Happy Über New Year; DOJ: You’re Up, Morgan Stanley; Labor Department Jobless Claims are New Year’s Bummer

Year end surge…

Image courtesy of renjith krishnan/FreeDigitalPhotos.net

Image courtesy of renjith krishnan/FreeDigitalPhotos.net

A heads up to all of you located in cities where Über is actually allowed to operate: Über is getting ready to ring in the New Year with some price surging. Of course, Über prefers the less obvious term, “dynamic pricing.” Just don’t expect to see any dynamic pricing for the rider, who might very well be paying as much as seven times the usual fare if the service is used between 12:30 am and 2:30 am. New Year’s is expected to be the busiest night of the year for the ride-sharing app, and many other services similar to it, due to the heightened demand on this particularly auspicious day. On its blog, the folks at Über said they are expecting to give more than 2 million rides in a 24 hour period and you’re best bet for the service is to call right when the ball drops or if riders are feeling especially adventurous, they should wait until after 2:30 am. Über also offered to graciously  – and economically – text riders to let them know when surge pricing – excuse me, I meant to say “dynamic pricing”  – ends.

Unsettled business…

Image courtesy of digitalart/FreeDigitalPhotos.net

Image courtesy of digitalart/FreeDigitalPhotos.net

It’s Morgan Stanley’s turn to tangle with the DOJ in an effort to reach a settlement for Morgan Stanley’s role in the 2008 financial crisis. Like its peers, including JPMorganChase, Bank of America, Citigroup, etc…Morgan Stanley is also staring down the wrong end of a DOJ investigation for its role in getting New Century Financial Corp to issue subpime mortgages. Apparently, the bank knew that homeowners would have a hard time paying mortgages but still issued them anyways. Well, that didn’t work out for anyone, now did it? Incidentally, New Century went bust following a bankruptcy filing back in 2007.

Wishing you an employment-filled New Year…

Image courtesy of nonicknamephoto/FreeDigitalPhotos.net

Image courtesy of nonicknamephoto/FreeDigitalPhotos.net

Leave it to the Labor Department to help ring in the new year with some disappointing news: namely that the number of people filing jobless claims rose last week by 17,000. While the total number of people still remains below the 300,000 mark (just barely), we are still left with 298,000 making a New Year’s resolution to get a job (we hope, anyways). Analysts actually only expected that number to hit 290,000, but, oh well. Can’t accurately predict ’em all. But we are supposed to be reassured by the fact that this time of year brings with it good tidings of volatile claims and all fiscal signs still point to a decent economic recovery and climate. Also, the four-week average, which tends to be more accurate, was only up by 250. So maybe it’s okay to breathe a little little sigh of relief.

United Sues Resourceful Computer Whiz; Twitter Is Making A Follower Out of You; California’s Bagged Out

Hide and seek the city…

Image courtesy of anankkml/FreeDigitalPhotos.net

Image courtesy of anankkml/FreeDigitalPhotos.net

United Airlines and Orbitz are suing a 22 year old computer whiz for doing something that isn’t necessarily illegal. The very resourceful and industrious Aktarer Zaman found a nifty little way to score some reasonably priced seats on airlines and runs a website called Skiplagged.com. Dubbed the “hidden city” strategy, you simply purchase a ticket that happens to have a layover in your destination city and then just skip the last leg of the flight. But you need to make sure it’s a one-way ticket and don’t check bags, since the bags will most definitely end up in the final destination even if you have no intention of ever going there. While others call the idea genius, United Airlines and Orbitz have, no doubt, other choice words for Zaman and are seeking $75,000 in lost revenue. (Even though airlines are reporting record profits, but I digress). Zaman, however, alleges he hasn’t made any profit from the website and argues that all he did was expose an “inefficiency.” United and Orbitz call it unfair competition and “strictly prohibited travel” (boohoo), even though the airlines are well aware of “hidden cities” which have been around for many years now.

I’m a leader, not a follower!

