Recently in Business Category

Unreal - this would be tossed out by any intelligent group of people. From the New York Daily News:

Dental hygienist labeled sexual abuser and stripped of license because he slept with a patient — to whom he is married
The College of Dental Hygienists of Ontario stripped a hygienist of his license and labeled him a sex offender because he had a sexual relationship with a client. It didn’t matter that the client was his wife.

Alexandru Tanase, of Guelph, confessed to cleaning the teeth of Sandi Mullins when on several occasions between April 2015 and August 2016, according to the Canada’s CTV news. They were engaged when the treatments started and are now married.

Despite fighting the case over the past three years, Tanase said he was stripped of his license last month. He was reportedly outed by a tipster who was a social media photo of Mullins flashing her pearly whites following a cleaning by Tanase, who is pictured by her side.

Like I said - unreal...

Roast beef at the legion hall

| No Comments

Tonight was the roast beef dinner at the American Legion hall. $18 for a big plate of prime rib, vegies and cake.

Sat next to a delightful couple from Australia who were on vacation. They were house (and pet) sitting through the worldwide Trusted Housesitters program. Very clever idea - the house and pet owners as well as the wanna-be sitters each pay $100/year to join the program and then they have a background check. There is an online database that links them up and there is no charge for the visits. Part of the $100 covers insurance for emergency vet care, etc...

The $15 minimum wage

| No Comments

As expected, it is killing jobs - from the New York Post:

As predicted, the $15 wage is killing jobs all across the city
Just as predicted, the $15 minimum wage is killing vulnerable city small businesses, with the low-margin restaurant industry one of the hardest-hit as it also faces a separate mandatory wage hike for tipped staffers.

In Sunday’s Post, Jennifer Gould Keil reported on the death of Gabriela’s Restaurant and Tequila Bar — closing after 25 years. It struggled all year to find a way out, gradually laying off most non-tipped employees, including some chefs, only to find that quality suffered and customers fled. Owners Liz and Nat Milner finally hung it up.

Other eateries share the pain. In an August survey of its members, the NYC Hospitality Alliance found more than three-quarters have had to cut employee hours, more than a third eliminated jobs last year and half plan to cut staff this year.

“It’s death by a thousand cuts,” the Hospitality Alliance’s Andrew Rigie told The Post, since “there’s only so many times you can increase the price of a burger and a bowl of pasta.”

The unions are the ones pushing this - not only does it kill the small businesses, union saleries are indexed to the minimum wage so an increase means a jump in wages for union employees as well.

Capitalism versus socialism/communism

| No Comments

Adam Smith always had a way with words:

"It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest."
--Adam Smith

Trade wars work

| No Comments

From Yahoo/Reuters:

China's slowdown deepens; industrial output growth falls to 17-1/2 year low
The slowdown in China's economy deepened in August, with growth in industrial production at its weakest 17-1/2 years amid spreading pain from a trade war with the United States and softening domestic demand.

Retail sales and investment gauges worsened too, data released on Monday showed, reinforcing views that China is likely to cut some key interest rates this week for the first time in over three years to prevent a sharper slump in activity.

Despite a slew of growth-boosting measures since last year, the world's second-largest economy has yet to stabilise, and analysts say Beijing needs to roll out more stimulus to ward off a sharper slowdown.

All Beijing has to do is normalize their currency and stop the unfair trade practices. Things will rapidly get back to normal. That is all...

Wonderful news - unions

| No Comments

Looks like the heads of the labor unions are a bit worried. From Breitbart:

Union Bosses Fear Workers Will Stick with Trump: ‘It’s a Serious Problem’
Union bosses, closely tied to the Democrat Party, say American union workers sticking with President Trump in 2020 and his economic nationalist agenda is “a serious problem” for them.

A report by the Wall Street Journal reveals how union bosses and Democrats are looking to peel off Trump’s support from American union workers who back his agenda, where most recently he has demanded multinational corporations move their production in China to the U.S.

The Journal reports:

“It’s a serious problem for us,” said Alan Netland, president of the North East Area Labor Council in Duluth, Minn., which represents 40,000 union members. “People may say, ‘I voted Republican and the world didn’t fall in, so maybe I better keep doing that.’”

Union officials, along with Democratic presidential candidates, are now trying to highlight what they see as a yawning gap between the president’s pro-worker rhetoric and his policies.

Democratic candidates have put appeals to working-class voters at the front of their campaigns. “I am a union man,” declared former Vice President Joe Biden, who leads in 2020 primary polls, during his campaign kickoff in Pennsylvania in May. [Emphasis added]

Vice President of the United Mine Workers of America in Uniontown, Pennsylvania, Chuck Knissel said based on the current 2020 Democrats running for president, it will be difficult to get union workers to vote for anyone other than Trump.

Good. Maybe the union bosses will listen to their constituents for a change. They have been listening to the power brokers in D.C. and look where it has gotten them.

The ultimate cheat sheet for business

| No Comments

Great list of 100 rules for running a business. From James Altucher writing at Quora:

The Ultimate Cheat Sheet For Starting And Running A Business
No joke. This is going be a bullet FAQ on starting a business. If you're a lawyer, feel free to disagree with me so you can charge someone your BS fees to give the same advice.

If you can think of anything to add, please do so. I might be missing things. If you want to argue with me, feel free. I might be wrong on any of the items below.

There are many types of business. Depending on your business, some of these won't apply. All of these questions come from questions I've been asked.

