Of course, all of those numbers pale in comparison to the big kahunas of the convention and tourism business. Las Vegas (No. 3 on the Cvent list) has an advertising budget of about $90 million that it uses to draw some 40 million visitors a year with an estimated economic impact of $45 billion. Orlando, No. 1 on Cvent list (and most everyone else’s) spends about $35 million touting itself as a great destination, and generates more than half of Florida’s $51 billion of tourism dollars.
GHCVB? It has just $3.6 million to promote Houston as a great convention and tourism destination.

Opera gala raised $2 million, but HGO has a much bigger figure in mind

By Mark Yost
The Houston Business Journal

The Houston Grand Opera held its annual gala on April 5 at the Wortham Center and raised $2 million from more than 600 of Houston’s most well-heeled guests. That’s up from $1.75 million a year ago.

Your humble correspondent, in black tie.

Your humble correspondent, in black tie.

But the local opera company with a national reputation has a much bigger number in mind: $165 million.
That’s the goal of a comprehensive fundraising campaign, Inspiring Performance, which began in August 2007 and concludes at the end of this year. According to Greg Robertson, HGO’s chief advancement officer, patrons big and small have already donated $151 million.
The opera, which only covers about 23 percent of its operating budget through ticket sales, will use the money raised to fix some long-term, systemic problems. Namely, funding its endowment.
“Arts are chronically under-endowed,” Robertson told Houston Business Journal. “Universities figured this out years ago. Arts are late to the endowment game.”
He noted that San Diego Opera, which recently folded, didn’t have an endowment.
When HGO reaches it’s goal of $165 million — the largest-ever arts fundraising campaign in the history of Houston — it will use the money for a variety of things. Operations will receive $110 million, $21 million will go toward HGO’s endowment, and Robertson hopes to devote $34 million to so-called legacy gifts. That’s when patrons remember HGO in their wills.
While that’s impressive, Robertson is perhaps proudest of the fact that more than 6,500 patrons have contributed to the campaign, in amounts big and small. For instance, before the start of the campaign, HGO had never received a gift of $1 million or more outside of an estate. Since the start of the campaign, HGO has received 25 gifts and pledges of $1 million or more.
“It’s always dangerous to rely too much on a handful of big donors,” said HGO Managing Director Perryn Leech.
He said that instead of going after just the big donors, HGO looks to add 50-60 new patrons every year. And while the opera has 170 donors who have given at the trustee level of $10,000 or above, the opera also has 800-900 contributors at the patron level who give $4,000 or more.
As for that big number — $165 million — that HGO is trying to reach: “We’re very optimistic that we will meet or exceed our campaign,” Robertson told HBJ.

It’s cheaper to watch the Astros lose this year

By Mark Yost
The Houston Business Journal

How much does it cost to see the Astros? Thankfully, less than last year.
Minute MaidAccording to the Fan Cost Index, put out every year by Team Marketing Report of Chicago, this year it will cost the average family of four $215.90 to go to a game at Minute Maid Park. That’s down from last year’s price of $224.33. The Astros are the 13th most expensive franchise this year, according to TMR, down from 10th last year.
The average Major League Baseball ticket increased by just 2 percent this year, according to TMR, while the Fan Cost Index rose 2.6 percent.
The FCI is created by combining four non-premium season tickets, two beers, four soft drinks, four hot dogs, parking, two programs or scorecards, and two adult-size hats.
The average price for an Astros ticket in 2014 is $27.98, down 13.6 percent from a year ago.
The cheapest place to watch a baseball game is Chase Field in Phoenix, where the Arizona Diamondbacks play, with an FCI of $126.89. The most expensive is Fenway Park, home of the Boston Red Sox, where it’ll cost a family of four $350.78.
The Astros added several new food and drink choices this year, including the Texas Smoke House (Section 124) and the Stockyard Bar (Section 156) that features Bayou City craft brews.
The Astros had the worst record in baseball last season, winning just 51 of their 162 games, but are considered one of the most profitable teams because of their low payroll.
Despite that record, local businessman Jim “Mattress Mack” McIngvale is running a promotion that will offer Gallery Furniture customers who spend $6,300 or more a chance to win back 100 percent of their furniture purchase price. All the Astros have to do is win 63 games in the regular season. Last year, the Astros won 51 games.
As of April 7, the Astros 2014 record was 3-3, good enough for second place in the American League West.

