Theres also a lot of overlap in ADP numbers. Get a new job and you sometimes get 2 paychecks - for example people moving up or down or getting laid off can hit that number twice if they get a new job but are still being paid from the old one. That's why I don't pay attention to it.
There could be some correlation if you take a derivative.
Greece's new coalition government could already be on a collision course with its Troika overlords after yesterday proposing to extend the country's "fiscal adjustment period" by at least 2 years to 2016. Greece also wants to scrap plans to cut 150K public sector jobs, slash VAT on food, and provide unemployment benefits for 2 years instead of 1. [View news story]
There is only one solution. War. It will start soon.
Sprint Sees Its Calling With New $2 Billion WSCA Contract [View article]
Large contracts won over stiff competition in a down market usually become lead weights to profitability and often become losses as costs increase when the economy starts to turn around.
I think Frontier is on the right track. Homogeneous systems are an essential component of networking strategy. It sounds like they've done that, finally, but pretty much on schedule. Lets not forget that a lot of revenue in telecom is controlled by the FCC and what they will let carriers charge. This could change in an instant, and the last changes hurt FTR, so if there is an adjustment its likely to go the other way. FTR is paying taxes, and lots of them. Look at its competitors. If we assume that a company as big as FTR can afford tax planning equal to its competitors the only reasons FTR pays so much in tax is that they are a real company, making real money, with real assets, and not playing with their books. That, and the dividend at 12% says BUY to me. I bet the institutional guys would love to see FTR jump above $5. Networking, telephones, and the internet are not going anywhere but up. We can't live without them, AND the average family saves money using them. Its a no brainer that becomes more apparent in a recession. Drive to the store and pay $10 in gas, or shop on line. Call a plumber or use Google and fix it yourself. I see FTR as a possible takeover candidate. Telecommunications to the home has a huge future, and rural areas are easier to deploy high tech to. Who would do it? Google for 1. Imagine a cell system built around small boxes on the roof of every rural home instead of huge, expensive cell towers. Guess who has the infrastructure to support that? Bandwidth is running out. Smaller cells with wired infrastructure, lower power (lower range) would solve that problem. Again, FTR is there. Small high tech cell boxes with high speed internet distributed in the marketplace is a reality that will happen. ATT probably has this on the drawing board, which is one reason they lobbied to reduce the income of the wire carriers - to get the buy out price down by cutting their income. Google, Facebook, Microsoft and others have a huge interest here, because the next cell expansion is going to be the one that really rules (not to mention the fact that it will have a huge positive health impact when sites are always close). I would not be surprised to see one of the players offer $15/share for FTR. Of course FTR could eventually deploy this technology themselves beginning in 2013. If its not ready, they may augment by buying a cell carrier. Now as for the future of the U.S. economy, as stupid as Obama is, and as corrupt as Romney is, they can't stop what is going to happen next. It's not 3D printing. It's going to be distributed computing to the home. With huge disk drives getting cheaper by the month, we'll soon be broadcasting the internet from satellites. Imagine having a small system in your home that is part of a home-cloud and receives data updates continuously from overhead. Your disk fills with data, movies, audio, and information that fits your personal profile. There will be no bandwidth issues streaming video, because the streaming will be from local nodes (as above) from storage you have in your home - or your neighbors or his. We are probably no more than 10 years away from a home-cloud/home-cell architecture that delivers products and services far beyond most peoples imagination. For example, virtual reality is going to need a delivery vehicle, and I don't mean Best Buy, Sony, or UPS. A home-cloud system could deliver this in real time at the push of a button. People will experience just about anything they want to with this kind of data/telecommunication... available. Imagine the difference between Pong and today's video games. That's what life will be like in 10 years, and in 20 many of the big financial issues (like healthcare) will be GONE. You will be diagnosed at home, or even operated on in your own home. Thats is what infinite computing will do. Frontier is an integral part of the build out. They are sitting in the right place at the right time, which is why I'm long FTR.
