Doors Floors and More

Cited: Reuters

McDonald’s was helped by a new summer drinks, Smoothies, in the United States and longer hours in Europe to beat Wall Street forecasts for July as well as lifting their shares higher than ever. According to McDonald’s, global sales at restaurants that had been open for 13 months rose 7% in July which is better than analysts expectations for an increase closer to 5%.

The strong sales show McDonald’s is succeeding in reinventing its menu and image, winning new diners in a weak economy that has hurt rivals, analysts said.

“Over the last several years, they’ve been very successful at improving the quality of their food,” said Stifel Nicolaus & Co analyst Steve West. “They’ve really invested in their brand.”

While U.S. high unemployment persists, the fast food company’s appeal to families and retirees has helped it steal market share from chains like Burger King (BKC.N) and KFC, which is owned by Yum Brands Inc (YUM.N).

“McDonald’s has more broad-based appeal. They’re not as exposed to single white males,” West said, noting that group has been particularly hard-hit by the economy. “McDonald’s is appealing to soccer moms. They’re appealing to high-end consumers.”

U.S. sales, which account for about 35% of the company’s business, benefited from the introduction of Real Fruit Smoothies and Frappes from its McCafe line of drinks.

A record-setting heat wave in parts of the country and an extra Saturday in July also fueled the 5.7% rise in U.S. same-restaurant sales, said Edward Jones analyst Jack Russo.

Shares of McDonald’s were up 1.5% at $72.85 in afternoon trading on the New York Stock Exchange. Earlier in the session, the shares reached $73.33, an all-time high since the chain went public in 1965 at $22.50 per share. Burger King rose 1.1% while Yum gained 1%.

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EUROPE, ASIA ON THE RISE

In Europe, same-restaurant sales rose 5.3%, led by gains in France, Britain and Germany. McDonald’s has been renovating restaurants and extending hours in the region, which was the largest revenue contributor last year at 41%.

Same-store sales rose 10.1% in the Asia/Pacific, Middle East and Africa area. The company said Japan, Australia and China were standouts. Nearly 8,500 of McDonald’s 32,500 restaurants are located in that region, which contributed nearly 20% of its revenue in 2009.

McDonald’s plans to double its network in China to more than 2,000 outlets by 2013.

System wide sales rose to 6.8% or 8.3% on a constant currency basis.

McDonald’s said last month that the U.S. roll-out of espresso-based coffee and other high-margin drinks like Frappes had exceeded the company’s goal of adding $125,000 of sales per unit.

By expanding its business in the beverage area, McDonald’s was seen as attacking the core business of copy shop chain Starbucks Corp (SBUX.O). However, both companies appeal to different customers where beverages are concerned.

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My Take: The one thing I like about McDonald’s is it their community conscience. They hope local schools get kids desks and other school furniture they are in need of like whiteboards. They also help needy kids and kids who have terminal illnesses. The one thing I do not like about McDonald’s and that they used too much lettuce on their big Macs!

I have even seen some of the kids meals come with tooth brush and toothpaste to help encourage the kids to brush regularly. That way they don’t have to go to Virginia dentist and get cavities taken care. I do not know if this is true or not but I heard recently that McDonald’s help a kid who had a cleft palette by paying a South Riding VA cosmetic dentist to repair it.

So, McDonald’s has improved sales with new drink “Smoothies”. That is great because they spend some of those millions of dollars on people who really need it. And yes, I do you think macula once while with their delicious french fries.

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Polishing an Entire Boat

Although people who love their vehicles certainly polish their cars and trucks on a regular basis and have no issues finishing that process in a timely manner, many boat owners who have just as much enthusiasm for their machine can’t seem to use boat polisher all in one go and this is why sometimes a person can get behind on a regular polishing schedule which can lead to buildup and a gradual fading of the boat’s exterior which can make it look old and decrease its resale value. This is why some boat owners will employ an automated polishing system that includes a machine.

Cited: Forbes

Continued from “Some Brands Never Die Part 1“

Parkhurst actually believes that, without any more setbacks, Toyota just might bounce back over the next couple of years as the backlash is already beginning to die down. Toyota sales as even jumped 17% in the 1st half of the year with the cloud of the safety recalls hanging over its head.

Company troubles don’t always doom strong brands. Consider Marlboro. Cigarette brands have been on the ropes for years as government restrictions have made it increasingly difficult for tobacco companies to market their products. The settlement signed in 1998 between the four largest tobacco companies and 46 state Attorneys General severely limited tobacco marketing and called for the companies to shell out $206 billion over 25 years to the states to pay for health-care costs.