Image courtesy of Master isolated images/FreeDigitalPhotos.net

Image courtesy of Master isolated images/FreeDigitalPhotos.net

Twitter started a new experiment by selling ad space on your timeline. But Will Shatner doesn’t like it. Not one single bit. All the hoopla began when the Star Trek legend noticed a MasterCard ad appearing on his “following” list.  This peeved the actor and Priceline sheller quite a bit, especially because he wasn’t following MasterCard’s account. Shatner then tweeted, “Why am I following MasterCard when I didn’t add them? I do not appreciate this.” Here here, Captain Kirk. Mr. Shatner, and presumably others, don’t like that it might be assumed that they are promoting and endorsing brands just because Twitter put those brands on their “following” lists. Shatner, it appears is not the only celebrity who seems to have brands appearing in their following lists.  Non-celebrities have this issue too, but who cares about them. While Twitter has been engaging in this practice since 2013, there is no word yet on how the micro-blogging website will proceed with Mr. Shatner’s complaints. And those of regular people, as well.

I’m bagging you to please stop…

Image courtesy of winnond/FreeDigitalPhotos.net

Image courtesy of winnond/FreeDigitalPhotos.net

Looks like Californians weren’t digging the plastic bag ban, after all. Opponents of the plastic bag ban collected a whopping 800,000 plus signatures to force a referendum on the issue, an especially impressive feat since only 504,000 signatures were actually needed. The American Progressive Bag Alliance (I swear I could not make that up if I tried) which is made up of several business groups and plastic bag manufacturers said that Senate Bill 270, aka the plastic bag ban, has less to do with helping the environment than it does with money. The APBA said “SB270” was basically a “back room deal” since stores make money by getting consumers to purchase reusable bags from them. Californians Against Waste are hearing none of that, arguing that the culprit-y bags not only pollute the environment but then have the nerve not to bio-degrade on top of it. The group also says that plastic bag manufacturers profit by selling $200 million worth of bags so it’s in their best interest to keep those bags around. In any case, once the signatures are validated, the fate of the bags, reusable and otherwise, will rest in the hands of California voters.

Is Xiaomi the Next Big Thing to Hit the Smartphone Scene?; Russia’s Ruble in the Rubble; Shake Shack Shaking Up Wall Street

Third’s the word…

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Here’s a riddle for you: If Samsung is the number one smartphone maker in the world, with Apple perched at the number two spot, then who has taken third? Hint: It’s not LG. Or Nokia. Or Motorola. Or… In fact, the number three smartphone maker in the world has yet to reach our shores, even though the company’s got a $45 billion valuation and is slated to become the most valuable IPO. Ever. In case you haven’t figured it out – and it’s okay if you didn’t –  I am talking about Chinese smartphone maker Xiaomi. The company which, just pulled in another $1.1 billion in funding, is number one in the mammoth Chinese market. It also happens to be the fastest growing smartphone maker and the most valuable start-up in the world right now (yes, even more so than Über and Pinterest, if you can believe it). And by fast I mean the company’s sales are up 211% in the third quarter, having taken a 5% bite out of the market share. Xiaomi, whose Mi4 smartphone coincidentally, bears a striking – make that very striking – resemblance to the iPhone, actually makes most of its money from apps and add-ons, and not from the phone itself. It also apparently has some nifty marketing strategies, though I can’t weigh in on that one. Xiaomi is currently focusing on branching out into places like Indonesia, Russia and Mexico with no immediate plans to come to the US, which clearly hasn’t been a problem for it.

Is that a recession I smell…

Image courtesy of David Castillo Dominici/FreeDigitalPhotos.net

Image courtesy of David Castillo Dominici/FreeDigitalPhotos.net

Russia’s not having a very good week. News is out now that the economy there shrank for the first time in five years. The GDP fell by .5% with the Russian government saying that next year the GDP could go down by as much as 4%. How do you say “yikes” in Russian? The ruble is continuing its slide,  falling the most in two weeks, and is about 40% weaker than the dollar. It’s down by about 70% since the beginning of the year. Of course the international sanctions imposed on Russia by other countries who were not cool with its incursions into the Ukraine are being blamed. And, of course, Russia then decided to block imported food – a move that has not been good for anyone on either side of the issue. Then there’s the price of oil which keeps dropping and dropping and…well, it’s no fun to see oil numbers drop if you happen to be the largest energy exporter and well, that’s exactly what Russia is.

