>> rose:. >> rose: welcome to the program. we begin with peter lynch, one of the most successful money managers at his time. he retired at age 46 to devote himself to philanthropy. >> if you look at magellan or black rock you think they must have access to the best information in the world. >> but they're not -- they don't see things get better way -- they don't see the -- it could be in the plastics field or lithium. >> rose: people in the business see it is? >> they see it first. in a mall, imagine the companies you've seen in dunkin' donuts, it goes on and on, wal-mart, stop & shop. these are all companies that got better and suddenly you say "gee i'm shopping there." i'm not saying people should -- if he want to invest in the same kind of research they do when they buy a refrigerator. >> rose: we continue with

malcolm gladwell. >> i have often said we are as a society information rich and theory poor. that we have more and more experiences and the breadth and variety of experiences that our parents and grandparents never had. but what we look are ways to make sense of them and so the genre of books to which my books belong, these are a genre of sense-making books. i'm giving and people who write in the same field, we're giving people theories to tie them together. >> rose: we continue with ron howard, bryce dallas howard and james murphy talking about canon's project imagination. >> bryce made a wonderful movie. she was short-listed for the oscar category in short films last year and it was a very perm film and also successful for canon and i thought what it did was it promoted this notion this many more people are far more creative than they sort of allow themselves to believe.

their work is worthy and that kind of collaboration can be incredibly fruitful and stimulating and they decided to do it again this year but have more filmmakers. >> rose: peter lynch, malcolm gladwell, ron howard, bryce dallas howard and james murphy when we continue. captioning sponsored by rose communications from our studios in new york city, this is charlie rose.

>> rose: why do people buy stock because of two-thirds of x or half of x. on that base alone they buy a stock. that's called bottom fishing in the stock market. >> rose: peter lynch is here. he is a legendary investor, a best-selling author, a philanthropist. for 13 years he ran fidelity's magellan fund with average annual returns of nearly 30%. from 1977 to 1990 it grew from $18 million in assets to $14 billion in assets. he retired at the age of 46. since then, he's dedicated his time and resources to giving away a large portion of his personal fortune. i'm pleased to have him back at this table. welcome. >> thank you. >> rose: see i've been wanting -- we had this wonderful interview and i would occasionally say whatever happened to peter sflifrj >> (laughs) >> rose: it's one of those things because -- and whatever

happened to peter lynch is my question. >> people said he'll start his own fund, the a hedge fund. >> rose: he wants to do it on his own, he doesn't need the gratify dellty. >> small transmission is one gear, overdrive. so you can't sort of run a fund. >> rose: (laughs) >> i have a lovely wife caroline three children, i wanted to do other things so i've worked very part time with younger analysts. my father died at 46. >> rose: is that the reason 46? >> it sticks in your mind. he took sick when he was 4, died at 46. i said i love the job, love the company but i worked every saturday for 11 years. i wanted to spend more time with my wife and family. >> rose: and you were constantly on the road because you believed in being there. >> you got it. >> rose: in fact you would take her with you and family with you in search of understanding the company. >> rose: correct. and so what have you learned since then? do you look back and say "oh, i stopped too earlly.

" or "i stopped too late?" >> it's lucky, it was aqj?terfet time. an absolutely perfect time. i got to see my three children grow up and they're married. i spend time with my grandchildren. >> rose: tell me about your passions. >> i think my wife and i caroline, her father was a high school principal. she grew up in rural delaware. i went to public schools and we have the best college and universities in the world. no one would doubt that. but k-12 we're not that hot. >> rose: no. >> and somebody born in america today is less likely to graduate from high school than their parents. that's remarkable. that's not true in europe. >> rose: and falling behind in scores on math and science and engineering! >> rose: >> and also 25 years ago if you were a dropout you could work a lathe or a press, there were lots of jobs. you didn't even have to speak english. today there's low level jobs at fast food restaurants and hospitals but if you want to get a decent job that's challenging

and fun you have to be able to use a computer. you have to speak in english. all these manuals are all in -- they're not in creole, they're not in portuguese, they're not in spanish. they're in english. so today being a dropout is a tragedy. it shouldn't be happening. >> rose: once you lose a step, you lose a second step and third step and fourth step. >> and literacy. there's an amazing correlation, the couple million people in prison, 85% of them are illiterate. not their fault. >> rose: here's the thing for me. the people -- you and so many people i know-- some deceased, some in youth, some -- but all passionate about education, passionate all have resources, all have a voice. why aren't we fixing this? >> i think first of all the greatest issue is recognizing the problem. i don't think this problem is clear 10, 20 years ago. i think when world war ii

