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The week in bankruptcies: R&S REI LLC and G&R Transit Solutions LLC

Sacramento area bankruptcy courts recorded two business filings — including zero with total debt above $1 million — during the week that ended Oct. 8. Year to date through Oct. 8, the court recorded 37 Chapter 7 or Chapter 11 business bankruptcy filings, a 21% decrease from the same span the prior year. Chapter 7 bankruptcy protection typically provides for the liquidation of a business’ assets to satisfy creditor claims, while Chapter 11 protection enables a business to restructure its creditor….....»»

Category: topSource: bizjournalsOct 14th, 2021

Van Jones on his new podcast in partnership with Amazon Music and how he plans to implement a $100 million gift for charity from Jeff Bezos

Van Jones spoke to Insider about his new podcast, "Uncommon Ground with Van Jones," which debuted this week in partnership with Amazon Music. Van Jones. Leigh Vogel/Getty Images Van Jones spoke to Insider about his new podcast, "Uncommon Ground with Van Jones," which debuted this week in partnership with Amazon Music. Jones also discussed his work in criminal-justice reform and the award he received from Jeff Bezos that included a $100 million gift for non-profit recipients of Jones' choosing. Van Jones, the CNN political commentator, activist, and entrepreneur, spoke to Insider last week in a phone interview tied to the release of his new podcast, "Uncommon Ground with Van Jones," which debuted Wednesday in partnership with Amazon Music."Uncommon Ground" finds Jones in conversation with notable names and grassroots activists "in search of unifying solutions to our country's biggest problems," with topics ranging "from climate change, to prison reform, to voting rights, to spiritual evolution, to cancel culture," according to a release. The initial slate of guests includes Deepak Chopra, Chef José Andrés, will.i.am, Sarah Silverman, Bishop T.D. Jakes, Andrew Yang, and S.E. Cupp.In our interview, Jones discussed the podcast in relation to his history of work in criminal-justice reform, including his founding and continued presence on the Reform Alliance and his efforts to help pass the bipartisan legislation of the First Step Act in 2018. He also alluded to his plans to implement the "Courage and Civility Award" that he received from Amazon founder Jeff Bezos in July, which included a $100 million to gift to non-profit organizations of Jones' choice.This interview has been lightly edited and condensed for clarity.How did this come together, the podcast and the partnership behind it?You know, I've been fascinated by the podcast space as a place for a deeper and more intimate conversation, had the opportunity to do a podcast with CNN called "Incarceration, Inc.," and really enjoyed that experience. And I just wanted to have broader, deeper conversations in the podcast space. Amazon is in the process of ramping up this capacity, in this area, and I'm excited to be on board. How do you approach making topics like climate change and voting rights compelling enough to engage the average or uninterested listener? Sort of the question of our times.I think people are very interested in these topics. I think that they are just worn down by the tone and the tenor of the discussion. I think it's kind of like when you have two neighbors fighting over an important topic. You're sick of the fight, but you're not sick of the topic. How are we going to give our kids a livable planet? How are we going to make sure that democracy works better for everybody? How can we make sure that people have opportunities in this new kind of high-tech economy? Those are things that people are thinking about and talking about and worrying about all the time. I just think what we have to do is make sure that we are going deeper than just the soundbites and the tweets and the talking points. And that's really what "Uncommon Ground" is all about.Also, we're going to be hearing from new voices, all these amazing grassroots leaders, who I get a chance to meet when I'm on the road, working on political causes or speaking in different communities. These folks never get heard from, and they are so hopeful and smart and tough. So I think having new voices is going to be important and hearing from new voices. And then hearing from more familiar voices, but talking about things in a deeper, more heartful way. So there's going to be new voices in the conversation. There's also gonna be new perspectives from familiar voices in the same conversation.What's your ideal guest, apart from who you've listed? Who do you seek out for this type of a format?Well, I'm really proud of the people we've already got. I mean, we've got some of the biggest humanitarian voices on the planet, whether you're talking about Chef José Andrés, or whether you're talking about Deepak Chopra or T.D. Jakes. We also have people that are not as well-known, but grassroots activists, like Malkia Cyril and LaTonya from Philadelphia. And then, as we go forward, I'm hoping that that people recognize us as a very good place to come and have a deeper and more heartful conversation. And I think people may be surprised at some of the voices that we pull on overtime. Jeff Bezos (C) with Chef José Andrés (L) and Van Jones in July, after announcing a $100 million award for charity to both Andrés and Jones. Joe Raedle/Getty Images I wanted to say, congrats on the award from Jeff Bezos.Oh, well, thank you.How does one go about strategizing the implementation of a $100 million gift for charity?Uh, very carefully. [Laughs].[Laughs].[Laughs]. You know, I was blown away that Jeff Bezos and Lauren Sanchez decided to create this new award in the first place, and then to have me be one of the first two recipients. Over the past 30 days, since we've only had the grant for 30 days, I've been in very deep conversation and dialogue with experts across a whole range of different fields of endeavor. And we have a 10-year horizon to figure out how to invest and distribute the funds. But look, here's the thing. I've always been fighting for the same basic causes. I've been trying to disrupt prisons and pollution and poverty for my whole career. But I've never had enough philanthropic capital to put behind my ideas or the solutions that I think are most promising.And so now that's different. It's a crazy experience to go from being somebody who's been asking for grants for 30 years to being somebody who is in a position to invest philanthropically. We'll have announcements to make in 2022, but I am taking my time. I'm not in a rush. You know, this is a once in a lifetime opportunity. We call this "the miracle money," and I want every penny to make a miracle. That's the standard. If I can 10x the impact, I want to be able to do that. So, every penny needs to make a miracle. And that's what we're focused on. By the way, the very first episode of the podcast, José Andrés and I talk about, in more depth and detail, what the experience is like. If anybody's interested in how the first two recipients of this award are thinking about it, should definitely check out episode one of the podcast.I, uh, will do. Going back a few years here, and in relation to your past efforts, what did you see as the key to the bipartisan effort behind the First Step Act?There are some areas where the two parties are just not going to agree and should therefore just battle it out, but that's not the vast majority of issues. If you take an issue like criminal justice, everybody understands that the liberals have our stake of the fight. Progressive are very passionate about social justice and racial justice. So the incarceration industry really offends progressive values, but there are conservative values that the incarceration industry also offends. Conservatives don't like big, staled, unaccountable government bureaucracies that eat up a ton of money and produce bad results. Well, that's the prison system to a T. Right-wing libertarians don't like the government gobbling up more and more people liberties. That's what the prison industry does every day. And there are a lot of conservative Christians who wonder, "Where is the redemption? Where's the second chances?" How can a fallen center rise again, if the prison industry just destroy people's lives and brands them forever as being unemployable and unworthy?And so it's when you find those areas where liberal passion for justice can line up with conservative passion for liberty, you can build a Liberty & Justice For All Coalition, and that's what we did. You had the strongest progressives and the strongest conservatives voting together during the Trump administration to pass a bill that by some calculations has helped 20,000 people come home from federal prison much earlier than they would have. That's the kind of bottom-up bipartisanship that I think we need more of. And by the way, we talk about that kind of stuff on the podcast. Also, we talk about climate solutions, which you mentioned earlier. Everybody knows that progressives are concerned about climate because of concern about future generations and species being loss. What people don't talk about is the fact that you have a bunch of red state farmers and ranchers who are getting pummeled by floods and fires and droughts, and who are very close to the land. And they know that the climate is changing rapidly and they would be very open to certain types of climate solutions, especially those that would pay them more money to capture and sequester carbon in the soil with more advanced agricultural techniques.So I spend a lot of time looking for those unlikely overlaps of interests. And I call those places, where you're shocked and surprised, and you're like, "Wait a minute. These two groups that you think would be far apart actually are just putting the emphasis emphasis on a different syllable, but they're saying the same thing." I call those areas of unexpected overlap "Uncommon Ground." And when you find them, whether it's on addiction or criminal justice or climate, or youth opportunity, I think we should go deep there and pull as many people into those conversations as possible. And that's the point of the podcast. Jay-Z, Van Jones, Robert Kraft, and Michael Rubin at a Reform Alliance event in 2019. Kevin Mazur/Getty Images What has your participation in the Reform Alliance meant to you, and what do you see coming from your continued role in the organization?It's just an extraordinary opportunity to work with people who have massive hearts, big brains, and big wallets, who want to make a difference. And I learn from each and every board member I every time I'm in communication with them. The level of concern and passion that those board members have is really mind-blowing. As well-known as they are, they do a lot of work behind the scenes that they deliberately don't want acknowledged, 'cause they don't want to create a feeding frenzy every time they show up. But, you know, the number of governors and senators and mayors that have gotten phone calls from a Reform Alliance board members I think would shock a lot of your readers. And then also they've built an unbelievable team of policy experts and advocates that have been able to pass bills in eight states, 13 bills and eight states, in just a two year period. That's a pretty, pretty fast clip.Some people, I think, thought this was going to be a vanity project, but it's turning out to be a much more impactful organization already than some of the skeptics were suggesting. And the issue that was the Reform Alliance takes on, probation and parole reform, really has not had a national champion until we launched. And two thirds of the people who were under the control of the criminal justice system are not in prison or jail. They're on either probation or parole, and their lives can be a living hell because it is so easy to be sent back to prison. If you show up late to a meeting with your parole officer or you get caught talking to someone who has a criminal record, and you're not doing anything, you can be back in prison and lose your job or your apartment and custody of your kids. So every day is just an incredibly anxiety-provoking nightmare and that level of stress doesn't make any community better or safer. So we're very proud that we are beginning to help to change that system, to make it a lot more humane, a lot more effective. ...Look, my view about this whole situation that we're in is that the divisive voices in our country, no matter what political ideology or race, are just getting way too much attention. And the unifying voices, the problem-solving voices, the healing voices are just getting way too little attention. And I think now's the time for people who've got really great ideas to solve the problems, to have a platform. And that's really what "Uncommon Ground" is all about. It's a platform for people who are exciting people, who are interesting people, who also are about that business of solving problems, to finally be heard.Read the original article on Business Insider.....»»

Category: topSource: businessinsider6 hr. 44 min. ago

Why Booz Allen Hamilton (BAH) is a Top Momentum Stock for the Long-Term

Wondering how to pick strong, market-beating stocks for your investment portfolio? Look no further than the Zacks Style Scores. It doesn't matter your age or experience: taking full advantage of the stock market and investing with confidence are common goals for all investors. Luckily, Zacks Premium offers several different ways to do both.Featuring daily updates of the Zacks Rank and Zacks Industry Rank, full access to the Zacks #1 Rank List, Equity Research reports, and Premium stock screens, the research service can help you become a smarter, more self-assured investor.Zacks Premium also includes the Zacks Style Scores.What are the Zacks Style Scores?The Zacks Style Scores, developed alongside the Zacks Rank, are complementary indicators that rate stocks based on three widely-followed investing methodologies; they also help investors pick stocks with the best chances of beating the market over the next 30 days.Based on their value, growth, and momentum characteristics, each stock is assigned a rating of A, B, C, D, or F. The better the score, the better chance the stock will outperform; an A is better than a B, a B is better than a C, and so on.The Style Scores are broken down into four categories:Value ScoreFor value investors, it's all about finding good stocks at good prices, and discovering which companies are trading under their true value before the broader market catches on. The Value Style Score utilizes ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and a host of other multiples to help pick out the most attractive and discounted stocks.Growth ScoreGrowth investors, on the other hand, are more concerned with a company's financial strength and health, and its future outlook. The Growth Style Score examines things like projected and historic earnings, sales, and cash flow to find stocks that will experience sustainable growth over time.Momentum ScoreMomentum investors, who live by the saying "the trend is your friend," are most interested in taking advantage of upward or downward trends in a stock's price or earnings outlook. Utilizing one-week price change and the monthly percentage change in earnings estimates, among other factors, the Momentum Style Score can help determine favorable times to buy high-momentum stocks.VGM ScoreIf you like to use all three kinds of investing, then the VGM Score is for you. It's a combination of all Style Scores, and is an important indicator to use with the Zacks Rank. The VGM Score rates each stock on their shared weighted styles, narrowing down the companies with the most attractive value, best growth forecast, and most promising momentum.How Style Scores Work with the Zacks RankThe Zacks Rank, which is a proprietary stock-rating model, employs earnings estimate revisions, or changes to a company's earnings expectations, to make building a winning portfolio easier.#1 (Strong Buy) stocks have produced an unmatched +25.41% average annual return since 1988, which is more than double the S&P 500's performance over the same time frame. However, the Zacks Rank examines a ton of stocks, and there can be more than 200 companies with a Strong Buy rank, and another 600 with a #2 (Buy) rank, on any given day.But it can feel overwhelming to pick the right stocks for you and your investing goals with over 800 top-rated stocks to choose from.That's where the Style Scores come in.You want to make sure you're buying stocks with the highest likelihood of success, and to do that, you'll need to pick stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you like a stock that only as a #3 (Hold) rank, it should also have Scores of A or B to guarantee as much upside potential as possible.The direction of a stock's earnings estimate revisions should always be a key factor when choosing which stocks to buy, since the Scores were created to work together with the Zacks Rank.For instance, a stock with a #4 (Sell) or #5 (Strong Sell) rating, even one that boasts Scores of A and B, still has a downward-trending earnings forecast, and a much greater likelihood its share price will decline as well.Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.Stock to Watch: Booz Allen Hamilton (BAH)McLean, VA-based Booz Allen Hamilton Holding Corporation is a provider of management and technology consulting, analytics, engineering, digital solutions, mission operations as well as cyber expertise to the United States and international governments, corporations plus not-for-profit organizations. The company operates as a single profit center with a single bonus pool for partners, vice presidents, principals and senior associates.BAH is a #3 (Hold) on the Zacks Rank, with a VGM Score of B.Momentum investors should take note of this Business Services stock. BAH has a Momentum Style Score of B, and shares are up 5.3% over the past four weeks.For fiscal 2022, one analysts revised their earnings estimate upwards in the last 60 days, and the Zacks Consensus Estimate has increased $0 to $4.21 per share. BAH boasts an average earnings surprise of 11.3%.With a solid Zacks Rank and top-tier Momentum and VGM Style Scores, BAH should be on investors' short list. Breakout Biotech Stocks with Triple-Digit Profit Potential The biotech sector is projected to surge beyond $2.4 trillion by 2028 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases. Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Recommendations from previous editions of this report have produced gains of +205%, +258% and +477%. The stocks in this report could perform even better.See these 7 breakthrough stocks now>>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Booz Allen Hamilton Holding Corporation (BAH): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacks7 hr. 44 min. ago

Why Fiserv (FISV) is a Top Momentum Stock for the Long-Term

Wondering how to pick strong, market-beating stocks for your investment portfolio? Look no further than the Zacks Style Scores. It doesn't matter your age or experience: taking full advantage of the stock market and investing with confidence are common goals for all investors. Luckily, Zacks Premium offers several different ways to do both.Featuring daily updates of the Zacks Rank and Zacks Industry Rank, full access to the Zacks #1 Rank List, Equity Research reports, and Premium stock screens, the research service can help you become a smarter, more self-assured investor.Zacks Premium also includes the Zacks Style Scores.What are the Zacks Style Scores?The Zacks Style Scores, developed alongside the Zacks Rank, are complementary indicators that rate stocks based on three widely-followed investing methodologies; they also help investors pick stocks with the best chances of beating the market over the next 30 days.Based on their value, growth, and momentum characteristics, each stock is assigned a rating of A, B, C, D, or F. The better the score, the better chance the stock will outperform; an A is better than a B, a B is better than a C, and so on.The Style Scores are broken down into four categories:Value ScoreFor value investors, it's all about finding good stocks at good prices, and discovering which companies are trading under their true value before the broader market catches on. The Value Style Score utilizes ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and a host of other multiples to help pick out the most attractive and discounted stocks.Growth ScoreGrowth investors, on the other hand, are more concerned with a company's financial strength and health, and its future outlook. The Growth Style Score examines things like projected and historic earnings, sales, and cash flow to find stocks that will experience sustainable growth over time.Momentum ScoreMomentum investors, who live by the saying "the trend is your friend," are most interested in taking advantage of upward or downward trends in a stock's price or earnings outlook. Utilizing one-week price change and the monthly percentage change in earnings estimates, among other factors, the Momentum Style Score can help determine favorable times to buy high-momentum stocks.VGM ScoreIf you like to use all three kinds of investing, then the VGM Score is for you. It's a combination of all Style Scores, and is an important indicator to use with the Zacks Rank. The VGM Score rates each stock on their shared weighted styles, narrowing down the companies with the most attractive value, best growth forecast, and most promising momentum.How Style Scores Work with the Zacks RankThe Zacks Rank, which is a proprietary stock-rating model, employs earnings estimate revisions, or changes to a company's earnings expectations, to make building a winning portfolio easier.#1 (Strong Buy) stocks have produced an unmatched +25.41% average annual return since 1988, which is more than double the S&P 500's performance over the same time frame. However, the Zacks Rank examines a ton of stocks, and there can be more than 200 companies with a Strong Buy rank, and another 600 with a #2 (Buy) rank, on any given day.But it can feel overwhelming to pick the right stocks for you and your investing goals with over 800 top-rated stocks to choose from.That's where the Style Scores come in.You want to make sure you're buying stocks with the highest likelihood of success, and to do that, you'll need to pick stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you like a stock that only as a #3 (Hold) rank, it should also have Scores of A or B to guarantee as much upside potential as possible.The direction of a stock's earnings estimate revisions should always be a key factor when choosing which stocks to buy, since the Scores were created to work together with the Zacks Rank.For instance, a stock with a #4 (Sell) or #5 (Strong Sell) rating, even one that boasts Scores of A and B, still has a downward-trending earnings forecast, and a much greater likelihood its share price will decline as well.Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.Stock to Watch: Fiserv (FISV)Founded in 1984, Fiserv Inc. is headquartered in Brookfield, WI. The company provides financial services technology solutions to over 12,000 clients worldwide in the banking, insurance, healthcare and investment industries. Fiserv serves banks, credit unions, leasing and finance companies, investment management firms, billers, retailers, and merchants.FISV is a #3 (Hold) on the Zacks Rank, with a VGM Score of B.Momentum investors should take note of this Business Services stock. FISV has a Momentum Style Score of B, and shares are up 0.5% over the past four weeks.For fiscal 2021, two analysts revised their earnings estimate upwards in the last 60 days, and the Zacks Consensus Estimate has increased $0.01 to $5.56 per share. FISV boasts an average earnings surprise of 3.7%.With a solid Zacks Rank and top-tier Momentum and VGM Style Scores, FISV should be on investors' short list. Breakout Biotech Stocks with Triple-Digit Profit Potential The biotech sector is projected to surge beyond $2.4 trillion by 2028 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases. Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Recommendations from previous editions of this report have produced gains of +205%, +258% and +477%. The stocks in this report could perform even better.See these 7 breakthrough stocks now>>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Fiserv, Inc. (FISV): Free Stock Analysis Report To read this article on Zacks.com click here......»»

