Category: Economics & Business

Foot in the door

Mark Cuban has an interesting post about how to get his attention and money.

Please, please, please. Do not get the Mavs office address, or the address of any of my companies and send me a package with a shoe or a fake foot so you can get “your foot in the door”.
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If you are looking for money for any of the millions of wonderful or painful reasons someone might ask for money, DO NOT send it to me in a fed-ex or overnight delivery package. My first thought is always, if they need money so badly, why are the spending so much to send me this package.

Shop for value, not price

The cost of car ownership isn’t just what you pay for the car —

None of the traditional American brands are among the 10 vehicles expected to retain the most value over the next half-decade, according to a new report from Kelley Blue Book, a company that tracks used car values. But American brands dominate the other end of the spectrum, the vehicles expected to lose the most value. …

For instance, a four-wheel-drive 2005 Ford Explorer Limited selling for $40,480 is projected to lose 64 percent of its value in four years, meaning that it would fall to $14,525, according to the Automotive Lease Guide, another company that tracks used car values. By comparison, a 2005 Toyota 4Runner Limited with four-wheel drive, selling for $38,500, is expected to retain 47 percent of its value and resell for about $20,000.

From The New York Times

Doughnut hole

“Once the darling of Wall Street, doughnut-maker Krispy Kreme reported second-quarter profits Thursday that were less than half what the company earned a year ago, widely missing analysts’ expectations. Shares of Krispy Kreme Doughnuts Inc. fell nearly 10 percent on the news.”
Source: The New York Times

Toys R’nt Us

Toys ‘R’ Us is thinking about getting out of the toy business (it’s losing out to Wal-Mart, Target and others). Isn’t this sort of like McDonald’s getting out of the hamburger business?

Tired of regular postage stamps?

Well now you can make your own. That’s right, real postage stamps with your own photos/art. New baby, put their photo on the stamps for the announcements. Take a trip, put your own photo on the stamps for the postcards. Costs about $21 for twenty 37-cent stamps. Still, pretty cool.

PhotoStamps.com

Update: Actually, I guess you’d have to send the postcards when you got home and received your order.

Wal-Mart = Bush. Costco = Kerry. Costco’s Winning.

Daniel Gross writing at Slate tells us —

Now we’ve also got red-state, blue-state discount retailers.

On the left: Costco Wholesale Corp. Last week, Jeffrey Brotman and James Sinegal, chairman and chief executive office of Costco, respectively, joined the list of executives who endorsed John Kerry for president. The company is based in Washington (a blue state in the past four elections, and one that Kerry leads, by a 53-45 margin according to the Aug. 2 Zogby poll), and a list of its locations bears some resemblance to the Kerry-Edwards campaign: strong on the affluent coasts and virtually nonexistent in the comparatively poor Great Plains and in the Old Confederacy….

Like today’s Democratic Party, Costco favors highly trafficked urban and edge-city locations—it has three stores in New York City. And it caters to a decidedly upscale crowd. As John Helyar reported in this excellent Fortune profile, the average salary of a Costco member is $95,333. The company’s merchandise mix reflects the fact that its customers shop at discounters by choice, not by necessity. They’re New Luxury suckers who like to save on staples, more Jean Chardonnay than Joe Six-Pack. As Helyar notes: “Costco is the U.S.’s biggest seller of fine wines ($600 million a year).”

The article continues.

Wal-Mart is shifting part of its labor costs onto the public

From the Los Angeles Times:

Inadequate wages and benefits force workers at Wal-Mart stores in California to seek $86 million a year in state aid, according to a report released Monday by the UC Berkeley Labor Center.

Moreover, if other retailers cut their wages and benefits to the levels offered by Wal-Mart Stores Inc., the cost to California’s public-assistance programs would rise by $410 million annually, the study said.

Why I like Costco and not Sam’s

From AlterNet:

Indeed, Costco’s pay is much, much, much better — a full-time Costco clerk or warehouse worker earns more than $41,000 a year, plus getting terrific health-care coverage. Wal-Mart workers get barely a third of that pay, plus a lousy health-care plan. Costco even has unions!

Yet, Costco’s labor costs are only about half of Wal-Mart’s. How’s that possible? One reason is that Costco workers feel valued, which adds enormously to their productivity, and they don’t leave — employee turnover is a tiny fraction of Wal-Mart’s rapidly revolving door.

Heavy lifting

One person’s story doesn’t win a class-action suit, but if this is typical I would think Wal-Mart has a multi-billion dollar problem. From the Denver Post —

For Mary Henderson, an assistant store manager at the Wal-Mart store in Trinidad, a class-action sexual discrimination lawsuit against her employer is about one thing: equal pay.

Henderson, 49, has been with the company for six years and makes $32,000 a year. She claims that a male assistant manager at the same store, with less experience, makes $9,000 more than she does. She said that he showed her his W-2 form.

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Henderson started out in 1998 making $5.75 an hour as a sales floor associate in the sporting goods department at the La Junta Wal-Mart.

“The man who started right across from me started $1.50 higher,” she recalled. “I was told it was because he had to do more lifting.”

Henderson said it took three years to earn her first promotion. When she first applied for the assistant manager’s position, she said her store manager told her, “You have a husband that can support you. You don’t need to be an assistant manager,” and that another man deserved the position because “he’s the head of a family.”

She said that she told the manager that he was comparing apples and oranges.

“I asked him what was the difference, was it something that I was born without?” she said, referring to her gender. “He actually turned white and walked away.”

Overpaid

According to a story in Friday’s New York Times, Harvard’s endowment money managers were paid enough last year, as one alumnus critic put it, “to send more than 4,000 students to Harvard for a year.” Harvard paid its money managers more than $100 million and laid off 10 library workers.