No tobacco brand has thrived like Marlboro since the settlement. The brand ranks No. 8 on our list, worth $29.1 billion. Marlboro’s market share in the U.S. was 33.8% at the time of the settlement; today it’s 42.8%, which is greater than the next 12 cigarette brands combined. Marlboro’s message has been taken out of mainstream media. The brand, owned by and , is now marketed directly to consumers and in places where they gather, with help from a database of the names of 25 million smokers.

Goldman Sachs, meanwhile, has been called everything from evil to a vampire squid, but when it comes to investment banks, Goldman Sachs the brand still reigns supreme. It has been the lead bank in global mergers and acquisitions for eight of the past 10 years. Even with an SEC suit hanging over its head (the company has since settled, agreeing to pay $550 million), Goldman was once again the top M&A bank in the first half of 2010. It had an advisory role on $224 billion worth of deals, which represents 20% of global deal activity, according to Dealogic. The brand is worth $9.4 billion, and comes in at No. 45 on our list.

The United Way is the only nonprofit that makes our list, coming in at No. 26 with a brand value of $14.3 billion. The United Way was founded in 1887 and is made up of 1,800 local United Way chapters in 45 countries and territories. The economic downturn affected the charity as it did most other nonprofits, and donations fell 9% between 2006 and 2008. Yet with $4 billion in annual donations, the United Way is twice the size of the next biggest charity, the Salvation Army.

United Way of America CEO Brian Gallagher has transformed the century-old charity since he took over in 2002. At that time 50% of local United Ways defined fundraising as their primary objective, with the rest focused on community impact. Today 90% of United Ways are focused on community impact. In 2008 Gallagher announced a new plan to refocus the organization on three core issues: education, income and health, with specific metrics for measuring success in each area.

According to James Gregory, CEO of CoreBrand a global brand consulting firm, US companies are going to put more value in their brand names because they will affect the balance sheets more. Brands play a more prominent role on balance sheets outside the US than they do within the US or they may be lumped as part of a goodwill package when companies are bought and sold. Gregory says that the increasing calls for a standardized global accounting system may present an opportunity for the role brands have on the balance sheet to be seen.

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My Take: I agree, some brand names will never die. Take a look at Singer, that brand has been around for 70 years. The brands that do die are the ones that were taken down by personal injury lawyers. When a personal injury Attorney Denver CO gets a case against one of these brand names, they go all out. It also depends on the type of case that they’re working on.

If it is a brand name like Toyota, then a Texas car accident law firm would be handling the case. As recent events have shown, Toyota is probably in negotiations with a lot of injury attorneys. When a TX personal injury attorney gets a hold of a case, they are like bulldog! It’s even more so when a tractor trailer accident attorney handles an accident involving a semi truck and another smaller vehicle. Many times when a vehicle’s manufacturer is at fault, people will also get a wrongful death lawyer to handle the case.

There are injury attorneys all over the country and they used to be called ambulance chasers. Only the ones that are lacking in a good reputation are called that anymore. There are Los Angeles injury attorneys, Chicago injury attorneys, Florida injury attorneys and the list goes on. And that is why these brand name companies have a tendency to quake in their boots when a lawyer contact them about one of their products.

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Cited: Reuters

On August 14, Saturday, the president went swimming with his daughter in Florida to declare the golf area beaches “open for business”. This was an attempt to change the region hit by the BP oil spill safe once again for tourists and residents to enjoy.

Obama, on his fifth visit to the region since BP Plc’s deep-sea well in the Gulf of Mexico ruptured in April, pledged to restore the economy and the environment in the aftermath of the world’s worst offshore oil spill.

“Oil is no longer flowing into the Gulf, and it has not been flowing for a month. But I’m here to tell you that our job is not finished, and we are not going anywhere until it is,” he told reporters after holding talks with local business owners.

“That is a commitment my administration is going to keep.”

No oil has leaked into the Gulf of Mexico since July 15, when BP placed a tight-fitting cap over the broken Macondo well, which has spewed an estimated 4.9 million barrels of oil since April 20. The British company last week injected cement into the top of the well to seal it.

But officials say they will not declare victory until completion of a relief well being drilled 13,000 feet beneath the seabed that is now just feet away from its target. More cement is due to be pumped in via the well.

The president and his family are on a weekend trip to Panama City as part of an effort to encourage more tourists to visit Florida’s famous white sand beaches, which have suffered only minor damage from the spill, mostly in the form of scattered tar balls and small oil patches.

“I also want to point out that as a result of the cleanup effort, beaches all along the Gulf Coast are clean and safe and open for business,” he said. “That’s one of the reasons Michelle, Sasha, and I are here,” he said, referring to his wife and youngest daughter.

The White House later released a picture of Obama immersed in the Gulf waters, playing with 9-year-old Sasha.

