Managing Future Income Risk

                With regards to the future, I do believe I have put myself in a comfortable spot, financially, with a lot of help from my parents. Being an economics major, I believe that this bachelor’s degree alone will not fulfill my future expectations. I have chosen to add a business minor and am currently considering going to graduate school in an attempt to further my studies as well potential in the job market. Prior to being an economics major, I was within the industrial engineering program here. Having an engineering degree would presumably offer more job security and maybe a more financially stable future compared to a bachelors in economics alone. I have chosen to switch to economics, some could consider this a risk, because I find it more suitable to my interests. 

                This past summer I held an internship at a manufacturing company doing competitive pricing reviews as well as reviewing their current business plan. Besides this being a great experience and immersing me in a well-run business, it was also a great addition to my resume. I intend to use this as a springboard into a different summer internship in 2016. With aspirations to work for a private equity firm, I hope to get an internship at an investment banking firm. There is a lot of opportunity to create wealth in this industry

As far as debt goes, I have not accumulated any because I have very generous parents. I understand this is a luxury not all have but it is going to reduce my future risk immensely. When I leave college I will attempt to get a job near my parents so I can reduce living costs for the first years of my working life. After I have accumulated two years of savings I will begin to invest! Watching my brother invest for the long term over these past five years has really sparked my interest in investing. If you stay up to date with the market, diversify, and do your homework on your stocks, I see an enormous potential to reduce income risk.  

Aside from watching my brother invest, I have been lucky enough to experience both of my older siblings to enter the working world and purchase homes. Having not moved from the same suburb of Chicago all my life I had either naively assumed purchasing a house was simple, or just never thought of it at all. The whole concept of real estate was new to me. So many outlaying factors go into buying a house that turn it into a large investment. For example, buying a house in a neighborhood where property values are rising can aid financial stability in the long run. 

As a junior in college I would say I have made some solid choices with guards to future risk. Choosing a major I’m passionate about, my internship experiences and lack of debt should provide a smooth transition out of college. On top of that I have witnessed two sibling transition into their later lives. I believe these combined experiences have greatly lowered my future financial risk.

Hypothetical Implementation of "Illinibucks"

Implementing “Illinibucks” to allow students at the University of Illinois to cut lines with regards to registration and other services around campus, would make drastic changes to the way these services are provided. Having been a part of the Division of General Studies for two years at the University, I would allocate a majority, if not all, of my Illinibucks towards registration. Being in the DGS, I was always one of the last people to register and that led to having very eschewed schedules and undesired professors/classes. Through this hypothetical system I may have been able to move up the registration list. However, I feel that most students would prioritize there bucks for registration because it has such a large effect on your time spent in college. If there happened to be a tie in use of bucks, would it then differ to your year in school? If this is the case then we would essentially be back to the priority basis that we use for registering now. 

Due to a very high demand for early registration, I could see the University setting the price for this service relatively high to deter some students. For the deterred or less studious students, these bucks could be used to cut lines at concerts, sporting events, and maybe even registering campus facilities. The prices for these would be less to raise the demand. If the University could not lower the demand for early registration by raising its price, they could set a maximum amount of bucks allowed to be spent for this service. This would be similar to a government intervention in a real market. I would also wonder if the University would allocate the same amount of bucks to each student or would they allow students to purchase additional bucks. If this were the case, then the University would be giving an advantage to students who could afford this luxury. It would also affect the money supply and alter supply/demand. 

 

 Aside from that, would students have the bucks tied to their university account, or would they be allowed to trade bucks to other students? This would create another miniature economy where students spend bucks not for campus services, but for services from other students. Clearly, this could create legal issues for the University, but it would be interesting to analyze this situation if it came to fruition. For students who really wanted to register early, they could pay other students for their Illinibucks or do work for them. Due to the low supply of Illinibucks, they would raise in extrinsic value to the point that they could be seen as more valuable than real currency. 

The implementation of Illinibucks would be a very interesting experiment. It would illustrate many economic models as well as show how the students prioritize the services that the University provides. 

Team Compilation and Performance

During my senior year of high school, I helped lead our varsity football team to its first playoff berth in a decade. With regards to the text, “Reframing Organizations, Artisry, Choice, and Leadership”, by Bolman and Deal, my football teams structure followed a dual authority model. It all starts with the head coach, who is essentially the head boss. Branching off from him are two coordinators, the offensive coordinator and defensive coordinator.

These coordinators have their respective position coaches that work for them. For example, there are specific position coaches for the running backs that would report back to the offensive coordinator. Obviously, every week we played a new team and therefore required a new offensive and defensive game plan. On Sundays, the head coach and his two coordinators would meet and design this game plan to be implemented on Monday. This was then relayed to the position coaches and team through film sessions and chalk talks. It wasn’t until Tuesday that we put pads on and physically practiced the new plays.

This is only when it comes to practice, during games the pressure is mostly left to the players. I happened to play free safety on defense and was in charge of communicating are coverages to the rest of the secondary defense and linebackers. Although I made the initial call, any other secondary member or linebacker could communicate back a different call if he saw something that I did not. This would follow the model of an All-Channel network. There was communication floating freely between all members.

With reference to Katzenbach’s six distinguishing characteristics of high-quality teams, I think his first bullet point applied to my position in football dramatically. That is, our coach and defensive coordinator would put forth a plan with an opportunity. Then it was up to my defensive platoon to handle the challenge with flexibility and coordination. Essentially, once our coaches taught us the game plan, they had to stay out of the way and let us go to work. Our defense, which was rather successful in stopping opposing defenses, did have a good mix of expertise and specialization. For football purposes this is pretty straightforward, we had large linemen that could create piles at the line and a quick secondary that could drop back into coverage or come up and stop the run. We also had corners that were able to drop into zone coverage, as well as play man to man. This combination of teammates with different specialties is what lead to our defenses success. 

References:  “Reframing Organizations, Artisry, Choice, and Leadership”, by Bolman and Deal