It would be very helpful when prior numbers are revised if you would include revised from what so we could see the variance on a routine basis month to month. A format like, -3.6% (revised, prior reported -2.5%) would be nice.
Apple: Looking For A Good Entry Point? [View article]
Wait a year. It will be $400. The competition is on the horizon. Packaging can be easily copied, and computers are computers. Display resolution can only add so much to a product - until everyone has it. The laws of physics continue to hold. Then there's the government.
Apple 5-Year Price Target: A Grand And Then Some [View article]
Well, I think its time to take a real bite out of the apple. Apple makes computers. That's what a smartphone is. That's what an iPad is. Its got industry leading packaging. Jobs was able to dictate at Apple, and dictators can achieve great gains by focusing resources, and avoiding the normal committee delays inherent in any organization of humans where the brightest must often argue and politic to move things where they would have otherwise made an instantaneous decision. Jobs is gone. The fact remains that Apples products ARE computers, and there are many computer companies out there who will eventually introduce competitive products that will kill Apples profitability, and destroy their product strategy. It happened before to them, and it will happen again.
The competition will produce better products that are open, flexible, and meet the real needs of the marketplace without the price premium.
Let's face it, Captain Kirk had the first iPad. Gene Rodenbury showed us handheld computers before Jobs had a paycheck. Computers are nothing more than glass, plastic, lithium, metal etc..
Apple knows this. That's why they are looking to expand into other application areas where they can focus technology, manufacturing, and money to make an impact. The problem is these areas are already occupied by big players with heavy competition. If we learn anything from Apple, it should be that people will still pay for high quality and performance, especially if you are the first to bring it to market, and form factor is important for humans.
Lets not forget that capitalism is self correcting - not only for the losers but for the winners too, unless the government gets involved to screw it up, and they seldom act on behalf of winners.
It's too far too fast for KB Home (KBH), plummeting 15.5% premarket on an earnings miss after a 67% moonshot in the shares YTD. Q1 net orders of 1,197 were off 8% from 2011 Q1. Gross margin declined to 9.7% from 12.6% a year ago. Order backlogs represent $460M in sales against $353.6M this time last year. [View news story]
Just wait until the other shoe drops. Take a look at the racial profiling of their developments. The restrictive covenants routinely used by these companies began after the civil war to keep blacks out of certain areas. They were reincarnated after redlining was outlawed, and adopted by the large builders and banks to get around the law. Initially they got away with this, but the proof is in the pudding. A book on this subject was recently published and my bet is that there will be a lot of litigation in the next couple of years targeting the banks and large builders. Areas where these builders have operated turn extraordinarily homogeneous. States have already begun curbing the power of HOA's, but the real action will come in the courtroom. After that the housing bubble will really end, but I'm not sure these companies will survive in their present form, if at all.
EU leaders are meeting the press as the summit breaks up. Merkel: "Fiscal union is to develop over the next few years... Despite the opt-out, the U.K. is always a reliable partner." Barroso: The next step is to flesh out treaty details, i.e. little was decided and more summits are necessary. Risk markets are higher on this? [View news story]
Hats off to the U.K. for opting out. This article is right on target. Watch their economies when we close our bases in Europe. That is coming next.
Sign Of Distress? Central Banks Collaborate To Boost Liquidity [View article]
It used to be true that you can't fight the Fed, but when presidential candidates accuse the fed chairman of treason on national television the winds of change are blowing - or is this just incompetence? My analysis is below.
Does anyone remember Lyndon LaRouche? Looks like he was actually right about the crises. Showing my age here.
The liquidity issue last night kicked the can down the road financially, but why? BB and TG are simply not stupidly playing that game. They are not presidents or congressmen.
The beast with 17 heads is going to 10. Either this one or its replacement. They know this, hell its even in the Bible. But that's not the issue. Short term the crises would be very good for the U.S. economy, so why intervene? Its not to save the big banks, we don't really need them.
The real challenge is to keep the dollar as the reserve currency after the event. The system which gives us our current strength could be our undoing later. We inflate with a keyboard not a treaty.
