Author: Serkadis

WASHINGTON (CBS/AP) ― Does the City of Chicago’s nearly three-decade old ban on handgun ownership violate Second Amendment? The U.S. Supreme Court will soon decide.

The Supreme Court is hearing arguments Tuesday in a case that asks them to extend their landmark 2008 decision in Heller v. District of Columbia. The  case being heard now, McDonald v. Chicago, asks them to extend the decision to state and local laws.

In Heller v. D.C., the court ruled then that the Second Amendment gives individuals a right to possess guns for self-defense and other purposes, but that decision only applied to federal laws, such as those of Washington, D.C.

The court has ruled that most of the rest of the Bill of Rights applies to state and local governments.

The plaintiffs in the case will all be present for as their attorneys argue the lawsuit before the Supreme Court.

The plaintiffs are:

Otis McDonald, a retiree who says he wants protection after his Far South Side house has been broken into repeatedly and he has been threatened.

David and Colleen Lawson, whose involvement stems from a scare in 2006 when Colleen Lawson was home alone with the flu and three men tried to jimmy open her back door. They ran off when they saw her through a window.

Adam Orlov, a businessman who was previously a police officer for four years, and believes that people hurt by the city’s handgun ban are those obeying it.

Chicago’s ban on the sale and possession of handguns dates from 1982, and it has been weathering legal challenges for years. But it gained newfound attention after the Heller decision.

Within days of the Heller vs. D.C. ruling, suburban Wilmette, Morton Grove and Winnetka did away with their handgun bans altogether, and Evanston repealed parts of its ban.

But in Chicago and Oak Park, the ban remained. A federal judge dismissed lawsuits by the National Rifle Association to overturn the bans, and in June of last year, a three-judge federal appeals court upheld that ruling.

Mayor Richard M. Daley wants the ban to remain in place. He says local officials need flexibility to decide how best to protect their communities.

“We have the right for health and safety to pass reasonable laws dealing with the protection and health of the people of the city of Chicago,” Daley said.

He is backed by community groups and Chicago’s congressional delegation.

“Many of my friends talk about the fact that they hunt in their state and I will tell them that many of the people who are hunting in Chicago are not hunting wild game — they are hunting each other,” U.S. Rep. Danny Davis said.

McDonald, Orlov and the Lawsons are not the only plaintiffs — the Second Amendment Foundation, an anti-gun control group, and the Illinois State Rifle Association are also named.

If Chicago’s ban is overturned and the city passes another gun law the National Rifle Association’s Todd Vandermyde predicts a flurry of lawsuits against the city.

“They’d better understand that Supreme Court opinions are not advisory in nature,” he said. “They’re either going to comply or they’re going to find themselves on the long end of a lot of litigation.”

Read the original article from WBBM News Radio.

Distributed via Chicago Press Release Services

In this morning’s Gartman Letter, analyst Dennis Gartman expresses his true love for Canada in a way we’ve never seen before.

Perhaps its the afterglow of the Winter Olympics in Vancouver or the 5.0% growth in GDP during Q409; either way, there’s plenty of reason to be going ga-ga for Canada:

• As stated, fourth quarter GDP of 2009 rose a reported 5.0%, crushing analysts expectations.
• Unemployment is falling
• Their hockey team ultimately kicked our asses.
• The Canadian Dollar is holding strong amidst other currencies.
• Non-farm payrolls are rising.

Sounds good to us, eh.

Join the conversation about this story »

See Also:

• Dennis Gartman’s First Prediction For 2010: The US Will Grow Like Gangbusters And Surprise Everyone
• Gartman: Here’s How The Chinese Tightening Could Prick The Real Estate Bubble, But Help Inflate Stocks
• Gartman: Why The Nation’s Crude Refiners Have Turned Into Storers

 

 

A rubber band pistol was confiscated from algebra class — – because it was a weapon of math disruption.

Any weapons race with Russia doesn’t receive the publicity it did 30 years ago. But whatever you call someone who originates loans in Russia (brokers?) received some good news last week, when Russia’s Prime Minister Vladimir Putin announced that the government will help to lower the mortgage rates investing more than $8.3 billion. The government will provide this money to the banks thus substantially subsidizing the current mortgage rates, which are currently at 14-15% in Russia. Putin set a target rate at 11% with a maximum down payment of 20%.