The article points out that Yale and Texas, other big endowment schools, paid their money managers substantially less and, in Yale’s case, with better results.

Drug pushers

From The Arizona Republic:

Parents might want their children to consider a career in selling drugs after reading this.

The demand for pharmacists is hot as baby boomers age and more prescriptions are filled each year in Arizona and nationwide. The shortage’s culprit is simple: supply and demand. There were more than 4,100 open pharmacy jobs across the nation as of January, according to the National Association of Chain Drug Stores.

“An unemployed pharmacist generally doesn’t have a pulse,” said Dennis McAllister, associate dean of the College of Pharmacy at the Midwestern University campus in Glendale.

Each of today’s Arizona graduates has an estimated seven job openings to choose from, McAllister said. Job security isn’t the only lure. Starting salaries range from $88,000 to $93,000 with some starting as high as $120,000, plus $10,000 to $30,000 sign-on bonuses.

Home sweet home

From the June Atlantic —

If you’re interested in buying an extravagant home, the most expensive property on the U.S. market is a $75 million spread in Bridgehampton, Long Island, that includes a 25,000-square-foot main house, a nine-hole golf course, three large ponds, and a 3,000-bottle wine cellar. But million-dollar homes aren’t just for people who like to golf in their back yards. According to a recent report from Harvard’s Joint Center for Housing Studies, the number of owner-occupied U.S. homes valued at a million dollars or more increased by 170 percent from 1989 to 2001 (the total number of homeowners grew by only 21 percent); the average price of such houses now stands at roughly $1.7 million. A full 41 percent of the nation’s million-dollar houses are in California, and five percent of them are within the Los Angeles city limits alone. But for concentration of expensive houses L.A. can’t compete with Cambridge, Massachusetts, where 11.6 percent of all single-family dwellings cost $1 million or more—though $1 million buys only about 1,800 square feet in crowded Cambridge. There, locals say, “fancy starts at $2.5 million.”

—”‘Million-Dollar Homes’ and Wealth in the United States,” Zhu Xiao Di, Joint Center for Housing Studies, Harvard University

Albuquerque number one

For the sixth year Forbes has evaluated 150 metro areas and 168 smaller places to find the best for business and careers.

The best metro areas to launch a business or a career often revolve around universities that offer a diverse, educated work force and, especially when they are far from big cities, relatively low costs. Such regions–Raleigh, Austin and Ann Arbor among them–are also attractive places to live, judging by the patterns of migration.

Top 10 Metropolitan Areas

1. Madison, WI
2. Raleigh-Durham, NC
3. Austin, TX
4. Washington, DC
5. Atlanta, GA
6. Provo, UT
7. Boise, ID
8. Huntsville, AL
9. Lexington, KY
10. Richmond, VA

NewMexiKen’s very own Albuquerque ranks 12th overall, and number one for the lowest cost of doing business.

The top small place is Sioux Falls, South Dakota.

Amadeo Peter Giannini…

was born on this date in 1870. Giannini was one of Time’s 20 most influential builders and titans of the 20th century. Daniel Kadlec wrote the story:

Like a lot of folks in the San Francisco area, Amadeo Peter Giannini was thrown from his bed in the wee hours of April 18, 1906, when the Great Quake shook parts of the city to rubble. He hurriedly dressed and hitched a team of horses to a borrowed produce wagon and headed into town–to the Bank of Italy, which he had founded two years earlier. Sifting through the ruins, he discreetly loaded $2 million in gold, coins and securities onto the wagon bed, covered the bank’s resources with a layer of vegetables and headed home.

In the days after the disaster, the man known as A.P. broke ranks with his fellow bankers, many of whom wanted area banks to remain shut to sort out the damage. Giannini quickly set up shop on the docks near San Francisco’s North Beach. With a wooden plank straddling two barrels for a desk, he began to extend credit “on a face and a signature” to small businesses and individuals in need of money to rebuild their lives. His actions spurred the city’s redevelopment.

That would have been legacy enough for most people. But Giannini’s mark extends far beyond San Francisco, where his dogged determination and unusual focus on “the little people” helped build what was at his death the largest bank in the country, Bank of America, with assets of $5 billion. (It’s now No. 2, with assets of $572 billion, behind Citigroup’s $751 billion.)

Most bank customers today take for granted the things Giannini pioneered, including home mortgages, auto loans and other installment credit. Heck, most of us take banks for granted. But they didn’t exist, at least not for working stiffs, until Giannini came along.
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Giannini also made a career out of lending to out-of-favor industries. He helped the California wine industry get started, then bankrolled Hollywood at a time when the movie industry was anything but proven. In 1923 he created a motion-picture loan division and helped Mary Pickford, Charlie Chaplin, Douglas Fairbanks and D.W. Griffith start United Artists. When Walt Disney ran $2 million over budget on Snow White, Giannini stepped in with a loan.
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When Giannini died at age 79, his estate was worth less than $500,000. It was purely by choice. He could have been a billionaire but disdained great wealth, believing it would make him lose touch with the people he wanted to serve. For years he accepted virtually no pay, and upon being granted a surprise $1.5 million bonus one year promptly gave it all to the University of California. “Money itch is a bad thing,” he once said. “I never had that trouble.”

The West

From the Los Angeles Times, a report on the first State of the Rockies Conference, held this week at Colorado College:

The myths and paradoxes of the new American West were explored Tuesday as experts here released a comprehensive report highlighting sweeping changes in population, growth and the environment across the Rocky Mountain region.

Most Westerners don’t live off the land, aren’t especially rugged and like big-box stores and lattes as much as anyone else, the statistics show.

They are, however, better educated than most Americans, younger and living in a beautiful region that’s become the fastest growing in the country.