RELIEF WELLS

Obama’s U.S. public approval ratings have been dented by public discontent, especially in Gulf Coast communities, over his administration’s response to the spill. The administration came under fire during the crisis for appearing to cede too much responsibility for management of the spill to BP.

Retired Coast Guard Admiral Thad Allen, the top government official overseeing the spill, said the company will get the go-ahead to finish the relief well but is doing a last batch of testing and planning first.

The testing is meant to make sure BP is prepared to deal with the risk of excessive pressure building up in the well during the final effort to kill it, Allen told a teleconference news briefing. The go-ahead could come by Tuesday, he said.

Obama had come under pressure to spend part of his summer vacation in the Gulf region to show solidarity with the thousands of people in the fishing and tourist industries whose livelihoods have been threatened by the spill.

While Florida escaped largely unscathed, other states such as Louisiana, Mississippi and Alabama were hard hit and are the focus of BP’s cleanup operations.

Leaking oil seeped into ecologically sensitive wetlands and marshes, soiled miles of beaches and forced the closure of rich fishing grounds.

Obama highlighted the cleanup efforts in his remarks.

“Now, as a result of the massive cleanup operation that has already taken place, a recent report by our top scientists found that the majority of oil has now evaporated or dispersed, or it’s been burned, skimmed, or recovered from the wellhead,” he said. “But I won’t be satisfied until the environment has been restored, no matter how long it takes.”

Obama said any delays by BP or officials in paying claims to individuals affected by the spill are “unacceptable.”

Hotel owners, tour operators and other businesses have submitted thousands of damages claims to BP, claiming the spill has kept many tourists away during the lucrative summer season. BP has set up a $20 billion fund to handle the claims.

Local tourism officials have been trying to counter the perception that Florida’s beaches were sullied by the oil that blackened other parts of the Gulf coastline.

The sunshine State’s $60 billion a year tourism industry relies on the nearly 12 miles of shoreline on the coast of Florida as a major attraction and Panama City boasts the best and most popular destination for spring break for college students in the US.

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My Take: Well, Panama City just might see the students come back this next year, but I don’t think that tourists are going to be coming to Florida at the end of the summer. I think Florida will just have to suffer like the rest of the country. Main reason, tour season is almost over and those that would have been there either change their vacation spot or decided to stay home.

Those that stayed home probably spent their time playing games on their PS3’s. With technology today you can get a PS3 download right to your game system. The guys were part would probably download PS3 racing games and drive their wives crazy, in more ways than one. Others who stayed home probably stayed on the computer playing games or going to casinos online. I understand that casino gambling online has become very popular.

Then you have those who live in the area and want to get out. Many people moved when it all started coming in. Others that stayed contacted West Palm Beach FL personal injury attorneys to sue BP. BP is probably negotiating with not just one West Palm Beach FL business litigation attorney, but with several.

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Cited: Newsweek

This is the Summer of Recovery according to the Obama administration anyway. They say that global recession is over, factories across America are producing more and corporate balance sheets are back in the black. Then why does it still seemed like a Winter of Discontent even with 90% humidity? New data last week showed that economic growth in the US was lower in the 2nd quarter than the 1st even though Ben Bernanke was talking about the end of the recession and that the downturn of 2009 was the worst than anybody thought. Technically, the economy is growing again. However, many economists are disappointed that it is not as much as they hope. Unemployment still remains high in many parts of the sclerotic Old Europe despite record company profits.

At least the continentals will be spending August on the beach. American workers, fearful of continued layoffs, are scrambling to put in more hours on the job. Meanwhile, wages are still flat. All this underscores what I believe is one of the most important economic trends of our age—the increasing disconnect between the fortunes of multinational companies and their countries of origin. What little recovery America is seeing can be chalked up to rising sales and profits within the biggest U.S. companies; top firms are sitting on “mountains of cash,” says Global Insight chief economist Nariman Behravesh. But that’s not because American consumers are spending—indeed, last week’s data dump proved that Americans are saving even more than we thought—6.4 percent of their income rather than 4 percent, a rate not seen since 1993. Consumers, whose spending makes up by far the largest share of the U.S. economy, are not feeling secure yet. Those bulging corporate profits are largely attributable to sales abroad.

Just look at the jump in U.S. export growth, typically about 7 to 8 percent a year, but now in the double digits. The majority of manufacturing industries in this country, from electronics to furniture to consumer goods, are growing strongly because of demand in places like China, Brazil, and India. It’s no wonder customers in these emerging-market giants are feeling flush—their nations have come through a global recession without so much as a hiccup, and their job prospects are good and getting better. According to Goldman Sachs, every year for the next several years, at least 70 million of these emerging-market consumers will be joining the global middle class.