Do folks here in the US and in the mortgage business have any good news to cheer about, besides rates not being 11%? Some are dealing with the changes in FHA lending and the effect on condominiums. The markets, and interest rates, are facing the end of the Treasury’s purchases of mortgage backed securities and the end of the first time homebuyer tax credit ($8000). The economy does not appear to be rebounding enough to generate much home buying interest, the unemployment rate is hovering around 10%, and foreclosure filings not yet abating.

It could very well be that the jumbo market, like a dormant volcano, is about ready to rumble back to life. In addition to jumbo security prices rallying, there have been several newspaper articles on the subject, and there are rumors that Wells Fargo plans to roll something out in a few business channels possibly as soon as the end of this month. In Los Angeles and Orange counties, Wells Fargo Home Mortgage (retail) already lowered their down payment from 25% to 20%.  But, as one would expect and hope, borrowers must provide evidence of high income, have sizable bank accounts as a cushion against the unforeseen and occupy the houses themselves. We don’t really want more problems in the jumbo market by going too far back the credit curve, do we? Do we?

And warehouse lenders are hungry for business. Last week I mentioned a warehouse lender looking for customers, and if your volume justified it, to give them a shout. Here is another one who is seeking new customers nationwide: Georgia Banking Company. Lenders should contact Ronica Roundy at [email protected] or via their website at www.gbcfunding.com.

PHH reported that it returned to a profit in the fourth-quarter as the company cut costs and the volume of its loans grew. The company earned $97 million for the quarter compared with a loss of $216 million in the same quarter last year. “Our 2009 core earnings were a reflection of higher mortgage production volumes and margin improvement, as well as cost reductions in our businesses.”

A new item was released concerning GMAC’s 3D program. The program, which was in place for some GMAC correspondents who were eligible, was recently suspended in general and for all clients approved for the program.  As it stands now, GMAC is working with FNMA regarding the 3D program and tweak it to better suit the current risk model and viability of the two companies working together. It is widely known, however, that GMAC has undergone, and could continue to undergo, significant changes in both management and business channels.

Wells Fargo’s wholesale channel came out with an announcement focusing on the 4506-T form for brokers, how the form is incorporated in Wells’ reporting system (mandatory starting 4/1), frequently asked questions, and some training opportunities. Until further notice, brokers are to order one 1040 form for 2008, for example.

Franklin American provided their customers with guidance on recently published agency information. For example, borrowers are required to have rent loss insurance on certain investment property transactions when the borrower is relying on rental income to qualify. When the borrower is using rental income for qualification purposes, rent loss
insurance will be required on all 2-4 owner occupied properties and 1-4 investment properties regardless of underwriting method. For condominiums, HO-6 (walls-in) insurance policies are required on all loans where the master HOA policy does not provide coverage of the interior of the unit, and HO-6 impounds are required on all loans where escrows are required. As with other investors, borrowers may not obtain “gap” coverage to meet the minimum project insurance requirements, and for FHA and VA loans the Condominium’s Homeowner’s Association, not the borrower is responsible for obtaining and maintaining flood insurance under the NFIP on properties located in an SFHA.

Flagstar, for its direct endorsed customers, stated that customers will be responsible for processing any corrections required by HUD in order to obtain a Mortgage Insurance Certificate (MIC). The announcement is in great detail, and patrons are advised to read it. “All corrections must be processed within 15 days from the date of notification. Upon notification that a correction is needed Flagstar will place a coinciding E&O on the loan. In order to clear the E&O the customer will be required to submit a copy of the correction document and proof of that the document has been mailed.” (If you’re in Philadelphia, for some reason, the procedure is slightly different – check Flagstar’s announcement.)

Flagstar told customers that the 4506-T Request for Transcript of Tax Return form must be completed in its entirety. “Originators must ensure all sections (including checkboxes) are completed prior to having the borrower sign the document. Information that is missing or incorrect could delay the processing.” Another memo from the company addressed Fannie Mae’s Homepath Appliance Incentive, where Fannie Mae is currently offering buyers of their REO properties an additional incentive up to 3.5% of the final sales price to be used toward the purchase of new Whirlpool appliances: “while borrowers may obtain FHA financing to purchase a Fannie Mae REO property, FHA considers the 3.5% appliance purchase incentive to be an ‘inducement to purchase’ Therefore, the amount of any appliance incentive must be deducted from the purchase price before calculating the maximum purchase LTV.” And for VA loans, Fannie Mae Appliance incentives are considered seller concessions. “The combination of all seller concessions, including the Fannie Mae appliance incentive is limited to 4% of the property value.”