When it comes to opera, these two Louisianans place their bets on Houston

By Mark Yost
The Houston Business Journal

Houston Grand Opera will host its 2014 Grand Opera Ball, Fleurs de l’Opera, at Wortham Hall April 5. It is the group’s most important fundraiser of the year, and will be integral to HGO reaching its current fundraising goal of $165 million.

Jerry Fischer, soprano Nina Stemme, who starred in HGO's production of Tristan and Isolde, and John Turner.

Jerry Fischer, soprano Nina Stemme, who starred in HGO’s production of Tristan and Isolde, and John Turner.

But in many ways, Houston’s opera company, which has a reputation for being one of the best in the country, received the most important fundraising commitment of the season.
John Turner and Jerry Fischer, two opera-loving Louisianans from Baton Rouge, committed $2 million to the Houston Grand Opera. And while no arts company ever wants to rely too heavily on a handful of big donors, Turner and Fischer are symbolic of how arts groups woo patrons.
When it comes to giving, these globe-trotting Louisiana opera lovers put their money in Houston. They’ve agreed to provide $500,000 a year over the next four years as HGO produces one of the hardest operas of any repertoire, Wagner’s Ring Cycle, which will cost an estimated $12 million, according to HGO Chief Advancement Officer Greg Robertson.
“It’s a relationship we’ve nurtured over time,” Robertson told Houston Business Journal. “Five years ago, they were modest donors, giving maybe $5,000 a year.”
Robertson and his staff first spotted the pair of Carmen-loving Cajuns when they saw that they purchased tickets to see multiple performances of the same operas.
“It told us they were serious opera goers,” Robertson said.
Fischer and Turner said their first HGO performance was “Tosca” in 2003. Over time, HGO became one of their favorite opera destinations and they became two of HGO’s favorite patrons.
Turner is one of the Turners of Turner Industries Group LLC, an industrial construction and pipe fabrication company that’s headquartered in Louisiana but has offices in Houston, Beaumont, Corpus Christi and Paris, Texas. Turner doesn’t work in the family business anymore. He and his life partner, Fischer, travel the world listening to great opera.
“They nurtured us slowly and brought us into the HGO Family,” Turner said.
They wrote their first check for HGO’s 2009 production of Wagner’s Lohengrin. Since then, the number of zeros on the end of their checks has grown, culminating in their support for Wagner, one of their favorite composers.
“Wagner is not only really beautiful music, but also some of the most difficult to perform,” Fischer said. “It requires a huge orchestra. And while HGO doesn’t need to reaffirm it’s credentials as one of the top opera companies in the country, it says a lot about their ambition and artistic integrity that they’re putting it on.”
For the year ended July 31, 2012, the HGO’s total revenue was $18.7 million. Of that, $10.4 million, or about 56 percent, came from contributions.

I Wish Davey Crockett was Fat

So it’s Opening Day 2014, and I can’t help but think of my good friend, Tony Mattera.

CCWe are both diehard Honeymooners fans. One of our favorite moments is when Ralph overhears Harvey Wohlstetter Sr. talking about how great Alice is. Not knowing that she is picking up babysitting money on the side, Ralph assumes the worst and thinks Alice is cheating with Harvey.

Dressed in his full Raccoon Lodge regalia, Ralph storms over to the Wohlstetter apartment, confronts Alice, and starts screaming into the bedroom for Harvey to come out.