The rules are: I'm going to give no explanations. Just listen to me.

    1. C Corp or S Corp or LLC? C-Corp.
    2. What state should you incorporate in? Delaware.
    3. Should founders vest? Yes, over a period of four years. On any change of control the vesting speeds up.
    4. Should you go for venture capital money? First build a product, then get a customer, then get friends and family money (or money from revenues which is cheapest of all) and then think about raising money, But only then. Don't be an amateur.
    5. Should you patent your idea? Get customers first. Patent later. Don't talk to lawyers until the last possible moment.
    6. Should you require venture capitalists to sign NDAs? No. Nobody is going to steal your idea.
    7. How much equity should you give a partner?
    8. Divide things up into these categories: manage the company, raise the money, had the idea, brings in the revenues, built the product (or performs the services). Divide up in equal portions.
    9. Should you have a technical co-founder if you are not technical? No. If you don't already have a technical cofounder you can always outsource technology and not give up equity.
    10. Should you barter equity for services? No. You get what you pay for.
    11.  How do you market your app? Friends and then word of mouth.

Excellent advice from a master. 90 more at the site.

The trade war with China

| No Comments

It seems that the nabobs at the Wall Street Journal think that they know more about economics than President Trump - from Breitbart:

Donald Trump Rips Wall Street Journal: ‘They Understand Nothing About Trade or Business’
President Donald Trump ripped the establishment Wall Street Journal on Thursday for editorializing against his ongoing trade battle with China.

“The Wall Street Journal editorial board and some others continue to publish foolish articles that demonstrate that they understand nothing about trade or business,” Trump said. “Nothing.”

The president spoke about the paper during a political rally in New Hampshire about leveling tariffs on China, noting that the Wall Street Journal editorial page kept urging him to remove them.

“I lose all the cards if we take off the tariffs,” Trump replied, pointing to the tough tariffs leveled by countries like the European Union and India.

The members of the WSJ editorial board are not businessmen. They went to journalism school. Big difference.

Looks like it is going ahead full-steam. From their website:

Expansion Project
The original Trans Mountain Pipeline was built in 1953 and continues to operate safely today. The Expansion is essentially a twinning of this existing 1,150-kilometre pipeline between Strathcona County (near Edmonton), Alberta and Burnaby, BC. It will create a pipeline system with the nominal capacity of the system going from 300,000 barrels per day to 890,000 barrels per day.

Sounds like a great project. Also good is that they can shut down one of the lines for inspection without impacting the other so the oil will continue to flow. Not bad - 66 years of continuous operation.

This reduces the cost of Canada's oil - of course the environmentalists oppose it.

Grizzly Tools

| No Comments

I love the place - have a lot of their tools. Well made, hold their accuracy and well priced. They started in the 1980's and are now the largest tool supplier in the USA (for good reason). They just published a very nice video of their founder, his story and the growth of the business - a great example of the power of America. Want to do something? Put in the time? You can do it!

From Business Insider:

Starbucks is installing needle-disposal boxes in locations across America following OSHA penalties and worker concerns about drug use in bathrooms
Starbucks' efforts to address opioid use and improperly disposed needles in its bathrooms are expanding.

Starbucks stores in at least 25 US markets have installed needle-disposal boxes in bathrooms in recent months. By this summer, the chain aims to have installed sharps boxes in bathrooms in all regions where such action has been deemed necessary.

Stopped going there 25 years ago - independent coffee is best.

Some interesting research - from the National Bureau of Economic Research:

Do Minimum Wage Increases Reduce Crime?
An April 2016 Council of Economic Advisers (CEA) report advocated raising the minimum wage to deter crime. This recommendation rests on the assumption that minimum wage hikes increase the returns to legitimate labor market work while generating minimal adverse employment effects. This study comprehensively assesses the impact of minimum wages on crime using data from the 1998-2016 Uniform Crime Reports (UCR), National Incident-Based Reporting System (NIBRS), and National Longitudinal Study of Youth (NLSY). Our results provide no evidence that minimum wage increases reduce crime. Instead, we find that raising the minimum wage increases property crime arrests among those ages 16-to-24, with an estimated elasticity of 0.2. This result is strongest in counties with over 100,000 residents and persists when we use longitudinal data to isolate workers for whom minimum wages bind. Our estimates suggest that a $15 Federal minimum wage could generate criminal externality costs of nearly $2.4 billion.

Emphases mine - the whole paper is paywalled but I'm going to get it through our local library. Very interesting and shows that every action has unintended consequences - some good and some not so good.

Yay America - Oil Exports

| No Comments

Great news from CNN:

America is set to surpass Saudi Arabia in a 'remarkable' oil milestone
Move over, Saudi Arabia. America is about to steal the kingdom's energy exporting crown.

The United States will surpass Saudi Arabia later this year in exports of oil, natural gas liquids and petroleum products, like gasoline, according to energy research firm Rystad Energy.

That milestone, driven by the transformative shale boom, would make the United States the world's leading exporter of oil and liquids. That has never happened since Saudi Arabia began selling oil overseas in the 1950s, Rystad said in a report Thursday.

"It's nothing short of remarkable," said Ryan Fitzmaurice, energy strategist at Rabobank. "Ten years ago, no one thought it could happen."