Yesterday we learned that in January Personal Income increased .1% but that Personal Spending Increased by .5%. So much for that savings rate, which hits its lowest level since 2008. In addition, the ISM Manufacturing Index for February fell slightly from January’s levels, and Construction Spending dropped .6% as expected. The decline in construction spending was led by a fall in private nonresidential construction spending, which more than offset a moderate increase in residential construction. Lastly for news yesterday, Fed Vice Chairman Donald Kohn said that he will leave the Federal Reserve at the end of his four-year term as vice chairman after 40 years at the central bank. Although the announcement was somewhat early, it was not altogether unexpected and many believe that he will be a huge loss to the institution at time when credible, independent thinkers are required to get the Fed through a very difficult political period ahead.

Through all of that we had the usual Fed buying, and higher coupons (which are mostly older, 6% and higher, mortgages) doing somewhat better than lower coupons. With a slight break in the scheduled news today, the rate markets are pretty quiet and close to unchanged from yesterday, although the stock markets appear poised to continue rallying.

A young Texan grew up wanting to be a law man. He grew up big, 6′ 2”, and strong as a longhorn and fast as a mustang. He could shoot a bottle cap tossed in the air at 40 paces. When he finally became of age he applied to where he had only dreamed of working: the West Texas Sherriff’s Department.
After a big mess of tests and interviews the Chief Deputy finally called him into his office for the young man’s last interview.
The Chief Deputy says, “You’re a big strong kid and you can really shoot. So far your qualifications all look good.  But we have what you call an ‘attitude suitability test’ that you must take before you can be accepted. We just don’t let anyone carry our badge son.”
Then, sliding a service pistol and a box of ammo across the desk, the Chief says, “Take this pistol and go out and shoot six illegal aliens, six ACLU lawyers, six Democrat senators, six meth dealers, six Muslim extremists, and a rabbit.”
“Why the rabbit?”

“Great attitude,” says the Chief Deputy. “When can you start?”

Rob

(Check out http://www.mortgagenewsdaily.com/channels/pipelinepress/default.aspx. For archived commentaries, checkwww.robchrisman.com )

Google has been expanding Street View around the world, though it hasn’t been received with open arms in plenty of cases, and its Street View cars have been scouring cities on several continents. But the cars can only go so far and where the road stops so do they. Not the Street View trike, though, the crazy contraption has bee… (read more)

Filed under: Concept Cars, Coupe, Hybrid, Performance, Geneva Motor Show, Ferrari

Onlookers green with envy. Waiting twitchingly for the traffic light to turn green. A briefcase full of greenbacks. Even British Racing Green, if you’re talking about a GT. You could find a few ways to associate Ferrari with the color green, but the environmental sense would be a bit of a stretch – historically speaking, at least. But the times, as one Mr. Zimmerman wrote, they are a-changing. Now even Maranello has been forced to get on board the “Heal the World” train. And this is the result.

Called the HY-KERS, what you’re looking at is a rolling test bed. It’s a hybrid, sure, but if you thought this was a haphazard application of a plug-and-play hybrid system, think again. The HY-KERS incorporates a roadgoing derivative of Ferrari’s Kinetic Energy Recovery System – fancy-talk for regenerative braking – from last year’s Formula One program.

Ferrari has worked diligently to optimize the benefits of the system to the 599‘s performance. The entire system weighs a modest 40 kilograms, partially offset by the obviation of the starter motor and conventional battery. Integrated into the seven-speed dual-clutch transmission and mounted below the car’s center of gravity, the system returns over 100 horsepower, supplementing the V12 engine under hard acceleration and it can even operate under full electric power when puttering around town. Of course, a Ferrari never putters around anything, save for when it takes its owner for a round of golf at the local country club.

Take a closer look in the gallery of live shots of the lime-green show car – complete with 599XX-style matte-black roof and mirrored floor – from the Geneva Motor Show floor below, and brush up on the details on the latest from the Italian technological powerhouse after the jump.