started our army was smaller than in netherlands. we didn't realize how bad hitler was. how terrible nazi party was. we have to recognize it. i think the phase now we say there's 45 million kids in public school. probably half of them, two-thirds will get a decent education, the rest not so good education. that is not only a problem, it's a tragedy. so i think recognizing a problem and people like yourself who are leaders in that just getting the word off. this is not acceptable. this is bad for everybody. that's the first part. that's starting to happen now. there's several things happening to make it better. i think that's very positive. >> rose: are you convinced that we have the will to do what's she is in the will? >> well, i think -- if more people recognize the problem then they say we can do something about it and then things will happen. we're between phase 1 and phase 2. examples, teach for america, there's many examples like national mentoring. the programs that are starting to make a difference you can --

people really recognize it. people want to invest. like in the stock market they want to invest in the companies doing well, not badly so if they say this is a waste, why should i invest? it's hopeless. you have to take away that hopelessness and say we can make this a lot better. and there's examples in massachusetts we have these charter schools and we have some district schools and public schools that are topping state against the suburban schools. these things work. >> rose: but not all the results of all charter schools is good. >> exactly right. some of the early ones weren't well planned or thought out. the ones now -- plus, some district schools. we're talking public schools, this is called the achievement network that does a testing program. it's now -- 300,000 students have it today. this should spread all over the country. caroline did the research on that, my wife. they basically test the child four times a year. quick tests. and instead of at the end of the year saying "this kid is falling

behind." they say the reason johnny isn't doing swell he can't add a quarter to five eighths or susie doesn't understand adverbs. it helps rather than finding at the end of the year then it goes to the teacher next year. things are happening right now and it helps the teacher a lot. >> rose: and we're just beginning to understand how to use technology, too. for a long time it was there, we did not know how to use it. >> the khan academy is a great example. then's the importance of the principal. that's something phenomenon -- my wife, father's high school principal, imagine the principal spends a lot of time on the boiler or leaky roofs, these are not academics. there's no peers to talk to. who else do you speak to? it's a lonely, hard job and a difficult job. so we're working to work with principals in aspiring principals to help get the best methods and tools. they're the key people in america. and the teacher is the second most important. they have a lead.

when we talk c.e.o.s of company, the jack welch's, the lee iacoccas, that's the principal. that's what they have to do. >> rose: jack welsh, lee iacocca what is it they have? you would go around and do a self-analysis of companies and you would look for things and know that they had the potential to grow a a culture to grow and they had a plan to grow. what do great managers do? >> well, there's to two types. you have fred smith who comes up with an idea called federal express. then you had to grow it. he did all the parts: then there's lee iacocca had to turn around a troubled chrysler. even more challenging, a giant company like general electric that makes something good better. that's really hard. so all these people basically were problem solvers and they had to manage people and one of the things that's surprised people, they don't understand the different of management.

it's getting things done through others. it's a lot easier to do something yourself. sometimes you have to encourage people, sometimes you have to push them harder. >> rose: motivate, courage. >> but you have to understand what they want, you have to work with them, explain yourself, set goals and you have to be a leader university and put -- leader yourself. and there's a real amazing difference between being persistent and being suborn. i think great leaders can say -- >> rose: persistence is good, stubborn is bad. >> stubborn is terrible. >> rose: do great managers listen? >> yes, they do. absolutely. categorically. >> rose: i've come to know and believe that listening is a principle, essential quality. >> and sometimes managers get so high up people around them aren't giving them ideas. they don't have a chance to listen. >> rose: and the best manager will make sure they do hear the best things. >> and they go out on their own and do their own research independent of the people around them. >> rose: you still -- back to you. you were still with the fund.

you are the manager of the fund. you run the funds. she runs the foundation, you run the fund. >> i manage the money but she plans the great ideas. >> rose: does she really. so the division of labor is you make the money and she gives it away? >> that's right. she found teach for america. wendy kopp was 21 when she founded teach for america. city year early. national mentoring partnerships. she's findinging -- she does site visits. i attend some of these meetings, board meetings but i'm basically -- i'm on the investment committee. >> rose: do you miss anything? do you miss about the life that you had or do you simply say i have a portion of it, i'm making investments for something that means a lot to me and i know where the fruits of my labor are going. they're going to improve education and other projects i believe in. >> well, the nice thing -- i'm running money for our foundation and for ourselves so i'm doing -- all i have to say is my wife

is my only boss. when i was run mag jell lan, one out of every hundred americans was in the fund. these are beam who have $5,000 that's a huge deal to them. so when the market went down we felt badly. the pressure on you when it's average people, that's overwhelming. and you're nice enough to say nice things about magellan but in 13 years ten times it declined over 10%. >> rose: but your point was that you were confident enough to say when it's declineing to know when to give up and not to give up. >> when the market would go down i would go down. >> rose: sure, sure. but you wouldn't go scared, you'd invest in a company. >> i'd say the company's fine. it's fine. basically johnson & johnson was higher then the earnings are higher. that's what happens to a company. >> rose: i know lots of people are doing stunningly well in the world of investments and finance and they do it by a study of

