Costco’s Credit Chaos; Macy’s Switches it Up with New Chief; VW’s Writing Checks

Not to their credit…

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Image courtesy of lekkyjustdoit/FreeDigitalPhotos.net

So much for a seamless transition of the Costco Anywhere Visa cards. The club-retailer started accepting the card this week, after ending its 16 year relationship with American Express, and there has been no shortage of chaos. While American Express enjoys a hearty laugh over this new credit card debacle,  Costco customers have been flocking to Facebook to rage against Coscto and its Citigroup credit card. Since Monday, Citigroup has been flooded with phone calls from 1.5 million disgruntled callers whose issues included problems activating accounts, lengthy wait times to speak to a living human breathing customer service representative and even difficulty trying to pay off existing balances. I mean seriously, when was the last time you had a hard time getting someone to take money from you. Costco has over 80 million members worldwide and eleven million of them applied for this new card. Those cards were supposed to have arrived back in May. Unfortunately many didn’t. The card offers a generous cash-back program and has no annual fee and, which was the bone of contention between Amex and Costco, that ultimately put the kibosh on the relationship. About 25% of Costco shoppers used Amex cards for their purchases and Amex took a 6% fee that cost the retailer $180 million. Citigroup is the biggest credit card lender in the world and analysts think the new partnership is a great idea to cut down on costs. Visa’s fees will be considerably smaller, costing Costco somewhere between $60 million and $150 million. Which is great news, as long as you’re not standing on line right now trying to make a purchase with the store’s new Visa card.

Miracle on 34th Street?

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Long-time Macy’s CEO Terry Lundgren is getting set to bid a long and fond farewell to the department store he helmed for the last 14 years. While he still gets to remain chairman, succeeding him officially in 2017 will be Macy’s president and former Chief Merchandising Officer, Jeff Gennette. Lundgren might be a bit sad but Wall Street sure isn’t. Investors sent shares up on the news, which is especially reassuring since shares have gone down in value more than 50% in the last twelve months. To be fair, Lundgren’s contributions were nothing short of impressive. He made Macy’s the largest department store chain in the United States, among other shining achievements. But the time has come for a changing of the retail guard as Macy’s got hit with five straight quarters of same-store losses and its first quarter results were the worst they’ve ever been since 2008. That last bit caused a bit of panic in the retail sector as other big retailers worried that these results signaled an industry-wide problem. Some experts, me not being one of them, are convinced that Macy’s doesn’t have the chops, yet anyway, to compete with the likes of the Amazons, H&M’s and Zaras of the world. (Not that H&M’s recent results were all that impressive). With a strong dollar and falling sales, Macy’s had to close about 40 stores and cut thousands of jobs. As for Gennette, one source said, “He is going to make the radical changes” which sounds awfully ominous, but in fact, entails, at least in part, setting up an off-price store called Macy’s Backstage and making online shopping enhancements, which seem to be all the rage.

Farfegnugen…

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It’s official. Sort of. Volkswagen will cough up a settlement of about $10.3 billion to settle claims that it rigged emissions tests on some of its models. Part of the settlement includes offers to buy back about 500,000 odious vehicles which emit 40 times the allowable amount of nitrogen oxide into the air we breathe. By the way, VW is not expected, by the EPA anyway, to repair all of the offending vehicles. Some owners will receive as much as $7,000 in compensation. There’s a joke in there somewhere. Also, VW must set aside money for green energy projects besides establishing programs whose focus is to offset diesel pollution. Talk about karma. Both Volkswagen and the EPA declined to comment on the settlement, which I suppose is to be expected. This settlement is completely separate from other lawsuits suits filed by other U.S. states and is also separate from the Justice Department’s own criminal investigation into the matter. So it seems as though things are anything but settled for Volkswagen.