Live Photos: Noah Joseph / Copyright (C)2010 Weblogs, Inc.

Continue reading Geneva 2010: Ferrari 599 HY-KERS is green in more ways than one

Geneva 2010: Ferrari 599 HY-KERS is green in more ways than one originally appeared on Autoblog on Tue, 02 Mar 2010 09:31:00 EST. Please see our terms for use of feeds.

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SALT LAKE CITY — Brian David Mitchell, the man charged with snatching Elizabeth Smart nearly eight years ago, could finally face a jury after a federal judge ruled Monday that Mitchell was faking mental illness and is competent to stand trial.

“The evidence proves that Mitchell has the capacity to assist his counsel in his defense and the ability to behave appropriately in the courtroom,” U.S. District Judge Dale Kimball wrote in his 149-page ruling issued in response to a 10-day hearing last year on Mitchell’s competency.

Lawyers for Mitchell said his hallmark disruptive singing in court was evidence he’s mentally incompetent.

Kimball, however, called the outbreaks a “contrivance” used by the suspect to give the impression he can’t control his behavior.

“Although the defense has suggested that Mitchell’s singing is a psychotic response to stress, Mitchell has repeatedly demonstrated that he has the capacity to be composed and in control, even in stressful situations,” the judge wrote.

Elizabeth Smart’s father, Ed Smart, said he was thrilled Mitchell was found competent.

“Because he is competent; he’s crazy like a fox,” Ed Smart said.

He didn’t think his daughter, who is serving a mission for The Church of Jesus Christ of Latter-day Saints in Paris, had heard the news.

Mitchell’s federal public defender Robert Steele took issue with the ruling while acknowledging it was a “close call.”

Steele said an appeal wasn’t likely to succeed, and he was instead preparing for a trial expected to start later this year.

“It is our firm conviction that Mr. Mitchell is certainly mentally ill,” Steele said. “Therefore, we are prepared to go to trial with an extremely mentally ill client.”

The ruling was a leap forward in a case that languished in state court as a judge twice ruled Mitchell incompetent and refused to force him to be medicated. The U.S. attorney’s office intervened in 2008, indicting Mitchell in federal court on charges of kidnapping and unlawful transportation of a minor across state lines.

A March 26 hearing was scheduled to set a trial date.

Smart was 14 when she was kidnapped from her Salt Lake City bedroom in 2002. She was found nine months later walking a suburban Salt Lake City street with Mitchell and his now-estranged wife, Wanda Barzee.

“The abduction of Elizabeth Smart was every parent’s nightmare,” FBI special agent-in-charge Jim McTighe said Monday.

Smart, now 22, testified in October as part of the competency hearing, saying she was raped after a marriage ceremony staged by Mitchell and repeatedly throughout her captivity.

Experts who testified during the hearing last year split in their opinions about Mitchell’s competency.

A prosecution witness, New York forensic psychiatrist Dr. Michael Welner, concluded Mitchell suffers from a range of disorders, including pedophilia and anti-social and narcissistic personality disorders but was not psychotic or delusional.

Welner also described Mitchell as an “effectively misleading psychopath” who has duped those around him into thinking he is incompetent.

A key expert for the defense, Dr. Jennifer Skeem, diagnosed Mitchell with a delusional disorder and said he was incompetent to stand trial.

Judge Kimball concluded Mitchell was faking mental illness to avoid responsibility for wrongdoing.

Carlie Christensen, acting U.S. attorney for Utah, applauded the ruling, calling it a significant step in holding Mitchell accountable.

Mitchell “wasn’t successful in punking the system” and won’t be offered a plea deal, she said.

Salt Lake City Police Chief Chris Burbank, whose department investigated Smart’s disappearance, said it was frustrating to see Mitchell hold up the court proceedings for so long.

“The system never works as fast as we’d like,” he said.

Barzee, 64, pleaded guilty in November to federal charges of kidnapping and unlawful transportation of a minor across state lines. Last month, she pleaded guilty in state court to a charge related to the attempted kidnapping of Smart’s cousin. Prosecutors dropped other state charges against her.

Barzee’s lawyer, Scott Williams, said Barzee has agreed to testify at Mitchell’s trial.