If Germany dumped the EU or it evaporated the DM would be so strong that Germany could achieve world financial domination. That is the real problem for the U.S. Merkel might not want this but she could easily be replaced in the turmoil.
After the storm quiets, the DM would become the new financial safe haven and probably the reserve currency of the world.
Preventing that is the short term U.S. objective. BB and TG are working hard against tough odds and stupidity. My hat is off to them for trying. This is not treason, its their job.
The U.S. has abused its position having the worlds reserve currency. When we inflate we suck value from the assets stored by other central banks that were generated with the hard work of the people in those countries. This is tolerated at low levels of inflation, but we are queuing up levels that can no longer be tolerated and we will soon be dealing with a situation where foreign economies, forced to austerity, will make it a political issue. Our next president will have this on his plate.
If GG and TG prevail by keeping Germany burdened with the current EU, then the U.S. economy is going to take off. The next challenge will be to return Americanism to America and rebuild capitalism as we prepare for competition with the revitalized EU.
Our next president will have a very tough job dealing with the poison of socialism, the concentration of wealth, and unleashing the power of new small business expansion on a shoe string while dealing with the public unions and downsizing government.
Lets hope we get to enjoy these problems because if BB and TG fail the U.S. will be devastated. This is a war being fought with money, credit, inflation, diplomacy, and strategy. As a consequence of the battle you can expect swings of 500 points or more repeatedly. If we had a real president I'd bet on the U.S.of A. but sadly we don't and kicking the can until we do might be a realistic alternative.
Success handling the financial situation must take place in spite of the developments in Russia and the Middle East. The fact that we've come this far is a truly remarkable characteristic of the American Constitutional System which divides power and makes it capable of autonomous operation in our best interest when necessary.
Are The Major Banks Near A Generational Bottom? [View article]
Don't even think about it. The major banks are nothing but an arm of the government, and no more valuable. Since all governments are broke, dishonest, self serving, and incompetent, the banks are nothing less. That is why the disclosure laws, accounting procedures, and financial dealings are unregulated and intentionally complicated enough to hide their actions.
It's possible that you can make some money on the banks short term because most people do not understand whats going on, but the tide is against you. The internet is creating a major headwind for them, just as it is for the Fed. The days of the dark smoke filled room dealings in secret are just about over, and the bright light of public scrutiny using technology is fast approaching.
Banks are no longer businesses. I would not be surprised at all if all of the major banks are nationalized in 2012 by forcing them into bankruptcy, moving any remaining assets to the public treasury and replacing them and the Fed with an open agency having all of its dealings public on the internet against which all citizens will have certain equal rights of access depending upon their earning power.
A better approach is to view them as a commodity, and its clear from the regulations that continue to come from Congress, that they are starting to treat them this way. The banks as we once knew them, particularly the larger banks, are never coming back as business entities. The rules have changed. When presidential candidates accuse the Fed chairman of treason, when most Americans hate bankers and have suffered from attempting to deal with banks, especially during their time of utmost urgency, major changes are in the wind. DO NOT be fooled by looking into the past and trying to assume similarity in the future. The banks are going the way of AMR.
When Big Banks Sink, The Market Cannot Fly [View article]
This is a good overview, but the root cause of the downside moves is too lightly covered. Why? Because there is no real data available, the disclosure laws and accounting procedures are too weak, and we can only take their word for it. No group of people (except perhaps Congress and the Presidency) bear a badge of dishonesty larger than the banks. Dodd Frank is an issue but it will not go away - it will probably morph into something that is more effective and less cumbersome. The banking system as we once knew it is not going to survive, the people are simply too angry. Forget the dividends. They will be gone next year.
