Panera Bread Shacks Up With Krispy Kreme Investor; Nothing Smooth About a Recent Nivea Campaign; Payless Out. Chapter 11 In.

Yummm…

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Krispy Kreme needs to scoot on over and make some room over at JAB, the investment firm that controls it. It’s latest roomie is moving in and its name is Panera Bread. Panera is expected to fit in quite nicely at JAB, at least that’s what all the analysts keep saying, as the firm’s other entities include Peet’s Coffee and Tea, Caribou Coffee and Keurig Green Mountain Coffee. JAB will take the sandwich chain private for a tasty $7.5 billion, which comes out to about $315 per share and more than a 20% premium. And why shouldn’t JAB pay all that money? After all, the chain boasts 2,000 locations and pulls down annual sales of $5 billion. Of course it makes cash like that because it offers healthier options than most other fast-food chains, not to mention readily available wifi. For a fast-casual restaurant chain, it happens to be very tech forward. And don’t even get me started on the restaurants online ordering. Just. Don’t. Talk about a draw. Apparently JAB wants Panera to continue doing exactly what it does so well (translation: no changes) because it’s keeping all the execs in their current roles, including founder and CEO Ron Shaich. Wall Street’s was totally digging the news as well sending shares up to around $312 a pop. Add that to the fact that Panera has beat estimates for the last year and half, and JAB has got itself a pretty nifty deal.

Racist deodorant?

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Racist may not be the first word that comes to mind when you think about deodorant. But then again, that might be because you hadn’t yet heard about Nivea’s slogan in its ad for “Invisible for Black and White Deodorant.” According to marketing geniuses at Nivea, “White is Purity. ” And that’s precisely the slogan that was used to promote the product. I. AM. NOT. KIDDING. The ad was originally unleashed on the company’s Middle East Facebook page and social media did not take it well, with one outraged Twitter user writing: “Your comments are FULL of society’s refuse. This cleared your marketing department? #prnightmare.” Beiersdorf, the German company that counts Nivea amongst its holdings, wisely deleted the ad. Just not before white supremacists weighed in with their thoughts on the slogan, including this one:  “We enthusiastically support this new direction your company is taking. I’m glad we can all agree that #WhiteIsPurity.” The way white supremacists feel about an ad campaign would make a fairly good barometer, in terms of marketing efficacy, don’t you think? As to how the ad got past quality control in the first place remains a mystery.

And there’s nothing Star Jones can do about it…

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Another one bites the fiscal dust and this time the dubious distinction of filing for Chapter 11 bankruptcy goes to Payless Shoes. Even the likes of Tyra Banks and Star Jones wasn’t enough to save the Kansas-based chain from having to shut down around 400 stores in the United States and Puerto Rico. But that’s what you gotta do when your revenue tanks 4% just in the last year, and Amazon and deep-discount stores keep eating into your business. However, all is not lost, as Payless still has around 4,000 other stores in over thirty countries. The company just needs to do a little fiscal restructuring. But then again, don’t we all?

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Bernie’s Big Ticket Plans; Trump: Print Me the Money!; A Glazing Good Deal for Krispy Kreme

 

Hey big spender…

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Studies were done on Bernie Sanders’ spending plan and the results just might churn your stomach, no matter how you feel about the potential presidential candidate. The non-partisan Tax Policy Center and the also non-partisan Urban Institute’s Health Policy Center explain how Bernie’s plan could harm the economy by dangerously increasing the federal deficit and the national debt – an ugly combo. His plan involves raising taxes across all income levels with nobody getting a pass – which almost sounds fair. His plan literally requires trillions of dollars in tax increases but hey, it includes FREE universal healthcare, expanded social security and FREE college tuition. Don’t even pay attention to the strain on economic growth under this plan. Because there won’t be any growth. Just cold hard strain. According to the study, Sanders’ domestic agenda plan would add $18 trillion to the national debt over ten years. That’s not including an additional $3 trillion in interest payments. And that number is just from Sanders’ lofty goal of providing free healthcare for all. The study also mentions a $32 trillion increase in federal medical spending over ten years plus another $3 trillion added for additional long-term care costs. But hey, it’s worth it right? Just maybe not for you. Or anyone you’ve ever known. At least Bernie Sanders would do away with all those annoying premiums, co-pays and co-insurance costs. Those in the lowest income bracket would end up paying, on average, $200 more in taxes. But that additional $200 taxes comes with $10,000 in benefits. So that’s a win. Sort of. For those who whose incomes fall more in the middle, they’ll find their tax bill going up, on average, by about $4,500. Seems awfully steep but hey, that bigger tax bill will get those middle income earners $13,000 more in benefits from the U.S. governments. Not that they necessarily need $13,000 more in government benefits, but whatever. With low and moderate income levels gaining the most benefits, it will leave the lucky top 5% of earners paying, on average $130,000 more in taxes. But if you’re in the top 5%, well then consider yourself fortunate. Or not. Feeling the Bern yet? Your additional $130,000 gets you not much of anything more. Well there is that additional $19,000 in benefits but if that’s not enough then too bad. Bernie Sanders administration doesn’t care about you. Sanders’ campaign officials did release their own cost estimates which, of course, weren’t nearly as traumatizing as those released by the non-partisan outlets. So whose math are you going to trust?

Poetry in motion…

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More gems escaped from the mouth of presumptive Republican presidential nominee, Donald Trump. This time he said that the U.S. won’t ever have to default on its loans because it can just print the money. This latest pearl was imparted after he was asked to clearly stipulate his strategy on how to handle the national debt. He insists he never said that he thinks the US should default and renegotiate with its creditors. He also said that he would do his super duper best to try and NOT touch social security – so gallant of him. The Donald also called himself the “King of Debt” because he loves debt. I mean, how could you not? He went on to say ,”I understand debt better than probably anybody. I know how to deal with debt very well. I love debt.” I could not have made up that quote if I tried. Trump wants us to know that he would like to take advantage of a drop in value of U.S. treasury debt and buy it back with better terms. That’s if and only the rates go up and those bonds can be purchased for a discount. It’s a legit tactic but the problem is it’s coming from the self-proclaimed “King of Debt.”

Glazed and not confused…

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Krispy Kreme’s Wall Street days are about to be history as the company, famous for its delectable glazed doughnuts, is going private again after being acquired by German company JAB to the tune of $1.35 billion. JAB is getting the yummy company for $21 per share, a nearly 25% premium over Friday’s closing stock price of $16.86. The company, which went public in 2000, boasts over 1,100 stores worldwide. Interestingly enough, Krispy Kreme has more stores outside the US, over 800 actually. Back in August of 2003, shares of the company hit a high of $49.37, but alas, those days are long gone. A majority of Krispy Kreme stores are operated by franchises and plenty of the international franchises have been hit with weaker sales, in part, because of the strong dollar. Krispy Kreme, however, will fit in nicely at JAB, which already acquired Peet’s Coffee & Tea and Caribou Coffee. Wall Street seemed sweet on the acquisition as it sent shares up today over 24% to almost $21 a share.