“Come on out Harvey!!!!” he bellows. “I know you’re in there.”

raccoonInstead of Harvey Wohlstetter Sr., a half asleep Harvey Wholstetter Jr. comes out of the bedroom in his pajamas.

“What is that?” Ralph asks.

“Havey Wohlstetter Jr.,” Alice says, disgusted. “Proud of yourself Ralph? You woke him up.”

As Alice picks up Harvey Jr. to put him back in bed, Harvey looks over her shoulder, rubs his eyes, sees Ralph in his coon-skin cap and says, “Gee, I never knew Davey Crockett was so fat.”

So when Yankee pitcher C.C. Sabbathia put on weight, Tony took to calling him Davey Crockett.

Well, I wish Davey Crockett was fat. Because whenever the heafty hurler loses weight, he also loses his best stuff.

In 2013, C.C., scared by the death of a cousin at 45 from heart disease, showed up a svelte version of his former self to spring training. Sabbathia usually tips the scales at more than 300 pounds. He was well under 300 last year and turned in one of his worst sesaons.

Through August of last year, Sabathia had a 4.78 ERA in 152.2 innings over 23 starts, easily the worst season of his career. His average fastball velocity also dipped below 91 MPH for the first time since 2002. The 24 home runs he allowed were a career-high, surpassing the 22 surrendered in 2012.

IN fact, in a Star-Ledger column just before the start of the 2014 season, Sabbathia even blamed his poor performance last year on his weight loss.

“I didn’t know the weight loss was going to affect me that much,” he told the Newark, N.J. paper. “There were just some games that I was short. I didn’t have the stuff, you know. It was frustrating.”

This year, Sabbathia showed up to George Steinbrenner Field tipping the scales at 275 pounds. Tonight, Sabbathia opened the season for the Yanks against the lowly Houston Astros. As of this writing, top of the 8th in Minute Maid Park, the Astros were leading, 6-1.

So, like the headline says: I wish Davey Crockett was fat again.

Johnny Football: Yes or No?

By Mark Yost
The Houston Business Journal

Former President George W. Bush and Texas Gov. Rick Perry will take in Texas A&M quarterback Johnny Manziel’s pro day on March 27 in College Station. So will the Houston Texans. Regardless of his performance, the question on every Houstonian’s mind is this: Will the Texans make the player nicknamed Johnny Football the No. 1 pick in the NFL draft on May 8?
FootballTexans and Aggies fans will have to wait to find out. But what does the Houston business community think about the player who famously said he wanted everyone to want him on the team, from Texans owner Bob McNair to the janitor.
Houston’s business community seems divided along two lines:
There’s no business case to draft Manziel because the Texans have a 24,000-person season-ticket waiting list and, despite an abysmal 2-14 season in 2013, Texans PSLs continued to appreciate.
Then there’s this — forget the business model, he’s the most exciting player in football.
John Grayson, a principal in Cokinos, Bosien & Young, and a 1980 A&M grad, is in the latter camp.
“Forget height, weight, stats and all that other stuff. In terms of competitiveness, natural ability and pure excitement, there is nobody like Johnny,” he said. “Of course the Texans should draft him. Big mistake if they don’t.”
Grayson’s boss, Greg Cokinos, is also in the “draft Manziel” camp.
“The Texans need a quarterback, so lets get the best one,” he said. “He is a Texan, born, bred and raised. How on God’s green earth could we pass on all that?” Cokinos said.
Dan Bass, managing director of investment banking at Performance Trust Capital Partners and University of Texas at Austin grad of ’86, is in the camp that thinks Manziel was great in college, but there’s “too much downside risk” to draft a player who barely stands 6-foot-1 into the NFL, where linemen average about 350 pounds.
Bass, always focused on key mergers and acquisitions in Houston, also doesn’t see the business case for making Manziel a Houston Texan.
“It isn’t like you need to draft him to sell tickets to the Aggie faithful,” he said. “Ticket sales aren’t a problem.”
Chris Begala of media relations and PR frim Begala McGrath said drafting Maziel would be the “most exciting and significant selection by any Houston pro sports franchise,” ranking up there with the Houston Oilers making Earl Campbell the No. 1 draft pick in 1978 and the Rockets drafting Hakeem Olajuwon in 1984.
“Drafting Johnny Football would send a charge through the entire state of Texas, not just Houston,” Begala said. “The Texans would elevate themselves throughout the nation as Johnny Football Texans jersey sales would instantly reach top five.”
Lane Clelland, a financial advisor at JEB & Co, perhaps has a little more authority to speak on the subject. He played football for Notre Dame from 2008-12.
“I think he’s going to do well,” Clelland said. “I think he’s going to surprise some people and could be a good pickup for the Texans.”
While most everyone had something to say about Manziel, Trevor McGinnis, a CPA at Fitts, Roberts and a Texans season ticket holder since 2002, was very succinct.
“Do not draft him,” he said.

