Steve Jobs Broke the 4 Minute Mile Today

It was 1945. The world record for the mile stood at 4:01.3, held by one of the great Swedish runners of that generation Gunder Hagg. That was the fastest recorded mile in human history. Naturally there was pressure to break the four minute barrier.

It took 9 years for the record to be broken. John Landy came close in 1952 with 4:02.1 but declared:

“Frankly, I think the four-minute mile is beyond my capabilities. Two seconds may not sound much, but to me it’s like trying to break through a brick wall. Someone may achieve the four-minute mile the world is wanting so badly, but I don’t think I can. “

So close – yet so far.

May 6th, 1954 Roger Bannister ran the mile in 3:59.4.

He broke the four minute brick wall barrier. He did what many did not think was humanly possible. And 46 days later John Landy, who had said, “I don’t think I can,” ran the mile in 3:57.0

Today Apple announced that they have created an iPhone that is essentially a wallet. It’s a closed payment system that uses something called near-field communications or NFC technology.

According to an article in CU Times this morning:

iTunes users still could use credit cards and banking accounts to fill up their iTunes accounts, but that would be the extent of financial institutions’ involvement in an Apple mobile payment system.

Creating a new payment system would cut out middle men like VISA and MasterCard.

Just last year I heard a now retired CUNA CEO say “We’ve been talking about smart phone technology for years – I still think it’s way off.”

The four minute mile has been broken in the financial industry.

And Steve Jobs just lapped us.

Are we done?

(a follow up to my last blog post about trying to start a credit union in New Mexico for Artists & Craftstmen)

Last night was the night. I had been preparing for a week. I was to get up in front of artists and craftsmen and explain how hard it is to start a credit union today. I work for a trade association that was founded to do just that. Nine years ago was the last time a new credit union was formed in our state. Only 2 years ago they meet their capital requirements. It’s hard to start a credit union today.

Naturally I began the presentation with a brief history of credit unions in America. Edward Filene, the signing of the CU Act in 1934 by FDR, the alarming stats that showed the peak of credit unions (1969 – almost 24,000) to the dismal fact that today there are less than 8000. I showed a brief alphabet of the regulations that will haunt them. In the spirit of transparency (in case anyone googled corporate credit union) I carefully laid out the recapitalization of our system by the NCUA. Sigh.

Is it really possible that we’re done with people helping people?

Everyone I talk to politely scoffs at the notion of starting a credit union today. It can’t be done. Why would you even try? I can only assume their filter for this reaction is the credit union of today. Struggling to remain all things to all people in an interest rate environment that is strangling the bottom line. A financial coop that finds themselves shoring up the system (again) and fighting off legislation (again). I see a tired movement. One that is willing to not only allow big mergers, but encourage them. But to what end? For the last ten years I constantly hear the predictions of the next ten years: There will only be (insert shocking number) of credit unions in the US. So, are we done?

What is our long term plan for people helping people?

Rein Whitt Prichette is an artist. It’s not a hobby, it’s his life’s work. He told the story last night of how a $1200 loan would have made all the difference in his life. He’s been banking at Wells Fargo. There’s no way they would give him a loan. He has no credit score. He has no W-2. But he does have art in the Albuquerque Art Museum. His serigraphy is featured in a first edition Franklin Mint collectors book. Would your credit union give him a loan? Not likely. So, I have to ask again, “Are we done?”

I see a movement hanging on – not planning for the future. I see CU leaders squinting down the lane to the finish line, blinders on, clutching what’s left of their 401k. I experience tellers that have a job, no hope for a career. Loan officers that are trained to pull the credit score lever and belch out the A+ paper and toss the rest in a pile of doom.

Wow – that was bleak. I know not all credit unions are like that. But let’s be brutally honest here for a moment. Size breeds anonymity. And the larger the financial institution the more they rely on technology to make decisions and sort the masses out. We’ve stopped talking to our members. Listening to their stories. Assessing their character. I fell as if we’ve stopped helping people. We make loans. Non-risky, middle market, credit driven, A paper loans. I know a lot of this has been driven by the regulators. I get that. But it’s not lost on me that we may become the reason credit unions were started in the first place. Rein cannot get credit. He’s the little guy of the 21st century.

The future does not bode well for the small credit union. So it begs the question: Are – we – done?

Rein was very nervous telling his story last night. He does not want charity. He wants to leave behind a system that will enable artists to take care of each other. He’s lost everything at this point, except for his passion. He ended with this proverb:

For want of a nail the shoe was lost.
For want of a shoe the horse was lost.
For want of a horse the rider was lost.
For want of a rider the battle was lost.
For want of a battle the kingdom was lost.
And all for the want of a horseshoe nail.

I’m not done. Stay tuned.