That was then:

This (Thank God) is now. More faster please. in the news

| No Comments

The rush to develop alternative energy sources is not altruism on the part of the utility companies. It is about sucking up those sweet Benjamins - taxpayer subsidies. From John Hinderaker writing at Powerline:

The late January brownout in central Minnesota, during a time of Arctic cold, showed that reliance on “green” energy can be life-threatening. Xcel Energy instructed customers to turn thermostats down to 60 degrees and refrain from using hot water. Xcel went so far as to put some customers up in hotels.

Investigation of the brownout has been informative. The principal problem, given that Minnesota has invested massively in wind energy, was that the wind wasn’t blowing. But there was another problem, too, which came out in testimony before the state’s Public Utilities Commission by an Xcel official. My colleague Isaac Orr explains:

During their testimony, Xcel Energy representatives stated that the company’s solar panels only produced 8 to 10 percent of their potential output because of snow cover.

John talks about subsidies and concludes with this:

It is all about the rate base. Any capital expenditure that goes into a utility’s rate base provides a guaranteed return. Whether the expenditure makes any sense in terms of providing reliable energy is another matter altogether.

We The People are being screwed. No simpler way to say it.

Interesting - Amazon

| No Comments

From GeekWire:

Amazon backs out of massive Seattle office tower as questions swirl about growth plans
Amazon has placed a high-profile Seattle office project on the sublease market, signaling plans to scale down its growth in its hometown.

A marketing flier obtained by GeekWire confirms that the tech giant is seeking new tenants for its office space in Rainier Square, a building under construction that will one day be the city’s second-tallest skyscraper. Amazon had leased all 30 floors of office space in the building. After weeks of rumors, the listing was made official over the weekend, according to real estate brokers familiar with the marketing efforts. Amazon will make all of the office space it leased in Rainier Square available to other companies.

The skyscraper project, once an emblem of Amazon’s ambitions in Seattle’s urban core, now becomes a symbol of its uncertain future in its hometown. The move follows Amazon’s decision to back out of its HQ2 project in New York City after opposition there, amid signs that the company will focus its Seattle-area growth in nearby Bellevue, Wash.

Interesting - the article points to another article about how Amazon was not pleased with the head tax designed to fund free shit for homeless people. I bet that Bellevue does not have this head tax.

Trade Wars work - China

| No Comments

Canada renegotiated their trade deal with us.
Mexico renegotiated their trade deal with us.
Now it is China's turn.

Trade wars work - a little discomfort for a short while but a long term benefit.

The true minimum wage is $0.00/hour - you have to provide value to your employer. From the San Francisco Chronicle:

At this fast food drive through, the person taking your order might not be a person at all
The drive through window is often considered the most harrowing assignment inside a fast-food restaurant.

A nonstop whirlwind of multitasking, the gig involves organizing multiple orders, communicating with the kitchen, counting money and negotiating with an endless stream of customers who range from polite and coherent to angry and inebriated -- all for a minimum wage reward.

If that juggling act wasn't hard enough, a giant timer hangs in many drive through kitchens, adding urgency to each task, former workers say.

Though the drive through gantlet has broken many a fast food worker, the newest employee at Good Times Burgers & Frozen Custard in Denver will not be feeling the heat anytime soon. That's because she's an artificially intelligent voice assistant -- emotion-free and immune to stress -- with the ability to operate a drive through window without fatigue, bathroom breaks or compensation.

Be careful what you ask for. I have seen Costco rolling out ordering kiosks for their food court. Fewer people working behind the counter.

Great pushback

| No Comments

That manager called it correctly. From The Daily Caller:

A Vans store employee at the Oak Park Mall in Overland Park, Kansas was terminated after saying “f*ck you” to a 14-year-old customer who wore a red MAGA hat into the store.

The incident occurred on Sunday and its aftermath was recorded and posted to social media. In a video, the teenager’s mother confronts the employee, then takes the issue up with the store manager.

Good - when you work for someone, you are THEIR personal representative and the face of their business. You do not get to express your own viewpoints and telling a random customer whom you do not know - especially one 14 years old - to F*** You is grounds for immediate termination in my book. No excuses.

Airbus is a European company and is very heavily subsidized by the trolls in Brussels. From Bloomberg:

Airbus Will Stop Making the World’s Largest Passenger Jet
Airbus SE decided to stop making the A380 double-decker after a dozen years in service, burying a prestige project that won the hearts of passengers and politicians but never the broad support of airlines that instead preferred smaller, more fuel-efficient aircraft.

Production of the jumbo jet will end by 2021, after the A380’s biggest customer, Emirates, and a handful of remaining buyers receive their last orders. The Gulf carrier will pare down its current A380 order to 14 from 53. Emirates said separately it would purchase 70 smaller A330neo and A350 widebodies listed at $21.4 billion before customary discounts.

“Today’s announcement is painful for us and the A380 communities worldwide” Airbus Chief Executive Office Tom Enders said in a statement. Airbus said as many as 3,500 jobs are affected by the decision.

While the A380 has struggled for years to match its popular appeal with a robust order book, the radical move to cancel the plane outright marks a watershed moment for civil aviation. The A380 was always more than an aircraft, albeit a very large one. Rather, it was the manifestation of Europe’s collaborative drive and the continent’s industrial ambitions. For Airbus, the airliner sought to create a commanding counterweight to Boeing Co., promising unparalleled space and luxury for increasingly congested airports and the skies above.

The A380's first commercial flight was in 2007 - eleven years ago. The Boeing 747 had it's first commercial flight in 1969 and is still being manufactured today - fifty years of production.