Bugatti: The Marriage of Art and Design

By Mark Yost
The Wall Street Journal

Oxnard, Calif.

BugattiThere have been many exhibits on Bugatti, but none quite like the one now at the Mullin Automotive Museum. “The Art of Bugatti” looks not only at the gorgeous cars that defined the Art Deco movement’s marriage of art and design, but at the Bugatti family itself—Italians whose story often gets lost in the glare of the headlights of their fabulous French creations.

“If you think about it, there has been no other family like them in the past 500 years—with multiple generations that have had such influence on art and design,” said Peter Mullin, an insurance billionaire and collector who has a soft spot for the Art Deco period and its pieces. You could debate that, but what’s not disputable is the depth and breadth of this exhibit, which features 27 Bugatti automobiles, the single-largest collection of the luxurious marques ever displayed (many of them from Mr. Mullin’s private collection), and a thorough history of the family told through paintings, sculptures, furniture, manuscripts, design sketches and other heirlooms, some on display to the public for the first time.

The tone of the exhibit, officially curated by Brittanie Kinch but very much a labor of love for Mr. Mullin, is set early when visitors enter a circular gallery—one curved wall featuring short biographies of the Bugattis; the other, a timeline of the cars. Visitors learn that automotive patriarch Carlo (1856-1940), the son of architect and sculptor Giovanni, was as well known for his silverware and furniture—his Art Nouveau Snail Room furniture suite wowed crowds at the 1902 Turin Exposition of Decorative Art—as for his automobiles. His son Rembrandt (1884-1916) hewed to the art world, while Ettore (1881-1947) would take the car company to what many consider its pinnacle of artistry.

Bugatti 2To reflect the exhibit’s theme that the family’s artistry spread well beyond the garage, works such as Rembrandt Bugatti’s 1908 sculpture “American Bison,” cast in bronze at Paris’s Hébrard Foundry, are intermingled with four cars, including a 1929 Bugatti Type 46 coupé. A short film in the exhibit further connects these dots, noting the similarity between the sleek lines of Rembrandt’s 1914 bronze sculpture “Stalking Panther” and those of the 1936 Bugatti Type 57SC Atlantic, considered one of the greatest creations of Jean Bugatti (1909-1939), son of Ettore, and a car that Mr. Mullin bought for an estimated $35 million in 2010.

Also on display throughout the museum—which has devoted all of its nearly 47,000 square feet of display space to the Bugattis—is a rare Carlo Bugatti banjo, circa 1898; a Carlo Bugatti oil-on-canvas portrait of his wife, Thérèse; and a 1927 Ettore Bugatti wooden horse-drawn carriage.

An interactive kiosk in the second major gallery—Bugatti Power—compares and contrasts the engine that Ettore built for the luxurious Type 41 “Royale” (more than 12,000cc, producing 300 horsepower at 1,800rpm) and the engine that his eldest son, Jean, built for the sportier Type 50 (a little less than 5,000cc that produced 225 horsepower at 4,000rpm). It notes that if there was any rivalry among the talented Bugattis, it was between those two men. “He took creative and financial risks that gave even his famously idealistic father pause,” the kiosk says of Jean, who was killed when he was just 30, testing a Type 57 racer that had just won Le Mans.