Yeah, it’s that good…

Image courtesy of KEKO64/FreeDigitalPhotos.net

Image courtesy of KEKO64/FreeDigitalPhotos.net

Apparently the Shake Shack is so good that Wall Street will get to partake of its delicacies in the form of a $100 million IPO that the company just filed today. Conceived by restaurateur Danny Meyer, the chain will be listed on the New York Stock Exchange under the aptly named ticker symbol SHAK. The company began as a single “shack” in New York City’s Madison Square Park and quickly grew to 63 locations…worldwide, with half of those operated by licensees. Shake Shack reported sales of $140 million in 2013, a scrumptious $81 million gain from the year before. Investors are awfully curious to see how Shake Shack will fare considering the mixed results the market has seen from food companies like perennial fave Chipotle to less than stellar performer Noodles & Co. If that’s not enough to whet your IPO appetite, then how about the fact that they pay an average hourly wage of $10.70 with health benefits and paid time off?

South Korea Puts Brakes on Über With Indictment; Walmart Raises Spirits and Paychecks; Jolly Jobless Claims Numbers

U-bummer….

Image courtesy of renjith krishnan/FreeDigitalPhotos.net

Image courtesy of renjith krishnan/FreeDigitalPhotos.net

In what is yet another roadblock in the tech saga we call Über, South Korea has now entered the fray. Except this time there’s a twist because South Korea actually indicted Über CEO Travis Kalanick along with his local Korean business partner MK Korea Co. instead of just ceasing operations of the ride-sharing app, like all the other locales have been doing.  And like all the other countries, states and cities that have been putting the kibosh on the service, South Korean officials argue that Über is violating transportation law  – only this time, by allegedly using rental cars to run its business, apparently a major no-no in those parts. This latest snarl only adds to Über’s growing list of infractions, lawsuits, infringements, etc. The penalty for this latest hiccup, assuming Kalanick and his business partner are found guilty, is up to two years in prison or an $18,000 fine. Ironically, that $1.2 billion Über just got to help expand into Asia ought to help cover that fine, not to mention the legal expenses that are about to mount in China, where law enforcement officials raided an Über “training” facility. But at least back in the states things are looking up in Portland, Oregon, sort of. Even though Über operations were almost immediately halted after its launch there, the company was told to sit tight for three months while the city revamps its taxi rules, presumably to allow Über to fit right in.

And to all a good raise…

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Over 1.3 million Walmart employees can expect a few more dollars in their paychecks, provided they are among the retailer’s minimum-waged. The biggest private employer in the US will be giving wage increases in nearly a third of its stores, located in 21 states, effective January 1, to comply with new federal guidelines. The three lowest pay grades, including cashiers, cart pushers and maintenance workers will now be combined into one base-level and the gap between the premium paid for higher-skilled workers and the minimum wage will become that much smaller. Walmart has taken a lot of slack for the low wages it has been known to pay and not for nothing as low-paid Walmart employees already collect $2.66 billion annually in government assistance.

Jolly jobless numbers…

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

While the previously-owned housing market provided us with a very unwelcome and December buzz-killing decrease, the drop in the number of jobless claims filed almost makes up for that. In fact, 9,000 less people filed applications for jobless claims, bringing the total to 280,000 applicants –  making it the lowest number in seven weeks. Not only are employers not firing but they are hiring – even adding 321,000 jobs to the labor force. If that’s not merry, then I don’t know what is. By the way, a number under 300,000 is cause for celebration.  So take that, previously owned housing market! What this means for you, me and your neighbors who outdid you with their Christmas lights display is that the job market and the economy are both steadily improving. So let us all thank the Labor Department for doing its part to shame those housing numbers and giving us some good fiscal cheer.

Keurig Issues a Very Un-Merry Recall; Walgreens’ Happy Fiscal New Year; Barnes & Noble Regifts Itself, Sort of, With Nook Buyback

Ahhhh Keurig!!!

Image courtesy of lamnee/FreeDigitalPhotos.net

Image courtesy of lamnee/FreeDigitalPhotos.net

Looks like the automotive industry doesn’t have the monopoly on recalls this year, after all. Enter Keurig, beloved brewer of coffee and other hot beverages for millions. Following over 90 reports of people literally getting burned by their machines, Keurig recalled 7.2 million Keurig Mini Plus machines because they can overheat (imagine that) and spray hot liquid on its discerning coffee drinkers. Oh the horror. Not sure if your precious Keurig is on the recall list? Well, there are an estimated 6.6 million brewers that were recalled in the United States, with the rest purchased in Canada. The machines were made between December 2009 and July 2014 and were likely purchased at Kmart, Kohl’s Target, or directly from the Green Mountain website. In any case, rest assured that Keurig will ship you a repair kit FOR FREE. Of course, can you guess what the company stock did today? Yes it took a bit of a pre-Christmas nosedive and that’s in addition to the 5% drop in sales the company saw in its fourth quarter.