Airbus decided to build a monster airplane but they forgot to ask their customers if this was something THEY wanted. Subsidies from the EU kept this project afloat but eventually, reality reared its ugly head and they are forced to pull the plug. Another instance of hard data trumping an idealistic narrative.

Tell me again how centralized government is so much better than raw capitalism.

Great news for Guyana - Oil

| No Comments

Best of luck with their new oil find - from Axios Journal:

Out of nothing, a new petro-state
On the coast of South America, just north of Brazil, lies the obscure and impoverished former British colony of Guyana, distantly remembered for a bizarre mass suicide four decades ago that begot the term "drinking the Kool-Aid."

But today, the discovery of a massive trove of oil off its shores, including two finds just this week, put Guyana on the cusp of becoming one of the world's wealthiest nations, in the league of petro-states like Qatar.

What's worrying the experts:

Guyana seems wholly unprepared for the avalanche of cash coming its way. It's in political turmoil, with no plan in place for how to marshal and distribute the money among a population of just 780,000 people.

The exploration and production deal with ExxonMobil is one of the most one-sided in frontier oil, heavily favoring the company with about a 50-50 split. That makes it rife for future political discontent and local demands for renegotiation. (In the former Soviet Union — arguably a wilder and more costly frontier — the typical split is 80-20, favoring the country.)

"There is no way the explosion of money will be managed properly," says Amy Myers Jaffe, director of energy security at the Council on Foreign Relations. "Here you take this poverty-stricken country and make them Qatar in three years."

Guyana would be looking at $5 Billion in cash every year. They are woefully unprepared for this. I really hope that they are able to deal with it and not morph into some bannana republic.

President Obama was on NPR Town Hall saying that in the USA, manufacturing jobs are not coming back and that there is nothing that can be done - here is the 37 second clip:

The complicit media agreed with him. From Forbes March 9th, 2017

Those Jobs Are Never 'Coming Back'
A significant part of Trump’s campaign centered on the angst of the white middle class and the ongoing loss of jobs in the Rust Belt. And that focus gave him his margin of victory.

Trump promised to bring those jobs back, a sentiment that resonated powerfully with the electorate. The problem is — as we’ve talked about previously — that at least 80–90% of manufacturing jobs were lost not to companies moving factories to China or Mexico but to increased automation.

Those Jobs Are Never “Coming Back”
They are gone. And that trend is going to continue and accelerate.

The author of this piece fancies himself an economist - wonder if he is getting much work these days. People usually like to hire people who are right more aften than not. Compare to this article in Forbes October 16th, 2018:

The Trump Manufacturing Jobs Boom: 10 Times Obama's Over 21 Months
The Great Recession officially ended in June 2009, six months into former President Obama’s first term. The economy continued to shed jobs until the following March. Manufacturing was particularly hard hit, with almost 2.3 million manufacturing jobs—some 1 in 6—lost between January 2008 and March 2010.

As is the case during recoveries, jobs bounced back, with seasonally adjusted nonfarm employment expanding almost 12% from March 2010 until January 2017, when President Obama handed over the presidency to Donald Trump.

A bit more - the Town Hall prediction:

At a town hall in June 2016, President Obama famously said that some manufacturing jobs “are just not going to come back.” He went on to mock then-candidate Trump by saying he’d need a “magic wand” to make good on this manufacturing job promises.

And the numbers:

In the first 21 months of the Trump presidency, nonfarm employment grew by a seasonally adjusted 2.6%. In the same period, manufacturing employment grew by 3.1%, reversing the trend under Obama when overall employment grew faster than employment in the manufacturing sector.

Comparing the last 21 months of the Obama administration with the first 21 months of Trump’s, shows that under Trump’s watch, more than 10 times the number of manufacturing jobs were added.

Doesn't fit the liberal narrative. Anyway, what prompted this was this announcement today from Ford Automobile:

Ford Motor Company is investing $1 billion in Chicago Assembly and Stamping Plants and adding 500 new jobs as it prepares to launch three highly anticipated new SUVs that go on sale later this year.

The transformation at the plant, which will begin in March, will expand capacity for the production of the all-new Ford Explorer – including the Explorer ST and Explorer Hybrid – the all-new Police Interceptor Utility and the all-new Lincoln Aviator. The work will be completed in the spring. The additional 500 full-time jobs bring total employment at the two plants to approximately 5,800.

With the Chicago investment, Ford is building an all-new body shop and paint shop at Chicago Assembly, and making major modifications to the final assembly area. At Chicago Stamping, the company is adding all-new stamping lines in preparation for the 2020 Ford Explorer, Police Interceptor Utility and Lincoln Aviator. Advanced manufacturing technologies at the plants include a collaborative robot with a camera that inspects electrical connections during the manufacturing process. In addition, several 3D printed tools will be installed to help employees build these vehicles with even higher quality for customers.

And do not forget that these 500 jobs are just the direct hires working at the facility. There are also the people who repair the machinery, the people who supply the raw materials, the lunch counters and restaurants that will open near the plant, the increase in transit riders necessitating new drivers. Trickle down at its finest.

MeToo - Insurance

| No Comments

An interesting consequence of this - from BoingBoing:

After #MeToo, whole industries have been blacklisted by insurers for sexual harassment liability coverage
A new report from Betterley Risk Consultants, shared with The Intercept, reveals that many of the world's largest insureres will no longer conside whole industries for "employment practices liability insurance" (EPLI), which covers liability from "sexual harassment, sex discrimination, and other employee claims."