Category: topSource: zacks7 hr. 44 min. ago

Why Fidelity National Information Services (FIS) is a Top Value Stock for the Long-Term

Wondering how to pick strong, market-beating stocks for your investment portfolio? Look no further than the Zacks Style Scores. It doesn't matter your age or experience: taking full advantage of the stock market and investing with confidence are common goals for all investors. Luckily, Zacks Premium offers several different ways to do both.Featuring daily updates of the Zacks Rank and Zacks Industry Rank, full access to the Zacks #1 Rank List, Equity Research reports, and Premium stock screens, the research service can help you become a smarter, more self-assured investor.Zacks Premium also includes the Zacks Style Scores.What are the Zacks Style Scores?The Zacks Style Scores, developed alongside the Zacks Rank, are complementary indicators that rate stocks based on three widely-followed investing methodologies; they also help investors pick stocks with the best chances of beating the market over the next 30 days.Based on their value, growth, and momentum characteristics, each stock is assigned a rating of A, B, C, D, or F. The better the score, the better chance the stock will outperform; an A is better than a B, a B is better than a C, and so on.The Style Scores are broken down into four categories:Value ScoreFor value investors, it's all about finding good stocks at good prices, and discovering which companies are trading under their true value before the broader market catches on. The Value Style Score utilizes ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and a host of other multiples to help pick out the most attractive and discounted stocks.Growth ScoreGrowth investors, on the other hand, are more concerned with a company's financial strength and health, and its future outlook. The Growth Style Score examines things like projected and historic earnings, sales, and cash flow to find stocks that will experience sustainable growth over time.Momentum ScoreMomentum investors, who live by the saying "the trend is your friend," are most interested in taking advantage of upward or downward trends in a stock's price or earnings outlook. Utilizing one-week price change and the monthly percentage change in earnings estimates, among other factors, the Momentum Style Score can help determine favorable times to buy high-momentum stocks.VGM ScoreIf you like to use all three kinds of investing, then the VGM Score is for you. It's a combination of all Style Scores, and is an important indicator to use with the Zacks Rank. The VGM Score rates each stock on their shared weighted styles, narrowing down the companies with the most attractive value, best growth forecast, and most promising momentum.How Style Scores Work with the Zacks RankThe Zacks Rank, which is a proprietary stock-rating model, employs earnings estimate revisions, or changes to a company's earnings expectations, to make building a winning portfolio easier.#1 (Strong Buy) stocks have produced an unmatched +25.41% average annual return since 1988, which is more than double the S&P 500's performance over the same time frame. However, the Zacks Rank examines a ton of stocks, and there can be more than 200 companies with a Strong Buy rank, and another 600 with a #2 (Buy) rank, on any given day.But it can feel overwhelming to pick the right stocks for you and your investing goals with over 800 top-rated stocks to choose from.That's where the Style Scores come in.You want to make sure you're buying stocks with the highest likelihood of success, and to do that, you'll need to pick stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you like a stock that only as a #3 (Hold) rank, it should also have Scores of A or B to guarantee as much upside potential as possible.The direction of a stock's earnings estimate revisions should always be a key factor when choosing which stocks to buy, since the Scores were created to work together with the Zacks Rank.For instance, a stock with a #4 (Sell) or #5 (Strong Sell) rating, even one that boasts Scores of A and B, still has a downward-trending earnings forecast, and a much greater likelihood its share price will decline as well.Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.Stock to Watch: Fidelity National Information Services (FIS)Headquartered in Jacksonville, FL, Fidelity National Information Services, Inc. provides banking and payments technology solutions, processing services and information-based services to the financial services industry. The company came into existence, following the merger with Certegy Inc., a provider of credit card, debit card, other transaction processing and check risk management services to financial institutions in 2006.FIS is a #3 (Hold) on the Zacks Rank, with a VGM Score of B.It also boasts a Value Style Score of B thanks to attractive valuation metrics like a forward P/E ratio of 18.68; value investors should take notice.For fiscal 2021, one analysts revised their earnings estimate upwards in the last 60 days, and the Zacks Consensus Estimate has increased $0 to $6.55 per share. FIS boasts an average earnings surprise of 2.9%.With a solid Zacks Rank and top-tier Value and VGM Style Scores, FIS should be on investors' short list. Breakout Biotech Stocks with Triple-Digit Profit Potential The biotech sector is projected to surge beyond $2.4 trillion by 2028 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases. Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Recommendations from previous editions of this report have produced gains of +205%, +258% and +477%. The stocks in this report could perform even better.See these 7 breakthrough stocks now>>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Fidelity National Information Services, Inc. (FIS): Free Stock Analysis Report To read this article on Zacks.com click here......»»

Category: topSource: zacks7 hr. 44 min. ago

New Highs Again for S&P and Dow as Earnings Continue

New Highs Again for S&P and Dow as Earnings Continue SPECIAL ALERT: We’ve just released our new 5 Stocks Set to Double Special Report which includes five stocks our team believes have the potential to grow +100% in the next 12 months. This latest report features favorite stocks from Kevin Cook, Ben Rains, Tracey Ryniec, Madeleine Johnson and David Bartosiak. Log on to Zacks.com to see these stocks today. Even a sharp mid-day drop couldn’t keep this market down! Stocks managed to stay on their feet in all the Tuesday turbulence and remain on their record-setting pace. Meanwhile, the biggest week of earnings season continued with two more tech giants scheduled to report after the bell. The S&P increased 0.18% today to 4574.79 and the Dow advanced 0.04% (or nearly 16 points) to 35,756.88. These gains came well off the highs of the session, but were enough for a second straight record for the S&P and a third straight for the Dow. The NASDAQ is now within 1% of a new closing high, which was last set on September 7. However, it didn’t make up much ground today with an advance of only 0.06% (or 9 points) to 15,235.71. Shares of Facebook (FB) dipped nearly 4% in its first day of trading after a mixed third quarter report last night. The social media giant slightly beat earnings estimates but missed on revenue. Elsewhere, Tesla (TSLA) experienced its first decline in five sessions, but only slipped by 0.63%. The EV pioneer joined the $1 Trillion club yesterday and received a 100K vehicle order from Hertz (HTZ). It’s also coming off a strong quarterly report from last week that included a positive EPS surprise of 34%. As far as economic data is concerned, consumer confidence in October turned out better than expected. The Conference Board’s index rose to 113.8, which topped forecasts and the September result of just under 110. The advance ends a three-month downtrend in this category and provides more proof that consumers are dealing with the rising inflation and supply chain issues for now. But let’s get back to earnings since two more powerhouses reported after the bell on Tuesday. Microsoft (MSFT) and Alphabet (GOOG) both beat on the top and bottom lines in their quarterly reports. MSFT reported an EPS surprise of more than 10% and is currently flat afterhours, as of this writing, while GOOG topped by 21% but is off around 0.6% afterhours. We get a break from the FAANGs in tomorrow's earnings schedule, but we’ll still be receiving reports from heavy hitters like Coca-Cola (KO), McDonald’s (MCD), Sony (SONY), Bristol Myers (BMY) and Boeing (BA), among hundreds of other names. Today's Portfolio Highlights: Stocks Under $10: Soaring oil prices make energy alternatives even more attractive, so Brian thought this was a good time to add ReneSola (SOL). This Zacks Rank #1 (Strong Buy) solar stock beat the Zacks Consensus Estimate for four straight quarters with an average surprise of 242%! Looking forward, revenue growth is expected at 25% for this year and 38% for next. Given its strong earnings history and rising margins, the editor thinks SOL is set to move sharply higher in the future. Meanwhile, the service also sold the underperforming VirTra (VTSI) position. See the full write-up for more on today’s action.   Options Trader: The portfolio's sights are set on Cognex (CGNX), a leader in the machine vision industry. In other words, the company makes computers that can ‘see’. This Zacks Rank #2 (Buy) has a projected sales growth rate of 27.35%, which is 67% better than the industry and 140% better than the S&P. Kevin also likes the bullish symmetrical triangle pattern in its chart. He expects a breakout soon, so the service bought to open two Feb22 90.00 Calls in CGNX on Tuesday. Read the full write-up for more on today’s move.   Surprise Trader: Rising energy prices pushed the Oil & Gas – E&P space into the Top 2% of the Zacks Industry Rank, so that's where Dave went for today’s addition. The editor picked up SM Energy (SM), which beat the Zacks Consensus Estimate by 105% in its last quarter while also posting a surprise profit. And now it has a positive Earnings ESP of 34% for its upcoming report on Thursday, October 28 after the bell. Earnings estimates for this Zacks Rank #1 (Strong Buy) are up to 33 cents for this year and $3.09 for next, suggesting a year-over-year surge of 840%! The portfolio added SM on Tuesday with a 12.5% allocation, while also selling Tractor Supply (TSCO) for a “small victory” of just under 5% in less than two weeks. Learn more about these plays in the complete write-up. In other news, this portfolio easily had the best performer among all ZU names on Tuesday as Perion Network (PERI) soared over 31%. This provider of online advertising solutions beat the Zacks Consensus Estimate for a 12th straight quarter. The earnings surprise was over 55%, while revenue eclipsed our expectation by more than 12%. Most importantly though, PERI raised its outlook for 2021 and 2022.   Zacks Short Sell List: Only two stocks were swapped in this week's adjustment. The positions that were short-covered included AppLovin (APP) and JD.com (JD), while the new buys that filled these spots were SunPower (SPWR) and Zurn Water Solutions (ZWS). Learn more about this emotion-free portfolio that takes advantage of falling and volatile markets by reading the Short Sell List Trader Guide. All the Best, Jim Giaquinto Recommendations from Zacks' Private Portfolios: Believe it or not, this article is not available on the Zacks.com website. The commentary is a partial overview of the daily activity from Zacks' private recommendation services. If you would like to follow our Buy and Sell signals in real time, we've made a special arrangement for readers of this website. Starting today you can see all the recommendations from all of Zacks' portfolios absolutely free for 7 days. Our services cover everything from value stocks and momentum trades to insider buying and positive earnings surprises (which we've predicted with an astonishing 80%+ accuracy). Click here to "test drive" Zacks Ultimate for FREE >>  Zacks Investment Research.....»»

Category: topSource: zacks10 hr. 44 min. ago

Seeking to "prevent clawbacks," Jones and Page say they"ll back money for trolley if changes are made

The leaders of the city of St. Louis and St. Louis County on Tuesday said they'll back spending $1.26 million to restart operations of the Loop Trolley streetcar, but only if it's operated by the region's transit agency. The 2.2-mile streetcar line, shut down since December 2019, is asking the East-West Gateway Council of Governments for $1.26 million in federal highway funds to cover the costs of operating the trolley for two years, with cars giving free rides for days a week. A taxing district….....»»