Whole Foods is Getting a Whole Lot Sunnier; Nothing Like a Good Shareholder Fight; Urban Outfitter Pleasantly Surprises

Here comes the sun…

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Image courtesy of digitalart/FreedIgitalPhotos.net

Whole Foods is getting solar with a little help from Elon Musk’s Solar City and NRG Energy.  Of its 430-plus locations, up to 184 Whole Foods stores will get the solar treatment and with the stashes of money it is expected to save over the long run, maybe the organic grocer will start pricing their merchandise a little more cost-friendly. Whole Foods went with both companies so as not to be limited. Sounds fair. With a disappointing fourth quarter that saw a $432 million loss and a slower rate of growth, SolarCity’s stock needed this deal which gave its stock a solid 6.3% lift. Because oil prices have been so low, consumers haven’t exactly felt the fiscal pinch to get cost-effective solar installations and SolarCity’s been feeling that effect in its numbers. No word yet on which locations will get the solar experience but the move will put Whole Foods in the same company as Costco and Walmart for being among the top 25 corporate companies to go solar.

United they fall…

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United Airlines has had better…decades, as two investment funds, who together own a 7.1% stake in the airline, are gearing up to turn the airline’s board of directors on its head. PAR Capital Management Inc. and Altimeter Capital Management LP aren’t happy with the way things have been going at the airline, which happens to be ranked as the third largest carrier by traffic and boasts 85,000 employees. The firms have nominated 6 new directors for the United Continental Holding Inc. board in hopes of undoing the “poor performance and bad decisions over the last several years.” Ouch. Because they feel the board is ineffective, one of the board members they are looking to bring in is former CEO Gordon Bethune, who ran the ship from 1994 – 2004, and is credited with turning the airline around back then. Shareholders will vote on the issue at the company’s annual shareholder meeting in the spring. Judging by the company’s low-employees morale, poor customer service, spate of electronic glitches and its inability to improve its on-time performance, there’s probably a whole lot of ugly going on there. The fact is that most of the other big airlines are cranking out huge billion dollar profits, while United Continental is still figuring out how to play catch-up, even after its 2010 merger, which is still plagued by tons of kinks. This news comes just two days after CEO Oscar Munoz announced that he’d be returning to his post on March 14, after being on medical leave since his October heart attack. Oscar Munoz came on board back in September, on the heels of former CEO Jeff Smisek stepping down after it was disclosed that there was a federal investigation involving United Continental and the Port Authority of New York and New Jersey.

So trendy…

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Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Urban Outfitters’ stock rallied today close to 17% and for a few good reasons. First, the company took in a profit of $72.9 million, adding 61 cents per share. Even though last year the company took in $80.3 million and 60 cents a share, it was still a Wall Street beat since analysts predicted that this time around the retailer would only add 56 cents per share. Boom. The company flat-lined in terms of its net sales, posting $1.01 billion, but it was the improved margins that had Wall Street tongues wagging. There are few things that Wall Street loves more than improved margins and execs are expecting more improvement on the Urban Outfitter fiscal horizon. The trendy apparel company also scored big with customers by adding some new beauty products that it started selling both online and in 70 shops within the stores. In fact, that rollout proved to be such a success that 60 more stores will get to revel in that retail experience.  Investors were so wowed by Urban Outfitters results that over a dozen brokerages even raised their target prices for the company’s stock, with some brokerages predicting those shares could go as high as $38 a share.  Not every analyst was as generous, however, the stock did close today at 32.69.

Brad Pitt Thinks Costco is Setting a Bad Egg-sample; Summer Style Black Friday Results Are In.; Netflix Is Having the Best. Year. Ever.;

Hold the yolk…

Image courtesy of SOMMAI/FreeDigitalPhotos.net

Image courtesy of SOMMAI/FreeDigitalPhotos.net

It’s Brad Pitt and Bill Maher versus Costco as the A-listers take issue with the wholesaler’s egg selection. The two Hollywood celebs think Costco contributes to animal cruelty by selling eggs from caged hens. Brad Pitt sent a very polite, but strongly worded, letter to Costco CEO Craig Jelinek telling him why eggs from caged birds is such a bad idea, Bill Maher, however, took to the pages of The New York Times, penning a scathing editorial, as only he can, detailing the horrifying results from the practice. It should be duly noted that both Pitt and Maher also praised Costco for its efforts toward animal welfare. They just want to make sure that the chain makes good on its 2007 promise to only sell eggs from uncaged hens. Perhaps then will Brad Pitt and Bill Maher return to the hallowed aisles of Costco, where they will whip out their membership cards and load up their tricked out SUV’s with a year’s worth of toilet paper. And, of course, some eggs.

Was it all that and a bag of chips?