Ten of the 32 largest insurers will no longer write EPLI policies for financial firms (brokers, investment banks, VCs, etc); eight will no longer sell EPLI coverage to entertainment and media companies. Also blacklisted are law firms, car dealerships, and other industries where "superstars" or "celebrities" or "high-billing rainmakers" have historically been able to get away with bad behavior so long as they continued to perform for the firm.

The blacklists mean that insurers that will extend coverage to the affected industry have a seller's market, with customers not able to shop around, and that means much higher prices and deductibles and lower caps on coverage; but more importantly, it requires that the companies seeking insurance demonstrate extensive institutional changes to minimize the risk of claims.

Interesting times. It is good that people are coming forward - non-consensual sex in the workplace should be rooted out and stopped. With power comes responsibility - to violate that is to violate the implicit trust.

RIP - Ron Joyce

| No Comments

Canada is in mourning. Ron Joyce? The co-founder of the Tim Horton's chain. From Canada's Financial Post:

'I've had a helluva ride in life': Ron Joyce, Tim Hortons co-founder, dead at 88
The creation story begins with Ron Joyce as just a child, whose father died when he was three, and whose mother, Grace, a widow at age 23, would move back to her out-of-the-way hometown of Tatamagouche, N.S., with a wee son in tow, and into a tiny house with no running water, no electricity and no insulation.

Grace would remarry and the boy would grow, leaving home at 15 with exactly “zero dollars,” in his pocket, heading west, working in a factory in Ontario, pulling a five-year stint in the navy, becoming a policeman in Hamilton and buying a shop in a fledgling doughnut chain that Tim Horton, a hockey great and future NHL Hall of Famer, started as a pet business project and ran out of his basement.

Joyce, the ex-cop, would learn how to bake from a fella who consulted a Ouija board, and he eventually became Horton’s partner in 1967, growing the doughnut chain into an iconic Canadian brand and adding terms, such as double-double, to the Canadian lexicon.

More at the site - quite the life and he built a really solid business.

That trade war - China

| No Comments

Looks like the trade war was won and China is over a barrel - from Bloomberg:

Hundreds More Chinese Companies Just Warned on Profits
The number of Chinese companies warning on earnings is turning into a flood, with no industry spared from worsening demand.

Some 440 firms disclosed on Wednesday -- the day before a deadline to do so -- that their 2018 financial results deteriorated, according to data compiled by Bloomberg. Of the more than 2,400 mainland-listed firms that have announced preliminary numbers or issued guidance this season, some 373 said they’ll post a loss, the data show. About 86 percent of those were profitable in 2017.

Damage was widespread: Airlines faced soaring fuel costs and a weak yuan, the equity-market slump hurt brokerages, while China’s economic slowdown and a surge in impairment costs slashed earnings for companies as varied as a bus manufacturer, a maker of refrigerators and an ID-card supplier. Conditions continued to get tougher in January for the smaller firms that form the backbone of the nation’s economy, government figures released Thursday showed.

They need US a lot more than we need THEM.

Don Surber answers my question - PG&E

| No Comments

Two days ago, I asked this question regarding California's Pacific Gas and Electric utility:

I wonder just how much of that $18 billion was wasted on scams. 100% comes to mind. Bad management and no accountability.

This morning, Don Surber has the number and Just Wow:

Bankruptcy hurts alternative energy
Old taunt: Get woke, go broke.

New: Green energy leads to bankruptcy.

California's largest utility -- Pacific Gas and Electric -- is in bankruptcy court because the state found it liable for deadly forest fires.

This is bad news for green energy because the utility has subsidized that industry for years.

The utility wants to shed $42 billion in contracts with 350 energy suppliers, mostly solar and wind farms. In many cases, the utility is the sole revenue for the company.

Dumping the contracts would be a death knell to the Democrat Party's kooky plan to get energy solely from "renewable" sources in 25 years.

Ho. Li. Crap - $42 Billion spent on Christ on a Corn Dog. No accountability indeed - their executives were just play-acting with their customers money.

The aftermath of this will be interesting to watch.

The prices of eyeglasses

| No Comments

An interesting look from the Los Angeles Times:

Why are glasses so expensive? The eyewear industry prefers to keep that blurry
It’s a question I get asked frequently, most recently by a colleague who was shocked to find that his new pair of prescription eyeglasses cost about $800.

Why are these things so damn expensive?

The answer: Because no one is doing anything to prevent a near-monopolistic, $100-billion industry from shamelessly abusing its market power.

Prescription eyewear represents perhaps the single biggest mass-market consumer ripoff to be found.

The author talks to an independent group about this and they decline to comment - here is why:

What the Vision Council probably didn’t want to get into is the fact that for years a single company, Luxottica, has controlled much of the eyewear market. If you wear designer glasses, there’s a very good chance you’re wearing Luxottica frames.

Its owned and licensed brands include Armani, Brooks Brothers, Burberry, Chanel, Coach, DKNY, Dolce & Gabbana, Michael Kors, Oakley, Oliver Peoples, Persol, Polo Ralph Lauren, Ray-Ban, Tiffany, Valentino, Vogue and Versace.

Italy’s Luxottica also runs EyeMed Vision Care, LensCrafters, Pearle Vision, Sears Optical, Sunglass Hut and Target Optical.

