Choo On This: Luxury Shoe Brand Not in Step with Coffee; Jack Ma Isn’t Feeling the Automation Love; Supreme Court to GM: Too Bad For You

Well-heeled…

Jimmy Choo

Luxury shoe brand, Jimmy Choo, will be getting a new owner now that JAB Holding Co. has decided that the company, wants to focus on its more carb/caffeinated brands. And who can blame the billionaire Reimann family that controls Jab. In the last few years, the company spent billions picking up various other food and beverage entities in the form of Krispy Kreme and Panera Bread, and well, 125 millimeter stilettos don’t really go so well with the stuff that carb dreams are made of. But Jimmy Choo may prove to be a very tempting company to a lot of potential buyers. While a pair of Jimmy Choo’s, whose fashion stock soared thanks to Carrie Bradshaw and “Sex and the City”,  may not hold the same appeal as a fresh hot donut – well, to some anyway – the fact is that shares of the luxury goods company are up 44% since the company’s debut back in October of 2014. JAB had the good business sense to pick up the iconic shoe company for 500 million pounds back in 2011. Revenue for 2016 increased over 14% to $465 million with a 43% profit increase to $54.4 million. Wall Street also digs the idea of a sale as shares of Jimmy Choo, which are traded in London, rose over 10% today.

The Jetson’s it ain’t…

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Image courtesy of Simon Howden/FreeDigitalPhotos.net

In case you were in the mood for a downer, then turn your attention to Alibaba founder and chairman, Jack Ma. During a conference hosted by the China Entrepreneur Club, Ma suggested that the future will suck. Because of robots.  He’s convinced that in the next thirty years, “the world will see much more pain than happiness.” Ma expects our automated companions to take over the workplace which might mean fewer work days but also fewer positions that require actual human attention. And the watercolor talk will be decidedly less entertaining. In fact, Ma is convinced that within thirty years, a robot will eventually grace a Time Magazine cover for being the “best CEO.” So if you think your boss has no personality now, just wait. And before you go calling Ma overly-dramatic, consider that according to the World economic Forum, it is estimated that there will be a net loss of 5 million jobs across 15 major economies thanks to automation. Sure technology is great, as long as it’s not taking over your paycheck.

Well at least they tried…

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Image courtesy of nirots/FreeDigitalPhotos.net

GM tried to get the Supreme Court to block hundreds of lawsuits over its faulty ignition switches that could end up costing the automobile company billions. But the Supreme Court said no dice and the lawsuits can proceed. The reason: The company’s 2009 bankruptcy. If you recall, those faulty ignition switches were responsible for 125 deaths and more than twice as many injuries. More than 2.5 million vehicles were recalled and $2.5 billion worth of settlements dished out. GM knew about the problem before the bankruptcy so technically, it’s on the hook, since it could have just as easily notified all the owners of the vehicles that had the problem. Of course, that decision did not sit well with GM and a spokesperson said as much saying the appeal “was not a decision on the merits…” Amazingly enough, the appeal denial didn’t even freak out Wall Street – this time anyway – as shares actually rose today, albeit slightly.

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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Image courtesy of KEKO64/FreeDigitalPhotos.net

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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Image courtesy of iosphere/FreeDigitalPhotos.net

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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Image courtesy of holohololand/FreeDigitalPhotos.net

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?

The Hits Keep on Coming for Wells Fargo; Janet Yellen Gets a Grilling; Perk Up! Thursday is National Coffee Day

Smacked…

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Image courtesy of iosphere/FreeDigitalPhotos.net

The hits just keep on coming for Wells Fargo as the great state of California gave the bank a major diss in the form of a year-long suspension of its business relationships. The bank is officially barred from underwriting debt and handling bank transactions for the Golden State. And if Wells Fargo still can’t get its act together, it can expect a “complete and permanent severance.” Yikes. I guess that’s what happens when you open up 2 million fraudulent accounts and according to State Treasurer John Chiang, promote “a culture which actively promotes wanton greed.” More yikes. Since Chiang oversees $2 trillion worth of banking transactions, besides managing a $75 billion investment pool, he’s probably a bit sensitive about the way banking institutions handle all that money. In the meantime, Wells Fargo CEO John Stumpf will kiss goodbye his $41 million in unvested stock awards.  Carrie Tolstedt, who oversaw the division that was responsible for green lighting the fraudulent accounts, loses all of her unvested awards and gets no further retirement benefits.  Other than the really good ones she already received.

Awkward…

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Image courtesy of iosphere/FreeDigitalPhotos.net

Fed Chairwoman Janet Yellen took a beating today from Congressman Scott Garrett over Lael Brainard’s chummy relationship with Hillary Clinton. Brainard, in case you might not know, is the governor of the Fed and is rumored to be the top pic for Treasury Secretary. She also gave $2,700 to the Clinton campaign. Congressman Garrett doesn’t take too kindly to this appearance of impropriety and asked the Chairwoman if this doesn’t pose a conflict of interest for the Fed, seeing as how Brainard is in talks with the Clinton campaign. After all, the Fed is supposed to be non-partisan. Yellen, said she was’t aware that there was, in fact, a conflict while also maintaining that the Central Bank has no biases as far as politics are concerned. Of course, Donald Trump disagreed vehemently with that assessment during Monday night’s presidential debate when he insisted that the Fed is keeping rates low to make Obama look good.  Incidentally, Janet Yellen chaired President Bill Clinton’s Council of Economic Advisers. Besides all that, there apparently is no issue with Fed officials giving money to campaigns. Who knew.