Image courtesy of  Iamnee/FreeDigitalphotos.net

Image courtesy of Iamnee/FreeDigitalphotos.net

The results are in. Kind of. Amazon’s Prime Day did manage to pull in some boffo sales and surpassed November’s Black Friday sales despite mounting criticism over the paltry selections on its  “Lightning Deals,” not to mention the not-so-deep discounts. Prime Day, which was established to honor the sanctity of the humble beginnings of Amazon just twenty years ago, pulled in 80% higher sales over this time last year. That was just for the US. In Europe, sales jumped 40% (though I suspect none of that came from Greece). With numbers like that, it seems not everybody took issue with the offerings. Take for instance the tens of thousands of people who purchased Amazon Fire Sticks. Or how about that Kate Spade bag that sold out in less than a minute. Shoppers also seemed to dig the “Lord of the Rings” blu-Ray set as Amazon sold 35,000 of them. But Wal-Mart’s not complaining either. In response to Prime Day, the world’s largest retailer offered up its own Black Friday deals, discounting some 2,000 items including an Apple iPad Air 2 for just $400. For Wal-Mart, these last three days have been some of its most successful online shopping days. Ever. Orders increased by triple digits over the same time period last year. So I guess Wal-Mart’s feeling pretty merry right about now.

No kidding…

Image courtesy of  David Castillo Dominici/FreeDigitalPhotos.net

Image courtesy of David Castillo Dominici/FreeDigitalPhotos.net

Netflix whipped out their earnings to much fanfare but little surprise. The internet streaming service picked up a few more subscribers. Make that a few million more subscribers, even scoring some record-breaking gains this year. This should probably come as no surprise since Netflix currently reigns supreme as the S&P’s fave top stock. Yes. That is a thing. International markets seem to be jumping on the Netflix bandwagon, where the service bagged some 2.37 million new subscribers. As for new subscribers on this side of the pond, Netflix gained 900,000 new customers who now get to binge watch such classics like “Orange Is the New Black.” Naturally, news of its impressive earnings caused the stock to take a nice jump today. Netflix total subscriber-ship now comes to 65.6 million people, and yet, the company is still far from its goal of conquering the world. Japan, Spain, Italy and Portugal are set to be getting access to the popular platform later this year.

Consumers Don’t Itch for Fitch; Wall Street Un-impressed that Costco Hits its Numbers; Why is UAE’s National Carrier Angry at the U.S.?

What are your qualifications?

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Nothing like a fickle teenage population to cause your company to lose 14% in sales. The fact is, consumers just aren’t digging A&F’s offerings lately. Combine that with a strong dollar and you get earnings that you’d rather not announce. But they were announced, in all their unattractive glory, and sadly, for A&F anyway, the apparel company took in a $63.2 million loss with 91 cents per share lost – a far cry from the $23.7 million and 32 cents it lost a year earlier. Sales, by the way, came in at $709.4 million, a major ugly drop from the $827.4 million the company raked in last year. These dismal numbers are also the result of the strong U.S. dollar that continues to wreak its fiscal havoc on both Abercrombie & Fitch and Hollister. So the company has decided to lower prices on its merchandise  – in Europe, that is. But the powers that be admitted the retailer will continue to take a sales hit despite these efforts.  Interestingly enough Hollister, has been showing slight signs of recovery so shares did surge today on that bit of information. If you think you possess the skills that could have prevented this messy quarter, then perhaps you should polish your resume and submit it to A&F. The company has been sans CEO for six months and is on the prowl for a new one.

A year’s supply of toilet paper…

Image courtesy of photoraidz/FreeDigitalPhotos.net

Image courtesy of photoraidz/FreeDigitalPhotos.net

Costco topped analysts’ estimates and if this comes as a surprise to you then, clearly, you have never experienced the magic that is Costco. Sales for the warehouse retailer came in at $25.5 billion, with revenue taken in from membership fees up 4% to $584 million. Sales are up 6%, leaving competitors like Wal-Mart and Target in the dust. The company pulled down $516 million in profit on a total of $26.1 billion in revenue, adding $1.17 per share, a 9% increase over last year and just a teeny tiny penny more than what analysts expected. However, shares of Costco, for some inexplicable reason, fell more than 1.5% today. Well, actually there is an explicable reason, sort of, as traders were underwhelmed with the wholesaler’s performance and hoped Costco would do more than just top expectations. You can’t please ’em all, I guess. And now, if you’ll excuse me, I’m going to drown myself in a one ton container of Kirkland brand jellybeans…