Apples strength comes from being first and not much more. The real power of competitors is just beginning to appear on the horizon. I think Custer is a better analogy for Apple. I have Apple products because they were early and the best, but the existing product line is already aging and the financial pressure has put every engineer in the world working overtime to keep their companies competitive. That is a challenge that Apple cannot withstand. In reality the iPad is a nice product, but its really nothing more than a laptop without the keyboard but with a touchscreen. The iPhone was first in high functionality phones but now there are many choices. Its not rocket science to produce a better iPad alternative that is much cheaper, expandable, and much more functional. Sometime in 2012 Apple will be a disaster, as these products begin to appear from the low end manufacturers. Remember this, product shipments are driven by technology and guarded by patents. Demand is near infinity at the entry of new packaging and technology, but quickly equalizes as the market is satisfied and becomes common. If you had your $300 laptop in 1970 the DOD would have paid you $1B for it. I personally think Jobs got far too much credit as an innovator. He was a good engineer that was lucky enough to rise to the point where he could control the corporate bean counters primarily because of his wealth which he obtained from other sources. This kind of innovation has often been achieved by moving aggressive engineers into the boardroom and pushing out the suits who are typically not creative and exist in the world of corporate politics. Jobs was able to bypass that ceiling and unlike most engineers had the skill to exist in that world on his own merit. That skill was his true value. His engineering talent was way overrated by the market. Either way, I don't think Apple is a good value, a good investment, or a significant player 5 years from now. They are the next RIM.
After slowing over past weeks, several measures of European money supply have begun to shrink. "We are seeing the destruction of money and it is a clear warning of serious trouble over the next 6 months," says Tim Congdon. The decline comes just at the time banks are shedding assets to raise capital, threatening a double-whammy of a credit crunch that could be worse than 2008. [View news story]
One of the assets they are probably going to sell off is gold. After all, its their hedge, and it will go. I'm looking for gold to absorb the brunt of their crash, as they trade it off for the obligations they must service. By using their gold reserves Europe will transfer some of their burden to the rest of the world who will suffer the market decline of their hedge. At that point the U.S. and China will be unprotected by the gold hedge and the crash here will make Europe look like child's play. While I'm making predictions, 7 countries will be tossed out of the E.U., and when the dust settles, their economy will survive because they were the first to do down, make the required corrections, and rebuild based on capitalistic assumptions that will be widely accepted. Then they will establish the new reserve currency while we crash and burn. Sorry for being so bearish!
June ADP Jobs Report: +176K vs. +136K prior (revised from 133K) and expectations of 95K. [View news story]
There could be some correlation if you take a derivative.
Greece's new coalition government could already be on a collision course with its Troika overlords after yesterday proposing to extend the country's "fiscal adjustment period" by at least 2 years to 2016. Greece also wants to scrap plans to cut 150K public sector jobs, slash VAT on food, and provide unemployment benefits for 2 years instead of 1. [View news story]
U.S. Economy: Why The Looming Fiscal Cliff Matters [View article]
Sprint Sees Its Calling With New $2 Billion WSCA Contract [View article]
I wouldn't break out the bubbly just yet.
Frontier Communications' CEO Discusses Q1 2012 Results - Earnings Call Transcript [View article]
I see FTR as a possible takeover candidate. Telecommunications to the home has a huge future, and rural areas are easier to deploy high tech to. Who would do it? Google for 1. Imagine a cell system built around small boxes on the roof of every rural home instead of huge, expensive cell towers. Guess who has the infrastructure to support that? Bandwidth is running out. Smaller cells with wired infrastructure, lower power (lower range) would solve that problem. Again, FTR is there. Small high tech cell boxes with high speed internet distributed in the marketplace is a reality that will happen. ATT probably has this on the drawing board, which is one reason they lobbied to reduce the income of the wire carriers - to get the buy out price down by cutting their income. Google, Facebook, Microsoft and others have a huge interest here, because the next cell expansion is going to be the one that really rules (not to mention the fact that it will have a huge positive health impact when sites are always close).
I would not be surprised to see one of the players offer $15/share for FTR. Of course FTR could eventually deploy this technology themselves beginning in 2013. If its not ready, they may augment by buying a cell carrier.