Category: topSource: bizjournalsOct 26th, 2021

Green Energy: A Bubble In Unrealistic Expectations

Green Energy: A Bubble In Unrealistic Expectations Authored by David Hay via Everegreen Gavekal blog, “You see what is happening in Europe. There is hysteria and some confusion in the markets. Why?…Some people are speculating on climate change issues, some people are underestimating some things, some are starting to cut back on investments in the extractive industries. There needs to be a smooth transition.” - Vladimir Putin (someone with whom this author rarely agrees) “By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of its citizens.” – John Maynard Keynes (an interesting observation for all the modern day Keynesians to consider given their support of current inflationary US policies, including energy-related) Introduction This week’s EVA provides another sneak preview into David Hay’s book-in-process, “Bubble 3.0” discussing what he thinks is the crucial topic of “greenflation.”  This is a term he coined referring to the rising price for metals and minerals that are essential for solar and wind power, electric cars, and other renewable technologies. It also centers on the reality that as global policymakers have turned against the fossil fuel industry, energy producers are for the first time in history not responding to dramatically higher prices by increasing production.  Consequently, there is a difficult tradeoff that arises as the world pushes harder to combat climate change, driving up energy costs to painful levels, especially for lower income individuals.  What we are currently seeing in Europe is a vivid example of this dilemma.  While it may be the case that governments welcome higher oil and natural gas prices to discourage their use, energy consumers are likely to have a much different reaction. Summary BlackRock’s CEO recently admitted that, despite what many are opining, the green energy transition is nearly certain to be inflationary. Even though it’s early in the year, energy prices are already experiencing unprecedented spikes in Europe and Asia, but most Americans are unaware of the severity. To that point, many British residents being faced with the fact that they may need to ration heat and could be faced with the chilling reality that lives could be lost if this winter is as cold as forecasters are predicting. Because of the huge increase in energy prices, inflation in the eurozone recently hit a 13-year high, heavily driven by natural gas prices on the Continent that are the equivalent of $200 oil. It used to be that the cure for extreme prices was extreme prices, but these days I’m not so sure.  Oil and gas producers are very wary of making long-term investments to develop new resources given the hostility to their industry and shareholder pressure to minimize outlays. I expect global supply to peak sometime next year and a major supply deficit looks inevitable as global demand returns to normal. In Norway, almost 2/3 of all new vehicle sales are of the electric variety (EVs) – a huge increase in just over a decade. Meanwhile, in the US, it’s only about 2%. Still, given Norway’s penchant for the plug-in auto, the demand for oil has not declined. China, despite being the largest market by far for electric vehicles, is still projected to consume an enormous and rising amount of oil in the future. About 70% of China’s electricity is generated by coal, which has major environmental ramifications in regards to electric vehicles. Because of enormous energy demand in China this year, coal prices have experienced a massive boom. Its usage was up 15% in the first half of this year, and the Chinese government has instructed power providers to obtain all baseload energy sources, regardless of cost.  The massive migration to electric vehicles – and the fact that they use six times the amount of critical minerals as their gasoline-powered counterparts –means demand for these precious resources is expected to skyrocket. This extreme need for rare minerals, combined with rapid demand growth, is a recipe for a major spike in prices. Massively expanding the US electrical grid has several daunting challenges– chief among them the fact that the American public is extremely reluctant to have new transmission lines installed in their area. The state of California continues to blaze the trail for green energy in terms of both scope and speed. How the rest of the country responds to their aggressive take on renewables remains to be seen. It appears we are entering a very odd reality: governments are expending resources they do not have on weakly concentrated energy. And the result may be very detrimental for today’s modern economy. If the trend in energy continues, what looks nearly certain to be the Third Energy crisis of the last half-century may linger for years.  Green energy: A bubble in unrealistic expectations? As I have written in past EVAs, it amazes me how little of the intense inflation debate in 2021 centered on the inflationary implications of the Green Energy transition.  Perhaps it is because there is a built-in assumption that using more renewables should lower energy costs since the sun and the wind provide “free power”.  However, we will soon see that’s not the case, at least not anytime soon; in fact, it’s my contention that it will likely be the opposite for years to come and I’ve got some powerful company.  Larry Fink, CEO of BlackRock, a very pro-ESG* organization, is one of the few members of Wall Street’s elite who admitted this in the summer of 2021.  The story, however, received minimal press coverage and was quickly forgotten (though, obviously, not be me!).  This EVA will outline myriad reasons why I think Mr. Fink was telling it like it is…despite the political heat that could bring down upon him.  First, though, I will avoid any discussion of whether humanity is the leading cause of global warming.  For purposes of this analysis, let’s make the high-odds assumption that for now a high-speed green energy transition will continue to occur.  (For those who would like a well-researched and clearly articulated overview of the climate debate, I highly recommend the book “Unsettled”; it’s by a former top energy expert and scientist from the Obama administration, Dr. Steven Koonin.) The reason I italicized “for now” is that in my view it’s extremely probable that voters in many Western countries are going to become highly retaliatory toward energy policies that are already creating extreme hardship.  Even though it’s only early autumn as I write these words, energy prices are experiencing unprecedented increases in Europe.  Because it’s “over there”, most Americans are only vaguely aware of the severity of the situation.  But the facts are shocking…  Presently, natural gas is going for $29 per million British Thermal Units (BTUs) in Europe, a quadruple compared to the same time in 2020, versus “just” $5 in the US, which is a mere doubling.  As a consequence, wholesale energy cost in Great Britain rose an unheard of 60% even before summer ended.  Reportedly, nine UK energy companies are on the brink of failure at this time due to their inability to fully pass on the enormous cost increases.  As a result, the British government is reportedly on the verge of nationalizing some of these entities—supposedly, temporarily—to prevent them from collapsing.  (CNBC reported on Wednesday that UK natural gas prices are now up 800% this year; in the US, nat gas rose 20% on Tuesday alone, before giving back a bit more than half of that the next day.) Serious food shortages are expected after exorbitant natural gas costs forced most of England’s commercial production of CO2 to shut down.  (CO2 is used both for stunning animals prior to slaughter and also in food packaging.)  Additionally, ballistic natural gas prices have forced the closure of two big US fertilizer plants due to a potential shortfall of ammonium nitrate of which “nat gas” is a key feedstock.  *ESG stands for Environmental, Social, Governance; in 2021, Blackrock’s assets under management approximated $9 ½ trillion, about one-third of the total US federal debt. With the winter of 2021 approaching, British households are being told they may need to ration heat.  There are even growing concerns about the widespread loss of life if this winter turns out to be a cold one, as 2020 was in Europe.  Weather forecasters are indicating that’s a distinct possibility.   In Spain, consumers are paying 40% more for electricity compared to the prior year.  The Spanish government has begun resorting to price controls to soften the impact of these rapidly escalating costs. (The history of price controls is that they often exacerbate shortages.) Naturally, spiking power prices hit the poorest hardest, which is typical of inflation whether it is of the energy variety or of generalized price increases.  Due to these massive energy price increases, eurozone inflation recently hit a 13-year high, heavily driven by natural gas prices that are the equivalent of $200 per barrel oil.  This is consistent with what I warned about in several EVAs earlier this year and I think there is much more of this looming in the years to come. In Asia, which also had a brutally cold winter in 2020 – 2021, there are severe energy shortages being disclosed, as well.  China has instructed its power providers to secure all the coal they can in preparation for a repeat of frigid conditions and acute deficits even before winter arrives.  The government has also instructed its energy distributors to acquire all the liquified natural gas (LNG) they can, regardless of cost.  LNG recently hit $35 per million British Thermal Units in Asia, up sevenfold in the past year.  China is also rationing power to its heavy industries, further exacerbating the worldwide shortages of almost everything, with notable inflationary implications. In India, where burning coal provides about 70% of electricity generation (as it does in China), utilities are being urged to import coal even though that country has the world’s fourth largest coal reserves.  Several Indian power plants are close to exhausting their coal supplies as power usage rips higher. Normally, I’d say that the cure for such extreme prices, was extreme prices—to slightly paraphrase the old axiom.  But these days, I’m not so sure; in fact, I’m downright dubious.  After all, the enormously influential International Energy Agency has recommended no new fossil fuel development after 2021—“no new”, as in zero.  It’s because of pressure such as this that, even though US natural gas prices have done a Virgin Galactic to $5 this year, the natural gas drilling rig count has stayed flat.  The last time prices were this high there were three times as many working rigs.  It is the same story with oil production.  Most Americans don’t seem to realize it but the US has provided 90% of the planet’s petroleum output growth over the past decade.  In other words, without America’s extraordinary shale oil production boom—which raised total oil output from around 5 million barrels per day in 2008 to 13 million barrels per day in 2019—the world long ago would have had an acute shortage.  (Excluding the Covid-wracked year of 2020, oil demand grows every year—strictly as a function of the developing world, including China, by the way.) Unquestionably, US oil companies could substantially increase output, particularly in the Permian Basin, arguably (but not much) the most prolific oil-producing region in the world.  However, with the Fed being pressured by Congress to punish banks that lend to any fossil fuel operator, and the overall extreme hostility toward domestic energy producers, why would they?  There is also tremendous pressure from Wall Street on these companies to be ESG compliant.  This means reducing their carbon footprint.  That’s tough to do while expanding their volume of oil and gas.  Further, investors, whether on Wall Street or on London’s equivalent, Lombard Street, or in pretty much any Western financial center, are against US energy companies increasing production.  They would much rather see them buy back stock and pay out lush dividends.  The companies are embracing that message.  One leading oil and gas company CEO publicly mused to the effect that buying back his own shares at the prevailing extremely depressed valuations was a much better use of capital than drilling for oil—even at $75 a barrel. As reported by Morgan Stanley, in the summer of 2021, an US institutional broker conceded that of his 400 clients, only one would consider investing in an energy company!  Consequently, the fact that the industry is so detested means that its shares are stunningly undervalued.  How stunningly?  A myriad of US oil and gas producers are trading at free cash flow* yields of 10% to 15% and, in some cases, as high as 25%. In Europe, where the same pressures apply, one of its biggest energy companies is generating a 16% free cash flow yield.  Moreover, that is based up an estimate of $60 per barrel oil, not the prevailing price of $80 on the Continent. *Free cash flow is the excess of gross cash flow over and above the capital spending needed to sustain a business.  Many market professionals consider it more meaningful than earnings.  Therefore, due to the intense antipathy toward Western energy producers they aren’t very inclined to explore for new resources.  Another much overlooked fact about the ultra-critical US shale industry that, as noted, has been nearly the only source of worldwide output growth for the past 13 years, is its rapid decline nature.  Most oil wells see their production taper off at just 4% or 5% per year.  But with shale, that decline rate is 80% after only two years.  (Because of the collapse in exploration activities in 2020 due to Covid, there are far fewer new wells coming on-line; thus, the production base is made up of older wells with slower decline rates but it is still a much steeper cliff than with traditional wells.)  As a result, the US, the world’s most important swing producer, has to come up with about 1.5 million barrels per day (bpd) of new output just to stay even.  (This was formerly about a 3 million bpd number due to both the factor mentioned above and the 2 million bpd drop in total US oil production, from 13 million bpd to around 11 million bpd since 2019).  Please recall that total US oil production in 2008 was only around 5 million bpd.  Thus, 1.5 million barrels per day is a lot of oil and requires considerable drilling and exploration activities.  Again, this is merely to stay steady-state, much less grow.  The foregoing is why I wrote on multiple occasions in EVAs during 2020, when the futures price for oil went below zero*, that crude would have a spectacular price recovery later that year and, especially, in 2021.  In my view, to go out on my familiar creaky limb, you ain’t seen nothin’ yet!  With supply extremely challenged for the above reasons and demand marching back, I believe 2022 could see $100 crude, possibly even higher.  *Physical oil, or real vs paper traded, bottomed in the upper teens when the futures contract for delivery in April, 2020, went deeply negative.  Mike Rothman of Cornerstone Analytics has one of the best oil price forecasting records on Wall Street.  Like me, he was vehemently bullish on oil after the Covid crash in the spring of 2020 (admittedly, his well-reasoned optimism was a key factor in my up-beat outlook).  Here’s what he wrote late this summer:  “Our forecast for ’22 looks to see global oil production capacity exhausted late in the year and our balance suggests OPEC (and OPEC + participants) will face pressures to completely remove any quotas.”  My expectation is that global supply will likely max out sometime next year, barring a powerful negative growth shock (like a Covid variant even more vaccine resistant than Delta).  A significant supply deficit looks inevitable as global demand recovers and exceeds its pre-Covid level.  This is a view also shared by Goldman Sachs and Raymond James, among others; hence, my forecast of triple-digit prices next year.  Raymond James pointed out that in June the oil market was undersupplied by 2.5 mill bpd.  Meanwhile, global petroleum demand was rapidly rising with expectations of nearly pre-Covid consumption by year-end.  Mike Rothman ran this chart in a webcast on 9/10/2021 revealing how far below the seven-year average oil inventories had fallen.  This supply deficit is very likely to become more acute as the calendar flips to 2022. In fact, despite oil prices pushing toward $80, total US crude output now projected to actually decline this year.  This is an unprecedented development.  However, as the very pro-renewables Financial Times (the UK’s equivalent of the Wall Street Journal) explained in an August 11th, 2021, article:  “Energy companies are in a bind.  The old solution would be to invest more in raising gas production.  But with most developed countries adopting plans to be ‘net zero’ on carbon emissions by 2050 or earlier, the appetite for throwing billions at long-term gas projects is diminished.” The author, David Sheppard, went on to opine: “In the oil industry there are those who think a period of plus $100-a-barrel oil is on the horizon, as companies scale back investments in future supplies, while demand is expected to keep rising for most of this decade at a minimum.”  (Emphasis mine)  To which I say, precisely!  Thus, if he’s right about rising demand, as I believe he is, there is quite a collision looming between that reality and the high probability of long-term constrained supplies.  One of the most relevant and fascinating Wall Street research reports I read as I was researching the topic of what I have been referring to as “Greenflation” is from Morgan Stanley.  Its title asked the provocative question:  “With 64% of New Cars Now Electric, Why is Norway Still Using so Much Oil?”  While almost two-thirds of Norway’s new vehicle sales are EVs, a remarkable market share gain in just over a decade, the number in the US is an ultra-modest 2%.   Yet, per the Morgan Stanley piece, despite this extraordinary push into EVs, oil consumption in Norway has been stubbornly stable.  Coincidentally, that’s been the experience of the overall developed world over the past 10 years, as well; petroleum consumption has largely flatlined.  Where demand hasn’t gone horizontal is in the developing world which includes China.  As you can see from the following Cornerstone Analytics chart, China’s oil demand has vaulted by about 6 million barrels per day (bpd) since 2010 while its domestic crude output has, if anything, slightly contracted. Another coincidence is that this 6 million bpd surge in China’s appetite for oil, almost exactly matched the increase in US oil production.  Once again, think where oil prices would be today without America’s shale oil boom. This is unlikely to change over the next decade.  By 2031, there are an estimated one billion Asian consumers moving up into the middle class.  History is clear that more income means more energy consumption.  Unquestionably, renewables will provide much of that power but oil and natural gas are just as unquestionably going to play a critical role.  Underscoring that point, despite the exponential growth of renewables over the last 10 years, every fossil fuel category has seen increased usage.  Thus, even if China gets up to Norway’s 64% EV market share of new car sales over the next decade, its oil usage is likely to continue to swell.  Please be aware that China has become the world’s largest market for EVs—by far.  Despite that, the above chart vividly displays an immense increase in oil demand.  Here’s a similar factoid that I ran in our December 4th EVA, “Totally Toxic”, in which I made a strong bullish case for energy stocks (the main energy ETF is up 35% from then, by the way):  “(There was) a study by the UN and the US government based on the Model for the Assessment of Greenhouse Gasses Induced Climate Change (MAGICC).  The model predicted that ‘the complete elimination of all fossil fuels in the US immediately would only restrict any increase in world temperature by less than one tenth of one degree Celsius by 2050, and by less than one fifth of one degree Celsius by 2100.’  Say again?  If the world’s biggest carbon emitter on a per capita basis causes minimal improvement by going cold turkey on fossil fuels, are we making the right moves by allocating tens of trillions of dollars that we don’t have toward the currently in-vogue green energy solutions?” China's voracious power appetite increase has been true with all of its energy sources.  