And it’s all your fault…

Image courtesy of Ppiboon/FreeDigitalPhotos.net

Image courtesy of Ppiboon/FreeDigitalPhotos.net

The United Arab Emirates’ fast-growing national carrier, Etihad Airways, took down some impressive numbers with revenues of $7.6 billion and profits coming in at $73 million. Those earnings are a 52% increase over last year, yet, the airline is all up in a snit. It seems the suited folks running the show at Etihad are ticked off (feel free to insert a more colorful word) because “aggressive protectionist sentiment” from the West, i.e. the United States, is going to wreak fiscal havoc on the airline in the future. Apparently, as I have never been on board one of Etihad’s aircraft, its fleet is pretty tricked out, with competitive prices and a major edge on attracting passengers in the Persian/Arabian gulf. US carriers say this advantage comes from major government subsidies and that Etihad is simply messing with an otherwise level airline playing field. However, an independent study found that US carriers also get by with a little from Uncle Sam. So is this a case of the proverbial pot calling the proverbial kettle black? Hmmm.

AmEx Wants to Know What Your Loyalty is Worth; How Do You Say Opel-ease in Russian?; FedEx’s Hit and Miss

Where’s your loyalty?

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Maybe membership does still have its privileges. AmEx is trying to make a comeback following its breakup with powerhouse retailer, Costco, and rumors of an impending break-up with JetBlue. To soothe it’s broken fiscal heart, the company is making plans to offer a rewards program called “Plenti.” Catchy, huh? Joining forces with Macy’s, Exxon, RiteAid, AT&T and a few other companies, AmEx is offering a loyalty program where American consumers get to cash in points earned on their AmEx cards, and then redeem the points at these retailers. I say Americans, because AmEx already has loyalty programs in other parts of the world, including Germany and Italy. Fill up your car at Exxon and then run over to Macy’s and buy yourself a shirt. Or some vitamins at RiteAid. Or insurance. Yes, I did say insurance since Nationwide Insurers is one of the partners. As is Hulu. Cool, huh? . Noticeably absent from the list of participants is a national grocer and home improvement retailer. But fear not, oh faithful spender, as rumor has it those slots are just about to be filled. If you’re wondering how AmEx benefits, it’s simple: AmEx gets a fee from its partners-in-retail. Clever indeed.

No more vroom…

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

GM is coming to a screeching halt in Russia after taking a 74% hit in sales there with an 86% hit on its Opel brand alone. Hence, GM has put the kibosh on Opel production altogether and will be drastically slowing down production on its Chevy lines, chalking it all up to a $600 million loss. The collapsed ruble and dropping oil prices have dealt a major blow to the Russian economy, with car sales especially down 38%. So GM decided to make a run for it. However, if you find yourself in Russia and jonesing for a Corvette, then no worries. Because Corvettes are imported, they will still be making their way into the country, together with Tahoes and Camaros. Can’t you just picture Putin cruising the Kremlin in a Camaro? Oddly enough, or not, the automobile company is still looking to up its Cadillac game in Russia. The luxury auto has yet to catch up to the popularity of European automobiles BMW and Audi. Tragically, only 72 of them have been sold in Russia in the first two months of the year.

Special delivery…

Image courtesy of David Castillo Dominici/FreeDigitalPhotos.net

Image courtesy of David Castillo Dominici/FreeDigitalPhotos.net

FedEx released its earnings report, regaling Wall Street and the world with news of its prosperous third quarter. One of the fiscal highlights was the $11.7 billion in revenue the company took in. Not a major difference than what experts forecasted, and a modest 4% gain over last year, but the number did hit its target so nobody was necessarily complaining on that front. The big exciting numbers, though, came courtesy of FedEx’s impressive profits. At $580 million and $2.01 per share, the company’s net income was a whopping 63% higher than last year at this time. Analysts only predicted a profit of $1.88. It’s kind of nice when analysts are wrong. Just saying. And for that very impressive feat, FedEx can thank low fuel prices. Of course there were a few other reasons too, but fuel could definitely be crowned the star of this one. But then its shares took a bit of dip today on the news of its less than impressive outlook. The company expects to pull in between $8.80 – $8.95 per share for the year but analysts much prefer to see $8.98 per share. FedEx’s performance tends to hint to Wall Street what we can expect from our fickle economy. So if FedEx is feeling a bit too fiscally modest and only moderately ambitious, it makes The Street a little edgy.