macroeconomics. you never bought into that? >> i always bond down. i was lucky. i owned a lot of -- i owned american motor inns, hospitality inns, united inns. i said "who's your best competitor?" they said "la quinta motor inn." i owned it before sunset. if something ever says something nice on a competitor they know it's true. >> rose: you can get them to say what they worry about it. >> they have a better formula. we can't match the formula. so i visited, it was a huge success. >> rose: how long did you stay with it? >> i think seven or eight years. >> rose: how do you know when to get out? >> in baseball analogy-- and i know you're a great baseball fan-- you want to get in the first, second, third inning, not when they're drawing up the lineup. >> rose: you don't want to do it? you want to wait until the second and third inning because you want to have scene them at bat? >> toys "r" us and 20 stores on the way to 500. or home depot on 40 store it is

way to 4,000. if you would have bought wal-mart ten years they went public they would have gone up 50 fold. ten years after they've gone public they own 18% of the united states. so you can say to yourself will there's a lot of room to go. when the limited got to every single mall in the united states with express and limited, they're in the eighth or ninth inning, where can they go? whereas one goes from crummy to semicrummy you're happy. if it goes to very good you say maybe i ought to go to something else. >> rose: can you be greedy in your business? >> yeah, i think sometimes -- i call it the three "cs," complacency, concern, and capitulation. so you can place -- i don't know about greedy. everything's going right and you forget to check the facts and say things are slipping. so being complacent is the worst one. >> rose: and add that to one that happens most often? >> unless you're working hard. if you're working hard you're

always checking with competitors customers, suppliers, trying to do work to find out is this company still early? do they have years and years of growth ahead of them? then you stay with it. the stock goes down. >> rose: there's also the idea of never invest in something you don't really know. that was part of -- that's why you went on the road so much? if i don't understand it i don't want to -- >> rose: when the stock goes from 10-6, if you understand what they do and they're financially solvent you're fine. they don't understand it you can call the psychic hotline. but if you don't understand it you'll probably do the wrong thing. if you understand exactly what they're doing you'll buy more. if you're confused to start with you'll say well there must be something wrng here. a lot of times stocks are in decline. they go 18-8 and sometimes to 40. at least i wasn't adding to it on the way to zero. >> rose: if it's going down you're not adding to it. >> rose: how much do you measure your success in your ability to

communicate well? your command of the language and the facility to express ideas in a simple and comprehensible has always been the reason your books sold well because it was good content there and secondly the way you were able to communicate and become a leader in your industry. >> rose: you ask the question about the ability to listen. i think that's the seal. because when you're talking about a company, if you ask all these questions, it's like a monologue. then you say at the end, is there something i've forgotten? you want to have them say, by the way, a year ago when you were looking to see what things were going to be like, how does it come out? what have been surprises for you? i'm listening to what people say so more listening than asking and also being nice. when you a go to a company they say last year your capital spending was $125 million, what will it be this year. you don't say "how are you doing?" you want to be nice but

courteous. >> rose: precise. >> and you want to show you did home work. don't be mean. you don't want to be mean, too. if the rubber hose worked i would have used it. you want to be kind. write letters saying i enjoyed meeting you. people can turn off -- they don't have to be that nice. being kind and courteous -- i was a boy scout. be prepared. >> rose: exactly. i mean, it is essential to what i believe is that you ask people things like "did i miss something? what am i not hearing? what question have i missed here?" almost what i think is important. you've got to engage the person in your own pursuit. make them work for you. >> i was a metals analyst with a company and their product -- i couldn't even pronounce it. i when i took chemistry in high

school we didn't even get that on the charts. i remember calling one company up and you get to know a person's personality. some people are optimistic, some people are conservative. his tone just was not as optimistic. i found out later -- i almost sold my entire position. you get that feeling. i called him a week later and said "you know, my brother was in a traffic accident about half hour before he called and i didn't know i was going to make it or not." i almost sold my entire position -- i called back and said, gee -- >> rose: i will sometimes call up people and say "did i do something to make you upset or angry? not in terms of the interview but in terms of the relationship? am i missing something here? did i do something that pissed you off?" sometimes they'll say yes. you didn't see i was over there waiting to see you and you walked right by? >> rose: a lot of times you'll be interrupting people. you really is v to say -- i've

heard that enough but i won't interrupt. it works well. >> rose: you still use those skills. those are human skills, aren't they? >> they're not taught anywhere. you have to learn them. there's no book on that. >> rose: i want to do something now i have never done. i had a friend of mine who i know who admires you greatly and i said give me five questions you would like for peter to answer if you were sitting at the table and in three minutes he sent them me. so here they are. what has changed about investing in the markets since you left in 1990. >>? what has changed? >> i think a lot of the computer driven -- you know, where people buy stocks for a second and only far second. i think that's a waste of time. i don't think it's -- i think it's disruptive. on the positive side, information to the public is so much more available today. when a company he leases their numbers and they have a call it's open to everybody. we used to wait for the mail to see what nike's inventory was like. we got hit in the first class