Read the original article on DailyHerald.com.

Distributed via Chicago Press Release Services

Three people are dead in what is being called a home invasion in southwestern Darien early Tuesday, officials said.

The three were shot to death just before 3 a.m., officials said. A fourth person alerted police while hiding in a closet.

Police Chief Robert Pavelchic said a young woman called 911 early Tuesday while she was hiding in a closet. Detectives are talking to the woman.

Darien is located in DuPage County, about five miles south of Downers Grove.

Police officials said police arrived at the house in the 8900 block of Kilkenny Drive after the call came in and found two of the three dead on the first floor of the home.

Police, who have not released the identity of the victims, also believe the house was targeted and this was not a random home invasion. ABC7 was reporting the victims were a mother, father and son.

No suspects are in custody at this time, police said, and the investigation continues.

Read the original article on DailyHerald.com.

Distributed via Chicago Press Release Services

It seems HTC’s official training videos, which show how to assemble and disassemble the device, has leaked onto the internet.

If you are brave enough to try this (for example to repair a broken screen) you may also want to see the re-assembly instructions, after the break.

Via Pocketnow.com

Pitch a no-hitter, win a million bucks (qjnet/news/you-can-win-a-million-bucks-playing-mlb-2k10-seriously.html) that’s the promise from 2K Sports aimed to drive sales for MLB 2K10. For those aspiring to win the lucrative prize, the pitching begins today as the

Back in January, while in France, I experienced firsthand one of the “unintended consequences” of France rushing forwarding with a “three strikes” law that kicks people off the internet based on accusations (not convictions). Because of that, the idea of open WiFi is now pretty much gone (which, amusingly, was pissing off the very same music execs who were such big fans of the law). It seems that something similar might be happening in the UK, as the folks behind the much maligned Digital Economy Bill have admitted that there will be no exceptions for anyone operating an open WiFi network, even a library or a university. Thus, if a library had an open WiFi network, and it received a few accusations of file sharing, Peter Mandelson could decide to kick them off the internet for as long as he would like.

While it doesn’t technically “outlaw” open WiFi, it does put such a big liability on it that it leads to the same result. It effectively makes it so that no one, not even community organizations, will want to offer open WiFi. At a time when the UK government claims it’s trying to encourage greater connectivity, it seems pretty silly to put in place a law that could lead to exactly the opposite.

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Filed under: Hybrid, SUV, Geneva Motor Show, Volkswagen, Diesel, Luxury, Off-Road

We could say Volkswagen was tired of making an SUV that ended up being rather expensive – for a VW – after you stuck a few options on it. So in addition to the lost weight, the new Touareg has lost some of the four-wheel drive equipment that made the last one so spendy. This one comes standard with a Torsen limited-slip differential, and then you can order a Terrain Tech Pack that adds the differentials and serious off-road capability that once came standard. That takes fuel economy upward, an boost also helped by the increased curve and lower Cd. VW sold 500,000 units of the previous-gen Touareg and it should do even better with this one. Follow the jump for info on all the Touareg’s new flavors and have a look at it in the gallery of high-res photos below.

Continue reading Geneva 2010: 2011 Volkswagen Touareg sports more features and curves, less weight

Geneva 2010: 2011 Volkswagen Touareg sports more features and curves, less weight originally appeared on Autoblog on Tue, 02 Mar 2010 09:00:00 EST. Please see our terms for use of feeds.

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The whole team must be on board for strategy to align with successful execution. One Strategy: Organization, Planning, and Decision Making by HBS professor Marco Iansiti and Microsoft Windows executive Steven Sinofsky looks at the multi-year development of Microsoft Windows 7, a product that relied on the buy-in of 4,000 employees. Using Sinofsky’s internal blog posts and Iansiti’s framework, One Strategy delineates the complex process of carrying out an ambitious project in a way that is accessible and potentially replicable.

“The Many Faces of Nonprofit Accountability,” a working paper [PDF] by HBS professor Alnoor Ebrahim, contends that nonprofits do themselves and their stakeholders no service when they try to be accountable to everyone for everything. Instead, nonprofits should identify and prioritize accountability mechanisms that make the most sense for their mission, be it service delivery or advocacy, for example. Ebrahim’s paper, a chapter in the forthcoming third edition of The Jossey-Bass Handbook of Nonprofit Leadership and Management, outlines accountability mechanisms such as disclosures, performance evaluations, self-regulation, participation, and adaptive learning, and offers guidance on their benefits and tradeoffs.

