Too cold! Ed’s Daily Notes for January 7th   7 comments


I am giving the bear to anyone who wants to suggest global warming is a threat today. It is 21 in Savannah, GA right now, with wind chills down to 7. Please, give me global warming! If it gets any colder, I will need a coal-burning stove to keep warm!

On the bright side, it is supposed to be 63 here on Friday. Come on Friday!

Fox Business: Senate Confirms Janet Yellen as Fed Chair

It’s official! Janet Yellen will be the next Federal Reserve Chairman, when Ben Bernanke’s term ends on January 31st. I take a “Henry VIII” view of it: “Second verse, same as the first…” Yellen has spent too much time defending Bernanke’s policies. If she does turn out to be different, that would be a surprise.

My Fox NY: Restive staff seize bosses at French Goodyear site

I hate to insult France, but…

Farm tires filled the doorway, and the two Goodyear managers were trapped in the conference room with angry workers demanding more money in exchange for the inevitable loss of their jobs. Monday’s meeting was not going well.

Goodyear has tried to shutter the plant in the northern city of Amiens for five years without success. Their latest attempt was met with a “boss-napping,” a French tactic that had largely faded away after the height of the economic crisis in 2009. More theater than actual threat, these aim to grab management’s attention — by grabbing management.

The Amiens plant has an especially contentious past. Goodyear’s hopes to close the plant have been hindered by violent protests that included bonfires of tires, government concerns and France’s prolonged layoff procedures. Now, the union is willing to accept the inevitable loss of jobs — but at a cost.

“Clearly it was no longer possible to keep fighting for our jobs,” Mickael Wamen, the union president, told LCI television. “So we decided to change tactics and fight for the largest compensation possible.”

In exchange for freeing the bosses, they’re demanding 80,000 euros ($108,000) plus 2,500 euros ($3,400) for each year worked. By late in the day, the managers were still trapped.

Evelyne Becker, a union representative at the factory, said the two were blocked from leaving after an especially difficult meeting with staff. Goodyear confirmed the two managers were being held against their will.

France’s status as a “developed nation” is severely questionable after this. Even though the managers’ lives aren’t being threatened, and even if they are supposedly being treated well, this kind of behavior is inexcusable. I personally wouldn’t invest a penny in France.

Bloomberg: Samsung Posts Profit Decline Amid Battle With Apple

For me, the bellwether stock for earnings season is Samsung, even though it is only thinly traded over-the-counter in the U.S. Mainly, I like it because they are one of the largest tech companies in the world, and their earnings can portend a lot about what to expect from other large tech companies. And the results?

Samsung Electronics Co. (005930) posted its first profit decline in nine quarters as new Apple Inc. (AAPL) iPhones won over high-end handset buyers and models from cheaper Chinese producers lured budget customers.

Operating profit was 8.3 trillion won ($7.8 billion) in the three months ended December, the Suwon, South Korea-based company said in a statement today. That compares with profit of 9 trillion won a year earlier, according to data compiled by Bloomberg.

Sales of Samsung’s Galaxy S4 have slowed amid the releases of the iPhone 5s and 5c and Chinese makers selling handsets for as low as $100. The world’s biggest maker of smartphones and televisions is introducing new designs, including curved screens and bendable displays, to spark sales after ramping up spending on employee bonuses and promotions for the Christmas shopping season.

…Fourth-quarter sales were about 59 trillion won, the company said today. That increase of 5.3 percent was the slowest since the third quarter of 2011 and compares with the 61.5 trillion-won average of 36 estimates.

I would view this as a positive for the electronics industry as a whole, mainly since Samsung increased sales in spite of increased competition from both the high and low ends. I would expect good earnings from Apple and Google on this news.


Posted January 7, 2014 by edmcgon in Federal Reserve, News, Stocks, Technology

7 responses to “Too cold! Ed’s Daily Notes for January 7th

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  1. Anyone read about this?
    Is Google trying to rule the world or what? It’s google fiber tv/internet service 5mb down and 1 meg up is free. $120 for gigabit fiber and tv.
    If Google runs fiber across this country I’ll hand it to them. So far fiber is so much more expensive that we only use it in certain applications. I think At&t is using fiber to a main hub and then 2 wire copper that has a limitation on distance. I think I read Verizon isn’t finding there investment into fiber cost effective..??

  2. Ed,
    I certainly would like to get on your Google bandwagon so that I can be there when they WILL rule the world. Too late?

    • George,
      For my time frame, 10+ years, it’s not too late. But it’s had a good run-up lately. At this point, I’d try and buy it around $1100. Alternatively, you could wait until January 30th when they report earnings, and hope for a disappointment. And yes, I would absolutely buy them with an earnings disappointment, because Google tends to keep their eye on the long-term more than each quarter, so they do occasionally disappoint.

  3. May thanks Ed.
    Best wishes to you and your family for a Happy, Healthy, Prosperous New Year!!

  4. Ed – that’s many thanks.

  5. Same to you and yours, George!

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