mail. so the investing for the average person is much clearer. it's -- you don't want to invest in companies whose balance sheet is -- they get $8 billion in debt and no cash and are losing money. that's a terrible combination. you get all the information out. so information is better than it was a long time ago. >> rose: you still believe in the investment mantra that you were often credited as your mantra which is invest in what you know? >>. >> i've been in my field a long time. imagine if you're in a mall the last 30 years. you would have seen a gap, you would have seen best buy, you would have seen circuit city. you would have seen companies crowded and doing something better. and so buying biotechnology stocks, that makes no sense to me. if you're in the steel industry and you see it going from awful to better, buy it. >> rose: if you look at magellan or black rock you think they must have access to the best information in the world. >> rose: but they don't have --

they're not in the steel industry. they don't see things get better -- they don't see the ones returning. it can be in the plastics field or lithium -- >> rose: people in the business see it first. >> they see it first. a mall imagine the companies you've seen -- dunkin' donuts, it goes on and on. wal-mart, stop & shop, these are all -- it's like gee, i'm shopping there. i'm not saying people should -- if they want to invest, they should do the same research they do when they buy a refrigerator, take a trip to italy. >> rose: you know what's about this country is stunning to me? for the most part we don't do that about medicine and our health. we don't do it. we are more interested in getting the best television than we are the best medical -- >> i agree. the diagnostics -- diagnostics today is so much better. >> rose: the other thing is what advice would you give to young investors who will almost certainly have more direct responsibility for their

retirement savings than their predecessors of which i'll talk about later. >> i think the advantage of putting money into a retirement fund. if obviously a fidelity fund i would prefer, but an index fund, whatever it is, put money aside it will compound tax free. start saving early. >> rose: compound willing do wonders won't it? >> amazing. and until you want to invest directly in individual stocks, start a paper portfolio. say i'm going to buy these ten companies and then write down in like five bullets why. what's the reason i bought those? then keep checking a year later. what happened? did they keep growing or did the competitor come along. do a paper portfolio. you can do what i did with a real portfolio and find out what am i good at? what am i bad senate and i good at small growth companies? maybe i paid too high for stocks. you can do this over four or five years and learn what your skills are and then specialize that. i had owned thousands of companies. >> rose: when you were running

$14 billion, did you see in your mind's eye-- and let's assume a lot of it was pension fund money whatever-- but did you see individuals "i'm investing for the fireman down the street." did you? >> it was -- almost none of pit. it was incredible that thrill. i got letters when the market went down in '87. my fund went down like a rock. people were writing letters to me cheering me up! >> rose: (laughs) "mr. lynch, you've done well for me?" >> hang in there, we'll be okay. >> rose: don't give up now, peter. >> i meet these people all the time. at airports all around. it was the greatest thrill of my life. our children and our wife. now, we've also seen sort of today the whole business hedge funds and private equity and shadow stuff and now we're talking about getting into the

mutual fund business. what do you think of that. hedge funds getting into mutual funds. >> rose: >> a couple differences between hedge fund and what i did. i couldn't buy commodities, i couldn't short the euro. they do it on leverage. so you have to be careful what you're getting into. some hedge funds are very conservative. they'll be 20% short and mostly long. because it's a nice thing about occasionally if you have an idea i thought was overpriced i went on to the next thing, i couldn't short it. so there is an advantage to short. but i found long only -- >> rose: with these hedge funds and you get into mutual fund it is you'll have to live under the rules mutual funds live under. do you think they will be successful. >> i found -- >> they're tracking some -- >> the hedge funds on the long side have done the best. they made up a little bit by something short but being right on the long side, being obviously -- if you're right you

can make -- and that's -- i would say i might have been right six times out of ten if i'm right i make it double or trip olcationly. you can be right a third of the time as long as you have good results. sopt i think long is the way to be. >> rose: optimistic. >> well, careful and optimistic. that's a red sox fan. >> rose: (laughs) yes, sir. that's like the person who said i'm very optimistic. well, why? and he said i'm not certain about my optimism. >> rose: (laughs) that's good. >> rose: so when you look at the market today it's a good time? we've seen new highs. i >> i think the market is fairly priced on what's happening right now. you have to say to yourself five years from now or ten years from now, it's growing about 7% or 8%

a year. so go up eight fold every 40. that's the kind of numbers you're interested. in a ten-year bond today is full over 2% so the stock market is the next place to be for the next 10, 20, 30 years. the next two years, no idea. >> rose: what do you want to accomplish in the next year of your life? >> i'd like to work with my wife and still take more vacation time. >> rose: what do you do on vacation? >> we'd like to see something new. this year we went to turkey. >> rose: fascinating. istanbul? >> remarkable. >> rose: amazing, one of the world's great cities. >> then went to sant rebny at the end of it. and two of our daughters and their husbands went. it was a great trip. i've been to russia, i've been to st. petersburg. >> rose: you've got to go there. >> i'd love to go to jordan, i've been to israel. >> rose: isn't that great?