On the environmentally-friendly front, that includes renewables; on the environmentally-unfriendly side, it also includes coal.  In 2020, China added three times more coal-based power generation than all other countries combined.  This was the equivalent of an additional coal planet each week.  Globally, there was a reduction last year of 17 gigawatts in coal-fired power output; in China, the increase was 29.8 gigawatts, far more than offsetting the rest of the world’s progress in reducing the dirtiest energy source.  (A gigawatt can power a city with a population of roughly 700,000.) Overall, 70% of China’s electricity is coal-generated. This has significant environmental implications as far as electric vehicles (EVs) are concerned.  Because EVs are charged off a grid that is primarily coal- powered, carbon emissions actually rise as the number of such vehicles proliferate. As you can see in the following charts from Reuters’ energy expert John Kemp, Asia’s coal-fired generation has risen drastically in the last 20 years, even as it has receded in the rest of the world.  (The flattening recently is almost certainly due to Covid, with a sharp upward resumption nearly a given.) The worst part is that burning coal not only emits CO2—which is not a pollutant and is essential for life—it also releases vast quantities of nitrous oxide (N20), especially on the scale of coal usage seen in Asia today. N20 is unquestionably a pollutant and a greenhouse gas that is hundreds of times more potent than CO2.  (An interesting footnote is that over the last 550 million years, there have been very few times when the CO2 level has been as low, or lower, than it is today.)  Some scientists believe that one reason for the shrinkage of Arctic sea ice in recent decades is due to the prevailing winds blowing black carbon soot over from Asia.  This is a separate issue from N20 which is a colorless gas.  As the black soot covers the snow and ice fields in Northern Canada, they become more absorbent of the sun’s radiation, thus causing increased melting.  (Source:  “Weathering Climate Change” by Hugh Ross) Due to exploding energy needs in China this year, coal prices have experienced an unprecedented surge.  Despite this stunning rise, Chinese authorities have instructed its power providers to obtain coal, and other baseload energy sources, such as liquified natural gas (LNG), regardless of cost.  Notwithstanding how pricey coal has become, its usage in China was up 15% in the first half of this year vs the first half of 2019 (which was obviously not Covid impacted). Despite the polluting impact of heavy coal utilization, China is unlikely to turn away from it due to its high energy density (unlike renewables), its low cost (usually) and its abundance within its own borders (though its demand is so great that it still needs to import vast amounts).  Regarding oil, as we saw in last week’s final image, it is currently importing roughly 11 million barrels per day (bpd) to satisfy its 15 million bpd consumption (about 15% of total global demand).  In other words, crude imports amount to almost three-quarter of its needs.  At $80 oil, this totals $880 million per day or approximately $320 billion per year.  Imagine what China’s trade surplus would look like without its oil import bill! Ironically, given the current hostility between the world’s superpowers, China has an affinity for US oil because of its light and easy-to-refine nature.  China’s refineries tend to be low-grade and unable to efficiently process heavier grades of crude, unlike the US refining complex which is highly sophisticated and prefers heavy oil such as from Canada and Venezuela—back when the latter actually produced oil. Thus, China favors EVs because they can be de facto coal-powered, lessening its dangerous reliance on imported oil.  It also likes them due to the fact it controls 80% of the lithium ion battery supply and 60% of the planet’s rare earth minerals, both of which are essential to power EVs.     However, even for China, mining enough lithium, cobalt, nickel, copper, aluminum and the other essential minerals/metals to meet the ambitious goals of largely electrifying new vehicle volumes is going to be extremely daunting.  This is in addition to mass construction of wind farms and enormously expanded solar panel manufacturing. As one of the planet’s leading energy authorities Daniel Yergin writes: “With the move to electric cars, demand for critical minerals will skyrocket (lithium up 4300%, cobalt and nickel up 2500%), with an electric vehicle using 6 times more minerals than a conventional car and a wind turbine using 9 times more minerals than a gas-fueled power plant.  The resources needed for the ‘mineral-intensive energy system’ of the future are also highly concentrated in relatively few countries. Whereas the top 3 oil producers in the world are responsible for about 30 percent of total liquids production, the top 3 lithium producers control more than 80% of supply. China controls 60% of rare earths output needed for wind towers; the Democratic Republic of the Congo, 70% of the cobalt required for EV batteries.” As many have noted, the environmental impact of immensely ramping up the mining of these materials is undoubtedly going to be severe.  Michael Shellenberger, a life-long environmental activist, has been particularly vociferous in his condemnation of the dominant view that only renewables can solve the global energy needs.  He’s especially critical of how his fellow environmentalists resorted to repetitive deception, in his view, to undercut nuclear power in past decades.  By leaving nuke energy out of the solution set, he foresees a disastrous impact on the planet due to the massive scale (he’d opine, impossibly massive) of resource mining that needs to occur.  (His book, “Apocalypse Never”, is also one I highly recommend; like Dr. Koonin, he hails from the left end of the political spectrum.) Putting aside the environmental ravages of developing rare earth minerals, when you have such high and rapidly rising demand colliding with limited supply, prices are likely to go vertical.  This will be another inflationary “forcing”, a favorite term of climate scientists, caused by the Great Green Energy Transition. Moreover, EVs are very semiconductor intensive.  With semis already in seriously short supply, this is going to make a gnarly situation even gnarlier.  It’s logical to expect that there will be recurring shortages of chips over the next decade for this reason alone (not to mention the acute need for semis as the “internet of things” moves into primetime).  In several of the newsletters I’ve written in recent years, I’ve pointed out the present vulnerability of the US electric grid.  Yet, it will be essential not just to keep it from breaking down under its current load; it must be drastically enhanced, a Herculean task. For one thing, it is excruciatingly hard to install new power lines. As J.P. Morgan’s Michael Cembalest has written: “Grid expansion can be a hornet’s nest of cost, complexity and NIMBYism*, particularly in the US.”  The grid’s frailty, even under today’s demands (i.e., much less than what lies ahead as millions of EVs plug into it) is particularly obvious in California.  However, severe winter weather in 2021 exposed the grid weakness even in energy-rich Texas, which also has a generally welcoming attitude toward infrastructure upgrading and expansion. Yet it’s the Golden State, home to 40 million Americans and the fifth largest economy in the world, if it was its own country (which it occasionally acts like it wants to be), that is leading the charge to EVs and seeking to eliminate internal combustion engines (ICEs) as quickly as possible.  Even now, blackouts and brownouts are becoming increasingly common.  Seemingly convinced it must be a role model for the planet, it’s trying desperately to reduce its emissions, which are less than 1%, of the global total, at the expense of rendering its energy system more similar to a developing country.  In addition to very high electricity costs per kilowatt hour (its mild climate helps offset those), it also has gasoline prices that are 77% above the national average.  *NIMBY stands for Not In My Back Yard. While California has been a magnet for millions seeking a better life for 150 years, the cost of living is turning the tide the other way.  Unreliable and increasingly expensive energy is likely to intensify that trend.  Combined with home prices that are more than double the US median–$800,000!–California is no longer the land of milk and honey, unless, to slightly paraphrase Woody Guthrie about LA, even back in the 1940s, you’ve got a whole lot of scratch.  More and more people, seem to be scratching California off their list of livable venues.  Voters in the reliably blue state of California may become extremely restive, particularly as they look to Asia and see new coal plants being built at a fever pitch.  The data will become clear that as America keeps decarbonizing–as it has done for 30 years mostly due to the displacement of coal by gas in the US electrical system—Asia will continue to go the other way.  (By the way, electricity represents the largest share of CO2 emission at roughly 25%.)  California has always seemed to lead social trends in this country, as it is doing again with its green energy transition.  The objective is noble though, extremely ambitious, especially the timeline.  As it brings its power paradigm to the rest of America, especially its frail grid, it will be interesting to see how voters react in other states as the cost of power leaps higher and its dependability heads lower.  It’s reasonable to speculate we may be on the verge of witnessing the Californication of the US energy system.  Lest you think I’m being hyperbolic, please be aware the IEA (International Energy Agency) has estimated it will cost the planet $5 trillion per year to achieve Net Zero emissions.  This is compared to global GDP of roughly $85 trillion. According to BloombergNEF, the price tag over 30 years, could be as high as $173 trillion.  Frankly, based on the history of gigantic cost overruns on most government-sponsored major infrastructure projects, I’m inclined to take the over—way over—on these estimates. Moreover, energy consulting firm T2 and Associates, has guesstimated electrifying just the US to the extent necessary to eliminate the direct consumption of fuel (i.e., gasoline, natural gas, coal, etc.) would cost between $18 trillion and $29 trillion.  Again, taking into account how these ambitious efforts have played out in the past, I suspect $29 trillion is light.  Regardless, even $18 trillion is a stunner, despite the reality we have all gotten numb to numbers with trillions attached to them.  For perspective, the total, already terrifying, level of US federal debt is $28 trillion. Regardless, as noted last week, the probabilities of the Great Green Energy Transition happening are extremely high.  Relatedly, I believe the likelihood of the Great Greenflation is right up there with them.  As Gavekal’s Didier Darcet wrote in mid-August:  ““Nowadays, and this is a great first in history, governments will commit considerable financial resources they do not have in the extraction of very weakly concentrated energy.” ( i.e., less efficient)  “The bet is very risky, and if it fails, what next?  The modern economy would not withstand expensive energy, or worse, lack of energy.”  While I agree this an historical first, it’s definitely not great (with apologies for all the “greats”).  This is particularly not great for keeping inflation subdued, as well as for attempting to break out of the growth quagmire the Western world has been in for the last two decades.  What we are seeing in Europe right now is an extremely cautionary case study in just how disastrous the war on fossil fuels can be (shortly we will see who or what has been a behind-the-scenes participant in this conflict). Essentially, I believe, as I’ve written in past EVAs, we are entering the third energy crisis of the last 50 years.  If I’m right, it will be characterized by recurring bouts of triple-digit oil prices in the years to come.  Along with Richard Nixon taking the US off the gold standard in 1971, the high inflation of the 1970s was caused by the first two energy crises (the 1973 Arab Oil Embargo and the 1979 Iranian Revolution).  If I’m correct about this being the third, it’s coming at a most inopportune time with the US in hyper-MMT* mode. Frankly, I believe many in the corridors of power would like to see oil trade into the $100s, and natural gas into the teens, as it will help catalyze the shift to renewable energy.  But consumers are likely to have a much different reaction—potentially, a violently different reaction, as I noted last week.  The experience of the Yellow Vest protests in France (referring to the color of the vest protestors wore), are instructive in this regard.  France is a generally left-leaning country.  Despite that, a proposed fuel surtax in November 2018 to fund a renewable energy transition triggered such widespread civil unrest that French president Emmanuel Macron rescinded it the following month. *MMT stands for Modern Monetary Theory.  It holds that a government, like the US, which issues debt in its own currency can spend without concern about budgetary constraints.  If there are not enough buyers of its bonds at acceptable interest rates, that nation’s central bank (the Fed, in our case) simply acquires them with money it creates from its digital printing press.  This is what is happening today in the US.  Many economists consider this highly inflationary. The sharp and politically uncomfortable rise in US gas pump prices this summer caused the Biden administration to plead with OPEC to lift its volume quotas.  The ironic implication of that exhortation was glaringly obvious, as was the inefficiency and pollution consequences of shipping oil thousands of miles across the Atlantic.  (Oil tankers are a significant source of emissions.)  This is as opposed to utilizing domestic oil output, as well as crude from Canada (which is actually generally better suited to the US refining complex).  Beyond the pollution aspect, imported oil obviously worsens America’s massive trade deficit (which would be far more massive without the six million barrels per day of domestic oil volumes that the shale revolution has provided) and costs our nation high-paying jobs. Further, one of my other big fears is that the West is engaging in unilateral energy disarmament.  Russia and China are likely the major beneficiaries of this dangerous scenario.  Per my earlier comment about a stealth combatant in the war on fossil fuels, it may surprise you that a past NATO Secretary General* has accused Russian intelligence of avidly supporting the anti-fracking movements in Western Europe.  Russian TV has railed against fracking for years, even comparing it to pedophilia (certainly, a most bizarre analogy!).  The success of the anti-fracking movement on the Continent has essentially prevented a European version of America’s shale miracles (the UK has the potential to be a major shale gas producer).  Consequently, the European Union’s domestic natural gas production has been in a rapid decline phase for years.  Banning fracking has, of course, made Europe heavily reliant on Russian gas shipments with more than 40% of its supplies coming from Russia. This is in graphic contrast to the shale output boom in the US that has not only made us natural gas self-sufficient but also an export powerhouse of liquified natural gas (LNG).  In 2011, the Nord Stream system of pipelines running under the Baltic Sea from northern Russia began delivering gas west from northern Russia to the German coastal city of Greifswald.  For years, the Russians sought to build a parallel system with the inventive name of Nord Stream 2.  The US government opposed its approval on security grounds but the Biden administration has dropped its opposition.  It now appears Nord Stream 2 will happen, leaving Europe even more exposed to Russian coercion.  Is it possible the Russian government and the Chinese Communist Party have been secretly and aggressively supporting the anti-fossil fuel movements in America?  In my mind, it seems not only possible but probable.  In fact, I believe it is naïve not to come that conclusion.  After all, wouldn’t it be in both of their geopolitical interests to see the US once again caught in a cycle of debilitating inflation, ensnared by the twin traps of MMT and the third energy crisis? *Per former NATO Secretary General, Anders Fogh Rasumssen:  Russia has “engaged actively with so-called non-governmental organizations—environmental organizations working against shale gas—to maintain Europe’s dependence on imported Russian gas”. Along these lines, I was shocked to listen to a recent podcast by the New Yorker magazine on the topic of “intelligent sabotage”.  This segment was an interview between the magazine’s David Remnick and a Swedish professor, Adreas Malm.  Mr. Malm is the author of a new book with the literally explosive title “How To Blow Up A Pipeline”.   Just as it sounds, he advocates detonating pipelines to inhibit fossil fuel distribution.  Mr. Remnick was clearly sympathetic to his guest but he did ask him about the impact on the poor of driving energy prices up drastically which would be the obvious ramification if his sabotage recommendations were widely followed.  Mr. Malm’s reaction was a verbal shrug of the shoulders and words to the effect that this was the price to pay to save the planet. Frankly, I am appalled that the venerable New Yorker would provide a platform for such a radical and unlawful suggestion.  In an era when people are de-platformed for often innocuous comments, it’s incredible to me this was posted and has not been pulled down.  In my mind, this reflects just how tolerant the media is of attacks on the fossil fuel industry, regardless of the deleterious impact on consumers and the global economy. Surely, there is a far better way of coping with the harmful aspects of fossil fuel-based energy than this scorched earth (literally, in the case of Mr. Malm) approach, which includes efforts to block new pipelines, shut existing ones, and severely restrict US energy production.  In America’s case, the result will be forcing us to unnecessarily and increasingly rely on overseas imports.  (For example, per the Wall Street Journal, drilling permits on federal land have crashed to 171 in August from 671 in April.  Further, the contentious $3.5 trillion “infrastructure” plan would raise royalties and fees high enough on US energy producers that it would render them globally uncompetitive.) Such actions would only aggravate what is already a severe energy shock, one that may be worse than the 1970s twin energy crises.  America has it easy compared to Europe, though, given current US policy trends, we might be in their same heavily listing energy boat soon. Solutions include fast-tracking small modular nuclear plants; encouraging the further switch from burning coal to natural gas (a trend that is, unfortunately, going the other way now, as noted above); utilizing and enhancing carbon and methane capture at the point of emission (including improving tail pipe effluent-reduction technology); enhancing pipeline integrity to inhibit methane leaks; among many other mitigation techniques that recognize the reality the global economy will be reliant on fossil fuels for many years, if not decades, to come.  If the climate change movement fails to recognize the essential nature of fossil fuels, it will almost certainly trigger a backlash that will undermine the positive change it is trying to bring about.  This is similar to what it did via its relentless assault on nuclear power which produced a frenzy of coal plant construction in the 1980s and 1990s.  On this point, it’s interesting to see how quickly Europe is re-embracing coal power to alleviate the energy poverty and rationing occurring over there right now - even before winter sets in.  When the choice is between supporting climate change initiatives on one hand and being able to heat your home and provide for your family on the other, is there really any doubt about which option the majority of voters will select? Tyler Durden Tue, 10/26/2021 - 19:30.....»»