Middle-class Americans, on the other hand, are still feeling pinched. The recession and housing slump has fueled a cycle of higher unemployment and stagnating wages that was already well underway. With the exception of the top 10 percent of earners in the United States, wages have been flat since the 1970s (indeed, during the last period of U.S. expansion, between 2002 and 2007, median household income dropped by $2,000). The reasons for all this are well known—changes in the tax system, the death of unions, globalization (that emerging middle class can now perform jobs higher up the food chain), and the rise of labor-saving technology.

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None of these trends show any sign of reversing. Not only are businesses rather than consumers doing the spending in the U.S. this year, but much of what they are buying is technology—software and services from high-tech firms that will help them, at least in the short term, continue to boost productivity without hiring more workers. Of course, this is good news for Intel and a few other companies in Silicon Valley. But the tech industry isn’t a huge employer in and of itself. The theory is that technology should help businesses grow so much faster and come up with so many new moneymaking ideas and products that they’ll have to begin hiring more workers. Yet even as productivity and profits are increasing in corporate America, firms simply don’t feel secure enough to begin hiring.

Bernanke keeps saying that we are suffering through an “unusually uncertain” economic season. However, every positive item about the economy can be countered with an negative. It is an environment that will continue making things tricky for policymakers who are have to weigh the needs of stimulus to keep a weak economy going against adding more cache to the government debt that’s been piling up over the last 2 years. If the Summer of Recovery looks and feels like this, fall better get here quick.

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My Take: I think there is some improvement. Prices are still going up, especially for gas. People are still selling their homes to avoid foreclosure and some are using property auctions to do it. I actually think that home auction buyers get a great deal this way and it helps the homeowner to pay off the mortgage. Unfortunately, commercial mortgage loans don’t seem to be having the same luck.

Commercial mortgage brokers seems to be scrambling in an effort to save mortgages. Maybe that’s why many companies are cutting back on payroll services or at least looking for the least expensive integrated payroll service. They certainly are not hiring very many people. If they’re ramping up their production, you would think they would be hiring more. That definitely would help the economy.

There are a lot of people that have had to join a debt settlement program just to get by because they don’t have a job anymore and unemployment doesn’t last long or go very far. One thing is definitely for sure, credit card debt reduction is the secret to getting through this rough economy. Plastic will get you in trouble every single time because it is too convenient to use!

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FDCPA Attorneys

The protection of consumer’s rights in all areas of credit, collections, and reporting, providing the most distinguished and experienced consumer rights lawyers and collection harassment lawyers possible to help you fight back against creditors who may be violating the law in order to get your money. If what a collector or lawyer is saying to you just doesn’t make sense it probably should not have been said. Even if you owe the debt or some portion of the debt but have fallen behind, that does not give anyone the right to threaten and embarrass you. You have the right to fight back!

Cited: Forbes

Apple’s brand will need more than a problem with the antenna reception of the iPhone 4 to bring it down. This is a company that has faced setbacks before and bounced back to become the world’s most valuable brand–worth $57.4 billion, according to Forbes. In a list dominated by tech brands–they made up 30% of the top 50 ranked by Forbes– squeaked by longtime nemesis , worth $56.6 billion, and , which came in fifth on the list with a brand value of $39.7 billion. Steve Jobs’ creation is among a number of resilient brands, including corporate ones, that have thrived despite business troubles or setbacks.

Apple shows just how a brand can survive and thrive even when a parent company stumbles. Apple’s sales in the late 1990s plummeted 46% over a four-year stretch while the company lost money seven times over eight quarters. The stock was trading for less than $4 (split-adjusted) in 1997 before company cofounder Steve Jobs, who had been ousted, rejoined Apple.

In Pictures: The World’s Most Valuable Brands

The following year Apple released the iMac, the first in a string of monster hits over a dozen years. Sales over the past 12 months hit $57 billion, and net income was $12 billion. The stock is up 60-fold since 1997.

To identify the world’s most valuable brands we looked at more than 100 with leadership positions in their respective industries. Forbes evaluated these brands along with Jeffrey Parkhurst, managing director of business strategy at Mindshare, a -owned media agency. We required that brands have at least some presence in the United States, because if a brand is to be considered global, it needs to be a player in the United States.

Our first step was to determine earnings before interest and taxes for each brand. Forbes averaged those earnings over the past three years and subtracted from earnings a charge of 8% of the brand’s capital employed, figuring a generic brand should be able to earn at least 8% on this capital.

Forbes applied the maximum corporate tax rate in the parent company’s home country to that net earnings figure. Next, we allocated a percentage of those earnings to the brand based on the role brands play in each industry. (Brands are crucial when it comes to beverages and luxury goods, but not so much, say, with airlines, when price and convenience are more important.) To this net brand earning number, we applied the average price-to-earnings multiple over the past three years to arrive at the final brand value. For privately held outfits we applied an earnings multiple for a comparable public company.