when you think about it how many places do i have that i haven't mean? >> this year i've been to all 50 states now. >> rose: did you go to fargo? >> no, i went to minot. i looked into hydraulic fracturing. >> rose: you're looking at hydraulic fracturing to see -- >> see if it works. and it does. >> rose: and it will change america's energy future. >> remarkable. >> rose: that's one of the great sort of -- >> what a breakthrough. imagine getting all this gas at $2 an n.c.f. where people in europe are paying that price. >> rose: how did you decide it worked? >> i could see this process -- first of all, you talk to them and you say -- wild catting you drill four wells and you're lucky you hit on one out of four these are all either a-plus or b plus wells. so what cost can you do it at? and you own the land. the costs are still going down. faster, quicker, less sand, less

water. >> rose: are there environmental threats coming out of it? >> as you know, there's usually about 11,000 feet and the water is 2,000 feet so if you make a mistake it goes down. so they can make mistakes. >> rose: great to see you. peter lynch, back in a moment, stay with us. >> and philistine was sent down, their mighty warrior, is a giant. he's 6'9, he's outfitted head to toe in this glittering bronze armor and he's got a sword and he's got a javelin and a spear. he is absolutely terrifying. and he's so terrifying that none of the israelite soldiers want to fight him. it's a death wish. there's no way they think they can take him. finally the only person who will come forward is this young shepherd boy. >> rose: malcolm gladwell has been a staff writer at the "new yorker" since 1996. his writing draws from history, psychology and story telling to help us understand the way we think and live is even coined in

adjective glad wellian. his new book challenges how we think about obstacles and disadvantages. it's called david and goliath, underdogs, misfits and the art of battling giants. i'm pleased to have malcolm gladwell back at this table. welcome. >> thank you, charlie. >> rose: "60 minutes," cbs "this morning." >> i've been busy! >> rose: you deserve to be. >> rose: so we've been thinking about david and goliath wrong? >> it's been funny to think about that story. that story is the quintessential metaphor for lob sided battles. but i started reading around the story and the literature accumulated since then. david's weapon, the sling is in his hand. it's a devastating weapon. it's one of the most devastating weapons in ancient times. the calculation -- i talked to a guy who was a blis ballistics

expert. the rock fired from david's sling has stopping power equal toll a bullet fired from a .45-caliber handgun. in other words he's not going in there with a child's toy. then there's goliath there's all speculation among endocrineologists that goliath has a disorder called acromegaly which is a tumor on his pit tour tear grand which would be the cause of his giantism because that causes overproduction of human growth hormone but it also has the common side effect of causing problems with your vision and goliath you read the story closely behaves an awful lot like a guy who can't see much beyond a few feet in front of his face. he's constantly calling out to david "come to me." and doesn't realize david's not going go and have a sword fight with him. so off combination of a big lumbering half blind giant and they a nimble skilled young man

with a devastating weapon. that is not the story of a hopeless underdog against someone in favor. >> rose: what do you take from that notion? >> that i think our -- that's the beginning story in the book because what i'm interested is in examining whether our intuitions about advantage are accurate. >> rose: it applies to warfare. not just that kind of conflict. real life warfare. americans in vietnam, the british in northern ireland. >> exactly. but in a number of situations i wonder whether -- i talk about education in this book and i talk about disabilities and a number of different instances we have a reaction to a set of circumstances which we label that circumstance -- let's use disability. we say well, that's clearly something that makes your life more difficult. my question is, is it really or it is always i'm trying to make

more sophisticated our understanding of what helps us in this book. >> rose: and to understand -- and having a disadvantage can be a motivator? >> >> i have a chapter on what does it mean lose a parent in childhood? and i talk about this extraordinary oncologist one of the great figures in 20th century medicine. he was one of the people who thread -- one of the most important people in defeating childhood leukemia which was this extraordinary bold. will outrageous idea that he had. and i was interested in his childhood. he had a dickensian childhood. lost a father very young. and i was interested in how he responded to that i got to talk to psychiatrists about the same phenomenon. they talk about the number of

times that people who have done something extraordinary in their life have lost a parent very early on. and the idea is that you have one of two responses. that's the most devastating blow a human being can have. the common response is that you are devastated. and this is a significant setback in your life. but there is another response which is just as important which is a certain class of people that appear to be in -- almost invigorated is the wrong word. but it gives them strength to have survived that blow, allows them to see themselves as much stronger and much more indomitable than they would have been. >> rose: and it sometimes gives people -- if that happened to me then it gives me purpose in terms of i have to -- yeah. i looked at -- the data looks at english prime ministers and american presidents. how many of them lost a parent in childhood. look, we have obama, clinton is a fascinating case of someone who suffer this is extraordinary blow very early on in his life