Category: worldSource: nytOct 26th, 2021

Learning From Trader Joe’s, Joe Coulombe

It’s a rare person who can run their own business, and rarer still are those who can do it well. And in a world of stiff competition and consumer fickleness, those people who’s businesses can both survive and thrive in that environment are probably the rarest of them all. Q3 2021 hedge fund letters, conferences […] It’s a rare person who can run their own business, and rarer still are those who can do it well. And in a world of stiff competition and consumer fickleness, those people who’s businesses can both survive and thrive in that environment are probably the rarest of them all. if (typeof jQuery == 'undefined') { document.write(''); } .first{clear:both;margin-left:0}.one-third{width:31.034482758621%;float:left;margin-left:3.448275862069%}.two-thirds{width:65.51724137931%;float:left}form.ebook-styles .af-element input{border:0;border-radius:0;padding:8px}form.ebook-styles .af-element{width:220px;float:left}form.ebook-styles .af-element.buttonContainer{width:115px;float:left;margin-left: 6px;}form.ebook-styles .af-element.buttonContainer input.submit{width:115px;padding:10px 6px 8px;text-transform:uppercase;border-radius:0;border:0;font-size:15px}form.ebook-styles .af-body.af-standards input.submit{width:115px}form.ebook-styles .af-element.privacyPolicy{width:100%;font-size:12px;margin:10px auto 0}form.ebook-styles .af-element.privacyPolicy p{font-size:11px;margin-bottom:0}form.ebook-styles .af-body input.text{height:40px;padding:2px 10px !important} form.ebook-styles .error, form.ebook-styles #error { color:#d00; } form.ebook-styles .formfields h1, form.ebook-styles .formfields #mg-logo, form.ebook-styles .formfields #mg-footer { display: none; } form.ebook-styles .formfields { font-size: 12px; } form.ebook-styles .formfields p { margin: 4px 0; } Get Our Activist Investing Case Study! Get the entire 10-part series on our in-depth study on activist investing in PDF. Save it to your desktop, read it on your tablet, or print it out to read anywhere! Sign up below! (function($) {window.fnames = new Array(); window.ftypes = new Array();fnames[0]='EMAIL';ftypes[0]='email';}(jQuery));var $mcj = jQuery.noConflict(true); Q3 2021 hedge fund letters, conferences and more If you choose a manager to whom you entrust your capital, in the words of Charlie Munger, choose a ‘business fanatic.’ Such individuals live, sleep and breathe their businesses. They’re not bound by the same restraints as most business people; constantly pushing boundaries, trialing new approaches, thinking outside the box, challenging conventional wisdom and always looking for business improvements. If you’re in business, these are the last type of people you want to compete with. One man that epitomized such fanaticism was the late Joe Coulombe, founder of the convenience store chain that carried his name, Trader Joe’s. “Edward H. Heller, a pioneer venture capitalist used the term ‘vivid spirit’ to describe the type of individual to whom he was ready to give significant financial backing. He said that behind every unusually successful corporation was this kind of determined entrepreneurial personality with the drive, the original ideas, and the skill to make such a company a truly worthwhile investment.” Phil Fisher Joe tells his story in the book, ‘Becoming Trader Joe - How I Did Business My Way and Still Beat the Big Guys.’ It contains a wealth of wisdom, particularly when it comes to thinking about running a successful retailer. Over more than a quarter of a century, Trader Joe’s sales grew at a compound rate of 19% per year and the company’s net worth grew at a compound rate of 26% per annum over the same period - no mean feat for a commodity business that’s hard to differentiate. Furthermore, the business never lost money in a year and incredibly each year was more profitable than the last. When the competitor 7-Eleven extended it’s footprint into California in the 1970’s, Pronto Markets, the precursor to Trader' Joe’s, already enjoyed the highest sales per store of any convenience operator in America by a factor of three. A high wage policy, strong locations, a few liquor licences, and the beginnings of a differentiated strategy through product knowledge was the core of their success. One of the mental models I particularly enjoyed in the book was Joe’s concept of ‘Double Entry Retailing.’ A form of second level thinking, Joe recognised that making changes to Demand Side factors had an influence on Supply Side factors which aren’t always obvious. A striking example was the introduction of orange juice freshly squeezed on the premises. While a great Demand Side success - customers embraced the product - it was a total nightmare to administer because of the Supply Side issues; the great variation in sweetness of oranges over the course of a year, difficulty in ensuring machines squeezed the right amount and disposal of the leftover rinds. As a result it was eventually phased out. You’ll recognise many of the characteristics that form a common link with the other great businesses we’ve studied. I’ve included some of my favourite extracts from the book below. Harnessing Demographic & Technological Change ‘The clue, the keystone of the arch of Trader Joe’s, was a small news item in Scientific American in 1965. When we left Stanford, my father-in-law, Bill Steere, a professor of botany, gave me a subscription to Scientific American. In terms of creating my fortune, it’s the most important magazine I’ve ever read. The news item said that, of all the people in the US who were qualified to go to college in 1932, in the pit of the Depression, only 2 percent did. By contrast, in 1964, of all the people qualified to go to college 60 percent in fact actually did. The big change, of course, was the GI Bill of Rights that went into effect in 1945. A second news item, one from the Wall Street Journal, told me that the Boeing 747 would go into service in 1970, and that it would slash the cost of international travel. In Pronto Markets we had noticed that people who travelled - even to San Francisco - were far more adventurous in what they were willing to put in their mouths. Travel is, after all, a form of education. Trader Joe’s was conceived from those two demographic news stories. What I saw here was a small but growing demographic opportunity in people who were well educated. 7-Eleven, and the whole convenience store genre, served the most basic needs of the most mindless demographics with cigarettes, Coca-Cola, milk, Budweiser, candy, bread, eggs. I saw an opportunity to differentiate ourselves radically from mainstream retailing to mainstream people.” Obliquity “I hope you’ll consider the following, my favourite quote from my favourite book on Management, ‘The Winning Performance’ by Clifford and Cavanaugh,’ ‘The fourth (general themes in winning corporations] is a view of profit and wealth-creation as inevitable byproducts of doing other things well. Money is a useful yardstick for measuring quantitative performance and profit and an obligation to investors. But … making money as an end in itself ranks low.’” A Bias to Action & Tenacity “In 1962, Barbara Tuchman published ‘The Guns of August’, an account of the first ninety days of WWI, It’s the best book on management - and, especially, mismanagement - I’ve ever read. The most basic conclusion I drew from from her book was that, if you adopt a reasonable strategy, as opposed to waiting for an optimum strategy, and stick with it, you’ll probably succeed. Tenacity is as important as brilliance.” “Trying to find an optimum solution in business is a waste of time; the factors in the equation are changing all the time.” Value, Empower & Pay Employees Well “You’ve got to have something to hang your hat on. The one core value I chose was our high compensation policies, which I put in place from the very start in 1958… This is the most important single business decision I ever made: to pay people well. First Pronto Markets and then Trader Joe’s had the highest-paid, highest benefitted people in retail.” “Time and again I am asked why no one has successfully replicated Trader Joe’s. The answer is that no one has been willing to pay the wages and benefits, and thereby attract - and keep - the quality of people who work at Trader Joe’s.” “[I was asked,] ‘But how could you afford to pay so much more than your competition?’ The answer, of course, is that good people pay by their extra productivity. You can’t afford to have cheap employees.” “Equally important was our practice of giving every full-time employee an interview every six months. At Stanford I’d been taught that employees never organise (join unions) because of the money; they organise because of un-listened-to grievances.” “The [store] Captains had the salary plus a bonus that theoretically had no limit. The bonus was based on Trader Joe’s overall profit, allocated among the stores based on each store’s contribution. In 1988, several Captains made bonuses of more than 70 percent of their base pay. Unless a bonus system promises, and delivers big rewards, it should be abandoned.” “My idea, often stated to everybody, was that the [store] Captains should have the chance to make more than executives in the office. In a traditional chain store, managers aspire to become bureaucrats with cushy, high-paying jobs in the office. I wanted to kill such aspirations at the start.” “Part timers .. at a time when the minimum wage was $4.35, we often paid $13.00 per hour because these people were worth it.” “Productivity in part is a product of tenure. That’s why I believe that turnover is the most expensive form of labor expense.” “We instituted full health and dental insurance back in the 1960's when it was cheap. When I left, we were paying $6,000 per employee per year!” “Each full-timer was supposed to be able to perform every job in the store, including checking, balancing the books, ordering each department, stocking, opening, closing, going to the bank, etc. Everybody worked the check stands in the course of the day, including the [store] Captain.” “In thirty years we never had a layoff of full-time employees. Seasonal swings in business were handled with overtime pay to full-time employees, and by adjusting part-time hours. The stability of full-time employment at Trader Joe’s was due in part to caution opening new stores, and insisting on high volume stores.” “Cost of goods sold is the dominant expense. The funny thing is that grocers seem to spend more effort squeezing payroll than squeezing Cost of Goods Sold, though there is at least five times more opportunity in the latter.” Retail & Real Estate Decisions ‘First we upped the investment ante by taking only prime locations, which could generate the most sales, even though the rents were higher. A lease is an investment, perhaps the most serious and certainly the least changeable a retailer can make. Financially, a lease is simply a long-term loan… Most retail bankruptcies come from bad real estate leasing decisions… Early in my career I learned there are two kinds of decisions: the ones that are easily reversible and the ones that aren’t. Fifteen-year leases are the least-reversible decisions you can make. That’s why, throughout my career, I kept absolute control of real estate decisions.” “The keys to management are strong locations with good people.” “People often ask me, how many stores did we have at such-and-such time? It’s the wrong question to ask. What’s important is dollar sales. For example, from 1980 to 1988, we increased the number of stores by 50 percent but sales were up 340 percent.” “My preference is to have a few stores, as far apart as possible, and to make them as high volume as possible.” “Too many stores, to many irreversible leases, too much geographical saturation was a recurrent theme in the failure of American retail chains in the twentieth century.” “Ancient Mariner Retailers claim that ‘volume solves everything.’ If it’s profitable volume, they’re right. Things go most sour in the lowest-volume stores. It’s like riding a bicycle, the faster it goes, the more stable it is. The ‘normal distribution’ of most chains is 20% dogs, 60% okay stores, and 20% winners. I believe in ruthlessly dumping the dogs at whatever cost. Why? Because their real cost is in management energy. You always spend more time trying to make the dogs acceptable than in raising the okay stores into winners. And it’s in the dogs that you always have the most personnel problems." “I believe that the sine qua non for successful retailing is demographic coherence: all your locations should have the same demographics whether you are selling clothing or wine.” “I liked semi-decayed neighbourhoods, were the census tract income statistics looked terrible, but the mortgages were all paid-down, and the kids had left home. Housing and rental prices tend to be lower, and more suitable for those underpaid academics. Related to this, I was more interested in the number of households in a given area than the number of people in a ZIP code. Trader Joe’s is not a store for kids or big families. One or two adults is just fine.” “Computerisation has radically upgraded the statistics available: I’d probably do it more formally now. But there’s no substitute for ‘driving’ a location to ferret out traffic problems. And do it at night, too.” “I hardly need to mention that a trading area is rarely determined by a radius. It’s determined by geographical barriers, boulevard access, and where the demographics lie.” “Let’s go back to the question of number of stores. How do you space them? Here are some parameters: You need to have enough stores in a trading area to economically amortise the radio advertising. You need enough stores in an area to have a large enough pool of employees. My rule was that distance between stores should not be measured in miles but in driving time. I wanted no less than twenty minutes between stores. That pretty much avoided the dread word, cannibalisation. Could a given trading area support more Trader Joe’s? Almost certainly! I figured we could break even at ten thousand core residences. But I wanted super-volume stores. If the credo that super-volume stores have the fewest operating problems is valid, then the overall health of the chain, in the long run, is maximised.” “How many trading areas should you enter? As long as you can preserve the culture of the company, and as long as logistics don’t kill you, go ahead.” “Never, never, never sign a lease with a ‘continuous operation’ clause. That clause means you must stay open - you can’t ‘go dark’ and just pay the rent.” Product Knowledge “The buyers at the supermarket chains knew nothing about what they sold, and they don’t want to know. What they did know all about was extorting slotting allowances, cooperative ad revenue, failure allowances, and back-haul concessions from the manufacturers.” Four Tests “The advantage of hard liquor merchandise was that it met three tests: a) A high value per cubic inch, essential to a small store format b) A high rate of consumption c) It had to be easily handled If we could have added a fourth test, it would be that we had to be outstanding in the field. Still trying to maximise the use of a small store, I looked for categories that met the Four Tests; high value per cubic inch, high rate of consumption; easily handled; and something in which we could be outstanding in term of price or assortment. For example, diamonds met the first test but flunked the second. Fruits and vegetables met the first and second but flunked the third because produce requires constant reworking. Fresh meat flunked the third test even more.” Purpose “Most of my ideas about how to act as an entrepreneur are derived from ‘The Revolt of the Masses’ by Jose Ortega y Gasset, the greatest Spanish philosopher of the twentieth century. I believe it offers a master ‘plan of action’ for the would-be entrepreneur, who usually has no reputation and few resources. Ortega offers an explanation of how such a person can get an enterprise started. In the context of the career of Julius Caesar, an entrepreneur who started without power, Otega says of the state: ‘Human life, by its very nature, has to be dedicated to something, an enterprise glorious or humble, a destiny illustrious or trivial .. The State begins when groups, naturally divided, find themselves obliged to live in common. The obligation is not of brute force, but implies an impelling purpose, a common task which is set before the dispersed groups. Before all, the State is a plan of action and a Programme of Collaboration. The men are called upon so that together they may do something .. It is pure dynamism, the will to do something in common, and thanks to this the idea of the state, is bounded by no physical limits.” Most of my career has been spent selling ‘plans of action and programmes of collaboration.’ If you want to know what differentiates me from most manager’s that’s it. From the beginning, thanks to Ortega y Gasset, I’ve been aware of the need to sell everybody.” Radical Transparency “Throughout my career, my policy has been full disclosure to employees about the true state of affairs, almost to the point of imprudence. I took a cue from General Patton, who thought that the greatest danger was not that the enemy would learn the plans, but that his own troops would not.” Growth “Growth for the sake of growth still troubles me. It seems unnatural, even perverted. This helps explain why I went from 1974 to 1978 without opening another store. To keep sales increasing during the mid-1970s, we relied on new ideas implemented in existing stores. This was my favourite form of growth. I don’t think that any given store ever fully realises its potential.” Smallness & Empowerment “We developed a prototype [Trader Joe’s] store of 4,500 square feet. Here’s a good question: Given my need to get away from convenience stores, why did I stick with small stores? The answer was verbalised for us in ‘In Search of Excellence,’ Tom Peter’s best-selling book on management. He called it ‘The Power of Chunking’: ‘The essential building block of a company is the section [which] within its sphere does not await executive orders but takes initiatives. The key factor for success is getting one’s arms around almost any practical problem and knocking it off… The small group is the most visible of the chunking devices.’ The fundamental ‘chunk’ of Trader Joe’s is the individual store with its highly paid [store] Captain and staff; the people who are capable of exercising discretion. I admire Nordstrom’s fundamental instruction to its employees: use your judgement. Trader Joe’s finally settled down at an average of about eight thousand square feet in the 1980’s, but the concept of a relatively small store with a relatively small staff remains in force.” Marketing & Customers “At all times I wrote the Fearless Flyer [marketing newsletter] for over-educated, underpaid people. This requires two mindsets: Trader Joe’s Fearless Flyer Newsletter 1) There are no such things as consumers - dolts who are driven by drivel to buy stuff they don’t need or even want. There are only customers, people who are reasonably well informed, and very well focused in their buying habits. 2) We always looked up to the customers in the text of the Fearless Flyer. We assumed they knew more than they did, we never talked down to them. 3) Given the first two assumptions, we assumed that our readers had a thirst for knowledge, 180 degrees opposite from supermarket ads. We emphasised ‘informative advertising.’ Originally, we distributed the Fearless Flyer only in stores and to a small but growing list. [Later,] by mailing to addresses rather than to individuals - by blanketing entire ZIP codes - we were able to tremendously expand the distribution of the Fearless Flyer. The ZIPs to which we mailed, of course, were chosen on the basis of the likely concentration of over-educated and underpaid people.” Word of Mouth “Word of Mouth: The Power of True Believers. As everyone knows, word of mouth is the most effective advertising of all. I have been known to say that there’s no better business to run than a cult. Trader Joe’s became a cult of the over-educated and underpaid, partly because we deliberately tried to make it a cult and partly because we kept the implicit promises with our clientele.” “There aren’t many cult retailers who successfully retain their cult status over a long period of time. A couple in California are In-N-Out Burger and Fry’s Electronics. But across America, in every town, there’s a particular donut shop, pizza parlour, bakery, greengrocer, bar, etc. that has a cult following of True Believers.” Pricing “One of the fundamental tenets of Trader Joe’s is that retail prices don’t change unless costs change. There are no weekend ad prices, no in-and-out pricing… I have always believed that supermarkets pricing is a shell game and I wanted no part of it.” Retailing “The fundamental job of a retailer is to buy goods whole, cut them into pieces, and sell the pieces to the ultimate consumers. This is the most important mental construct I can impart on those of you who want to enter retailing. Most ‘retailers’ have no idea of the formal meaning of the word. Time and again, I had to remind myself just what my role in society was supposed to be.” “[We decided] no outsiders of any sort were permitted in the store. All the work was done by employees.]” “From 1958 through 1976, we tried to carry what the customer asked for, given the limits of our small stores and other operational parameters. Each store probably had access to ten thousand stock keeping units (SKUs), of which about three thousand were actually stocked in any given week. By the time I left in 1989, we were down to a band of 1,100 to 1,500 SKUs, all of which were delivered through a central distribution system.” “Along the way not only did we drop a lot of products that our customers would have liked us to sell, even at not-outstanding prices, but we stopped cashing checks in excess of the amount of purchase, we stopped full-case discounts, and we persistently shortened the hours. We violated every received wisdom of retailing except one: we delivered great value, which is where most retailers fall.” “[We were] willing to discontinue any product if we were are unable to offer the right deal to the customer.” “Instead of national brands, [we] focused on either Trader Joe’s label products or ‘no label’ products like nuts and dried fruits.” “We wouldn’t try to carry a whole line of spices, or bag candy, or vitamins. Each SKU had to justify itself as opposed to riding piggyback into the stores just so we had a ‘complete’ line. Depth of assortment was of no interest.” “Each SKU would stand on its own two feet as a profit centre. We would earn a gross profit on each SKU that was justified by the cost of handling that item. There would be no ‘loss leaders.’” “Above all we would not carry any item unless we could be outstanding in terms of price (and make a profit at that price) or uniqueness.” ‘I do not believe in keeping ‘spoils’ in the back room until some salesperson comes by to pick them up. I believe that products should move in only one direction, never back up the supply chain. When a bottle was broken, a can dented, or a ‘short fill’ was discovered, it went to the trash bin.” “A guideline: No private label product was introduced for the sake of having a private label. This is 100 percent contrary to the policy of most supermarkets… Each private label product had to have a reason, a point of differentiation.” “The willingness to do without any given product is one of the cornerstones of Trader Joe’s merchandising philosophy.” “No bulky products like paper towels or sugar, because the high-value-per-cubic inch rule still prevailed.. We simply went out of business on the ‘bulkers’ and did not replace them with private labels.” “I believe in the wisdom that you gain customers one by one, but you lose them in droves.” “Back in 1967, [we] made a bet that rising levels of education would fragment the masses, that a small but growing group of people would be dissatisfied with having to consume what everybody else consumed… This philosophical approach put us in conflict with the mainstream of American retailing, which emphasises continuous products. Thus when a supermarket promotes Coca-Cola it doesn’t have to explain that Coca-Cola is a secret formula for a soft drink created a century ago in Atlanta.. Wines have not been popular in America because, intrinsically, they are not continuous products. You can’t just order up some more sugar and chemicals and make another batch. In 1987, I outlined to the buyers where I thought we should go: 1) we want continuous products. Any sane person does. We want continuous products which are profitable without creating a high-price image. 2) to create such products, they needed to be differentiated at least in order to avoid direct price comparison. 3) products in which we had an absolute buying advantage. For example, we were the largest seller of cheap Bordeaux blanc in the United States. 4) I was willing to continue to indulge in the spectacular ‘closeout’ sales of branded products, but I wanted to do so in the context of much greater overall sales, principally generated by continuous products, most of them private label.” “I don’t think that the internet grocery store will successfully invade food retailing because you’re dealing with four different temperatures: dry grocery, refrigerated products, frozen products, and ice cream when you try to home-deliver foods.” “Showmanship is the sum total of all efforts to make contact with the customer. It’s the most ephemeral, the most difficult, and the most important of the Demand Side activities.” “All the research on whether people turn to the left or the right, or whether you can ‘force’ people to the rear of the store, is irrelevant if you’re a value retailer.” Win-Win “Honour thy vendors: After all, these are the guys you’re buying from. They should not be treated as adversaries. Five year plan 1977 said, ‘Buying, therefore, is not just a matter of trying to beat down suppliers on price. It is a creative exercise of developing alternatives.’ Many of our best product ideas and special buying opportunities came from our vendors.” “Vendors should be regarded as an extension of the retailer, a Marks and Spencer concept. Their employees should be regarded almost as employees of the retailer. Concern for their welfare should be shown, because employee turnover at vendors sometimes can be more costly than turnover of your own employees.” “Tenants who enter negotiations with the idea of beating the landlord at the objective future game usually get the kind of landlords they deserve. And vice versa.” “Other non-merchandise vendors are very much extensions of Trader Joe’s and should be treated as much. Since we owned no trucks, warehouses, etc., I asked our people to keep track of the outsourced drivers and do their best to see that our contractors were paid reasonable wages with reasonable working conditions. Turnover is the most expensive labour expense!’ Committees “I want to make it quite clear that I called all the shots. I reject management by committee.” Economies of Scale “The point where the ‘buying power’ and ‘selling power’ curves cross each other creates the magical physical thresholds. There are two magical physical thresholds that a retailer must achieve to be competitive: the truckload, and the ocean container load. These thresholds mark the limit of most economies of scale.” Focus & Outsource “We tried to stay out of all functions that were not central to our primary job in society: namely, buying and selling merchandise.. [We’d] been getting rid of all functions except those buying and selling. We got rid of our own maintenance people, we sold off almost all the real estate we had acquired during the 1970’s, we never took mainframe computing in-house, etc. Some choice quotes from Dr. Drucker: ‘In-house service activities have little incentive to improve their productivity .. The productivity is not likely to ramp up until it is possible to be promoted for doing a good job at it. And that will happen in support work only when such work is done by separate, free standing enterprises.’” Business Problems “All businesses have problems. It’s the problems that create the opportunities. If a business is easy, every simple bastard would enter it.” “This is one of the most important things I can impart; in any troubled company the people at lower levels know what ought to be done in terms of day-to-day operations. If you just ask them, you can find answers.” Adapt, Challenge the Status Quo “Believe me, you have to have a system for everything that has to happen in your business - you just may not be conscious of it. And you probably have still other systems that are not needed. That’s why The Winning Performance calls for a ‘continued contempt for business as usual.’ To practice ‘constitutional contempt,’ you have to arrive every day with the attitude, ‘Why do we do such-and-such that way?’ Better yet, why do we do it at all? Usually the answer is, ‘We’ve always done it that way,’ ‘That’s the way we did it at my last job,’ or ‘All our competitors are doing it.’ Mental Model - Double Entry Retailing “I hit on the idea of using double entry accounting as an analogy, what I call Double Entry Retailing. On the left side of the ledger is the business in terms of how its customers see it: I call this the Demand Side. On the right side of the ledger are the factors that limit or determine the retailer's ability to satisfy those demands: the Supply Side. All businesses, whether manufacturing, wholesaling, services, etc., have [the] fearful symmetry of both Demand and Supply sides. And all businesses are subject to the ultimate supply-side constraint of cash: you can do anything, no matter how stupid, within that fearful symmetry, as long as you don't run out of cash. From my view, the Demand Side of Retailers can be analysed in terms of five variables: The assortment of merchandise offered for sale. Pricing: stability and relative to competition. Convenience: geographical, in-store, and time. Credit: the accepted methods of payment. Showmanship: the sum of all activities that result in making contact with the customer, from advertising to store architecture to employee cleanliness. Here are factors on the Supply Side: Merchandise Vendors Employees  The way you do things: "habits" and "culture" Systems Non-merchandise vendors Landlords Governments Bankers and investment bankers Stockholders Crime As in double entry accounting, the change in any factor must be matched by a corresponding change in another factor. For example, a decision to increase geographical convenience (Demand Side) obviously involves some change of policy with landlords (Supply Side) including the amount of rent you're willing to pay. Consider how Barney's paid through the nose because they thought they had to offer the geographical convenience of being in Beverly Hills. How big a factor was this in Barney's subsequent bankruptcy? Was it Demand Side success at the price of Supply Side failure? The lists above aren't much different from other businesses. What distinguishes retailing is the asymmetry of the fearful symmetry: the huge number of customers (Demand Side) vs. the number of suppliers. This is the exact opposite of a government defence contractor. This lopsided butterfly may cause a retailer to act as if the only people they have to ‘sell’ to are customers: the Demand Side. That’s a major mistake. All the people on the supply side have to be sold, too.” “One of the smartest things we ever did was to cut the hours of Trader Joe’s. This is mostly a Supply Side question, but the quality and attitude of the employees handling our customers is a Demand Side factor.” Employee Ownership “From the beginning of Pronto Markets, one of my basic principles, one of my basic goals, was employee ownership of the business. Getting there, however, was complicated.” Summary I found the similarities between Trader Joe’s approach to retailing and the German retailer Aldi strikingly similar. Despite being on opposite sides of the world, both businesses evolved complementary retailing practices: a focus on private label, above market wages for employees, a win-win mentality and continuous innovation. It’s little wonder the Albrecht family were attracted to the business. Aldi acquired Trader Joe’s in 1979 and retained Joe as the independent manager for another ten years. Paying staff well, empowering and sharing information with them and maintaining smallness are consistent themes across many of the successful business stories we’ve studied. When it comes to the specifics of retailing, the analogy of super-volume stores better able to provide balance is a useful one. As are the insights into economies of scale, pricing strategy, jettisoning poorly performing stores, the power of word-of-mouth marketing and the means to abolish bureaucracy through the outsourcing of non-essential functions. Every business has its own quirks and idiosyncrasies. Identifying what they are and how they contribute to a firm’s success can provide clues in our own quest to find compounding machines; in the long run, it’s business success which determines share prices. The more businesses you study, the larger the toolkit of mental models you’ll have to apply in your investment endeavours. Source: 'Becoming Trader Joe - How I Did Business My Way & Still Beat the Big Guys,’ Joe Coulombe, Patty Civalleri. Harper Collins. 2021. Follow us on Twitter : @mastersinvest * NEW * Visit the Blog Archive Article by Investment Masters Class Updated on Oct 26, 2021, 1:11 pm (function() { var sc = document.createElement("script"); sc.type = "text/javascript"; sc.async = true;sc.src = "//mixi.media/data/js/95481.js"; sc.charset = "utf-8";var s = document.getElementsByTagName("script")[0]; s.parentNode.insertBefore(sc, s); }()); window._F20 = window._F20 || []; _F20.push({container: 'F20WidgetContainer', placement: '', count: 3}); _F20.push({finish: true});.....»»