Now as for the future of the U.S. economy, as stupid as Obama is, and as corrupt as Romney is, they can't stop what is going to happen next. It's not 3D printing. It's going to be distributed computing to the home. With huge disk drives getting cheaper by the month, we'll soon be broadcasting the internet from satellites. Imagine having a small system in your home that is part of a home-cloud and receives data updates continuously from overhead. Your disk fills with data, movies, audio, and information that fits your personal profile. There will be no bandwidth issues streaming video, because the streaming will be from local nodes (as above) from storage you have in your home - or your neighbors or his. We are probably no more than 10 years away from a home-cloud/home-cell architecture that delivers products and services far beyond most peoples imagination. For example, virtual reality is going to need a delivery vehicle, and I don't mean Best Buy, Sony, or UPS. A home-cloud system could deliver this in real time at the push of a button. People will experience just about anything they want to with this kind of data/telecommunication... available. Imagine the difference between Pong and today's video games. That's what life will be like in 10 years, and in 20 many of the big financial issues (like healthcare) will be GONE. You will be diagnosed at home, or even operated on in your own home. Thats is what infinite computing will do. Frontier is an integral part of the build out. They are sitting in the right place at the right time, which is why I'm long FTR.
Feb. Durable Goods: +2.2% vs. +3% expected, -3.6% (revised) prior. Ex-transport +1.6% vs. +1.7% expected, -3.0% prior. [View news story]
Apple: Looking For A Good Entry Point? [View article]
Apple 5-Year Price Target: A Grand And Then Some [View article]
The competition will produce better products that are open, flexible, and meet the real needs of the marketplace without the price premium.
Let's face it, Captain Kirk had the first iPad. Gene Rodenbury showed us handheld computers before Jobs had a paycheck. Computers are nothing more than glass, plastic, lithium, metal etc..
Apple knows this. That's why they are looking to expand into other application areas where they can focus technology, manufacturing, and money to make an impact. The problem is these areas are already occupied by big players with heavy competition. If we learn anything from Apple, it should be that people will still pay for high quality and performance, especially if you are the first to bring it to market, and form factor is important for humans.
Lets not forget that capitalism is self correcting - not only for the losers but for the winners too, unless the government gets involved to screw it up, and they seldom act on behalf of winners.
It's too far too fast for KB Home (KBH), plummeting 15.5% premarket on an earnings miss after a 67% moonshot in the shares YTD. Q1 net orders of 1,197 were off 8% from 2011 Q1. Gross margin declined to 9.7% from 12.6% a year ago. Order backlogs represent $460M in sales against $353.6M this time last year. [View news story]
EU leaders are meeting the press as the summit breaks up. Merkel: "Fiscal union is to develop over the next few years... Despite the opt-out, the U.K. is always a reliable partner." Barroso: The next step is to flesh out treaty details, i.e. little was decided and more summits are necessary. Risk markets are higher on this? [View news story]
Sign Of Distress? Central Banks Collaborate To Boost Liquidity [View article]
Does anyone remember Lyndon LaRouche? Looks like he was actually right about the crises. Showing my age here.
The liquidity issue last night kicked the can down the road financially, but why? BB and TG are simply not stupidly playing that game. They are not presidents or congressmen.
The beast with 17 heads is going to 10. Either this one or its replacement. They know this, hell its even in the Bible. But that's not the issue. Short term the crises would be very good for the U.S. economy, so why intervene? Its not to save the big banks, we don't really need them.
The real challenge is to keep the dollar as the reserve currency after the event. The system which gives us our current strength could be our undoing later. We inflate with a keyboard not a treaty.
If Germany dumped the EU or it evaporated the DM would be so strong that Germany could achieve world financial domination. That is the real problem for the U.S. Merkel might not want this but she could easily be replaced in the turmoil.
After the storm quiets, the DM would become the new financial safe haven and probably the reserve currency of the world.
Preventing that is the short term U.S. objective. BB and TG are working hard against tough odds and stupidity. My hat is off to them for trying. This is not treason, its their job.