The Type 41 (1926-33) was one of the most expensive cars ever built because of its size, engineering and materials used. It cost more than 650,000 francs, or six times the average price of a Rolls-Royce. Ettore had planned to build 25 Type 41s, but made only six (and sold only three) because even Europe’s aristocracy, crimped by the Great Depression, found them too expensive. Jean’s Type 57, a panel here tells us, was in direct response to the decline of the luxury market in the 1930s. From 1934 to 1939, 660 Type 57s were produced in three versions: standard, the sportier 57S, and the 57SC that Mr. Mullin acquired in 2010. The Type 57, with its sleek lines, oversize fenders and bulbous cockpit, we’re told, “cemented Jean’s position in the high pantheon of automotive artists and made him a worthy contemporary of 20th-century modernists like Picasso and Chagall.”

Many of these cars were made at the Alsatian estate that Carlo Bugatti bought in 1909. True to the Art Nouveau movement, even the hinges on the factory doors in Molsheim, France, where Bugattis are still made today by its parent company Volkswagen, VOW3.XE +0.41% were custom-made and fabricated on site.

While all of this family background is news to many, the true stars of this exhibit are the cars. In addition to the models previously mentioned, all of which are on display here, the pièce de résistance is the Type 64 that Jean was working on when he was killed. Mr. Mullin has put his considerable resources into completing the unfinished masterwork, built to what many believe would have been Jean’s wishes and based upon a handful of drawings Jean made of the prototype. Mr. Mullin’s version includes a hybrid aluminum body that’s impossible to weld because of its metallic properties and instead is riveted like an airplane. In displaying the car, Mr. Mullin chose to suspend the body a few feet above the chassis, because “what’s underneath is as beautiful as the exterior,” he said.

Next to the completed car is a beautiful mahogany buck, a new wooden silhouette like the ones that auto makers used to build so they could hand-shape the individual body pieces and hang them. “Auto makers, of course, don’t do that anymore,” Mr. Mullin said. “It’s a lost art. So I thought it was important.”

It is important, as is most everything shown in this exhibit—one of the best ever put together showcasing the marriage of art and the automobile.

Mr. Yost is a writer in Houston.

‘Stocks are for lovers, gold is for haters’

By Mark Yost
The Houston Business Journal

That’s the view of David Zervos, the chief market strategist for Jefferies Group LLC (NYSE: JEF), who was the keynote speaker at a March 25 meeting of the Houston chapter of the Financial Executives International.

Jefferies market strategist David Zervos.

Jefferies market strategist David Zervos.

Zervos has a somewhat unique view on the fact that the world’s major central banks have been printing money like crazy, raising central bank assets from $6 trillion in 2008 to $17 trillion today. While some people decry this easy-money policy, particularly at the U.S. Federal Reserve, Zervos called it “the greatest monetary policy experiment in history.”
Zervos, who himself has worked at the Fed, said Chairman Ben Bernanke pursued the policy that resulted in 2 percent inflation and pretty much zero interest rates on savings accounts to “send people into other assets” such as gold, equities and real estate, the three things in the world “that Fed can’t dilute.”
Zervos said the Fed policy of pushing money into the U.S. economy through quantitative easing came about from Bernanke’s study of the Great Depression.
Bernanke“What did people do in the 1930s?” Zervos asked the crowd of money, finance and oil and gas executives. “Deflation and the hoarding of cash gripped the U.S.”
Zervos argued that the Fed’s monetary policy of easy money — much decried by deficit hawks — is better than a repeat of the 1930s.
“We’re either going to land in the ’90s or ’70s,” Zervos said. “Not the 1930s and not Japan’s lost decade.”
The U.S. economic downturn in the 1970s resulted in something economists called Stagflation, a stagnant economy coupled with double-digit inflation. The 1990s had the tech bubble burst, but eventually resulted in some of the strongest year-over-year economic growth in U.S. history.
That’s where he gets his signature tag line: “Stocks are for lovers, gold is for haters.” Zervos is clearly a lover.
In short, he said that if you’re somewhat of a pessimist — a hater — and think the Fed’s monetary easing can’t go on forever, and the system is destined to crash, then you think we’re going back to the 1970s and want to be in hard commodities, such as gold. But if you think the U.S. economy is eventually going to emerge from this period of low growth and eventually recover, much like the 1990s, then you’re a lover and should be in equities.
Zervos doesn’t dismiss the potential pitfalls of printing money.
“We will have some side effects of this QE, our antidepressant,” he said. “But for whatever reason, our system fosters growth and innovation. The incentives for us to be greater have never been better.”