Category: blogSource: valuewalkOct 26th, 2021

Fink Flip-Flops: Fears Social Unrest From Short-Termist Anti-Fossil-Fuel Furore

Fink Flip-Flops: Fears Social Unrest From Short-Termist Anti-Fossil-Fuel Furore Having virtue-signaled his way around the world for the last 18 months or more, expounding omnisciently at the need for lowly peasant folk to divest their internal combustion engines, switch to EVs, embrace renewables (at whatever cost), and stop investing in fossil fuels, BlackRock's Larry Fink is suddenly seeing the massive hole in his, and Davos Man's, cunning plan to 'greenwash' the world. The problem is simple - this anti-fossil-fuel virtue-signaling is leading to global energy shortages so severe they could cause social unrest. As Blackstone Inc. co-founder Stephen Schwarzman warned this week at a conference in Saudi Arabia: “We’re going to end up with a real shortage of energy,” he said. “And when you have a shortage it’s just going to cost more and it’s probably going to cost a lot more. And when that happens you’re going to get very unhappy people around the world, in the emerging markets in particular.” As Bloomberg reports, Schwarzmann's comments were echoed by Larry Fink, who said there’s a high probability of oil soon reaching $100 a barrel, especially with many governments and investors pushing back against investments in fossil fuels. “Inflation, we are in a new regime,” said Fink, chairman of BlackRock Inc, the world’s biggest asset manager. “There are many structural reasons for that. Short term policy related to environmentalism, in terms of restricting supply of hydrocarbons, has created energy inflation and we are going to be living with that for some time.” This is quite a flip-flop back to reality for the BlackRock boss who devoted his annual letter to investors to explain that climate change has now put us “on the edge of a fundamental reshaping of finance,” reportedly marking a watershed moment in climate history. Fink said in the letter that he would demand companies whose shares it holds disclose their plans to achieve net zero emissions, enabling BlackRock to then divest from polluting companies in its actively managed funds - which represent about a tenth of its assets - if they did not improve. “I believe that the pandemic has presented such an existential crisis - such a stark reminder of our fragility - that it has driven us to confront the global threat of climate change more forcefully and to consider how, like the pandemic, it will alter our lives,” Fink wrote. “No issue ranks higher than climate change on our clients’ lists of priorities.” Well, a year later, with energy costs at record highs and shortages everywhere amid both post-COVID demand acceleration and supply-based issues due in large part to ESG-driven fossil-fuel investment contraction (that was pioneered proudly by Fink), the situation is not the Green Utopia he imagined. Surging energy prices are currently playing out across the globe, with several European countries facing soaring energy bills amid a rise in commodities such as oil, natural gas, and coal. Gas prices rose by more than 35 percent in September amid lower supplies of natural gas and a surge in demand as pandemic-hit economies around the world reopen, prompting fears that there is simply not enough gas stored up for the winter if temperatures were to be particularly cold in the northern hemisphere. Lackluster output from Europe’s windmills and solar farms and maintenance work taking nuclear generators and other plans offline have also contributed to the energy price hike. It now appears Fink is taking a more stoic perspective, realizing that pleasing the Gretas and AOCs of the world in the short-term with words and actions has severe real-world implications on peoples' lives “We’re not focusing on long-term solutions, we’re not trying to change the world in a granular basis,” said Fink. “We have these visions we could go from a brown world and we could wake up tomorrow there’d be a green world. That is not going to happen.” And if that was not enough, we remind readers that neither China nor Russia will be attending COP26... thus making the climate change conference a total waste of time and money (and carbon credits for all those jets). Tyler Durden Tue, 10/26/2021 - 11:35.....»»

Category: blogSource: zerohedgeOct 26th, 2021

I convinced my boss to let me work a 4-day week after suffering from burnout - here are the exact steps I took to get them on board

Annabel Lee worried proposing a four-day workweek would make her seem uncommitted to the job. This is how she convinced her employer it was a win-win. Annabel Lee. Courtesy of Annabel Lee Annabel Lee wanted a four-day workweek, but she worried what her employer would think. This is how she made her request and how she ensured it would work for both parties. She worked a four-day week for five years and continued the arrangement when she began freelancing. In 2015, I burned out at my job as an account manager for a technology PR agency, where I had worked full time for the previous five years. I was exhausted and stressed, and I realized that I needed to reevaluate my work-life balance to feel better.I decided I wanted to reduce my working hours to a four-day week. But I had no dependents at the time and didn't know how to request flexible working for well-being and mental-health reasons, rather than for childcare or family commitments.I worried my request might be seen as a lack of commitment toward my job (it wasn't) and affect my career progression.After a lot of research, I made a formal request, and it was granted.This is my checklist of things I did and that I'd recommend to anyone who wants to make a similar flexible-working request.Consider when and how to make the request I used an upcoming annual review to make my request. This meant I had time to prepare and could broach the subject verbally. I considered making the request by email. There are pros and cons of each: An email is less direct, but it gives you no space for an immediate discussion.A meeting can feel more intense, but it offers a chance to discuss any issues in the moment, which allows for a more honest and upfront conversation. I found this worked well because I was able to get instant feedback on my request and gauge the response from my managers immediately. Explain the reasons why Before the meeting, I prepared notes, which helped me feel calm and confident. I included an overview of why I was making my request. I explained that I was burned out, that it was affecting my well-being and work, and that I wanted to reduce my working hours to create more balance.Discussing your mental health or personal issues with your boss can feel tricky. I found it helpful to prepare clear, concise, and factual notes beforehand. Be specific and flexible with what you're suggesting I went in with a clear request: I wanted to work a 30-hour week over four days rather than a 37.5-hour week over five.Having a specific request makes it easier to get a straightforward yes or no answer, or alternative but concrete suggestions.I said I was flexible about which day I would have off and explained that I was happy to identify a day that suited the company. We ultimately decided on a Thursday as this worked best with scheduled meetings and when others were working.Being this clear, while offering to help set up a new arrangement, helped make it easy for my employer to understand (and agree to) what I was proposing.Know exactly what this means for your take-home payI had calculated that I could afford a reduction to four-fifths of my salary. In real terms, this was not a 20% cut in take-home pay because I was taxed higher on the last fifth of my earnings.There are good salary apps (I used this one) that show what a reduction in your salary means in real terms, including how it would affect tax, pension, and national insurance contributions.Weigh how much money you can afford to lose if you reduce your hours, or whether you'd prefer to ask for compressed hours (such as a full week over four days). Anticipate issues or objectionsI considered possible issues or objections and included proposed solutions. In my case, this included how to manage client work when I was off and how to tell clients about my reduced hours.I laid out how we could manage this by ensuring that other members of the team had free capacity to cover my reduced hours, and that there would always be a suitable cover when I wasn't working. I also emphasized that I was happy to be contacted on my day off in an emergency. Explain how it benefits you and them I concluded by detailing the benefits for everyone: For me, this included improved mental health and greater happiness at work. For my employer, it meant improved productivity, reduced salary payments, and greater staff retention. After the review, we agreed that my employer would consider the request and respond within a few weeksIt was helpful to put everything in writing and agree to a timeframe to discuss it again. I thanked them for considering my request and explained that I was happy to work together to agree on an approach that worked for everyone.My request was granted. I stayed in the job for another five years. Thanks to the four-day week, I recovered from burnout and was happier, as well as more productive.It suited me so well that, when I left the job in 2020 to freelance, I stuck to working four days a week.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderOct 26th, 2021

Beijing Tells Evergrande"s Billionaire Founder To Repay The Insolvent Company"s Debts

Beijing Tells Evergrande's Billionaire Founder To Repay The Insolvent Company's Debts Hui Ka Yan, founder of China Evergrande Group, had once amassed a fortune of $42.5 billion, placing him at the top of the wealth rankings for all of Asia. But 73% of that immense fortune has now evaporated, and the tycoon will almost certainly lose even more as anxious creditors, suppliers and homebuyers besiege Evergrande’s offices. Hui Ka Yan But that's not nearly enough for Beijing. In a new twist of how China may soon conduct corporate bankruptcies, Chinese authorities told Hui Ka Yan to use his personal wealth to "alleviate" China Evergrande Group’s deepening debt crisis, Bloomberg reported according to people familiar with the matter. Beijing’s "directive" - which to us sounds just a bit m,more forceful than merely "urging" - to the Evergrande founder came after his company missed an initial Sept. 23 deadline for a coupon payment on a dollar bond, and takes place as local governments across China are monitoring Evergrande’s bank accounts to ensure company cash is used to complete unfinished housing projects and not diverted to pay creditors, the people said. According to Bloomberg, the demand that Hui to breach the corporate veil and "tap his own fortune to pay Evergrande’s debt adds to signs that Beijing is reluctant to orchestrate a government rescue, even as the property giant’s crisis spreads to other developers and sours sentiment in the real estate market." Our read is slightly different: Beijing will still have to orchestrate a government rescue because while Yan's fortune has shrank to "just" $7.8 billion from its 2017 peak of $42 billion, that would be a tiny fraction of the $300+ billion in debt and other liabilities the company owes. As such, Beijing's demand is merely a warning to other oligarchs: if your company became over indebted and is suddenly no longer viable, your own fortune will be at risk. Bloomberg's notes as much, saying that it was unclear whether Hui’s fortune is big and liquid enough to make a sizable dent in Evergrande’s liabilities, which swelled to more than $300 billion as of June. The developer’s dollar bonds are trading at deep discounts to par value as investors brace for what could be one of China’s largest-ever debt restructurings. To be sure, Beijing won't have much trouble bringing its case to the people, especially those people who lost their life savings on Evergrande Wealth Management Products: Hui’s fortune is derived from his controlling stake in Evergrande and the cash dividends he’s received from the company since its 2009 listing in Hong Kong. Hui has pocketed about $8 billion over the past decade thanks to Evergrande’s generous payouts, according to Bloomberg calculations. So, flipping Beijing's new paradigm of "shared prosperity" on its head to "shared misery", it only makes sense for Yan to lose everything as his company slowly goes under. While Evergrande surprised some China watchers by pulling back from the brink of default, paying a $83.5 million coupon to international bondholders before the grace period expired Oct. 23, the next big test will come as soon as this Friday when the 30-day grace period on another dollar coupon payment comes due. A hefty wall of maturing debt awaits in 2022, with some $7.4 billion of onshore and offshore bonds coming due. It wasn't clear where Evergrande's debt repayment funds came from. Separately, Reuters reported that Hui agreed to put his own money into a Chinese residential project tied to a bond to ensure it’s completed and bondholders get paid. Unfortunately for Evergrande's lenders, even if the billionaire backstops the debt with his personal funds, it won't make much of a difference. The property giant's operations have effectively frozen, as sales collapsed 97% in the most recent period, while there has been very little help from asset sales in recent months even after Hui put stakes in once-prized arms such as his electric vehicle and bottled water units on the block. Evergrande said last Wednesday it scrapped talks to offload a stake in its property-management arm. The deal fell apart even after officials in Evergrande’s home province of Guangdong helped broker the talks. If Yan ultimately goes along with Beijing's directive he has nobody to blame but himself... and Xi Jinping of course: Evergrande and its affiliated companies were built through an aggressive mix of debt issuance, share sales, bank loans and shadow financing - funding avenues that have been largely cut off under Beijing's recent debt crackdown. As Bloomberg notes, the Ministry of Housing and Urban-Rural Development instructed local subsidiaries across China in August to supervise funds for Evergrande’s property projects in special escrow accounts, people familiar said. Under the heightened oversight, the developer’s funds must first be used for construction to ensure project delivery. Evergrande has yet to finish homes for 1.6 million buyers who have already put down deposits. Its real estate sales plunged about 97% during peak home-buying season, further crimping its ability to generate funds. Ultimately, Yan may be lucky if he can get away from his troubles by just parting with all his money: his firm’s troubles are infecting the broader housing market, and the outcome could spark widespread popular anger which Beijing will be quick to redirect at the likes of Yan. For now this dire outcome seems unlikely: China’s banking regulator last week vowed to keep its curbs on the nation’s property market, even though the policies have weighed on indebted developers. While officials have told banks to speed up mortgage lending again, the central bank has indicated that contagion risks from Evergrande are “controllable” and unlikely to spread.Then again, that's what regulators said about Lehman too... Tyler Durden Tue, 10/26/2021 - 09:35.....»»

Category: blogSource: zerohedgeOct 26th, 2021

5 Technology Bigwigs Set to Beat Earnings Estimates This Week

Five technology bigwigs (market capital > $100 billion) are slated to release earnings results this week. These are: AMD, GOOGL, TXN, AAPL and NOW. The third-quarter earnings season is in full swing, with more than 900 companies set to report their quarterly numbers this week. Out of these companies, market participants’ focus will be predominantly on the technology behemoths.The third-quarter earnings results are pretty encouraging so far. This is in contrast to the view of a section of economists and financial experts that the momentum of the U.S. economic recovery slipped last quarter owing to prolonged supply-chain disruptions, labor shortage, higher inflationary pressure and the resurgence of the Delta variant of the novel coronavirus.In fact, it is primarily the robust third-quarter earnings results that led Wall Street to a bull ride in October after a tumultuous September. Nevertheless, earnings results of the tech sector, especially, the technology giants, will set the course for U.S. stock markets in the near term.Technology Sector in Q3 At a GlanceThe technology sector faced two major macro-economic headwinds in last quarter. The lingering global supply-chain disruptions led by the acute shortage of chipset affected the overall technology sector. Moreover, the lack of skilled labor resulted in a higher wage rate. These two factors together raised input costs for the industry players.Second, inflation rates skyrocketed in the third quarter compelling the Fed to think about tapering ithe existing quantitative easing program that the central bank adopted to maintain sufficient liquidity in the economy during the pandemic era.  The anticipation of the Fed’s tapering of $120 billion per month bond-buy program resulted in a spike in the yield curve of government bonds. Higher market risk-free returns are detrimental to growth-oriented sectors, especially, technology stocks. A higher discount rate will reduce the net present value of investment in technology stocks.Despite these hindrances, the Technology Select Sector SPDR (XLK), one of the 11broad sectors of the market’s benchmark — the S&P 500 Index — gained 1.3% in the third-quarter.Stocks in FocusFive technology bigwigs (market capital > $100 billion) are slated to release earnings results this week. Each of these stocks carries either a Zacks Rank#2 (Buy) or 3 (Hold) and has a positive Earnings ESP. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Our research shows that for stocks with the combination of a Zacks Rank #3 or better and a positive Earnings ESP, the chance of an earnings beat is as high as 70%. These stocks are anticipated to appreciate after earnings releases. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.The chart below shows the price performance of five stocks mentioned below in the last quarter.Image Source: Zacks Investment ResearchAdvanced Micro Devices Inc. AMD is riding on robust performance from the Computing and Graphics, and Enterprise Embedded and Semi-Custom segments. It is benefiting from strong sales of its Ryzen and EPYC server processors, owing to the increasing proliferation of AI and Machine Learning in industries like cloud gaming and the supercomputing domain.Moreover, the growing clout of 7-nanometer products in the data center vertical, driven by work-from-home and online learning trends, is a key catalyst. Management raised its 2021 guidance for revenues and gross margin on the back of strong growth across all businesses.This Zacks Rank #2 company has an Earnings ESP of +2.31%. It has an expected earnings growth rate of 94.6% for the current year. The Zacks Consensus Estimate for current-year earnings improved 0.4% over the last 30 days. It recorded earnings surprises in the last four reported quarters, with an average beat of 14.9%. The company is set to release third-quarter 2021 earnings results on Oct 26, after the closing bell.Alphabet Inc. GOOGL has been showing increased appetite in the Home Assistant space. The company is focused on innovation, launching products and services for multiple industries. Alphabet's robust cloud division is aiding substantial revenue growth.Moreover, expanding data centers will continue to bolster its presence in the cloud space. Further, major updates in its search segment are enhancing the search results. Additionally, Google’s mobile search is gaining solid momentum. Further, strong focus on innovation of AI techniques and the home automation space should aid business growth in the long term. Also, its deepening focus on the wearables category remains a tailwind.This Zacks Rank #2 company has an Earnings ESP of +7.71%. It has an expected earnings growth rate of 73.8% for the current year. The Zacks Consensus Estimate for current-year earnings improved 0.01% over the last 30 days. It recorded earnings surprises in the last four reported quarters, with an average beat of 47.2%. The company is set to release third-quarter 2021 earnings results on Oct 26, after the closing bell.2Texas Instruments Inc. TXN is benefiting from growth in the personal electronics market owing to the coronavirus-led work-from-home trend. Additionally, solid momentum across the Analog segment owing to robust signal chain and power product lines, is benefiting the top line.  The continued rebound in the automotive market is a tailwind for the company. Solid growth in the industrial market is another positive. Strategic investments in new growth avenues and competitive advantages should also reap results in the long term. Its portfolio of long-lived products and efficient manufacturing strategies are the other catalysts.This Zacks Rank #2 company has an Earnings ESP of +9.22%. It has an expected earnings growth rate of 32.7% for the current year. The Zacks Consensus Estimate for current year-earnings improved 0.8% over the last 30 days. It recorded earnings surprises in the last four reported quarters, with an average beat of 20.3%. The company is set to release third-quarter 2021 earnings results on Oct 26, after the closing bell.ServiceNow Inc. NOW is benefiting from robust growth in subscription revenues driven by the digital transformation of enterprises. As enterprises continue to cloudify their infrastructure, the company is poised to boost uptake of its Now platform. Its workflow solutions have been winning customers on a regular basis.Further, ServiceNow’s expanding global presence, a solid partner base and strategic buyouts are expected to bolster growth prospects. Based on the strong adoption of its digital workflow solutions, ServiceNow expects 2021 subscription billings to grow year over year. Also, strategic alliances with various technology behemoths remain tailwinds.This Zacks Rank #3 company has an Earnings ESP of +4.32%. It has an expected earnings growth rate of 25.5% for the current year. The Zacks Consensus Estimate for current year-earnings improved 0.2% over the last 30 days. It recorded earnings surprises in the last four reported quarters, with an average beat of 14.9%. The company is set to release third-quarter 2021 earnings results on Oct 27, after the closing bell.Apple Inc. AAPL is benefiting from continued momentum in the Services segment, driven by App Store, Cloud Services, Music, advertising and AppleCare. The company’s near-term prospects are bright, driven by new iPhones that support 5G, revamped iPad and Mac line-up of devices, healthcare-focused Apple Watch, and an expanding App Store ecosystem.Apple’s ability to attract small developers has been a key catalyst. Moreover, its devices continue to gain traction among enterprises. Its focus on autonomous vehicles and augmented reality/virtual reality technologies presents growth opportunities in the long haul. These are fast emerging as lucrative business opportunities.This Zacks Rank #3 company has an Earnings ESP of +5.69%. It has an expected earnings growth rate of 2.5% for the current year (ending September 2022). It recorded earnings surprises in the last four reported quarters, with an average beat of 23.7%. The company is set to release fourth-quarter fiscal 2021 earnings results on Oct 28, after the closing bell. Infrastructure Stock Boom to Sweep America A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made. The only question is “Will you get into the right stocks early when their growth potential is greatest?” Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.Download FREE: How to Profit from Trillions on Spending for Infrastructure >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Texas Instruments Incorporated (TXN): Free Stock Analysis Report Apple Inc. (AAPL): Free Stock Analysis Report Advanced Micro Devices, Inc. (AMD): Free Stock Analysis Report ServiceNow, Inc. (NOW): Free Stock Analysis Report Alphabet Inc. (GOOGL): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksOct 25th, 2021