Tech brands made a big showing on this with 30% of the top 50 brands, including four of the first five places in the rankings. Financial service brands and food and beverage brands each captured six spots. U.S. brands dominated the list.

Most large economies saw output decline in 2009, with the E.U., Japan and U.K. all falling at least 4% (the U.S. economy contracted 2.4%). The brands on our list fared a little better, with sales, on average, flat in 2009. Some brands were hit hard by the economic downturn as well as their own missteps.

Take for example No. 11-ranked . The brand is worth $24.1 billion, but has been troubled over the past year with multiple recalls that affected a total of 10 million vehicles. Toyota’s perceived quality score fell 20% in a survey this spring from Santa Barbara, Calif.-based ALG, which is the industry benchmark for residual values and depreciation data. “Toyota always promoted quality, and then [the recalls showed] they delivered exactly the opposite,” says Mindshare’s Parkhurst, who argues the fallout would not have been as bad if Toyota’s brand promise all these years had to do with, say, horsepower.

Continued in “Some Brands Never Die Part 2“

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My Take: To me, a brand-new name only means more money. The more famous he brand is, the more it costs! These guys use things like promotional products to get their name and logo into the minds of consumers. They will use all kinds of things like advertising bags and even corporate gifts to improve their “brand”. They will have thousands of imprinted pens made just to hand out to consumers when they go shopping and they may even give out personalized shopping bags.

I have even seen big companies like this get out a concert tickets just for coming to a showing of their product. In some areas they might actually be sports tickets or even theater tickets just to get people thinking about their brand name and logo.

These are the companies that are also afraid of the California Lemon Law. This is a law that holds them responsible for their product if it is faulty and/or causes injury to the consumer who purchased it. They do not want to hear from CA lemon law lawyers because it means it will cost them a lot of money to make them go away.

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Safe Ordering Online

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Cited: AP

On November 22, Wall Street got a boost from improved retail sales, but there is little hope for an enthusiastic holiday shopping season that could actually improve the economic recovery. The room by a surge in car sales, the October figures did exceed economists extra patience. However, because many consumers have a lot of debt and the rising unemployment, economists do not for see significant spending until well after the end of the year. Even optimists predict scant improvement over last year’s holiday season.

Consumer spending accounts for about 70% of total economic activity, so wary shoppers are a worrisome sign for retailers entering the crucial holiday season.

“U.S. consumers are no longer panicked, but they remain cautious,” said Mark Zandi, chief economist at Moody’s Economy.com. “They are spending just enough to keep the economy out of recession, but not enough to fuel a self-sustained expansion.”

Retail sales rose 1.4% last month, the Commerce Department said. But excluding a big rebound in auto sales, the gain was just 0.2%. Strength at general merchandise stores like Wal-Mart and Target was offset by sales declines at furniture stores, appliance stores and hardware stores.

Zandi said one telling statistic about household finances was that the number of bank credit cards in circulation has fallen 18% since the year began. That’s happened as banks facing soaring loan losses have tightened credit standards.

Consumer credit has now fallen for a record 8 straight months through September and households are struggling to manage their debt levels after the most severe recession since the 1930s.

Federal Reserve Chairman Ben Bernanke warned Monday of “important headwinds,” such as the weak job market and tight credit conditions. These forces “likely will prevent the expansion from being as robust as we would hope,” he told the Economic Club of New York.

On Wall Street, major stock indexes rose more than 1 percent to new 13-month highs after the retail sales figures were released. The Dow Jones industrial average jumped 136 points to 10,406 and the Standard & Poor’s 500 index closed above the 1,100 mark for the first time in more than a year.

The overall economy, as measured by the gross domestic product, resumed growing in the July-September quarter at what the government estimated was an annual rate of 3.5%. That was a sharp rebound after a record four straight declines in GDP.

Those who do not want to think about the bad and want to think about good health . . . Good health begins at home. Too many people are obese in this country and to many people smoke. The two biggest health hazards our society faces. If you absolutely insist on smoking try an electronic cigarette. You can get all the nicotine you want and none of the bad stuff! Of course, you should get the Njoy starter kit when you’re ready. This means you could quit smoking and lose weight with HCG drops. Many people worry about gaining weight when they quit smoking. No worries here because you still get the nicotine and with the weight loss drops, you will still lose weight.

Analysts noted that the retail sales report Monday included a sharp downward revision to sales in September. The government also reported last week that the nation’s trade deficit rose in September by the largest percentage in a decade. As a result, third-quarter GDP is expected to drop to a more modest 2.8% growth rate when the government releases a revised estimate next week.

