AT&T vs. U.S. Government. And President Trump; Turkeys: CBS and Dish Networks Can’t Work Things Out; Lowe’s and Behold! It’s Earnings Win

Trump’d up suit?

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Image courtesy of nirots/FreeDigitalPhotos.net

Dontcha just love a good fight? Today’s nasty dispute is brought to us by the U.S. government and AT&T. Not sure who my money’s on yet. You see, the government isn’t down with AT&T’s proposed $85 billion vertical merger with Time Warner. So it went ahead and did the most “American” thing possible: It sued AT&T to block the merger. Knowing that the U.S. government was going to be pesky about the merger, AT&T did what any smart company would do: It pre-emptively retained counsel. And AT&T went for the big guns hiring Dan Petrocelli. You remember him, dontcha? Or maybe you’re just trying to forget? He’s the dude that very shrewdly defended President Trump over lawsuits relating to the infamous Trump University real estate seminars. Oh, the irony. Trump hates the very thought of the merger and that may have something to do with his feud with CNN, which, incidentally, is owned by Time Warner. Petrocelli, who seems to have forgotten all about his Trump days, is arguing that not only does this lawsuit not pose a threat to industry competition, but the merger actually has the potential to lower cable bills. However, I have a hard time believing a cable carrier would willingly lower bills. As for investors, they seem to be on Team AT&T and believe the telecommunications giant will emerge victorious, especially because the last time the government was successful against a vertical merger, Nixon was president. Yikes!

Whose the turkey now?

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OMG! It’s football season and Dish Networks did the unthinkable – to football fans, anyway – and dropped CBS in some markets. “Some markets” includes over 3 million customers in 18 cities who will be feeling the effects of tryptophan sans quality NFL time if a deal is not reached by kickoff time. As if blocking football games isn’t bad enough, some viewers will even be getting deprived of “The Big Bang Theory” which is just so not cool. The issue, of course, is fees. Because it always is. Dish isn’t happy about CBS’s demands for higher fees, especially since Dish viewership is down (note: Google streaming on-demand video). Dish also insists that viewers are watching less CBS and feels that CBS ought to show a little more restraint in its fee demands. CBS, on the other hand, is accusing Dish of punishing its viewers while Dish is calling foul on CBS for not extending its contract until negotiations end.  However why any of this matters is beyond me since, invariably, those fees, on which the two sides eventually agree, usually end up getting passed on to subscribers via their monthly bill anyway. Now subscribers have something to look forward to once those inconveniently-timed negotiations come to a close.

Hurricane win…

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Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Hurricanes suck. Except for home improvement retailers. Lowe’s would agree. The company just reported third-quarter earnings, much to the delight of Wall Street. As a result of Mother Nature’s very unappreciated wrath, sales at Lowe’s went up 5.7% to $16.8 billion, way more than the predicted 4.6% and $16.6 billion. $200 million of those sales came courtesy of Hurricanes Harvey and Irma that wreaked its proverbial havoc on a large swath of the country. But they helped the home improvement chain take in an $872 million profit that added $1.05 per share, which was three cents higher than analysts’ estimates.  That number was particularly impressive since last year at this time, Lowe’s took in $462 million, nearly half that amount.  But Lowe’s doesn’t owe all its quarterly success to natural disasters. The company also made a big push to cater to professional contractors. And with good reason. They spend more money. Sure DIY home improvement is Lowe’s theme, but the company was savvy enough to recognize an additional opportunity and the fact that the housing market is doing pretty awesome lately only sweetens the pot.  And even though Lowe’s shares dropped a smidge during trading this morning, it can’t be too distraught since the company’s shares are up about 15% for the year.

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.

UPS Gets Hacked; Dollar Store Battles: Short on Glamour, Long on Drama; Housing Hits It

Do I need to sign for that?

Image courtesy of Victor Habbick/FreeDigitalPhotos.net

Image courtesy of Victor Habbick/FreeDigitalPhotos.net

UPS now joins that distnguished, tadly crowded field of hacking victims. Between January 20 and August 11, over 100,000 transcations may have been affected by a data breach. But lucky for UPS that it is nothing like the Target behemoth, whose own data breach affected some 70 million customers. That’s because UPS stores are not interconnected, but rather individually owned. Hence, of the over 4,500 UPS locations, only a little over 50 stores in 24 states were affected. How convenient. Sort of. Anyways, UPS, which now became the 58th largest company, taking out a not-so-smug-anymore Eli-Lilly & Co., will offer customers affected by the breach free credit monitoring and identity theft protection for a whole year. How convenient. Sort of. Anyways, after that you’re on your own.

The buck stops here…

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

In the drama-packed world of dollar stores, the latest episode has Family Dollar rejecting a $9 billion buyout offer from Dollar General. Instead, the dollar chain store is thought to be seriously considering another offer from contender Dollar Tree not so much because it’s offering more money – because it is not. Dollar Tree offered only $8.5 billion. Rather, because the deal from Dollar Tree would likely allow Family Dollar CEO Howard Levine to keep his day job. The deal from Dollar General would probably have Levine taking LinkedIn resume workshops by now. Apparently there are also some anti-trust issues associated with a deal from Dollar General. Allegedly. Back in June, activist investor Carl Icahn had a hefty 9.4% stake in Family Dollar. These days his stake is around 3.6%. What that tells us could be a lot. Or nothing at all. But probably a lot. And while all this talk about dollar stores might seem funny to you, just know that there is nothing funny about the tens of BILLIONS in cash that these discount stores rake in.

Home sweet affordable home…

Image courtesy of hywards/FreeDigitalPhotos.net

Image courtesy of hywards/FreeDigitalPhotos.net

It’s been an exciting July. Maybe not for you. But for the housing market it sure has been. And yes, the words housing market and excitement can go hand in hand, especially since July marks the fourth straight month that existing home sales increased – a sure sign that the housing market is headed in the right – up – direction. Unfortunately, as I have written several times, the housing recovery just hasn’t been happening quick enough. Sure, sales were up 2.4%, but that percentage is still way down from where it should be in a truly healthy market. Right now, it’s like the housing recovery is at the end stages of a cold, still some coughing and a slightly runny nose.  However, home construction surged a very impressive  15.7%. That and the fact that interest rates are low and there’s more inventory coming up should make for an equally riveting August. We hope.