Nasdaq’s Getting Crafty; Costco’s Earnings Knock it Out of the Warehouse; Labor Market Laboring

How crafty…

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Image courtesy of sattva/FreeDigitalPhotos.net

Etsy is looking to join the big kids on Wall Street. The online marketplace for all things crafty is looking to score $100 million for its IPO but that number could go much much higher. Brooklyn-based, Etsy, which would trade on Nasdaq under the ticker symbol ETSY (catchy, no?) was founded in 2005 and by 2014 it pulled in $195 million in revenue, a 56% increase over the previous year. Half of that revenue, though, comes from transaction fees. Plenty of that revenue also comes from the services it sells to its sellers, which are basically, payment processing, shipping labels and promoted listings. Impressive numbers definitely, but the company is spooking investors since it also took in a $15 million net loss last year and expects its operating expenses to “increase substantially.” Yikes. So yeah, that little tidbit puts a damper on things. Etsy currently has about 1.4 million sellers with close to 20 million buyers.

Are you even surprised?

Image courtesy of photoraidz/FreeDigitalPhotos.net

Image courtesy of photoraidz/FreeDigitalPhotos.net

Costco came out with its quarterly earnings, easily topping analysts’ predictions and if that is at all shocking to you then clearly you have never stepped foot inside one of its 671 warehouses dotting the world. News of the good earnings sent shares rising today 2.5% and why shouldn’t it? The stock went up 30% during 2014 and is already up 10% this year. And while the strong dollar has been playing some nasty little fiscal tricks with its earnings, the third largest retailer still managed to nail $598 million in profit at $1.35 a share on $27.5 billion in revenue. Analysts were only expecting $1.18 on $27.65 billion in revenue. It should be duly noted that some of that profit came courtesy of a $57 million tax benefit over a special dividend from last month. But it should also be duly noted that same store sales were up 2% and sales up 8%. These earnings come on the heels of Coscto’s AmEx breakup and its new contracts with Citigroup and Visa. Now it even has plans to sell a Kirkland Signature Chevrolet truck – a particularly handy vehicle for your average Costco run.

LinkedOut…

Image courtesy of  winnond/FreeDigitalPhotos.net

Image courtesy of winnond/FreeDigitalPhotos.net

For some not-so-pleasant news on the labor market we look no further than the Labor Department who just shared with us that the number of people seeking jobless claims for the first time rose to a seasonally adjusted 320,000 for the week ending February 28, adding an unwitting 7,000 applicants. That leaves us with close to 2.5 million people getting jobless benefits and that’s the highest number it’s been since May. Analysts actually expected that number to fall to under 300,000. Some people might even be wondering, “Hmmm. What seems to be going on with this fickle little job market of ours?” Excellent question. Naturally weather always makes a good scapegoat for this sort of thing. But otherwise, the Labor Department couldn’t really pinpoint any one reason why that offensive number reared its ugly unwanted head once again. Last week, that number also rose instead of going back down to a cozy semi-acceptable spot below the 300,000 mark. Experts were hoping that it was just a little labor market hiccup that would correct itself by this week. It didn’t.

Are You There Shareholders? It’s Me, Warren (2015); Forbes’ Magazine Names the A-Listers; Costco: AmEx Out, Visa and Citi In