-- >> rose: his father was killed before he was born. >> and he grows up in an environment without that kind of safety net. and what does it do? it seems to have given him a kind of strength. you see that pattern again and again and again. >> rose: do you think that's the majority patern? >> no, i don't. i make the same argument with dyslexia where there's a minority pattern where you see a very large number of successful entrepreneurs have dyslexia. that's not the common response. and if you talk to them you'll say -- they'll say i am who i am because of my dyslexia not in spite of it. nonetheless, it's fascinating to see this bimodal response to what we would ordinary consider just to be a setback. >> rose: do you think that -- it's often said that some or a large percentage or at least a majority of comedians come to

comedy out of pain. >> oh, you know what's funny? i was just reading that new biography of johnny carson. he talks about -- there's a fascinating thing that talkss about carson's mother who was the most emotionally withholding cold and -- and what was johnny carson? he was someone who was so acutely tuneed to the emotions of his audience. where does that come testimony from? his mother! if you grow up with someone who is just a blank wall and you have to pick up on the subtlest -- so that's why the thing about carson-- and the book makes this point is-- the thing that makes him so great is he just locked in on the emotional responses of the people in front of him. that's his -- so i totally agree with that. >> his genius almost. i think if you do this system mat i can analysis of comedians for whom you -- i think you

would see. that it's a reaction -- you can get as much as a productive response from a highly adverseed experience. >> rose: so now this book is out and you're talking about this book. are you already there in terms of what you want to do next >> no, i'm still -- it takes a long time to find an idea that you want to live with. >> does it begin with a question? >> it begins with a feeling and it begins with -- i have to be interested in something that i think is of the moment. that other people are thinking about now. i would never write "tipping point today." i don't think -- i think that idea was very much of that experience. >> rose: you are a giant on the speaking circuit and you're a giant at conferences where corporate people are trying to live somewhere where they can do

their work together. what do you think it's about? >> what do i think what is about? >> rose: where they want to hear from you. because it's the nature of the books and the fact that you're a gifted speaker, presenter of your ideas. >> i think there's this really interesting thing that happened in the business world over the last generation which was there was a kind of opening up. there was an understanding of people that they needed to look more and more outside of their own discipline for inspiration, for insight. so i see prudential has ads now with again gilbert, the great psychologist. i love that. i think the idea that a company -- a major corporation has turned to a psychologist and said let's work together. i think that's what's going on, i think, is this kind of glass most in the world of business. and i'm not a business person, i don't pretend to be. but i am a beneficiary of this

new openness. there's a manager at company x now thinks, you know what? i can learn something if i read about or hear someone talk about military history or social psychology. >> rose: i can somehow -- but in the end i think -- you know, there's also i think people looking for silver bullets, too. >> yeah, although it's funny. i don't know. >> rose: don't misunderstand silver bullet because i don't want you to think they're looking for a cheap fix but they're looking for something -- said another way they're looking for a theory of everything. they're looking for something that ties it together so they can say i get it. >> i have often said that we are as a society information rich and theory poor. that we have more and more experiences than -- and you had a breadth and variety that our parents and grandparents never had. so we lack ways to make sense of them. so what the genre of books to

which my books belong is that these are a genre of sense-making books. i'm giving people who write in the same field, we're giving people tie those things together. "this is called david and goliath: underdogs, misfits and the art of battling giants." malcolm gladwell, thank you, great to see you. back in a moment. stay with us. >> i'm excited to announce that you now have the opportunity to take on the same creative challenge that eva, jamie, liz, james, and jor gina are taking on themselves. >> rose: we turn to canon's project imagination. staying with us is ron howard. joining me his daughter bryce dallas howard who participated in the first year of the program and ran its consumer film contest and james murphy of the brand lcd sound system. he was one of the celebrity directors on this project. i'm proud to have each of them at this table to talk about somethat that is about photography, about creativity and about imagination as well.