Growth for the current quarter is expected to be around 3%. But, analysts said, growth in the first half of next year could slow to around half that pace as consumer spending falters and government stimulus programs begin to wane.

Growth at such a weak rate would raise the threat of a possible double-dip recession. That’s especially true with unemployment, now at a 26-year high of 10.2% and expected to keep rising into next year.

“It seems unlikely that households will be able to spend more freely anytime soon,” said Paul Dales, U.S. economist at Capital Economics.

Retailers last week gave muted holiday outlooks as they reported third-quarter earnings. Wal-Mart Stores Inc. and Kohl’s Corp. both said they plan to discount aggressively. J.C. Penney said it expects sales for the quarter that includes the holidays to fall.

According to a Gallup poll released Monday, Americans expect to spend $638 on Christmas gifts, equal to record-lows from November and December of 2008.

Michael P. Niemira, chief economist at the International Council of Shopping Centers, expects overall holiday sales will rise about 1% from last year, a historically weak performance.

The big swing in overall retail sales activity reflected a recent roller coaster ride for auto sales. New-car sales surged in August as shoppers rushed to take advantage of the government’s Cash for Clunkers sales incentives, which expired at the end of August. Sales then plunged in September.

For October, auto sales jumped 7.4%, recouping about half of the 14.3% drop in September. The 0.2% increase in retail sales, excluding autos, was down from a 0.4% rise in September. It was the weakest showing since July.

Bernanke stated that banks dealing with the wreckage of the recession and bad real estate loans could slow progress in an effort to get credit flowing more freely when commenting on the economic outlook. The fact is that credit difficulties will hinder businesses who wish to expand and hire.

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My Take: I have been reading many articles about the recession. Most of those articles are very depressing. Whatever happened to hope? Why don’t some people write articles about increasing sales even if their miniscule. Inspiring people to look to the future with hope just might help the recession along a little bit more. Otherwise, were going to see something like what happened when the Great Depression started. People jumping out of skyscrapers because they cannot face what is happening.

That means that people will be spending money on funeral services and urns instead of buying Christmas presents. It is bad enough to have to buy pet urns when you lose a pet, but it is even worse when you have to buy one or family member. I, for one, do not want to think of how bad the economy is, I would rather think about how good it is getting!

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Cited: StreetInsider.com

Market, market has got the market? Is it Wal-Mart or Amazon? These two retail giants have been fighting competition within their own markets for a long time. Now, everybody knows that Amazon is the place to go for books and CDs or DVDs at low prices. But this holiday season Wal-Mart wants a piece of that pie.

Big-box discount retailer Wal-Mart (NYSE: WMT) and online one-stop shop Amazon.com (NASDAQ: AMZN) are engaged in a price war that could end up as the biggest story to come out of the busiest shopping season of the year.

The battle started last month when the two retailers began a highly publicized battle to see who could have the lowest price on the newest books and DVDs coming out this fall. Now the two are going back and forth on toys, video games and mobile phones.

In perhaps the most evident sign of the two trying to keep up with each other, Wal-Mart dropped the price of its Easy Bake Oven from Hasbro (NYSE: HAS) to $17 from $28 as a part of its Black Friday deals. Wasting no time, Amazon dropped its similar $28 sticker price for the Oven to a competitive $18. Now, parents will have an option on where to get a good deal the 45-year old toy that is certain to bring brownies undercooked by a light bulb into homes across the country this holiday.

The two companies are fundamentally different and Amazon poses no real threat to Wal-Mart and its 4,000 stores. Lately the lines that divide the two are becoming blurred. Wal-Mart is expanding its online services in an effort to not cede any of its sales, which last year totaled $405 billion.

Amazon is punching back as it now offers same day shipping on its merchandise in seven cities to give the consumer some of the instant gratification that they receive from shopping in a store. Amazon is also looking to increase profit margin with expanding its white-labeling program by branding products with the company’s image. Amazon is leading the E-Commerce revolution, which currently only holds 4% of the retail market share, but is growing rapidly among those consumers who would rather point and click, rather than venture to overcrowded stores.

For those movie buffs out there who would like to get as many movies as they can . . . You can search thousands of full-length DVD quality movies, TV shows, music videos and much more online. With membership, you get unlimited 24/7 movies downloads! No time limits, no bandwidth limits no content limits! This retailer will even provide software so you can easily burn your own videos to DVD and no expensive burner is required. You can even download comedy movies online like “The Blind Side“, that became available on November 20.

Among the items being tussled over by the two companies are video games like Call of Duty: Modern Warfare 2, which Wal-Mart started selling with a $15 gift card, an offer that Amazon soon thereafter matched. Similarly both companies are now selling Xbox 360 gaming consoles for $199 with a $100 gift card, as well as the new Palm (NASDAQ: PALM) Pixi phone for $30, $175 off retail price.