Best Regards, Warren…

Image courtesy of  Boians Cho Joo Young/FreeDigitalPhotos.net

Image courtesy of Boians Cho Joo Young/FreeDigitalPhotos.net

Warren Buffet’s annual letter to Berkshire Hathaway shareholders arrived over the weekend, regaling us –  I meant them – with so many insights and wisdom about the economy and the ways of the investment Samurai. Among the many pearls, Mr. Buffet wanted to let folks know that “America’s best days lie ahead.” Things might have been a bit shaky the last few years, but darn be the naysayers  and things can and will only get better. Mr. Buffet also wished to remind people that “Market forecasters will fill your ear but will never fill your wallet.” Aw, Warren. There’s something very moving about the way the Oracle of Omaha advises people that all these financial experts surrounding us are good for nothing. He also offered some poetic words regarding his failed investment in British supermarket chain, Tesco: “In the world of business, bad news often surfaces serially: You see a cockroach in your kitchen; as the days go by, you meet his relatives.” The venture ultimately cost him a whopping $400 million and the Oracle attributes the loss, to among other things, not being decisive and fast enough about pulling out of the investment. Meanwhile, during an interview on CNBC, Warren Buffet said Sen. Elizabeth Warren (D-Massachusetts) should be “less angry and demonizing” and should be more open to compromise. Ouch. I guess those two won’t be hanging out together anytime soon.

Speaking of Warren…

Image courtesy of iosphere/FreeDigitalPhotos.net

Image courtesy of iosphere/FreeDigitalPhotos.net

Omaha’s most famous resident made it to the number 3 spot on Forbes’ list of billionaires. Microsoft’s Bill Gates claims the top spot – again –  with a net worth of $79.2 billion while Mexico’s Carlos Helu Slim comes in for second. There are 1,826 billionaires on the list who have a combined total net worth of $7.05 trillion. However, the average net worth of the billionaires is actually down by $60 million this year to $3.86 billion. I know, how sad.  Seventy-one of those billionaires are breaking onto the list of the very first time. Among those first-timers is basketball great Michael Jordan who makes his big billionaire list debut this year with a little help from having increased his ownership stake in the Charlotte Hornets. But his restaurants, deals with Nike, Gatorade, Hanes, etc…allow him to claim the 1,741st spot with a net worth of about $1 billion. Forty-six of the billionaires are under the age of 40 with Snapchat’s Evan Spiegel having the distinction of being the youngest billionaire on the list.

Well hello, pardner…

Image courtesy of stock images/FreeDigitalPhotos.net

Image courtesy of stock images/FreeDigitalPhotos.net

Club goers rejoice! Costco has officially entered into agreements with Citigroup and Visa to become the wholesaler’s partner in credit. In the meantime, the retailer is bidding a not-so-fond farewell to American Express, who for the last 16 years had an exclusive deal with the chain. Citigroup will be putting out a Costco/Citi credit card with perks and generous rewards aplenty, in keeping with the Costco spirit, of course. Unfortunately, Costco shoppers must wait until April of 2016 to whip out the new plastic. However, debit cards know no bounds – or labels – and those will continue to be warmly accepted regardless of the issuer, at Costco’s 674 warehouses worldwide. And while AmEx is expecting to take some type of beating on Wall Street for the next two years, shares of Visa hit an all-time high today over this very exciting fiscal news.

Expedia Challenges Priceline With its Latest Acquisition; Retail Sector: Where Have All the Shoppers Gone? Costco Breaks Up With Amex

Book it…

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Priceline look out! And you too, William Shatner. Expedia just announced its lofty plans to buy Orbitz Worldwide Inc.for $1.34 billion, which squares out to about $12 a share at a 25% premium. The folks at Expedia feel it’ll help them give Priceline Group Inc. a real run for its money – and reservations, I suppose. Orbitz already picked up Travelocity a while back for $280 million and now the online travel booking service also gets CheapTickets, and ebookers as part of this latest deal. As you may recall (and it’s perfectly fine if you don’t), Priceline itself made a few purchases itself last year when it scooped up a stake in ctrip.com International and OpenTable Inc. Apparently, mergers and acquisitions in the online booking arena are all the rage right now but let’s just see how it pans out fiscally for the consumers booking all those services.

Show me the money…

Image courtesy of stockimages/FreeDigitalPhotos.net

Image courtesy of stockimages/FreeDigitalPhotos.net

Will the retail sector get it right already? January proved to be a colossal fiscal bummer as the Commerce Department announced that sales in the retail sector fell, yet again, to 0.8%. Economists forecasted it would only drop 0.4% and it’s the second straight month to drop after December’s dismal 0.9% plunge. So what gives? After all, gas prices are low, employment numbers are rockin’ and even wages are coming up…a smidge. Apparently, Americans have been more inclined to actually pay down some of their debt and even save up some cash for a rainy day. The nerve of those fiscally responsible Americans, I tell you. But economists, the same ones who predicted those retail numbers would only fall to 0.4% instead of the 0.8% it did fall, are predicting that those numbers should come right back up to a more respectable level, if we give it some…space. Let’s just hope they’re right this time.