so it's an interesting title. how did it begin? >> well, i never got involved with anything having to do with branding. since i was a kid on the "andy gift from fifth show" and in toes days you had to do commercials so i had to do breakfast cereal commercials for general foods dressed up in my opie outfit. since then i haven't had anything to do with brapdz. >> and they made you eat so much cereal. i've heard this story. >> and product placement and all that? >> oh a little of that but only when it's appropriate because you want that prop anyway. i've never gone out of my way to cooperate with brands. >> rose: and now we're talking about a big brand, canon. >> and they wanted me to sort of be the face of this campaign. but it was such an inviting creative idea because it was this experiment. the idea was simple. it was people submit photographs still photographs, photographs dedicated to a particular category in film making

structure character, setting mood, things like that. so i don't know how many the first year. >> rose: it was almost a hundred thousand submissions in under a month. >> amazing number. >> rose: and what would they submit? >> still photographs that they had taken and they would say "i suggest it for the mood category." >> or the unknown category. >> and then the public narrowed it and i had to select one image from each category. in the first year we did it it was eight. when james did it it was 10. and then bryce's job was-- along with her screen writers, dane charbonneau-- was to build a story and make a short film inspired by those images. whatever that meant. whether they were literally inspired or dramatically inspired that didn't matter.

but you're supposed to be pure about taking the images because it reminds me of a creative exercise that i which is when i'm talking on the phone i like to flip over my memo card and on the book just do three different lines randomly and start to link them together and every once in a while even though i can't draw i come up with a really fun doodle. and i thought this reminds me of that game where you play with your kid where you start a line or story and it's continued around the table. i thought it could be fund. so bryce made a wonderful movie. she was short listed for the oscar category in short films last year and it was a very personal film and it was also successful for canon and i thought what it did was it promoted this notion that many more people are far more creative than they sort of allow themselves to believe. their work is worthy.

and that kind of collaboration can be incredibly fruitful and they decided to do it again this year but have more filmmakers. >> rose: tell me about the film you made. >> so it was called "when you find me" and i kind of viewed myself as like the first graduate of this program. of this experiment. project imagination. and like what you guys were talking about. i think it's so funny that we're talking about "rush" beforehand because that movie is about competition and i think people view hollywood or movie making as a very competitive industry and i think what this project has highlightd is that actually story telling is a very collaborative endeavor and that the collaboration can elevate everything. can elevate story telling and i mean -- and the thing that has been so intimidating for me as a storyteller-- not necessarily as an actress but as someone who writes and as someone who's

getting into directing-- is facing the blank page and that's very scary. and the opportunity that was presented with this project is that i never had to face the blank page. py looked at eight incredible photos with dane charbonneau, the writer of my piece, and instantly ideas were coming to us that would have never occurred to us before and i think it's a beautiful thing to get to have this kind of a collaboration and i think that's where we're headed with crowd sourcing. i think that's where we're headed because of the technology that's available to us now. that we can come together to tell stories in a much more profound way than we could have before. >> rose: did you come to this with a sense of collaboration or more of a sense of dependence on self? >> i'm not a great collaborator. (laughter) >> rose: smoup i knew that. >> yes, you are! >> rose: why?

>> well, because i am uncontrollably a little bit uncompromising. not like i view myself as uncompromising but i have a difficult time being like, well, that seems fine. like i really want my thing but i'm also really loathe to step on people or hurt people's feelings. i'm quite sensitive and'm pathetic to that type of behavior. i don't like to be autocratic and difficult i like to just do my thing. >> rose: just quietly take control. >> i go and make records alone if a room. i'm the producer, i play instruments and write everything. it's just my normal way of not being really frustrated or not frustrating others or not having my own friends hate me. so i do okay with that. but i saw this as like a chance to, like, try something. a chance to learn something and i learned that it was really collaborative. i never made a film before and i found that it was pretty

enriching. i was really care to feel pick the people that were the main people i worked with. my cinematographer manuel claro who is amazing and he calm med down immediately and it was like i'm stepping into this world and i don't know what i'm doing. i've shot videos before and that doesn't count. and i would say "i want to do this." and he'd say "that seems like a good idea." >> we're collaborating! >> as opposed to being like "i don't know if that's such a good idea." so i found it to be really collaborative and i found i was able to do precisely what i wanted while still collaborating. i don't know. i've never experienced anything quite like that before. >> one interview i read you said it was a series of multiple choice -- >> multiple choice questions. i hope nobody gets mad at me. i found it to be incredibly easy compared to other things that i've done. >> rose: film making? >> not that i think film making

is easy but my experience was i had a good team. i've never been asked questions before. i make records alone. all blank page, to me it's all blank page and it's all just like well, what am i going to do? and the multiple choice question is infinity. >> rose: but you're asking questions all the time. >> now i'm getting things like do you want to shoot from up here or -- oh, well out of those two choices i'll pick the ground. here's eight pairs of socks, what should the actor wear? i'd never had -- people would say do you want to make a record? i'd say yes and that's the end of the question. and i'd have to show up. so for me it was really -- that was wonderful. that was an amazing thing. watching actors make choices in rehearsal and being like okay, let's go back to this, that was really wonderful. >> you can sort of hear the passion and excitement in both of them. i was also -- as the program evolved and -- into these two phases, one is to have a new set