Out with the WAG, in with the WBA…

Image courtesy of jscreationzs/FreeDigitalPhotos.net

Image courtesy of jscreationzs/FreeDigitalPhotos.net

Nothing says jolly like beating analysts’ estimates and Walgreens did just that. The health retail giant pulled in some impressive numbers for its fiscal first quarter with earnings of $809 million and $.085 per share. Analysts forecasted a paltry $0.74 per share. Analysts also called for revenues of $19.43 billion. But Walgreens instead pulled in close to $19.6 billion in revenues. In fact, shares of the company have pleasantly creeped up 29% in the past year. And while we bid farewell to 2014, it’s also time to bid farewell to retiring Walgreens CEO Greg Wasson. Wasson, who will not soon be forgotten – whether some people like it or not – orchestrated plans to takeover Swiss health and beauty company Alliance Boots. Part of the original plan was to pull off an inversion-type deal which did not exactly pan out. But what did pan out was Walgreens’ long-awaited foothold onto the international pharmaceutical/health/beauty market by just taking over the Swiss company. So bienvenu Walgreens. Or whatever it is they say there. With this new deal we shall also bid farewell to Walgreens presence on the New York Stock Exchange and Nasdaq under the ticker symbol WAG. Assuming the deal with Alliance Boots finalizes by December 31, Walgreens will now be traded only on Nasdaq, under the ticker symbol WBA, as part of the Walgreens Boots Alliance, Inc holding company. Sniff, sniff. As for the company’s 8,200 plus stores, expect to see some changes as the company looks to cut costs and trick out appearances.

Nook’d out…

Image courtesy of adamr/FreeDigitalPhotos.net

Image courtesy of adamr/FreeDigitalPhotos.net

It’s official. The Nook e-reader business is once again fully back in the arms of Barnes & Nobles. But don’t expect the reunion to last too long as Barnes & Nobles plans to spin it off on its own by August. The Nook, which turned out to be a big money loser and just couldn’t compete with Amazon and friends (and enemies), cost Microsoft $300 million back in 2012. Barnes & Noble graciously agreed at the beginning of the month to buy back the biz from the software giant for $125 million with Pearson Inc. still holding a stake in the company. But no more as Barnes & Noble paid $27.7 million in cash to the educational book publisher with $13.8 million in actual cash and 603,ooo shares of stock.  Wall Street liked the move as well and shares of the bookseller moved up a smidge.

American Apparel Drama Round 2. Or is it Round 3?; Very Merry Gas Pumping Days; Housing: What’s Up or Rather Down With it?;

Change can be good…

Image courtesy of jscreationzs/FreeDigitalPhotos.net

Image courtesy of jscreationzs/FreeDigitalPhotos.net

Someone – make that some entity – actually wants to buy embattled retailer American Apparel, drama and all. In the meantime, co-chairmen Allan Mayer and David Danziger stepped down to be replaced by Colleen Brown. Rumors of a takeover began swirling last week, sending shares of the stock up. Private equity firm Irving Place reportedly put in a very generous offer of between $1.30 – $1.40 per share, or between $227 million – $245 million. The offer was especially generous because the stock is currently hovering around  $1.10 a share as I write this. Yet its price is still a distant memory from the $15.00 stratosphere where the stock was trading back in 2007. And the company is on track to post its fifth straight year of losses. What’s even more interesting about this takeover offer is that Irving Place would like to see alleged sexual harrasser, Dov Charney, back in the corporate mix, even though he was unceremoniously ousted last week, much to the chagrin of over 30 executives. Charney, however, still remains the largest shareholder in the company, with a hefty 43% stake in it.