While we’re on the topic of retail…

Image courtesy of photoraidz/FreeDigitalPhotos.net

Image courtesy of photoraidz/FreeDigitalPhotos.net

Costco shoppers rejoice. Next year when you go shopping at the wholesale warehouse you needn’t bother whipping out your Amex card anymore. The world’s second largest retailer and the charge card company just couldn’t work things out and thus an exclusive relationship between Costco and American Express is coming to an end March 31, 2016. The exclusive agreement allowed for Costco to pay a much smaller rate than other companies but alas, all good things must come to an end. The rate was so low , in fact, that it explains why the deal even lasted as long as it did. And thus, a sixteen year relationship has thrown in its fiscal towel. Sniff sniff. In Canada, a similar deal also came to an unfortunate demise last year. Oh Canada!  On Wall Street shares of American Express, took a bit of a hit while Costco shares actually went up. Perhaps next year, as you find yourself stocking up on a year’s supply of toilet paper and deodorant, you might just get to use your Visa or Mastercard, two cards that have so long yearned to be a part of the Costco magic.

Jack Ma’s One Singular Sensation; Google Gets New Lease on…Space; Best Buy’s Gobble Gobble

You’re celebrating what?

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

If you despise Valentine’s Day you might want to consider moving to China where November 11, as in 11/11, the holiday known as Singles day, was jubilantly and fiscally celebrated. Started in 1993 by group of Chinese students who decided to celebrate their singledom every year on 11/11, retailers savvily recognized a highly lucrative opportunity and now slash prices on this day in honor of “eligible” shoppers splurging on …themselves. It’s like Cyber-Monday and the opposite of Valentine’s Day all rolled into a neat little discounted package. E-commerce giant Alibaba and its CEO Jack Ma were certainly feeling the Singles Day love as his company hit a record-breaking $9.3 billion mark in sales. And even though Americans might not have been rejoicing in the retail festivities taking place in China, some American retailers, like Costco and Calvin Klein, still got to participate and reaped some good fortune.

The real estate in this town, I tell ya…

Image courtesy of Victor Habbick/FreeDigitalPhotos.net

Image courtesy of Victor Habbick/FreeDigitalPhotos.net

Google subsidiary Planetary Ventures is dishing out over $1 billion for some real estate. That’s not to mention the $200 million more it will pay just to fix up the joint. But at  least it’s a sixty year lease, so that’ll give it plenty of time to make it feel like home…or work, I guess. The real estate in question is actually the famous Hangar One at Moffett Field in Silicon Valley (where else?), built in the early 1930’s by the Navy and later transferred to NASA. In case you were wondering what Google plans to do with a massive 350,000 hangar that comes with two runways and a golf course (yes, a golf course), then wonder no more. Google’s looking to broaden its horizons – and portfolio, no doubt – into robotics, drones, balloons and, of course, space. Naturally, there are detractors, like Consumer Watchdog, which feels Google will use the land as it pleases, and not necessarily for the good of mankind. But others, including Congresswoman Anna Eshoo, D-Palo Alto, argue that it provides a great opportunity to restore famed Moffettt Field. Besides, now NASA doesn’t need to to pay over $6 million a year for all those irritating maintenance fees.

Another one bites the turkey dust…

Image courtesy of hin255/FreeDigitalPhotos.net

Image courtesy of hin255/FreeDigitalPhotos.net

In the lack-of-Thanksgiving-spirit, Best Buy becomes the latest relatailer to spoil family time and a tryptophan high by serving its Black Friday deals on Thursday as in, Thanksgiving. You can get going on your chaotic Black Friday shopping as early as 5pm, just as you begin to digest your poultry. How convenient. Then you waddle it iff as you meander through aisles and aisles of discounted electronic offerings, until 1 am. Surely with over 1000 stores in 47 states, you’ll able to score a bunch of merchandise at some great prices. But if you just don’t want to destroy the spirit of a national holiday devoted to sitting down at an actual meal with your loved ones and offering thanks for all that you have, Best Buy will still be offering discounts on the actual Friday for which “Black Friday” is aptly named.