ETFs to Win/Lose on PayPal"s Denial of Pinterest Acquisition

PayPal denied the acquisition news of Pinterest that market was abuzz with last week. The denial boosted PayPal shares on Oct 25 and weighed on the Pinterest stock. Last week, the market was abuzz with the news that PayPal Holdings Inc (PYPL) has reportedly offered to purchase digital pinboard site Pinterest Inc (PINS) for $45 billion. Shares of Pinterest had surged on the news last week while PayPal shares slumped (read: ETFs to Track on Pinterest and PayPal Merger News).However, PayPal ruled out the acquisition news lately. PayPal labeled the acquisition news as “market rumors”. The vey declaration boosted PayPal shares by 6% before market open on Oct 25 while Pinterest shares declined about 13.7% at the time of writing.Analysts were not very hopeful about the likely deal amid questions over the deal's structure. It was unclear how much equity or cash PayPal would use to finance the deal. At Mizuho Securities, analyst Dan Dolev had said in his note: "We see several potential concerns including unknown degree of user overlap, rapid deceleration in Pinterest user growth in recent quarters, and the deal potentially signaling that PayPal's organic net new adds in the second half of 2021 may be weaker than hoped," as quoted on investors.com.Meanwhile, Andrew Jeffrey, Trust Securities analyst, told CNBC last week that he was unconvinced of a PayPal-Pinterest merger. “A move to make another online deal, even in social media, just doesn’t make a lot of sense long term,” Jeffrey said, adding that PayPal needs to monetize in the physical world, as quoted on CNBC.Notably, PayPal has been striving to boost its e-commerce presence in recent years in an inorganic way. It bought online coupon finder Honey Science in 2019 for $4 billion and Japanese buy-now-pay-later (BNPL) firm Paidy for $2.7 billion earlier this year. It acquired return-service provider Happy Returns in May.The payments behemoth was among the big winners of the COVID-19-led social distancing, as customers have been choosing digital payments to serve their bills for essential items. Against this backdrop, the denial of the merger news should boost ETFs those are heavy on PayPal while ETFs those are heavy on Pinterest should slump in the near term.Likely ETF WinnersInvesco NASDAQ Internet ETF PNQIThe underlying Nasdaq CTA Internet Index is a modified market-capitalization weighted index designed to track the performance of the largest & most liquid U.S.-listed companies engaged in internet-related businesses & that are listed on one of the three major U.S. stock exchanges. PayPal takes 6.93% weight of the fund. The product charges 60 bps in fees.ETFMG Prime Mobile Payments ETF IPAYThe underlying Prime Mobile Payments Index provides a benchmark for investors interested in tracking the mobile and electronic payments industry, specifically focusing on credit card networks, payment infrastructure and software services, payment processing services, and payment solutions. PayPal takes 5.19% weight in the fund. The fund charges 75 bps in fees.Likely ETF LosersInvesco Dynamic Media ETF PBSThe underlying Dynamic Media Intellidex Index comprises of stocks of 30 US media companies. Pinterest takes the top spot with about 5.39% weight. The fund charges 63 bps in fees.American Customer Satisfaction ETF ACSIThe underlying American Customer Satisfaction Investable Index utilizes proprietary customer satisfaction scores to weight stocks within each sector by their relative customer satisfaction scores. Pinterest takes the second spot in the 36-stock fund. The fund charges 66 bps in fees. Infrastructure Stock Boom to Sweep America A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made. The only question is “Will you get into the right stocks early when their growth potential is greatest?” Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.Download FREE: How to Profit from Trillions on Spending for Infrastructure >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Invesco Dynamic Media ETF (PBS): ETF Research Reports Invesco NASDAQ Internet ETF (PNQI): ETF Research Reports ETFMG Prime Mobile Payments ETF (IPAY): ETF Research Reports American Customer Satisfaction ETF (ACSI): ETF Research Reports To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksOct 25th, 2021

Landstar System (LSTR) is a Top-Ranked Momentum Stock: Should You Buy?

The Zacks Style Scores offers investors a way to easily find top-rated stocks based on their investing style. Here's why you should take advantage. It doesn't matter your age or experience: taking full advantage of the stock market and investing with confidence are common goals for all investors. Luckily, Zacks Premium offers several different ways to do both.The research service features daily updates of the Zacks Rank and Zacks Industry Rank, full access to the Zacks #1 Rank List, Equity Research reports, and Premium stock screens, all of which will help you become a smarter, more confident investor.It also includes access to the Zacks Style Scores.What are the Zacks Style Scores?The Zacks Style Scores is a unique set of guidelines that rates stocks based on three popular investing types, and were developed as complementary indicators for the Zacks Rank. This combination helps investors choose securities with the highest chances of beating the market over the next 30 days.Each stock is given an alphabetic rating of A, B, C, D or F based on their value, growth, and momentum qualities. With this system, an A is better than a B, a B is better than a C, and so on, meaning the better the score, the better chance the stock will outperform.The Style Scores are broken down into four categories:Value ScoreValue investors love finding good stocks at good prices, especially before the broader market catches on to a stock's true value. Utilizing ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and many other multiples, the Value Style Score identifies the most attractive and most discounted stocks.Growth ScoreWhile good value is important, growth investors are more focused on a company's financial strength and health, and its future outlook. The Growth Style Score takes projected and historic earnings, sales, and cash flow into account to uncover stocks that will see long-term, sustainable growth.Momentum ScoreMomentum traders and investors live by the saying "the trend is your friend." This investing style is all about taking advantage of upward or downward trends in a stock's price or earnings outlook. Employing factors like one-week price change and the monthly percentage change in earnings estimates, the Momentum Style Score can indicate favorable times to build a position in high-momentum stocks.VGM ScoreWhat if you like to use all three types of investing? The VGM Score is a combination of all Style Scores, making it one of the most comprehensive indicators to use with the Zacks Rank. It rates each stock on their combined weighted styles, which helps narrow down the companies with the most attractive value, best growth forecast, and most promising momentum.How Style Scores Work with the Zacks RankThe Zacks Rank, which is a proprietary stock-rating model, employs earnings estimate revisions, or changes to a company's earnings expectations, to make building a winning portfolio easier.#1 (Strong Buy) stocks have produced an unmatched +25.41% average annual return since 1988, which is more than double the S&P 500's performance over the same time frame. However, the Zacks Rank examines a ton of stocks, and there can be more than 200 companies with a Strong Buy rank, and another 600 with a #2 (Buy) rank, on any given day.This totals more than 800 top-rated stocks, and it can be overwhelming to try and pick the best stocks for you and your portfolio.That's where the Style Scores come in.You want to make sure you're buying stocks with the highest likelihood of success, and to do that, you'll need to pick stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you like a stock that only as a #3 (Hold) rank, it should also have Scores of A or B to guarantee as much upside potential as possible.Since the Scores were created to work together with the Zacks Rank, the direction of a stock's earnings estimate revisions should be a key factor when choosing which stocks to buy.For instance, a stock with a #4 (Sell) or #5 (Strong Sell) rating, even one that boasts Scores of A and B, still has a downward-trending earnings forecast, and a much greater likelihood its share price will decline as well.Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.Stock to Watch: Landstar System (LSTR)Landstar System, Inc. is an asset-light provider of integrated transportation management solutions, incorporated in 1991. Based in Jacksonville, FL, the company provides services throughout the United States, Canada, Mexico as well as other countries in North America.LSTR is a #2 (Buy) on the Zacks Rank, with a VGM Score of B.Momentum investors should take note of this Transportation stock. LSTR has a Momentum Style Score of A, and shares are up 6% over the past four weeks.Five analysts revised their earnings estimate higher in the last 60 days for fiscal 2021, while the Zacks Consensus Estimate has increased $0.35 to $9.41 per share. LSTR also boasts an average earnings surprise of 11.4%.With a solid Zacks Rank and top-tier Momentum and VGM Style Scores, LSTR should be on investors' short list. Infrastructure Stock Boom to Sweep America A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made. The only question is “Will you get into the right stocks early when their growth potential is greatest?” Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.Download FREE: How to Profit from Trillions on Spending for Infrastructure >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Landstar System, Inc. (LSTR): Free Stock Analysis Report To read this article on Zacks.com click here......»»

Category: topSource: zacksOct 25th, 2021

Why Schneider National (SNDR) is a Top Value Stock for the Long-Term

Whether you're a value, growth, or momentum investor, finding strong stocks becomes easier with the Zacks Style Scores, a top feature of the Zacks Premium research service. Taking full advantage of the stock market and investing with confidence are common goals for new and old investors, and Zacks Premium offers many different ways to do both.The research service features daily updates of the Zacks Rank and Zacks Industry Rank, full access to the Zacks #1 Rank List, Equity Research reports, and Premium stock screens, all of which will help you become a smarter, more confident investor.Zacks Premium includes access to the Zacks Style Scores as well.What are the Zacks Style Scores?The Zacks Style Scores, developed alongside the Zacks Rank, are complementary indicators that rate stocks based on three widely-followed investing methodologies; they also help investors pick stocks with the best chances of beating the market over the next 30 days.Each stock is assigned a rating of A, B, C, D, or F based on their value, growth, and momentum characteristics. Just like in school, an A is better than a B, a B is better than a C, and so on -- that means the better the score, the better chance the stock will outperform.The Style Scores are broken down into four categories:Value ScoreValue investors love finding good stocks at good prices, especially before the broader market catches on to a stock's true value. Utilizing ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and many other multiples, the Value Style Score identifies the most attractive and most discounted stocks.Growth ScoreGrowth investors, on the other hand, are more concerned with a company's financial strength and health, and its future outlook. The Growth Style Score examines things like projected and historic earnings, sales, and cash flow to find stocks that will experience sustainable growth over time.Momentum ScoreMomentum trading is all about taking advantage of upward or downward trends in a stock's price or earnings outlook, and these investors live by the saying "the trend is your friend." The Momentum Style Score can pinpoint good times to build a position in a stock, using factors like one-week price change and the monthly percentage change in earnings estimates.VGM ScoreWhat if you like to use all three types of investing? The VGM Score is a combination of all Style Scores, making it one of the most comprehensive indicators to use with the Zacks Rank. It rates each stock on their combined weighted styles, which helps narrow down the companies with the most attractive value, best growth forecast, and most promising momentum.How Style Scores Work with the Zacks RankA proprietary stock-rating model, the Zacks Rank utilizes the power of earnings estimate revisions, or changes to a company's earnings outlook, to help investors create a successful portfolio.It's highly successful, with #1 (Strong Buy) stocks producing an unmatched +25.41% average annual return since 1988. That's more than double the S&P 500. But because of the large number of stocks we rate, there are over 200 companies with a Strong Buy rank, plus another 600 with a #2 (Buy) rank, on any given day.But it can feel overwhelming to pick the right stocks for you and your investing goals with over 800 top-rated stocks to choose from.That's where the Style Scores come in.To maximize your returns, you want to buy stocks with the highest probability of success. This means picking stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you find yourself looking at stocks with a #3 (Hold) rank, make sure they have Scores of A or B as well to ensure as much upside potential as possible.The direction of a stock's earnings estimate revisions should always be a key factor when choosing which stocks to buy, since the Scores were created to work together with the Zacks Rank.A stock with a #4 (Sell) or #5 (Strong Sell) rating, for instance, even one with Scores of A and B, will still have a declining earnings forecast, and a greater chance its share price will fall too.Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.Stock to Watch: Schneider National (SNDR)Schneider National, headquartered in Brown County, WI, is a leading transportation and logistics services company. Founded in 1935, the company offers a portfolio of premier truckload, intermodal and logistics solutions. Additionally, Schneider National, which went public in April 2017, operates one of the largest for-hire trucking fleets in North America. In 2020, the company served approximately 9,250 customers, including many well-known companies.SNDR is a #2 (Buy) on the Zacks Rank, with a VGM Score of A.It also boasts a Value Style Score of A thanks to attractive valuation metrics like a forward P/E ratio of 12.61; value investors should take notice.Three analysts revised their earnings estimate upwards in the last 60 days for fiscal 2021. The Zacks Consensus Estimate has increased $0.04 to $1.97 per share. SNDR boasts an average earnings surprise of 15.7%.With a solid Zacks Rank and top-tier Value and VGM Style Scores, SNDR should be on investors' short list. Infrastructure Stock Boom to Sweep America A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made. The only question is “Will you get into the right stocks early when their growth potential is greatest?” Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.Download FREE: How to Profit from Trillions on Spending for Infrastructure >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Schneider National, Inc. (SNDR): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksOct 25th, 2021

4 Mutual Funds to Rally on Cleantech Boom

Rapid climate change is forcing global economies to adopt clean energy, leading to a boom in cleantech. Climate change concerns have forced global economies to adopt clean energy rapidly. The recent wave of decarbonization is forcing economies to move away from carbon-based fossil fuels and adopt cleaner alternatives like solar, wind, and other renewable energy.Per a Deloitte report, the New Climate Economy findings state that low-carbon growth can deliver $26 trillion in economic benefits globally by 2030. This is allowing the spectra of the clean technology bust. Clean technology or cleantech talks about renewable energy, energy efficiency and other technologies to reduce carbon emissions.In the late 2000s and early 2010s, several startups popped up globally, grabbing the attention of venture capitalists. Gradually with the government transforming the face of energy consumption and taking up decarbonization as a plan, funds started flowing, helping companies grow. Governments are also investing millions of dollars into the research and development of sustainable technologies and cleantech. Clean power generation, smart agriculture and building retrofits have been areas of focus for the Biden administration.Several corporates and millionaires are now funding small-scale changemakers. Bill Gates has committed billions of dollars in funding for battery companies and electric-vehicle firms. Tech bigwigs like Google have set goals to become carbon-neutral by 2030, while Amazon has set up a $2-billion fund to invest in climate initiatives.Investors can also look into renewable energy sources like wind, solar, and hydroelectric, that supply about a quarter of the electricity generated by the power sector at present. The industry has been growing roughly 8% annual rate over the past decade to increase its electricity generating capacity.Though Biden’s infrastructure bill is on hold, it plays a huge role in supporting his plan to make the United States run 100% carbon-free by 2035. Hence, the electric vehicle, smart-home sectors are poised to grow, boosting the cleantech space.4 Cleantech Fund PicksGiven the current scenario and the boom in clean technology, we have shortlisted four funds poised to grow. These funds flaunt a Zacks Mutual Fund Rank #1 (Strong Buy) or 2 (Buy). Moreover, these funds have encouraging three and five-year returns. Additionally, the minimum initial investment is within $5000.We expect these funds to outperform peers in the future. Remember, the goal of the Zacks Mutual Fund Rank is to guide investors to identify potential winners and losers. Unlike most of fund-rating systems, the Zacks Mutual Fund Rank is not just focused on past performance but also on the likely future success of the fund.The question here is: why should investors consider mutual funds? Reduced transaction costs and portfolio diversification without several commission charges associated with stock purchases are primarily why one should be parking money in mutual funds (read more: Mutual Funds: Advantages, Disadvantages, and How They Make Investors Money).Fidelity Select Utilities Portfolio FSUTX aims for capital appreciation. This non-diversified fund invests most assets in common stocks of companies, primarily engaged in the utilities industry and generating most of their revenues from utility operations.This Zacks Sector – Utilities has a history of positive total returns for more than 10 years. Specifically, FSUTX has returned 7.6% and 10.1% in the past three and five-year period, respectively. To see how this fund performed compared to its category, and other 1 and 2 Ranked Mutual Funds, please click here.FSUTX has a Zacks Mutual Fund Rank #1 and an annual expense ratio of 0.76%, below the category average of 0.94%. This fund has significant investment in alternative energy companies like Clearway Energy, Vistra Corp, Nextera Energy and Sunnova Energy.New Alternatives Fund Class A NALFX aims for long-term capital appreciation, with income being the secondary objective. The fund invests in common stocks of YieldCos, American Depository Receipts, real estate investment trusts and publicly-traded master limited partnerships.This Zacks Sector – Other product has a history of positive total returns for more than 10 years. NALFX has three and five-year return of 26.3% and 17.5%, respectively. To see how this fund performed compared in its category, and other 1 and 2 Ranked Mutual Funds, please click here.NALFX has a Zacks Mutual Fund Rank #2 and an annual expense ratio of 0.96% versus the category average of 1.29%. Additionally, the fund has significant investment in alternative energy companies like Nextera Energy, Vestas Wind Systems and Innergex Renewable Energy.Calvert Global Energy Solutions Fund Class A CGAEX aims to track the performance of the Calvert Global Energy Research Index. The fund invests a majority of assets in companies whose main business is sustainable energy solutions. The portfolio consists of companies engaged in facilitating the transition to a more sustainable economy by reducing greenhouse gas emissions and the expanded use of renewable energy sources.This Zacks Sector – Other product has a history of positive total returns for more than 10 years. CGAEX has three and five-year return of 23.8% and 16.8%, respectively. To see how this fund performed compared in its category, and other 1 and 2 Ranked Mutual Funds, please click here.CGAEX has a Zacks Mutual Fund Rank #2 and an annual expense ratio of 1.24%, below the category average of 1.26%. Additionally, CGAEX has significant investment in alternative energy companies like Nextera Energy Partners, First Solar and Terraform Power.Fidelity Select Automotive Portfolio FSAVX fund aims for capital appreciation. This non-diversified fund invests a majority of assets in common stocks of companies involved in the manufacture, marketing or sale of automobiles, trucks, specialty vehicles, parts, tires and related services.This Sector - Other product has a history of positive total returns for over 10 years. Specifically, FSAVX has returned 29.3% and 21.2% over the past three and five years, respectively. To see how this fund performed compared to its category, and other #1 and 2 Ranked Mutual Funds, please click here.FSAVX has a Zacks Mutual Fund Rank #2 and an annual expense ratio of 0.88%. Additionally, the fund has significant investment in companies that deal in EVs or related products and services like Tesla, Ford and Nio.Want key mutual fund info delivered straight to your inbox?Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing mutual funds, each week. Get it free >> Infrastructure Stock Boom to Sweep America A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made. The only question is “Will you get into the right stocks early when their growth potential is greatest?” Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.Download FREE: How to Profit from Trillions on Spending for Infrastructure >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Get Your Free (FSUTX): Fund Analysis Report Get Your Free (FSAVX): Fund Analysis Report Get Your Free (CGAEX): Fund Analysis Report Get Your Free (NALFX): Fund Analysis Report To read this article on Zacks.com click here. Zacks Investment Research Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report.....»»