Just pause to appreciate the lengthy shadow this one company casts over the vision care market. You go into a LensCrafters retail outlet, where the salesperson shows you Luxottica frames under various names, and then the company pays itself when you use your EyeMed insurance.

A very sweet deal.

I had cataract surgery ten years ago and the inserts corrected my eyesight to 20/20 but I do need readers. The cost of the readers has gone up quite a bit over the last five years or so. I used to get good ones from WalMart for under ten bucks but now they are $15 and up for cheap ones. I like having a large field of view too but they have been shrinking the size of the lenses. I have a few treasured aviator-style ones for computer and closeup work but the new ones really limit my vision. Ok for reading but not for looking at a whole screen or taking a photograph.

Adapt or die - J. C. Penny

| No Comments

Another business dinosaur is thrashing its last - from The Wall Street Journal:

J.C. Penney Struggles to Avoid Same Fate as Sears
J.C. Penney Co.’s sales are falling, its stores are stuck in malls and the turnaround strategy keeps changing. Now, three months after the embattled retailer hired a new chief executive, a handful of senior positions remain vacant.

The series of events is prompting analysts and other industry experts to question whether Penney can avoid the fate of fellow department-store operator Sears Holdings Corp., which filed for bankruptcy and barely staved off liquidation.

“Penney is a broken business,” said Mark Cohen, director of retail studies at Columbia Business School. “They are looking at a very problematic 2019. It’s the mistakes of the past coming home to roost.”

Many factors - Walmart drank some of their milkshake. Online shopping did not help. They could have compensated but did not. Their management was out of touch. Same thing with Sears.

The article goes on to say that problems are also brewing for Macy’s and Kohl’s.

Not surprising at all - from the Merced Sun-Star:

PG&E calls bankruptcy ‘only viable option’ in California wildfire crisis
Overwhelmed by billions of dollars in claims from the Camp Fire and the 2017 wildfires of Northern California, PG&E said Monday it plans to file for bankruptcy, but insisted it will not go out of business.

The embattled utility gave 15-day notice of its intent to file for protection under Chapter 11 of the bankruptcy code, as required by a state law enacted last fall to deal with utility fire liabilities. The company made the announcement less than 12 hours after announcing the resignation of its CEO, Geisha Williams.

“We believe a court-supervised process under Chapter 11 will best enable PG&E to resolve its potential liabilities in an orderly, fair and expeditious fashion,” said interim CEO John R. Simon in a prepared statement. He pledged to “continue providing our customers with safe service and investing in our systems and infrastructure.” Simon had been the utility’s general counsel.

Sounds like a well-run utility - not just the fires:

The first tangible financial impact of PG&E’s troubles will come Tuesday, when the company plans to skip a $21.6 million bond payment that’s due, according to the SEC filing. The bonds are unrelated to the wildfire crisis.

The company is facing other pressures, including a federal judge’s threat to order PG&E to inspect its entire electric grid.

I feel sorry for the poor bond holders - they are going to get screwed out of their savings.

President Trump just sold rice to China. Talk about art of the deal. From farm website ProAg:

For First Time Ever, China Begins Purchasing U.S. Rice
China is buying U.S. rice for the first time. The “South China Morning Post” reported Chinese customs officials cleared American rice for import on Thursday.

It’s not clear how much China will buy, but the U.S. rice industry calls China the 800 pound gorilla for the industry, and a market barrier it’s been trying to break for decades.

Johnny Sullivan of Producers Rice Mill, Inc. says “China is a monster of a market. The facts are based on the consumption rate of rice in China, the short story is China could chew through the entire U.S. crop in 14 days, so it’s unreal.”

Tell me again how the tarrif war is hurting American business?

I love this place

| No Comments

They are farming out bids for a new high school - this great story from the Stanwood Camano News:

Bids come in under budget for the new Stanwood High School
Stanwood-Camano School District officials unsealed three bids for the new Stanwood High School — and all were under budget.

Bothell-based Cornerstone General Contractors Inc. offered the lowest bid at $89 million, about $4 million less than Redmond-based Edifice Construction and Edmonds-based Spee West Construction.

The Stanwood-Camano School Board will meet at 7:45 a.m. Monday to consider officially awarding the project, presumably to the lowest bidder. Once the board approves a pact, the long-planned project will begin in earnest.

Love it - not just Cornerstone but all three bids were under budget. Helps to have a strong economy. If this were Seattle (shudder). The money will be used wisely:

With bids under the district’s budget, there should be enough money to pay for a list of extra projects school officials wanted, Platt said. That includes new lighting at all the athletic fields, new greenhouses, softball batting cages, additional theater equipment and more.

Say it ain't so - Campbells Soup

| No Comments

I grew up on the stuff and have a can of their Chicken Noodle soup when I am feeling nostalgic or do not feel like cooking. From the New York Times:

Campbell Soup’s Fate Hangs on Duel Between Company Heirs and ‘Interloper’
Daniel Loeb is happy to play the barbarian at the gate. He’s got the money, about $3.1 billion. He’s got the office, a sleek white space that is a quintessential hedge fund aerie, with art by Jean-Michel Basquiat, Jeff Koons and Andy Warhol. And in taking on the old-money family that owns more than 40 percent of Campbell Soup Company, he’s found the perfect foil for his new-money ambitions.

Third Point, Mr. Loeb’s hedge fund in Manhattan, is pushing for the sale or restructuring of Campbell, a slumping food giant that has called Camden, N.J., home for nearly 150 years.