of sort of celebrity high profile creative people experiment directing a movie for the first time and, you know, georgina chapman is a designer. jamie foxx who we all know and james, eva longoria, biz stone, an entrepreneur. >> rose: from twitter. >> from twitter. it's been fascinating for know see two things: one, their own -- we were talking earlier about "rush" and that ambition. reflecting itself in not treating like this like a dalliance but throwing themselves in it full bore. all five. i'm telling you. and it's kind of -- >> rose: yes, they're not slumming here. they are saying i'm going to dive into the deep end. >> i'm going to honor the experiment. i think everybody knew it was going to be somewhat high profile. but it's also an opportunity. >> i used that phrase. like i try to honor the process,

the experiment which was like -- because it was more fun. it was more fun to be like see what we do with the pictures rather than i want to make a short movie on my own. doing that. but why not engage the process as much as possible? i haven't talked to any of the other directors since they started so i'm dying to kind of -- i always felt like i'm lost in my own world. >> rose: so what movie did you snake >> i made a short film called "little duck. ". >> rose: "little duck?" >> and it's fall japan and it's all in japanese. >> it's a really special film. >> rose: they're all very experimental in this way. i have to also say hats off. you know, canon and company never was wading in and saying "you have to do this, you have to do that." >> they're supporting creativity. i mean, they have created the technology to enable individuals to have a voice and that's what they asked of all the celebrity directors and then when the -- if brought into consumers that's what they asked of consumers.

just make your films. this is the construct of the experiment but those were the specifications and then the films that came in from the consumers were just absolutely remarkable. it was incredible. >> rose: creating a movie -- >> using largely the same photographs made a movie in japan, in japanese, a very character driven fascinating story. eva longoria made an action movie. stimulated -- inspired by the same photos. >> are you amazed at how much creativity there is on the internet? that it has provided a springboard for people? it's democratic -- >> it is technology influencing what's possible. proving to people over and over again that they have something to share. and a way to sort of prove it. people put images out there. >> rose: the other thing it can do, it can access things that will stimulate your creativity. >> david fincher gave me this

tip-- not to name drop but you have to give credit where credit is due. he's such a great visual. he's a remarkable director and bold. bold visualist. and i was even -- i was getting ready to do "rush and i knew i wanted to push the envelope in certain ways and he said "just think of a word and look it up on youtube. just see what people have done with it and you will be blown away. and there's some images in "rush" that have to do with moving parts, things that somebody found a way to replicate. >> rose: you mean engines and things like this? >> but in a very visceral and poetic and personal way. and it was -- it's great advice but it's out there and people are finding ways to express themselves and that has to be good for everyone, you know? >> rose: now, what's the role of canon here? >> canon sponsored it. >> rose: they underwrote it? >> they underwrite it and they -- again, this is not about selling a specific camera or -- but it is a --

>> rose: brand identification with them. >> brand identification and creativity. they don't want to just be thought of -- they want to remind people that they love making the tools but they also have a lot of respect for what the tool can offer artists or everyday consumers who never thought that they necessarily had an eye. >> rose: and of the consumers of the five winning consumers, these were not individuals who were filmmakers, actually. that's what was so intimidating. >> rose: we didn't even know that as we were selecting it. >> and we found out afterwards oh, my gosh, the majority of these films are these people's first attempt at making a movie. and a majority of -- even though this wasn't a requirement, a majority of the consumers making movies used canon equipment because it was the most affordable equipment that was of the highest quality. >> rose: so your life was about music and about the ear. >> yes. >> rose: does this somehow

impact you in thinking "i'd love to do things for the eye"? >> i've never seen a question where it divides between anything so i grew up listening to music and listening to, like, rock music and punk rock and so much of that is tied in with visual identity and that's why record covers looked different in the '60s and '70s and '80s and '90s so i never felt that was super separated. but i like telling -- i like arcs and i like stories and i usually have dealt with them muse qli and it's more difficult with me sometimes writing or with film because music is more illogical. if you want energy to step up you turn it up. the characters need to believably amine from this moment which i found was different. >> rose: what are you doing next >> well, i had my second child last year and i am.

>> rose: which is a huge achievement. >> which was wonderful. and the joke is that i've made five short films -- i've directed five short films, all when i've been either pregnant or lactating. (laughter) >> so keep making films. >> exactly, i'd love to make a feature film when i'm not in that state. so during this time i've been developing that and then i'm going to be -- they're relaunching the "jurassic park" franchise and i'm going to be in that. so i'll be chasing dinosaurs next year. >> rose: good to have you here. >> thank you. >> rose: >> thank you so much. >> rose: great to see you again. thank you for joining us. see you next time. captioning sponsored by rose communications captioned by media access group at wgbh access.wgbh.org

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