Wildcatting in the Arts

By Mark Yost
The Houston Business Journal

To say that Alecia Lawyer, founder of the River Oaks Chamber Orchestra, takes a different approach to the arts in Houston would be an understatement.
She’s focused as much on ROCO’s ROI as its repertoire.

Alecia Lawyer of the River Oaks Chamber Orchestra.

Alecia Lawyer of the River Oaks Chamber Orchestra.

“I like to call it wildcatting in the arts,” said Lawyer, who founded the 40-person chamber music group in 2005 and says her entrepreneurial streak works well in Houston.
“Teaching musicians to be entrepreneurial is a necessity,” she said. “Most artists don’t have a business side. They’re uncomfortable talking about money.”
That’s because “this isn’t something they teach at Julliard,” said Lawyer, a graduate of the prestigious New York music school and ROCO’s principal oboist.
“You practice for hours in a room by yourself, graduate and they wish you good luck, and send you out into the world,” Lawyer said. “What they don’t tell you is that orchestra chairs are lifetime tenured positions.”
For oboe, that means maybe three seats a year open up.
“Outside of a tenured position, the music schools don’t teach you how to make money doing what you love,” Lawyer said.
Lawyer is trying to change that by operating ROCO more like a business than an arts group. The approach seems to be working. ROCO’s budget has doubled nearly every year since it’s founding and it only relies on ticket sales ($25 each) for 15 percent of its budget.
Instead, ROCO sells $5,500 sponsorships to every chair in the orchestra. Lawyer also teaches musicians to treat patrons like a business treats its customers. So chair sponsors aren’t just allowed to sit in on rehearsals — they get to sit next to their musicians on stage. And instead of having a traditional intermission, the musicians go out into the audience and mingle.
“Every audience member is a friend we haven’t met yet,” Lawyer tells her musicians, half of whom live here in Houston and half of whom come from out of town. “I tell our musicians, ‘It matters who’s in your audience. It matters that you know their name and they know yours.’ “
The strategy seems to work. Lawyer befriended a group she calls “the founding consortium.” Originally, it was just three River Oaks ladies who were spending just $1,500 on a partial chair sponsorship. Since hosting a sponsorship party at their home, the group has grown to more than a dozen friends who now sponsor five chairs, or $42,000.
Lawyer is also entrepreneurial in the way she presents the group, which performs just eight concerts a year as a whole but has various trios, quintets and quartets that perform the rest of the year.
“I tell our musicians to look at our group like Legos,” Lawyer said. “Sometimes we’re altogether, but then can break apart into smaller groups and still make money doing what we love.”
And like a lot of arts groups, Lawyer understands that her biggest challenge isn’t luring young or old people, but couples in the middle busy with kids. So she started ROCO Rooters, a combination music education program/babysitting service for young couples. ROCO Rooters provides an educational session for kids followed by pizza and movies. Lawyer said it gives parents a three-hour date night.
“We understand that our competition isn’t Houston Grand Opera or the symphony,” Lawyer said. “It’s staying home with a glass of wine and Netflix.”