Trump Getting Carrier’d Away with Employment Numbers; Get Ready to Rumble with Trump’s Latest Pick; Unemployment Lows Give Economists a High



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Just when you thought he’d Tweeted it all…It’s Trump vs. the union boss in the next installment of the President-elect’s Tweet-drama. This time Trump took on union boss Chuck Jones, who serves as president of United Steelworkers 1999 over at Carrier.  Trump tweeted that Jones has “done a terrible job representing workers.” That’s just one of the many pearls that escaped Trump’s social media account. “Spend more time working-less time talking. Reduce dues,” was another gem he tweeted about his current dispute. Look for this exchange to come back and haunt him when it’s time for re-election. In any case, Jones said Trump was giving people false hope about the job situation at Carrier, and told the Washington Post, “…for whatever reason, he lied his a– off.” What Trump allegedly lied his a– off about was the 1,100 jobs he is taking credit for saving. He might have temporarily and theoretically – depending on whom you ask – sort of saved closer to 730 jobs and the problem with Trump’s math is that the 1,100 number might have included 300 jobs that weren’t even in danger of heading across the border. Come mid-2017 and another 600 Carrier jobs are gone as well, whether Trump is involved or not. And after all those lay-offs, Carrier will have a grand total of 800 manufacturing workers and another 300 engineers on its roster. Carrier was offered $7 million worth of tax incentives and credits to stay put. Jones said $23 million worth of concessions were offered up in order to entice Carrier not to head off to Mexico. But Carrier still stands to save $65 million by moving south and well…you see where this is headed. If Carrier decided to remain in the U.S., employees would have to agree to ditch benefits and earn $5 per hour below minimum wage.  Let’s see Trump fix that one.

Let’s get ready to rumble…


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In other Trump drama, the President-elect just picked WWE co-founder Linda McMahon to head the Small Business Administration. Which seems only fair considering she gave a whopping $6 million to a pro-Trump super PAC. Although, she did call Trump’s comments about women deplorable, so that’s something in her favor. The Senate still needs to approve the pick, but all signs point to her getting the gig. With offices in every state, the SBA helps small businesses and entrepreneurs get financing and training. McMahon, like Trump, supports a lower corporate tax rate and less government regulation. She founded WWE thirty years ago with her husband Vince McMahon. McMahon made two previous attempts to get into Washington DC when she ran for Senate seats twice in Connecticut. Both times she lost and the cost of the campaigns set her back about $100 million.  Not that it put much of a dent in her bank account. WWE is a publicly traded company with a market value of $1.5 billion. McMahon herself owns $84 million in company stock. And by the way, Trump is a member of the WWE Hall of Fame.

Nothing to do with Trump…


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The number of Americans filing for unemployment fell from its five month high last week.    That should leave you feeling positively giddy as it signals a very healthy strong labor market. With this bit of news you can expect the Federal Reserve to hike those rates next week. The number of people who filed for first time benefits dropped by 10,000 to 258,000 applicants. It also marks the 92nd straight week that claims fell below 300,000  – a fiscally remarkable feat which hasn’t been seen since 1970. And again, that points to another good sign of a healthy labor market. In case you were curious about what economists were predicting – and it’s okay if you weren’t – the numbers were as expected. With the labor market seen as near full-employment, the government also released data showing that unemployment hit a four year low of 4.6% back in November. And bonus: the number of Americans who receive unemployment benefits fell a glorious 79,000 to 2.01 million.

Starbucks Betting on $10 Coffee; Trump Ready to Dump on Pharmaceuticals; Trump’s June Stock Dump



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Starbucks CEO Howard Schultz is stepping down from his post in April with plans to build a Starbucks’ prestige brand where he will serve as its Executive Chairman. The idea is that by going upscale Starbucks will be able to raise its profile with those pesky millennials. Besides that, the company needs to compete with a number of other upscale rivals that keep rearing their gourmet heads all over the place. One thousand “Reserve” brand stores are slated to set up shop with another 30 large Reserve Roastery (expect to find that word added to a dictionary near you) and Tasting Rooms expected to open up all over the globe. In case you were wondering what one orders from this new prestige brand, you might consider purchasing a $10 cup of coffee that you can sip daintily from a glass siphon.  Or perhaps you’re up for paying $50 for an 8 oz. bag of an exotic, small-lot coffee? I’m sure you’ll find something worth depleting your funds.  In any case, Starbucks also announced plans to open another 12,000 stores –  that’s in addition to its already existing 25,000 stores –  in the next five years.  Five thousand stores are slated just for China. The company also plans to annually boost revenue by 10% while adding between 15% – 20% to its shares, and increase its focus on its food offerings since the coffee giant is convinced it can double its growth in that area.

What a pill…


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Donald Trump’s latest executive plans involve bringing down drug prices and the pharmaceutical companies that keep increasing them with seemingly reckless abandon. Which is kind of ironic since pharmaceutical stocks saw a huge surge following Trump’s election. And here they thought they had an ally. Hah! A Kaiser Family Foundation survey leading up to the election found that people felt drug prices were the number one healthcare issue for the next President. Well, I guess the President-elect is ready for it then. Sort of. Trump has yet to outline any concrete plans on how he is going to achieve this goal. But during his campaign, Trump did say that he is all in favor of consumers having their meds re-imported. He also wants Medicare for the elderly to renegotiate drug prices directly with pharmaceutical manufacturers. That should be fun to watch, especially because both the industry and many many Republicans are vehemently against that idea. Stay tuned for that drama. Just today, Pfizer Inc. and Flynn Pharmaceutical Ltd. were slapped with some massive record fines in the UK after raising drug prices by…wait for it…2,600%. Now, Pfizer will cough up about $106 million, while Flynn will fork over approximately $6.5 million. I guess they should be happy that they were busted in the U.K. and still have time to clean up their act in the United States before Trump-dom takes effect. In the meantime, Allergan Plc. CEO Brett Saunders is bracing himself for the new president’s impact and said Trump could end up being more “vicious” on pharmaceuticals and their drug pricing than Hillary Clinton might have been. But he also pledged to limit price increases to less than 10% per year. Or perhaps he did that lest Trump unleash his Twitter wrath on Allergan, just like he’s done to several other individual companies including Carrier Corp., Ford and Boeing.



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Yesterday, President-elect Donald Trump’s team announced, with no explicable reason as to the timing, that he sold off all of his stocks back in June. Don’t hold your breath for proof of that sell-off as none was provided. While being interviewed today on the “Today” show by host Matt Later after being named Time Magazine’s “Person of the Year,” Trump explained that he decided to unload his stock holdings in order to avoid any conflicts of interest. How very gallant of Mr. Trump.  And even though the press was not made aware of it until yesterday, Donald Trump insisted that everybody already knew. We just don’t know who “everybody” is. Mr. Trump went on to say that he sold off his stocks since he knew he would win the election and would be making deals for the United States that could affect various companies in all sorts of different ways. That was indeed very thoughtful of him. He also said he didn’t even own that much stock.  Which is debatable at best since a recent filing from December of 2015 valued his holdings at $40 million. But in all fairness, his stock market holdings pale in comparison to his real estate holdings which apparently make up the bulk of his net worth.  Ethics experts, however, are suggesting those real-estate holdings might also be a conflict-of-interest as well. Just saying. It’s worth noting that since his sell-off, the S&P 500 went up over 10% while the Dow Jones Industrial Average hit some very impressive all-time highs. Since Trump’s victory, many stocks have also hit all-time highs and, of course, he’s taking credit for it.