Category: topSource: zacksOct 25th, 2021

EV Roundup: TM"s $3.4B Investment, TSLA"s Blowout Q3 & More

While Toyota (TM) bets big on the U.S. electric future with a $3.4-billion investment, Tesla (TSLA) impresses investors with impressive Q3 results. The electric vehicle (EV) revolution is speeding up, with legacy automakers leaving no stone unturned to establish a strong foothold in this domain and setting ambitious targets to electrify their fleet. Last week, Toyota TM bet big on the U.S. electric future with a $3.4-billion investment. In a bid to step up its EV prowess, Stellantis STLA inked joint venture deals with LG Energy Solution and Samsung SDI. Ford F announced plans to invest $300 million for manufacturing EV components in Europe, as it plans to go all-electric in the continent by the decade-end. Such has been the frenzy surrounding electrified vehicles that Apple iPhone maker Foxconn is also set to capitalize on the same. The Taiwan-based electronics giant is set to bet on the green mobility future with three EVs that it plans to bring to the market: an electric SUV, a flagship sedan, and an electric bus, labeled the Model E, Model C, and Model T, respectively. Last Week’s Key StoriesToyota will invest $3.4 billion (380 billion yen) for automotive battery development and production in the United States through 2030. The investment, which is supposed to come from Toyota’s North American arm, involves the plan to establish a new company and build an automotive battery plant in the United States in collaboration with Toyota Tsusho. The plant, anticipated to start production in 2025, involves an outlay of $1.29 billion for expansion until 2031, resulting in the creation of 1,750 new jobs. The venture will initially focus on producing batteries for hybrid EVs. The new company's activities will also include aiding Toyota in enhancing its local supply-chain network and production expertise related to lithium-ion automotive batteries. Tesla TSLA reported third-quarter 2021 earnings of $1.86, which surpassed the Zacks Consensus Estimate of $1.39. A higher-than-expected automotive gross profit resulted in this outperformance. Precisely, automotive gross profit came in at $3,673 million, topping the consensus mark of $3,328 million. The bottom line also compared favorably with the year-ago earnings of 76 cents a share. Total revenues came in at $13,757 million, beating the consensus mark of $13,163 million. The top line also witnessed year-over-year growth of 56.8%. The EV king reiterated its goal of achieving 50% average annual growth in vehicle deliveries over a multi-year horizon. Tesla currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Stellantis entered into a joint venture deal with LG Energy Solution to develop battery cells in North America. Per the deal, the companies will jointly establish a battery factory having an annual capacity of 40 gigawatt-hours (GWh) that will be functional by first-quarter 2024. Stellantis also announced its collaboration with Samsung SDI for battery production in North America. With Samsung, it will develop a plant with an initial annual capacity of 23 GWh, having an expansion capacity up to 40 GWh. This plant is expected to become operational in 2025. The agreements are in sync with Stellantis’ plans to invest more than €30 billion throughout 2025 in electrification and software development.Ford announced plans to spend more than $300 million to manufacture EV parts and components in Europe. In this regard, the U.S. auto biggie intends to convert the Halewood factory in northern England into a facility that will engage in the development of electric power components for green vehicles. The Halewood plant, with a production capacity of 250,000 power units per year, will begin manufacturing the parts by mid-2024. This marks Ford’s first European in-house location to make EV parts and an important investment, as it plans to go all-electric in the continent by 2030.Allison Transmission ALSN is set to make a strategic investment of approximately $42 million in Jing-Jin Electric (JJE) IPO. Allison’s investment in JJE follows the recent collaboration between the two companies to accelerate the development of best-in-class electrified powertrain solutions for global commercial vehicles. The alliance aims to bank on JJE’s dominance in electric motor and inverter development, and robust foothold in the China commercial vehicle electrified powertrain market, while exploiting Allison’s expertise in fully-electric and electric hybrid commercial duty propulsion systems. The latest investment highlights Allison’s commitment to the commercial electric vehicle space.Price PerformanceThe following table shows the price movement of some of the major EV players over the past week and six-month period.Image Source: Zacks Investment ResearchIn the past six months, all stocks have decreased, apart from Tesla, XPeng and Li Auto. Lordstown bore the maximum brunt, with shares declining 53.2%. The past week also displayed a mixed price trend, with Nikola being the worst performer and Tesla registering the maximum gains.What’s Next in the Space?Stay tuned for announcements of upcoming EV models and any important updates from the red-hot industry. Infrastructure Stock Boom to Sweep America A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made. The only question is “Will you get into the right stocks early when their growth potential is greatest?” Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.Download FREE: How to Profit from Trillions on Spending for Infrastructure >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Ford Motor Company (F): Free Stock Analysis Report Toyota Motor Corporation (TM): Free Stock Analysis Report Tesla, Inc. (TSLA): Free Stock Analysis Report Allison Transmission Holdings, Inc. (ALSN): Free Stock Analysis Report Stellantis N.V. (STLA): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksOct 25th, 2021

An 18-Year-Old Living in a Kenyan Refugee Camp Is Among 100 Teens Awarded Lifelong Support to Foster Global Change

The winners include teens from 42 countries speaking 20 languages selected from a pool of more than 50,000 applicants Christian Maboko wants to change the world. Starting Monday, the 18-year-old from Burundi, who lives in a Kenyan refugee camp and has co-founded a nonprofit to help address poverty there, will get a lifetime of help with his work from a new philanthropic program to nurture talented teens around the world. Schmidt Futures announced that Maboko is one of the inaugural 100 Rise Global Winners, part of a $1 billion program funded by philanthropists Wendy and Eric Schmidt, the former CEO of Google and executive chairman of its parent company, Alphabet Inc. The program aims to foster collaboration and new projects from young people to help solve the world’s thorniest problems. [time-brightcove not-tgx=”true”] Maboko plans to use Rise’s financial support to further his work in the Kakuma Refugee Camp in Kenya and go to college, even though only 1% of high school graduates in the camp do so. “I’m trying my best to be among the 1%,” he told The Associated Press. Rise winners will receive lifetime access to higher education scholarships, career development and funding for projects they create for public benefit. They also receive an annual three-week residential summit with the other winners, and mentorship and internship opportunities in their fields of interest. Because the costs of college degrees vary widely around the world, the prize for each winner also will vary. Rise will notify the winners, which include teens from 42 countries speaking 20 languages, on Monday. “We think talent around the world is distributed evenly,” Wendy Schmidt said. “But opportunity isn’t.” Schmidt Futures and The Rhodes Trust invited teens to explain how they would address an issue or are already addressing it. More than 50,000 teens from 170 countries applied last year. For his application, Maboko developed a program to teach girls and young women in his refugee camp about reproductive health and the importance of remaining in school even if they get pregnant. “I don’t want to see my younger sisters dropping out,” said Maboko, whose family has been unable to return to Burundi due to political unrest. “So I had to come up with a solution and do it for the community.” The wide variety of global problems that Rise applicants want to tackle — from sustainable farming to female representation in Irish mythology to making shopping more accessible to those in wheelchairs — surprised the Schmidts, who expected an emphasis on scientific projects. “When I look at this group, I can see the pandemic generation,” Wendy Schmidt said. “These kids have been growing up at a time when almost every system in the world that they knew about was failing. If that doesn’t give them an opening for creative solutions to some of these really big, hairy global problems that we face, nothing does.” Eric Schmidt said the Rise initiative hopes to prove several theories about supporting teenagers. Unlike other programs that support individuals rather than organizations — such as the MacArthur Foundation’s “genius grant”— Rise selects its winners mainly on potential and takes numerous criteria into account, including intelligence and overcoming adversity. “There’s a lot of intuition that you can identify exceptional, creative, powerfully important people at 16 and not 14,” he said. “Now, that’s still a question, but I believe it to be true. And I think the cohort that has been selected is illustrative of this.” Another winner, Ella Duus, wants to reduce political polarization in America. The 16-year-old from Huntsville, Alabama, built an online tool to gauge how much biased information any Twitter account offers. “Social media algorithms get people stuck in feedback loops,” she said. “This ultimately leads to a lot of radicalization of people, which can be a danger to the public.” Her tool proved so popular that Duus had to take it down because the server charges to host it grew too expensive. That will likely soon change because of her inclusion in the Rise Global Winners, which also will help her pursue her interest in diplomacy and national security when she goes to college. Jennifer Uche, 17, of Boston, another winner, said the application process strengthened her writer’s voice and she hopes to encourage her peers to raise their voices as well. For her application, she wrote and produced a fictional podcast about mutant teens who suffer discrimination and react by becoming heroes in their community. “I wanted to really make something interesting out of the idea of advocacy,” Uche said. “And I wanted youth to see they have a voice and they can do something.” She combined the podcast with an online forum for people to discuss the combination of art and advocacy and how various works of art could inspire them to take action in their lives. Uche plans to use the support she gets from the Rise initiative to expand her podcast and forum, as well as pursue a college education in film and computer science. Applications for next year’s class of Rise Global Winners will be accepted until Dec. 22 from those who will be 15 to 17 as of July 1, 2022, through the Hello World Network smartphone app. Other Rise global winners include: — Irfan Ayub, of Afghanistan, who started a tutoring center in his rural community. — Adam Dhalla, of Canada, who developed a machine learning algorithm to classify the locations of proteins within cells. — Valentina Barrón García, of Mexico, who built a hydroponic system for growing fruits and vegetables. — Lydia Ruth Nottingham, of the United Kingdom, who convinced her school to invest in reusable masks. — Aryan Sharma, of India, who made a diagnostic app that scans X-rays for abnormalities. ___ The Associated Press receives support from the Lilly Endowment for coverage of philanthropy and nonprofits. The AP is solely responsible for all content......»»

Category: topSource: timeOct 25th, 2021

I run a private security firm where we charge $30,000 a day for hostage rescue missions - here"s what my job is like

"Nine times out of 10, kidnapping is a business transaction," says Adam Gonzales, who runs a global security firm powered by military-trained personnel. Adam Gonzales Adam Gonzales Adam Gonzales is a private security specialist and CEO of Hyperion Services. His company consists of former military members who work as personal security guards and hostage rescuers. This is what his job is like, as told to freelance writer Jenny Powers. See more stories on Insider's business page. This as-told-to essay is based on a transcribed conversation with Adam Gonzales, a private hostage negotiator and security specialist. It has been edited for length and clarity.Whenever the national anthem played at a sporting event while I was growing up in Miller Beach, Indiana, I always felt proud to be an American. By the age of 20, I enlisted in the Army and was deployed to Iraq and Afghanistan. For four years, I trained as part of a six-man, long-range surveillance operative charged with parachuting onto enemy lines undetected for reconnaissance and surveillance purposes.In 2004, I transitioned to the private military sector and became what's known by former members of the military as a corporate warrior or silent professional, outsourcing myself to the government to help support and augment US war efforts.My first job as an independent contractor was with a military defense contracting firm that was relatively unknown at the time.It was the height of the Iraq War, and I was deployed to Baghdad for six months as security to Ambassador Paul Bremer, the US Presidential Envoy to Iraq.Our team, made up of approximately 50 contractors, provided a wide range of missions which included driving armored Suburbans, close protection, villa protection, and close air support with helicopters. Adam Gonzales in Iraq in 2009. Adam Gonzales I worked the night shift, from 7 p.m. to 7 a.m. When my shift was over, I slept when I could, at times doing double duty as a door gunner on the Little Bird helicopters that provided close air support for the ambassador. By 2013, I decided it was time to lead a more normal life and get a civilian job. I had no connections in America since I'd spent my adult life overseas, so I moved to Chicago taking a position as an electrical apprentice. Each morning I dreaded going to work. I'd sit in my truck at the job site, staring out the window thinking 'I don't belong here' and cry to myself. I lasted a year before deciding to take advantage of my military experience and make the shift to protect UHNW individuals. No longer part of a security operative, I became a one man show - the driver, the advance team, logistics manager, and protector. Nine times out of 10, kidnapping is a business transaction.For some it's a quick way to make money. A small percentage of cases, however, have nothing to do with money and are about honor or a vendetta. Those are the toughest because the clock is ticking before total loss of life.In 2015, I was called in on a case involving a woman in her late 20s who'd voluntarily joined a cult in Central America but now wanted out. She was being held against her will, and I was hired to rescue her. I knew the particular country well and had one man on the ground to gather local intelligence before I went in alone. With an aircraft on the ground waiting in the wings, I created an elaborate cover story feigning interest in joining the cult in order to get inside the compound.The cult leader bought my story, invited me in, and showed me the lay of the land. He even assigned me a room with access to a swimming pool and computer lab.On the computer, I downloaded information to share with my team on the outside, including the compound's floor plans. I also discreetly identified myself to the kidnapped woman by sharing details about her childhood I'd learned from her family.Under the guise that the woman was sick, I arranged for an outside source posing as an ambulance driver to arrive and whisk her out of the compound. From there, she boarded the private plane safely and headed home. The ordeal lasted three days from when I arrived until the rescue.I, on the other hand, had to remain in the compound a few more days so as not to raise any red flags. I crafted another story about having to leave due to an emergency with a promise to return, but instead headed straight to a hotel and spent a week decompressing in a hammock on the beach.It's hard to find meaning in your work after leaving the military, so I wanted to help fellow vets. In 2017, I launched Silent Professionals, a free job board for military and law enforcement veterans to find work in the private military and security industries. To date, the site has helped 10,000 veterans transition back into civilian life by using their background and skill set to make a living and discover a renewed sense of purpose.As our reputation grew, wealthy people with security needs began reaching out, so in 2019 the natural progression was to open Hyperion Services, a global solutions security firm powered by high-level military-trained personnel. The bulk of our business is in turnkey executive security which runs $2,000 a day and includes lodging, meals, labor, weapons, and equipment. Often clients sign a year-long contract and pay upfront in full. In addition, we offer hostage rescue starting at $30,000 a day with a month-long commitment, as well as kidnapping prevention and disaster response services.These days, I live south of DC, in the Quantico Area. I suffer from PTSD, but my wife of five years, who is also a veteran, helps me cope. It's hard to trust people and I question everything. If a new mailman shows up at our front door or the car behind me makes too many of the same turns as me, my spidey senses go off. After dealing with the most violent people on the planet and bearing witness to the types of atrocities I've seen, I view the world through a very different lens. Sometimes in bed I wonder how different my life would have been if I'd stuck with being an electrical apprentice, but before long my alarm clock goes off, and I'm back to work. Editor's note: Some details in this story were anonymized to protect the identities of the people and companies involved.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderOct 24th, 2021

Chinese & Russian Warships Still Circling Japan As "Counterweight" To US "Destabilization" In Region

Chinese & Russian Warships Still Circling Japan As 'Counterweight' To US "Destabilization" In Region After their provocative sail through of the Tsugaru Strait on Monday, a narrow chokepoint waterway through Japan, a large group of Chinese PLA and Russian warships have continued encircling Japan during an Indo-Pacific patrol mission that's gone into the weekend. Russian media cited the country's defense ministry as follows on Saturday: "Russian and Chinese navy vessels have completed their first joint patrol mission in the Pacific Ocean, covering a distance of over 1,700 nautical miles (around 3,100km) in a week." It included at least ten warships, with Russia's military releasing some stunning footage of the large naval group. Though irking and alarming Tokyo, also given this is the closest that such a joint Russia-China naval patrol has come to Japan's coast (though Tsugaru is considered an international waters transit point), the Japanese Navy after closely monitoring their movements later said there's as yet been no violation of Japan's territorial waters.  Chinese state media hailed the joint patrol mission as a crucial counterweight to the US presence and Washington's "destabilization" of the region.  For example, in state-run Global Times: The Chinese-Russian joint naval flotilla that transited the Tsugaru Strait days ago has since sailed along the east side of Japan's main island to its south, almost making a circle around the island country, in a move Chinese experts said on Friday can bring balance to regional stability at a time when the US, Japan and other Western forces have been colluding to destabilize the Asia-Pacific region. Joint China Russian fleet currently conducting Freedom of Navigation Patrol around Japanese Islands after military drills in Sea of Japan pic.twitter.com/zZyhfvTdYF — Carl Zha (@CarlZha) October 22, 2021 Here's more from GT, suggesting Beijing and Moscow are sending a loud and clear message to the continued heightened presence of the US in the region: Encircling Japan, particularly sailing to the east side of Japan, is of significance because many key military installations are located on that side, including the US Navy base in Yokosuka, a Chinese military expert who requested for anonymity told the Global Times on Friday. Many US military provocations on China in places like the Taiwan Straits and the South China Sea were launched from these bases, the expert said, noting that the joint patrol by Chinese and Russian vessels could be seen as a warning to the US and Japan, which have been rallying up to confront China and Russia, serve the goals of US hegemony and undermine regional peace and stability. Indeed it appears this exercise was designed to show the "reach" of these two military superpowers' navies in cooperation, at a moment the two countries are growing increasingly close in terms of strategically coordinating to oppose Washington aims, particularly in the East. Tyler Durden Sat, 10/23/2021 - 16:00.....»»

Category: smallbizSource: nytOct 23rd, 2021