As the two companies continue to grow and evolve it is clear that the competition will continue. As for this holiday season, consumers will have plenty of deals to choose from as things heat up.

Shares for Wal-Mart are trading were nearly even on November 25, up 0.31% to $55.02. Amazon is down a fraction to $132.84. There is a significant difference between the core shoppers of Amazon and Wal-Mart were competing toe-to-toe on some items. The largest percentage of Wal-Mart shoppers earn $25,000-$45,000 a year, compared to over $100,000 at Amazon.

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My Take: It is good to see a little bit of competition between competing retailers. It means that consumers are going to get lower prices and will be able to afford the things they want. Consumers like college students do not have much money will be able to afford their Greek clothing this year. It also means that they will be able to get cool tees as from as gifts for their friends or family this Christmas.

Of course, some college students will be entering fraternities or sororities and will need to get a Greek shirt for next semester and with this kind of competition they will be able to afford it. They will also be able to afford some new cool T shirts for next summer.

Don’t get me wrong, students will not be the only ones who will benefit from the price wars this holiday season. The low prices on books and DVDs are just beginning. If the competition heats up more, you will see lower prices on electronics, toys, toiletries and even some of the frivolous things like Scentsy wickless candles. I know, women are the ones that usually light all the candles in the bathroom and then soak in the tub to relax. Some men do it as well! Of course, they will need the Scentsy candle warmer for these candles, they have no wick.

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Cited: Wall Street Journal

Black Friday has been considered an important indicator of retail sales during the holiday season for many years. However, this year the following Monday or cyber Monday may provide important information on how the stock market will perform the remainder of the year.

On Friday, November 27, stock market trading volume will be particularly weak and it will be difficult to get a clear reading on how much spending consumers are actually doing. But by Monday, preliminary reports of retailers’ sales on Black Friday and throughout the weekend will have been released, and they are likely to become a big driver of Monday’s stock-market action. Using history as a guide, Monday’s trading is likely to indicate what the stock market will do the rest of the year.

This year, holiday retail sales have become an even bigger focus for investors than in the past. With the consumer-discretionary sector of the S&P 500 having climbed 34% so far this year despite a 10.2% unemployment rate, investors are looking for the consumer’s behavior this holiday season to either justify the rally so far and indicate more gains may come, or show that it’s time to get out.

“Black Friday is critical,” said Michael Alpert, a portfolio manager with Seligman Investments. “Black Friday is really where we’ll get a sense of how strong the consumer feels and if the 90% of consumers still employed are still going to go out and spend.”

According to Schaeffer’s Investment Research, looking at the past 40 years, the Dow Jones Industrial Average has climbed from the close of the Monday after Thanksgiving through the end of the year 75% of the time that the Dow was positive on that Monday after Thanksgiving.

The average return over that period was 2.5%. Whenever the Dow fell on that Monday, it still rose from then through the end of the year 61% of the time, but 61% isn’t nearly as strong as 75%, and the average returns during those periods were a weaker 1.78%.

The connection is even stronger in recent years, when more accurate data became available sooner after Thanksgiving. In the last 10 years, when the Monday after Thanksgiving was positive, stocks rose through the end of the year 100% of the time.

The National Retail Federation released survey results Wednesday that showed up to 134 million people are expected to shop this Friday, Saturday or Sunday, higher than the 128 million people who said they planned to last year. In addition, Andrew Beck, portfolio manager at Aston/River Road Asset Management, said he wouldn’t be surprised if the sales results from this weekend beat investors’ expectations, which would be good for stocks through the end of the year.

Still, Mr. Beck said, “that’s only because expectations are so low and comparisons to last year are easy.” He added that regardless of how the retailers do this holiday season, valuations are no longer that attractive, which prompted his firm to recently sell its holdings in Polo Ralph Lauren Corp. and Abercrombie Fitch Co.

Nevertheless, many participants are waiting for this weekend’s retail sales to decide how to position their portfolios for 2010.

“Given the appreciation that we’ve seen among a lot of these consumer-oriented stocks, investors are paying more attention,” Mr. Beck said. “You’re more sensitive to what’s going to happen in the holiday season to make a decision of ‘Do I want to hold this position into the new year, or not?’”

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My Take: Well, it seems logical that the following Monday would be a better indicator of not only stock prices but retail sales. Many people do not want to fight the crowds on Black Friday. There are a lot of people who will stand in line for hours just to get a good price on a pair of low rise jeans for Christmas present. I, myself, would rather we go online and get a better pair of skinny jeans and take advantage of the convenience of doing it for my own home.