He’s up against the descendants of John T. Dorrance, a chemist who devised the formula for condensed soup at the turn of the last century. Dozens of family members depend on the dividends they receive from the company to underwrite their comfortable lives. And for the most part they find Mr. Loeb’s proposals anathema.

“We’re interlopers who’ve come in, and they’ve decided to stick with the status quo,” Mr. Loeb said in an interview.

His hedge fund and the company have spent months exchanging barbed letters. Their battle will culminate on Nov. 29, when Campbell shareholders vote on a proposal by Third Point to take five seats on the company’s board. Mr. Loeb has even persuaded one dissident Dorrance heir and a former Campbell board member, George Strawbridge Jr., to join his campaign.

Sounds like corporate raiding to me soon to be followed by a bout of asset stripping. Not illegal but really really sucks.

Mittens was right - auto bailout

| No Comments

From the Goldwater Institute:

Romney Was Right, the GM Bailout Goes Bust, and Taxpayers Pay the Price
“Let Detroit go bankrupt,” former presidential candidate Mitt Romney wrote in 2008, arguing that the federal government should not bail out the failing domestic auto industry for their poor management decisions. Vilified for turning his back on America’s autoworkers, Romney lost the argument, Barack Obama won the election, General Motors got its way, and U.S. taxpayers got stuck with an $11.2 billion bill to keep the company alive.

Today’s announcement from General Motors that it will close two plants in Metro Detroit and lay off 14,700 workers helps prove Romney right, albeit ten years later. Romney wrote that with a bailout, the American automotive industry’s demise “will be virtually guaranteed” because it would not be forced to undergo radical restructuring to be competitive in the marketplace. By subsidizing failure, the federal government would be gambling with taxpayer dollars and forestalling the inevitable.

This wasn’t the first time the government had bet heavily on General Motors at citizens’ expense. In a story much like recent efforts by state and local governments to give away billions of dollars to win a new Amazon headquarters, the cities of Detroit and neighboring Hamtramck teamed up in the early 1980s to win a new General Motors factory, chasing the promise of jobs and renewal of depressed and blighted neighborhoods. The Detroit News reports:

General Motors and Detroit Mayor Coleman Young hatched a plan: If the city would get the land, the auto company would build a state-of-the-art plant, crossing the border with Hamtramck, employing 6,000 people and providing a glittering example of what the auto companies and their suppliers could do in the city of their birth.

Residents who had lived in the targeted neighborhood would be given offers to sell their homes and move to make way for “progress,” but as the Detroit News reports, not everyone wanted to sell. In the face of protests and a legal challenge, the city moved forward with the plan, and a Michigan Supreme Court decision upheld the city’s decision to raze the site for General Motors. The factory was built, and decades later the court decision was overturned, but today, some 37 years later, that factory will be closed as General Motors fights to save costs.

One of the reasons that I love Ford so much is that they did not need to take any federal bailout money in 2008 - they are a well run company and turn out a really good truck. In hindsight, I am glad that Romney lost and that we got eight years of Obama - this set us up for President Trump and the people to follow him.

General Motors - meet President Trump

| No Comments

I do not think that they fully understood the consequences of betting against our President - this will be fun to watch:

Insider trading? George Soros

| No Comments

He may be a manipulative sociopath but he knows the markets - wonder if he had insider information? From Barrons:

George Soros Sold Facebook, Netflix, and Goldman Stock Just Before They Tumbled
Billionaire investor and liberal activist George Soros has been known for investing moves that have succeeded wildly —and also for ones gone horribly wrong.

Chalk up three recent moves in his win column.

Soros Fund Management, which Soros founded and chairs, exited social-network giant Facebook (FB) completely in the third quarter, while also slashing positions in Netflix stock (NFLX) and Goldman Sachs Group stock (GS). Those three stocks have tumbled in the fourth quarter so far, with Facebook and Goldman setting new lows Tuesday. They are down almost 20% and 15%, respectively, so far this quarter. Highflying streaming-content giant Netflix has tumbled almost 29% since the end of September.

Soros saved a chunk of cash by selling: Barron’s estimates that, had he maintained positions in those stocks, he would have unrealized losses of about $17.7 million so far in the fourth quarter.

Everyone knew that these prices were a giant bubble but the popping sure surprised a lot of them.

An interesting chart - 20 years

| No Comments

From Mark Perry at the American Enterprise Institute:

The CD ‘chart of the century’ makes the rounds at the Federal Reserve


Over the last 12 years, I’ve probably created and posted more than 3,000 graphics on CD, Twitter, and Facebook including charts/graphs, tables, figures, maps and Venn diagrams. Of all of those graphics, I don’t think any single one has ever gotten more attention, links, re-Tweets, re-posts, and mentions than the one above (and previous versions), which has been referred to as “the Chart of the Century.” 

And, to make this interesting, here is the underlying reason for the spike in prices:

The greater (lower) the degree of government involvement in the provision of a good or service the greater (lower) the price increases (decreases) over time, e.g., hospital and medical costs, college tuition, childcare with both large degrees of government funding/regulation and large price increases vs. software, electronics, toys, cars and clothing with both relatively less government funding/regulation and falling prices. 

So true - the prices that are going up are highly regulated businesses while the prices that have been falling are highly deregulated and capitalism and competition is allowed to work.

