Tesla Deliveries Anything But Electrifying; Sec’y of State Nominee’s Future Looks Green; Trump’s SEC Chairman Pick

Not electrifying…

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Tesla’s fourth quarter sales rose 27%, yet deliveries fell short with CEO Elon Musk pointing to production delays. And Tesla didn’t fall short according to Wall Street’s predictions but rather its very own.  It may seem like a convenient excuse, but it’s a valid one that was also used to blame the company’s second quarter shortcomings. The electric car company delivered 22,000 cars in its last quarter, which was over 5,000 more than the same time last year. That might seem awfully impressive except that Tesla wanted that figure to top 25,000 vehicles. So now, that 3,000 car miss becomes an ugly smudge on the company’s fourth quarter earnings report. Tesla’s grand total of car deliveries for the year hit over 76,000. But once again, because Tesla went ahead and predicted that number would hit 80,000, it disappointed only itself.  Setting forecasts he just can’t meet is a nasty habit that Elon Musk can’t seem to break.  Production delays or not, maybe Tesla’s should stop trying to predict the future.  Shares were down 11% for 2016 which marks the first time that Tesla reported an annual decline since its 2010 IPO. But miraculously those shares still rose today because Wall Street clearly has a thing for Elon Musk. Well, his company, anyway.  Wall Street and consumers alike are waiting with bated breath to see if the much anticipated $35,000 Model 3 will actually surface this year. Some experts, however, think the more affordable model will only be making its grand debut in 2018. That still has’t stopped loyal Tesla buyers and enthusiasts from shelling out a total of $350,000 worth of deposits for the car.

Hatched…

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President-elect Donald Trump’s pick for Secretary of State, Rex Tillerson, reached a very lucrative retirement deal with ExxonMobil. If Tillerson does in fact get confirmed – and that’s still kind of iffy – then he’ll walk away from his post with $180 million comfortably nestled in a trust account. And that’s the approximate value of Tillerson’s 2 million deferred shares of the energy giant. Because he would not be allowed to own shares of the company if he took the post, the shares would get cashed out and put into an independently managed trust account. Besides dumping his ExxonMobil shares, Tillerson will not be allowed to work in the oil and gas industries for a period of ten years. Plus, he has to give up a cash bonus and other benefits that are worth another $7 million because he won’t be there in March, when he’ll have reached the company’s official retirement age that affords him the opportunity to collect on that $7 million package. But, that $180 million ought to tide him over. He’ll also need to agree to sever ties in order to avoid any conflicts of interest. Should he decide to return to the industry, then all that money would be given to charities of the main trustee’s choosing. But I did write that his confirmation is”iffy” because there are plenty of Congressional members who aren’t down with Tillerson’s cushy relationship with Russian president Vladimir Putin. That’s going to come up a lot during the confirmation hearings and it’ll probably be ugly, if not wholly entertaining.

And I choose you…

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Image courtesy of Sira Anamwong/FreeDigitalPhotos.net

Trump just announced his pick for Securities and Exchange Commission Chairman and it’s one that should surprise…no one. Enter Jay Clayton, a lawyer with the law firm Sullivan and Cromwell, who has plenty of experience with banks. Well, representing them, anyway. Besides banking clients, Clayton also defended a variety of “large financial institutions” against such entities as the Department of Justice, other government agencies and regulators and – get this – even the SEC itself.  Some of his more notable achievements include representing everybody’s favorite Chinese e-commerce giant, Alibaba, when it made its grand IPO debut. He’s also represented Barclays when it unceremoniously scooped up Lehman Brothers, and Bear Stearns when JP Morgan took it on. You didn’t think we’d leave out Goldman Sachs, did you?  Because he repped that one too.  Word on the street is that Carl Icahn interviewed Clayton, along with several other candidates for the post. Presumably the two gentlemen discussed how to best undo obstructive banking regulations, Dodd-Frank and all those other pesky rules that have been casting a major downer on the financial world.