Ebrahim concludes that “accountability is not simply about compliance with laws or industry standards, but is more deeply connected to organizational purpose and public trust. Nonprofit leaders might thus pay greater attention to strategy-driven forms of accountability that can help them to achieve their missions.”

— Martha Lagace

Working Papers

Equity-Debtholder Conflicts and Capital Structure

Authors:	Bo Becker and Per Strömberg

Abstract

We use an important legal event as a natural experiment to examine equity-debt conflicts in the vicinity of financial distress. A 1991 Delaware bankruptcy ruling changed the nature of corporate directors’ fiduciary duties in that state. This change limited incentives to take actions favoring equity over debt. We show that, as predicted, this increased the likelihood of equity issues, increased investment, and reduced risk taking. The changes are isolated to indebted firms (where the legal change applied). These reductions in agency costs were followed by an increase in average leverage and a reduction in interest costs. Finally, we can estimate the welfare implications of agency costs, because firm values increased when the rules were introduced. We conclude that equity-bondholder conflicts are economically important, determine capital structure choices, and affect welfare.

Download the paper: http://www.hbs.edu/research/pdf/10-070.pdf

The Many Faces of Nonprofit Accountability

Author:	Alnoor Ebrahim

Abstract

What does it mean for a nonprofit organization to be accountable? Nonprofit leaders tend to pay attention to accountability once a problem of trust arises-a scandal in the sector or in their own organization, questions from citizens or donors who want to know if their money is being well spent, or pressure from regulators to demonstrate that they are serving a public purpose and thus merit tax-exempt status. Amid this clamor for accountability, it is tempting to accept the popular view that more accountability is better. But is it feasible, or even desirable, for nonprofit organizations to be accountable to everyone for everything? The challenge for leadership and management is to prioritize among competing accountability demands. This involves deciding both to whom and for what they owe accountability. This paper provides an overview of the accountability pressures facing nonprofit leaders and examines several mechanisms available to them: disclosures, performance evaluations, self-regulation, participation, and adaptive learning. Nonprofit leaders must adapt any such mechanisms to suit their organization-be it a membership-based organization, a service-delivery nonprofit, or an advocacy network. More crucially, they need to pay greater attention to strategy-driven forms of accountability that can help them to achieve their missions.

Download the paper: http://www.hbs.edu/research/pdf/10-069.pdf

Integrity: A Positive Model That Incorporates the Normative Phenomena of Morality, Ethics, and Legality-Abridged

Authors:	Werner H. Erhard, Michael C. Jensen, and Steve Zaffron

Abstract

We present a positive model of integrity that, as we distinguish and define integrity, provides powerful access to increased performance for individuals, groups, organizations, and societies. Our model reveals the causal link between integrity and increased performance, in whatever way one chooses to define performance (for example, quality of life, or value creation for all entities), and provides access to that causal link. Integrity is thus a factor of production as important as knowledge and technology. Yet the major role of integrity in productivity and performance has been largely hidden or unnoticed or even ignored by economists and others. The philosophical discourse, and common usage as reflected in dictionary definitions, leave an overlap and confusion among the four phenomena of integrity, morality, ethics, and legality. This overlap and confusion confound the four phenomena so that the efficacy and potential power of each is seriously diminished. We show that defining integrity as honoring one’s word, as we have defined “honoring one’s word,” 1) provides an unambiguous and actionable access to the opportunity for superior performance and competitive advantage at the individual, organizational, and social levels and 2) empowers the three virtue phenomena of morality, ethics, and legality. We also demonstrate that applying cost-benefit analysis to honoring your word guarantees that you will be untrustworthy.