Come all ye’ gas guzzlers…

Image courtesy of Rawich/FreeDigitalPhotos.net

Image courtesy of Rawich/FreeDigitalPhotos.net

These days are looking very merry at the pumps as gasoline prices are, on average, at their lowest prices since May 15, 2009. Head on over to Tulsa, Oklahoma and you might just find yourself filling up your tank to the very merry tune of less than $2.00 per gallon. Other cities where miracles like that are happening are in Lubbock, TX and Kansas City, MO. But don’t get too giddy as the average price is hovering above the $2.00 mark in most parts of the country. It’d probably be best to steer clear of Long Island, where you’ll be paying over $2.80 per gallon, on average. Still, these prices are better than they were last year when we were shelling out approximately $0.79 more per gallon than we are now. If you’re holding out hope for these prices to fall even more, they just might. But only by a few cents. There is a dark side, though,  to falling gas prices, particularly in Texas, whose economy relies heavily on the energy industry. The Texas economy could actually take a brutal beating from these decreasing prices, losing perhaps billions of dollars in revenue, but more importantly, hundreds of thousands of jobs.

No home for the holidays…

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Seeing as you’re saving all this money because of falling gas prices, perhaps as much as a whopping $550.00 a year, then maybe you ought to consider looking for a new home. Well, someobody ought to anyway, considering that purchases for previously-owned homes took a nasty little 6.1% dive with only 4.93 million homes being sold in the month of November. Forecasts, sadly enough called for a decline from October’s 5.25 million, but only to 5.2 million. So that 4.93 million figure was an unwelcome surprise being the weakest number posted since May. But it’s not all bad and gut-wrenching since that number is still a 2.1% increase over the same time last year. Yet a bit perplexing since mortgage rates are so low right now, with the average rate on a 30 year fixed topping off at 3.8% last week. Experts, me not being one of them, also say that the decrease could just mean that there are a lot of prospective buyers out there who just don’t like the current batch of housing inventory and are holding out for more properties to come on the market. Let’s hope that’s the case. The next few months ought to provide us with a few clues.

GM Says Nyet to Russia Deliveries; Start Spreading the News: Gov Cuomo Bans Fracking; Kraft-y New CEO

Rubles the wrong way…

Image courtesy of David Castillo Dominici/FreeDigitalPhotos.net

Image courtesy of David Castillo Dominici/FreeDigitalPhotos.net

Russian President Vladimir Putin gave his annual hours long press conference where he discussed the plunging ruble. He said the economic recovery could take up to two years and, of course, he made sure to point his country’s finger (presumably the middle one) at the US and the EU because he says plunging oil prices and economic sanctions are to blame. Oh and also the central banks messed up too because they apparently didn’t respond fast enough to economic issues as they arose. Darn central banks! Then GM went ahead and suspended deliveries to Russia, becoming one of the latest western companies to do so. And who can blame them. After all, when currencies drop, the companies lose big bucks.  But considering GM only sold 170,000 vehicles in Russia so far this year  – it sells more than that in a single month over here – its sure not to put any major crimp in their business. Apple also shut down operations while other companies, like BMW, took the route of raising their prices to make up for the drop in the ruble rate. Why his love life came up during the press conference is a mystery, but at least now we know that Vladimir Putin is in love –  and somebody even loves him back –  according to him anyway.

Frack off…

Image courtesy of xedos4/FreeDigitalPhotos.net

Image courtesy of xedos4/FreeDigitalPhotos.net

Governor Andrew Cuomo (D) has made it official: New York has become the first state to ban the ever-controversial fracking process, a decision that puts a major chink in the oil and gas industry. The process, which involves tapping into natural gas by using high-pressure water blasts and, of course, chemicals, has been under a moratorium in New York State since 2008 after it was felt that more research was needed to see just how bad the process is for the environment and our health. At a press conference, Governor Cuomo handed the reins over to health and environmental officials who said the issues are too great to allow it to happen and conveniently had several studies on hand to back up their claims. Now if they could just do something about those traffic jams…

Nothing cheesy about it…

Image courtesy of digitalart/FreeDigitalPhotos.net

Image courtesy of digitalart/FreeDigitalPhotos.net

In a move that shocked analysts, who generally make it a habit of predicting things, Kraft CEO Tony Vernon, who is but 58 years young, announced that his retirement from the company will officially take place on December 27. Vernon has been at the post since October of 2012 and will stay on as an adviser until March. His replacement will be John Cahill, who already has Pepsico  gracing his resume. Kraft, the intrepid force behind Velveeta cheese and the ever-malleable Jell-O, said that it needs to make big changes quickly if it wants to keep up with the constantly changing needs of the food industry. Sounds fair, considering Kraft saw an 11% drop in its third quarter profits.