Russian Cyber-vengeance?;Insta-gram-ification!; A&Fitch Logo Ditch

Cyber-score?

Image courtesy of Victor Habbick/FreeDigitalPhotos.net

Image courtesy of Victor Habbick/FreeDigitalPhotos.net

Now that a massive cyber-attack on JPMorgan Chase and a few other banks has been linked to Russian hackers, the question looms large: Was the hack attack in response to US imposed sanctions? Things that make you go hmmm. And while major amounts of data loss fell into the hands of these hackers, curiously enough, there hasn’t been an unusually high amount of fraudulent activity noted. At least for now. Which kind of suggests – in a really big way  – that yeah, this cyber attack was politically motivated. Incidentally, back in April, JPMorgan blocked a money payment from a Russian embassy to a US sanctioned bank.  That didn’t go over well – probably more so for JPMorgan than the Russians involved. In any case, with global conflicts on the rise, expect to see a lot more cyber-threats, kind of like the ones Iran has been throwing our way for years. Probably because they’re annoyed with US imposed economic sanctions. The attacks on banks are particularly impressive, more so than say those on Target, since banks have security and firewalls that are way more hardcore than those used in the retail sector. But banks have and will continue to step up their cyber-security precautions. JPMorgan is hoping $250 million and 1000 employees will do the trick.

I want it now!

Image courtesy of David Castillo Dominici/FreeDigitalPhotos.net

Image courtesy of David Castillo Dominici/FreeDigitalPhotos.net

Look out Veruca Salt! If you want it all and want it NOW then give a big shout out to Instagram for redefining the shopping experince. Now when you see something on Instagram that you absolutely have to have, like, immediately, you don’t just get to like the item on Instagram. You don’t just get to love it the product on Instagram. You actually get to buy the darn thing too! No more brooding over a an Instagram shot while you frantically search the retailer’s products page. A new “Like2Buy” button will take you exactly where you need to go/be. Shopper ecstasy.

Abercrombie & Switch…

Image courtesy of Simon Howden/FreeDigitalPhotos.net

Image courtesy of Simon Howden/FreeDigitalPhotos.net

Shockingly…or not, depending on whom you ask, Abercrombie & Fitch had its tenth straight quarter of declining sales. Perhaps it has to do with the fact that retailers like Forever 21, Zara and H&M are offering much trendier clothing for much less. It probably doesn’t help that A&F is helmed by a loud-mouthed CEO, who was stripped of his chairman title for making such stupid, odious comments about how his company’s clothing is intended for cool, skinny and pretty people. But clearly the cool, skinnies don’t care as they have been clearly taking their business elsewhere. The company has now decided that, in the US anyway, it’s going to shed the logo that is so prominently featured on so much of its clothing. They’re hoping that a move like that will bring in more revenue since adding more larger sizes didn’t do the trick. Go figure! Same store sales fell 6% and news of the unimpressive earnings report sent shares south by 8%.

Another Typical Day At GM? JPM Not Welcome To Miami and Building Good Sentiment

What’s old is new again…

Image courtesy of Paul/FreeDigitalPhotos.net

Image courtesy of Paul/FreeDigitalPhotos.net

On Wednesday, GM CEO Mary Barra heads to Washington DC to face yet another congressional grilling  – this time over how her company plans to fix the lax corporate culture that led to faulty ignition switches, 54 crashes and thirteen deaths. She’ll also be grilled on how GM plans to the compensate the victims of its lax corporate culture that fostered “negligence.” GM is in the midst of fixing its faulty ignition switches in 2.6 million vehicles. However, it’s only gotten around to about 7% of them, which amounts to about 177,000 cars, since the recall was announced four months ago. But the auto maker better step on it since 3.2 million more recalls were just announced on vehicles from 2000-2014. GM hopes, as we all do, that all the vehicles will be fixed by October.