The U.S. has abused its position having the worlds reserve currency. When we inflate we suck value from the assets stored by other central banks that were generated with the hard work of the people in those countries. This is tolerated at low levels of inflation, but we are queuing up levels that can no longer be tolerated and we will soon be dealing with a situation where foreign economies, forced to austerity, will make it a political issue. Our next president will have this on his plate.
If GG and TG prevail by keeping Germany burdened with the current EU, then the U.S. economy is going to take off. The next challenge will be to return Americanism to America and rebuild capitalism as we prepare for competition with the revitalized EU.
Our next president will have a very tough job dealing with the poison of socialism, the concentration of wealth, and unleashing the power of new small business expansion on a shoe string while dealing with the public unions and downsizing government.
Lets hope we get to enjoy these problems because if BB and TG fail the U.S. will be devastated. This is a war being fought with money, credit, inflation, diplomacy, and strategy. As a consequence of the battle you can expect swings of 500 points or more repeatedly. If we had a real president I'd bet on the U.S.of A. but sadly we don't and kicking the can until we do might be a realistic alternative.
Success handling the financial situation must take place in spite of the developments in Russia and the Middle East. The fact that we've come this far is a truly remarkable characteristic of the American Constitutional System which divides power and makes it capable of autonomous operation in our best interest when necessary.
Are The Major Banks Near A Generational Bottom? [View article]
It's possible that you can make some money on the banks short term because most people do not understand whats going on, but the tide is against you. The internet is creating a major headwind for them, just as it is for the Fed. The days of the dark smoke filled room dealings in secret are just about over, and the bright light of public scrutiny using technology is fast approaching.
Banks are no longer businesses. I would not be surprised at all if all of the major banks are nationalized in 2012 by forcing them into bankruptcy, moving any remaining assets to the public treasury and replacing them and the Fed with an open agency having all of its dealings public on the internet against which all citizens will have certain equal rights of access depending upon their earning power.
A better approach is to view them as a commodity, and its clear from the regulations that continue to come from Congress, that they are starting to treat them this way. The banks as we once knew them, particularly the larger banks, are never coming back as business entities. The rules have changed. When presidential candidates accuse the Fed chairman of treason, when most Americans hate bankers and have suffered from attempting to deal with banks, especially during their time of utmost urgency, major changes are in the wind. DO NOT be fooled by looking into the past and trying to assume similarity in the future. The banks are going the way of AMR.
When Big Banks Sink, The Market Cannot Fly [View article]
Bullish Cross, which says it has never missed a price target on Apple (AAPL), now hails it as "the most undervalued and underappreciated large-cap growth company in America... Apple is reaching a floor in this age of P/E compression, and is about to undergo one of the biggest rallies in [its] history." Shares now trade at a trailing 13.1 P/E, lowest in nearly a decade. (also: I, II) [View news story]
Its not rocket science to produce a better iPad alternative that is much cheaper, expandable, and much more functional. Sometime in 2012 Apple will be a disaster, as these products begin to appear from the low end manufacturers. Remember this, product shipments are driven by technology and guarded by patents. Demand is near infinity at the entry of new packaging and technology, but quickly equalizes as the market is satisfied and becomes common. If you had your $300 laptop in 1970 the DOD would have paid you $1B for it.
I personally think Jobs got far too much credit as an innovator. He was a good engineer that was lucky enough to rise to the point where he could control the corporate bean counters primarily because of his wealth which he obtained from other sources. This kind of innovation has often been achieved by moving aggressive engineers into the boardroom and pushing out the suits who are typically not creative and exist in the world of corporate politics. Jobs was able to bypass that ceiling and unlike most engineers had the skill to exist in that world on his own merit. That skill was his true value. His engineering talent was way overrated by the market.
Either way, I don't think Apple is a good value, a good investment, or a significant player 5 years from now. They are the next RIM.
After slowing over past weeks, several measures of European money supply have begun to shrink. "We are seeing the destruction of money and it is a clear warning of serious trouble over the next 6 months," says Tim Congdon. The decline comes just at the time banks are shedding assets to raise capital, threatening a double-whammy of a credit crunch that could be worse than 2008. [View news story]