Download the paper: http://www.hbs.edu/research/facpubs/workingpapers/papers0910.html#wp10-061

Accelerating Innovation in Energy: Insights from Multiple Sectors

Authors:	Rebecca Henderson and Richard G. Newell

Abstract

A combination of concerns about climate change and energy security has recently led to significant increases in public funding for energy R&D. Some commentators are suggesting that these increases need to be sustained and are advocating for increases of as much as 300 or 400 percent, suggesting that the U.S. needs a “Manhattan project” for energy. Other observers have discussed supporting innovation through a range of additional policy interventions, including tax credits, loan guarantees, IP policy, regulatory mandates, codes, and standards. It is critically important that these kinds of interventions be thoughtfully designed since it seems probable that without major advances in energy technology it is unlikely that the world will be able to reduce green-house gas emissions rapidly enough to avoid a substantial increase in the risk of significant climate change. This book hopes to contribute to the public debate in this area by pulling together a group of distinguished economists who have studied the role of public support in generating innovation in other sectors of the economy. Over the last few years relatively few economists have studied energy innovation in any depth, but there has been a substantial investment in understanding the dynamics of innovation in a wide range of other industries, including pharmaceuticals and biotechnology, IT and telecommunications, defense, chemicals, and agriculture. We believe that there are valuable lessons in this research for the energy sector.

Download the paper: http://www.hbs.edu/research/pdf/10-067.pdf

A New Model of Leadership

Authors:	Michael C. Jensen and Allan L. Scherr

Abstract

In this paper we provide a new definition of leadership that gives organizations and individuals access to new power, performance, and accomplishment. In our model leadership, consists of four critical elements: 1) the creation of a vision for the future that represents a significant departure from the past, one that requires breakthroughs for its realization; 2) the creation of a system that facilitates enrollment into and elicits voluntary commitment to the vision by the critical mass of people required to discover and implement the breakthroughs required for realization of the vision; 3) the creation of a system that ensures both the timely identification of breakdowns (and the dissemination of information about them) that, if unresolved, would prevent the successful realization of the vision; and 4) the creation of a system for managing breakdowns that causes people to voluntarily recommit to the vision and maintain these commitments through to the implementation of the breakthroughs required for the realization of the vision.

Download the paper: http://www.hbs.edu/research/facpubs/workingpapers/papers0910.html#wp07-107

Beyond Agency Theory: The Hidden and Heretofore Inaccessible Power of Integrity

Authors:	Michael C. Jensen and Werner Erhard

Abstract

There is far too much concern today about the conflicts of interest between people-for example, conflicts of interest between agents and owners-and not enough attention paid to the damage caused by an individual’s conflict of interest with himself or herself. We argue here that a large amount of the damage inflicted on people and organizations is caused by actions of individuals that are not in their own self-interest. That is, people consistently impose costs on their loved ones, friends, associates, partners, employers, and the public by actions that are not in their own self-interest. This paper focuses on the integrity issues that cause huge problems in the lives of most individuals and to everyone we come in contact with. We present a positive model of integrity that, as we distinguish and define integrity, provides powerful access to increased performance for individuals, groups, organizations, and societies. Our model reveals the causal link between integrity and increased performance, quality of life, and value creation for all entities and provides access to that causal link. Integrity is thus a factor of production as important as knowledge and technology, yet its major role in productivity and performance has been largely hidden or unnoticed or even ignored by economists and others. In summary, we show that defining integrity as honoring one’s word, as we have defined “honoring one’s word,” 1) provides an unambiguous and actionable access to the opportunity for superior performance and competitive advantage at both the individual and organizational level and 2) empowers the three virtue phenomena of morality, ethics, and legality.

Download the paper: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1552009

Deep Dive: What Leaders Do When Only They Can Drive

Authors:	Howard H. Yu and Joseph L. Bower

Abstract

The actions of top management are seldom the unit of analysis in empirical strategy research on complex organizations. Yet, the behaviors of top executives are frequently featured as an important determinant in historical treatments of strategic change inside large firms. Theories of organizational ecology, ambidexterity, and punctuated change do not provide explanations consistent with these historical accounts. This paper, by examining the resource allocation process closely, identifies a specific set of circumstances in which intervention by top management is critical to a firm’s ability to adopt new ways of behaving and thereby to realize a new strategy. In these cases, top management must seize hold of the substantive content of the new strategy as well as its operational implementation—a top-down intervention we call deep dive—in order to overcome barriers to change that are manifest in a wide range of organizational routines and behavioral norms, previously fostered by the established structural context of the firm. We illustrate this model of corporate intervention with a case study in which a high-performing firm seeks to shift its performance trajectory into new dimensions.