However, many people feel that Black Friday is the best day offer sales and lower prices. They can find the makeup and natural skincare products if they want at lower prices. Or maybe they’re looking for sales on Hugo Naturals shampoo. If they would only realize that they could probably get the same items online at a sale price, they would not have to wait in line for so many hours.

Some online retailers can provide some beautiful custom gifts at sale prices. In fact, I know one online retailer that sells personalized custom gifts at good prices. I believe that online retailers are going to take advantage of Black Friday just as well as in-store merchandisers. So I do think that Monday will reveal a lot after the weekend.

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Cited: CNN Money

The unemployment insurance bill that was signed by President Obama on November 20 be giving businesses a break. They will have a chance to turn some of their losses in the cash with a temporary expansion of attacks manager that is often used. Of course, another tax break will be put on hold to pay for it. This will allow businesses to turn recent losses into cold cash.

The bill will let all businesses apply their losses from either 2008 or 2009 to any five years prior to 2008. By doing so, they can get a refund from the IRS on the taxes they paid for those five years. A loss is defined as the amount by which a company’s tax deductions exceed its gross income.

Under current law, the so-called “net-operating loss carryback” is only allowed for two years. There are only two restrictions to the new provision. The first is that no business that has accepted funding from the Troubled Asset Relief Program (TARP) would be eligible for the break. And the second is that any refunds for taxes in the fifth year would be reduced by 50%. The provision is estimated to cost $10.4 billion over 10 years, according to the Joint Committee on Taxation.

Businesses have been angling for this break throughout the recession. And they expected it to come a lot earlier. A similar measure was proposed for inclusion in the $787 billion stimulus package passed in February. But it ended up being watered down so that only small businesses with gross revenue of $15 million or less could qualify.

While those small businesses represent about 98% of companies, they only represent roughly 5% of taxable income, said Clint Stretch, managing principal of tax policy at Deloitte, at the time. Not surprisingly, the estimated cost of that provision in the stimulus bill was considerably lower, just under $1 trillion.

Who is likely to benefit most?

While most businesses have suffered during the downturn, those in the hardest hit industries are going to enjoy the biggest break.

“The homebuilders and banks that have never taken TARP money are the most obvious beneficiaries,” said Anne Mathias, director of research at Concept Capital’s Washington Research Group, in a research note.

But she also noted others in line to benefit include semiconductor companies, materials companies, retailers and print media companies. While an overwhelming majority of lawmakers voted for the overall bill, not all lawmakers are happy with the provision.

Calling it a “corporate giveaway, Rep. Lloyd Doggett, D-Texas, said, “This is a textbook example of how not to deal with the economic challenges facing our country,” according to a CongressDaily report.

A supporter of the provision, House Ways and Means Select Revenue Measures Subcommittee Chairman Richard Neal, D-Mass, said it would help businesses hard up for cash. “It will provide quick capital at a time when it is nearly impossible to find,” Neal said.

The quid pro quo

One way the legislation seeks to pay for the cost of the tax breaks is to delay the implementation of a tax relief provision for multinational companies that was supposed to be enacted in 2011. Under the bill, it will now be enacted in 2018. The tax relief measure is intended to create more of an incentive for multinationals to invest in the United States. And the way it is structured it would benefit financial services companies the most. The delay in implementation is expected to raise $20.1 billion over 10 years, the JCT estimates.

Multinationals aren’t happy about it but they haven’t fought the measure because “they have bigger fish to fry,” such as the potential loss of their ability to defer paying U.S. tax on income they haven’t brought back to U.S. soil, said Joanne Thornton, director of international research at Concept Capital, in her research note.

There is also a possibility that the delay in the measure could become permanent in part because it will be a tempting revenue raiser to pay for other legislation. The House health reform bill, for example, already calls for a full repeal of the multinational tax relief measure for a savings of $26.1 billion over 10 years. Now, Thornton said, “there will be a $20.1 billion hole in the health care bill.”

Lawmakers already proposed another measure in anticipation that the bill would pass that would compensate and potentially raise nearly $24 billion. However, negotiations are still taking place to get the legislative language in line that could reduce how much will be raised for the measure.

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My Take: You know something, every time they pass a new “Bill” they keep telling us that it is going to save money and in the long run it usually costs more money. This falls into the vicious circle of costs.

By that I mean, that every time prices go up, it takes forever for the paychecks to follow. The cost of everything goes up very fast. However, wages do not follow suit very quickly. It is no wonder that people cannot afford anything in today’s society.

Complaining about your custom payroll program has no affect on your wages. All they really do is keep track of your time and attendance and not how much you get. You need to complain to your boss about how much you make. But of course, as with many bosses, they are more concerned about their credit card processing and how much money they make. In fact, your company is probably worrying about your business merchant account because your sales are down.

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