Miami heat on JPM…

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Miami is not shining bright on JP Morgan Chase these days. The city, yes the entire city, is suing the bank for discriminatory lending. Miami is one of the country’s leaders in “zombie” properties and foreclosures. It blames the mega bank for much of this claiming the bank issued loans that made it harder for minorities to pay them back which ultimately led to tens of thousands of foreclosures in the region. Miami alleges JPM violated the federal Fair Housing Act and wants all sorts of legal damages awarded to it for things like reduced property taxes and municipal services because of foreclosures. Providence, Rhode Island and Los Angeles have also filed lawsuits against banks for similar reasons. Bank of America has been sued for “red-lining” no-loan zones even when minorities qualified for better loans. Of course, a JPM spokesperson called the claims “baseless.”

Not the best of sentiments…

Image courtesy of Supertrooper/FreeDigitalPhotos.net

Image courtesy of Supertrooper/FreeDigitalPhotos.net

Homebuilders are feeling a little bit more confident as far as the new house market is concerned. According to the National Association of Home Builders/Wells Fargo sentiment index, that sentiment rose to 49. Which is almost good news. When that sentiment is above 50, then we can all breathe a collective sigh of relief. But there hasn’t been any relief sighing since before January. Yes, winter was bit of a culprit there. But that number, even if it is a bit shy of where we’d like it to be, still shows that the home-buying matket is on its way to stabilizing, albeit slower than we’d like. New home sales are still at half the rate of what they should be in an otherwise healthy market that is currently down 4% from what it was a year earlier.

 

Whale of a Fail at JPM, Yoga Mats: Nothing Tasty About Them and Bust Goes the Creek

JP Morgan’s not-so-good day…

Image courtesy of ddpavumba/FreeDigitalPhotos.net

Image courtesy of ddpavumba/FreeDigitalPhotos.net

JPMorgan Chase’s chaiman and CEO Jamie Dimon said, “JPMorgan Chase had a good start to the year, given there were industry-wide headwinds in Markets and Mortgage.” That’s just what I was thinking as JP Morgan is looking a little less green today after its earnings fell for the second quarter in a row. The financial giant took a massive hit this quarter over the same time last year with profits making a huge nosedive. When JPM posts lousy numbers like that, you can expect others like it to perform similarly. Experts did expect a drop from the firm. Just not that bad. But let’s face it, handing over $13 billion to the Department of Justice to settle claims about some dubious business practices is harsh even for a giant firm like JPM. Then there was that $800 million legal bill they had to pay their lawyers to handle a number of problems including the incredibly embarrassing and infamously pricey London Whale Trading Scandal. Well, at least their lawyers had a good year.

Namaste Subway

Image courtesy of satit_srihin/FreeDigitalPhotos.net

Image courtesy of satit_srihin/FreeDigitalPhotos.net

Oh the wonders of blogging! You can thank FoodBabe.com’s Vani Hari if you’re Subway sub starts tasting a little less downward doggy. The food blogger started a petition back in February to get privately held Subway to stop using an ingredient found in its bread dubbed “Yoga Mat.” Also known as azodicarbonamide, you can find it in a number of food products from markets to McDonald’s and Starbucks. But unfortunately you can also find it in your yoga mat (hence the name), not that it makes your yoga mat any more (or less) edible. By next week, Subway’s bread should be “Yoga Mat” free in just about all of its 26,600 locations.

Busted Creek…

Image courtesy of David Castillo Dominici/FreeDigitalPhotos.net

Image courtesy of David Castillo Dominici/FreeDigitalPhotos.net

Coldwater Creek has run dry. The women’s retailer filed a Chapter 11 petition after failing to get a buyer for the Sandpoint, ID based company. With assets of $278.5 million and debt of $361.3 million, the chain will be shuttering its more than 360 stores by the summer. That gives you plenty of time to find some nice stuff for your mom for Mother’s Day at a fraction of the cost. But then again, seeing as how they’re bankrupt, there’s clearly a reason why you, and apparently your mother, didn’t shop at the chain to begin with. In any case, Coldwater Creek now joins the less than illustrious ranks of Loehmann’s Inc. and Sbarro’s Pizza who also went bust this year.