Great news from Baton Rouge station WBRZ:

Louisiana bars banks from $600M deal because of gun policies
Louisiana officials have blocked two of the nation's largest banks from involvement in a $600 million road financing plan because they have policies restricting gun sales by their commercial customers.

In a narrow 7-6 vote, the State Bond Commission refused to allow Citigroup and Bank of America to participate in the interstate highway financing work.

The effort to ban the banking giants from the road deal was led by Attorney General Jeff Landry and Treasurer John Schroder and opposed by Gov. John Bel Edwards' administration.

Those pushing to exclude Bank of America and Citigroup from the financial work said by enacting firearm restriction policies for their corporate customers, the banks were violating Second Amendment rights.

Good - stand up to the bullies and they will back down. Very glad that I am not banking with either of these banks. Switched to a local credit union back in 2008 when the corporate meltdown happened and have been happy ever since.

This looks interesting - Air Help

| No Comments

From their website:

Claim compensation for your flight delay or cancellation
Flight delays happen, but that doesn’t mean you have to accept them. You may be entitled to as much as $700 in compensation if your flight has been delayed, canceled or overbooked within the last three years.

They take 25% of whatever compensation you receive and you do not have to lift a finger.

President Trump is doing a very clever thing to bring down the costs of medicine and health care. He is allowing for competition. A couple of headlines with links:

By making the prices available to the insurers and the customers, he is allowing for competition. People and insurance providers can now shop around and get the best service for the best price. If a hospital wants to get more business (they are, after all, in it for the money), they will have to cut costs, trim the fat and lower their prices. Right now there is no incentive for drug companies or hospitals to cut their prices so they are gouging.

And the bubble pops (a little bit)

| No Comments

Great acronym: FAANG From CNBC:

Apple and the FANG stocks could lose at least a third of value, market watcher warns
Wall Street's crown jewels, the FAANG stocks, have lost their shine lately.

Facebook, Apple, Amazon, Netflix and Google parent Alphabet are selling off again Monday after losing a combined $185 billion over the previous two sessions.

Ahead of Apple earnings scheduled for Tuesday evening, Larry McDonald, editor of the Bear Traps Report, warns to stay away from what has been one of the hottest areas of the market this year.

"These are stocks you want to run away from," McDonald told CNBC's "Trading Nation" on Friday. "I see potentially 30 percent to 40 percent downside on the FAANGs."

These things are cyclical - the stock prices were overvalued and the leaders of these companies tried to make even more money by selling consumer data. The consumers did not like this and they revolted.

I own a rural grocery store and this video is sooo spot on:

Tip of the hat to Gerard.

October 2019

Sun Mon Tue Wed Thu Fri Sat
    1 2 3 4 5
6 7 8 9 10 11 12
13 14 15 16 17 18 19
20 21 22 23 24 25 26
27 28 29 30 31    

Environment and Climate
Cliff Mass Weather Blog
Climate Audit
Climate Depot
Green Trust
Jennifer Marohasy
Planet Gore
Science and Public Policy Institute
Solar Cycle 24
Space Weather
Space Weather - Canada
the Air Vent
Tom Nelson
Watts Up With That?

Science and Medicine
Derek Lowe
Junk Science
Life in the Fast Lane
Luboš Motl
New Scientist
Next Big Future
Ptak Science Books
Science Blog

Geek Stuff
Ars Technica
Boing Boing
Don Lancaster's Guru's Lair
Evil Mad Scientist Laboratories
Hack a Day
Kevin Kelly - Cool Tools
Slashdot: News for nerds
The Register
The Daily WTF

The Argyle Sweater
Chip Bok
Broadside Cartoons
Day by Day
Medium Large
Michael Ramirez
Prickly City
User Friendly
What The Duck

Awkward Family Photos
Cake Wrecks
Not Always Right
Sober in a Nightclub
You Drive What?

Business and Economics
The Austrian Economists
Carpe Diem
Coyote Blog

Photography and Art
Digital Photography Review
James Gurney
Joe McNally's Blog
The Online Photographer

A Western Heart
American Digest
The AnarchAngel
Anti-Idiotarian Rottweiler
Babalu Blog
Belmont Club
Bayou Renaissance Man
Classical Values
Cold Fury
David Limbaugh
Defense Technology
Doug Ross @ Journal
Grouchy Old Cripple
Irons in the Fire
James Lileks
Lowering the Bar
Maggie's Farm
Marginal Revolution
Michael J. Totten
Mostly Cajun
Power Line
Questions and Observations
Rachel Lucas
Roger L. Simon
Sense of Events
Sound Politics
The Strata-Sphere
The Smallest Minority
The Volokh Conspiracy
Tim Blair
Weasel Zippers

Gone but not Forgotten...
A Coyote at the Dog Show
Bad Eagle
Steven DenBeste
democrats give conservatives indigestion
Cox and Forkum
The Diplomad
Priorities & Frivolities
Gut Rumbles
Mean Mr. Mustard 2.0
Neptunus Lex
Other Side of Kim
Ramblings' Journal
Sgt. Stryker
shining full plate and a good broadsword
A Physicist's Perspective
The Daily Demarche
Wayne's Online Newsletter

About this Archive

This page is an archive of recent entries in the Business category.

Asshats is the previous category.

Climate is the next category.

Find recent content on the main index or look in the archives to find all content.

Monthly Archives


OpenID accepted here Learn more about OpenID
Powered by Movable Type 5.2.9