Oh the perks…

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Image courtesy of Iamnee/FreeDigitalPhotos.net

Consider this next bit a public service announcement:  Thursday September 29 marks National Coffee Day. Yes, that’s a real thing. And before you whip out your wallet, you might want to know which eating establishments wont be charging you for your java fix. If you happen to be near a Krispy Kreme store, then I urge you to step inside. Rumor has it you’ll score a free coffee and glazed donut just for showing up. But be sure to say thank you! Manners are key. If you’re a fan of Wawa coffee, then you’re in luck as that chain is also offering free cups of its brew. Particpating 7-Elevens are also giving out free coffee. Just make sure you have their smartphone app and register for its 7Rewards program. Dunkin’ Donuts will offer medium-sized cups of coffee for just 66 cents in honor of the company’s 66th birthday. As for Starbucks, don’t expect any freebies. Ever. However, the company is affording you the opportunity to be charitable. For every brewed cup of Mexico Chiapas Starbucks sells, the company will donate a coffee tree to Latin American growers whose crops have been destroyed by fungus.

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

 

Hey big spender…

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Image courtesy of renjith krishnan/FreeDigitalPhotos.net

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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Image courtesy of Idea go/FreeDigitalPhotos.net

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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Image courtesy of Keerati/FreeDigitalPhotos.net

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.

Forbes-ulous 400; International (FREE) Coffee Day; Getting Fee’d On

Rank’d…

Image courtesy of biosphere/FreeDigitalPhotos.net

Image courtesy of biosphere/FreeDigitalPhotos.net

Forbes 33rd Annual Forbes 400 rankings of 2014 has at last descended upon us to rub our noses in it. The combined wealth of the lucky 400 who made the list totals a staggering $2.29 trillion (note the “t”). For his 21st straight year in a row, Bill Gates leads the pack with $81 billion in his bank account. Warren Buffet is nipping at his heels in the number two spot with only $67 billion. Facebook honcho Mark Zuckerberg fills in the #11 spot. As for the rookies, there’s WhatsApp’s Jan Koum rounding out the #62 spot and Uber Technologies very own Travis Kalanick who is comfortably perched at the #190 spot. At just thirty years old, Elizabeth Holmes is the youngest of the 47 women on the list at #110. She is the founder of a company called Theranos which apparently does something super complicated and impressive in blood testing. We’ll leave it at that. And in case you were wondering -and it’s okay of you weren’t – Oprah Winfrey comes in at the #190 spot. You can catch up on your billionaire rankings  at: http://www.forbes.com/forbes-400?

 Buzzzzzz…

Image courtesy of amenic181/FreeDigitalPhotos.net

Image courtesy of amenic181/FreeDigitalPhotos.net

Today, September 29, marks International Coffee Day. And no I did not make that up. If you don’t believe me you can just walk in to your local Dunkin’ Donuts and pick up you FREE MEDIUM-sized cup of joe in honor of the momentous. Incidentally, Dunkin’ Donuts is eagerly touting its latest and greatest dark roast. If you’re feeling frisky, then whip out just a dollar and get yourself a mocha or latte. The idea behind International Coffee Day is to promote awareness for free-trade coffee and raise awareness about coffee growers around the world. Hey, works for me. McDonalds and Krispy Kreme, among others, are also offering some java gratis. But you might want to skip Starbucks today as it’s only offering samples – until 12:00. Whatever.

Fee’d…

Image courtesy of scottchan/FreeDigitalPhotos.net

Image courtesy of scottchan/FreeDigitalPhotos.net

Just in case you weren’t paying attention, penalties for using ATM’s NOT associated with your bank have very rudely risen by 5% over this past year and more than 20% in the last five years. The average fee has stealthily climbed to $4.35 per transaction. There are actually two fees involved – one from your bank, punishing you for being so inconsiderate as to dare use another’s ATM. The other fee comes from the owner of the ATM from whose coffers you, once again, so inconsiderately, dared to withdraw funds. The average penalty for overdraft fees also increased to $32.75 per transaction. Following the 2008 financial crisis, banks had to follow a few new rules and regulations that put limits for what they could and could not penalize you. But, of course, they made up for it by making sure those penalties for which they could charge you went up. A lot. If these fees are really getting to you, check out credit unions, smaller local banks and online banks which tend to have less fees – and less (or no) strings attached.

The General Gets Hostile; Alibaba’s IP-Whoa!; No Sugar High for Krispy Kreme

Oh no you didn’t…

Image courtesy of lam nee/FreeDigitalPhotos.net

Image courtesy of lam nee/FreeDigitalPhotos.net

In the dollar store wars, things just got uglier as Dollar General went hostile on potential acquisition target, Family Dollar. If you recall, the powers that be over at Family Dollar dissed the two offers that Dollar General made – offers that were higher than Dollar Tree’s, Family Dollar’s other admirer. Dollar General is eager to bring Family Dollar into its fold, especially because Wal-Mart is getting a bit too cozy in the deep discount dollar store arena. Dollar General graciously offered to yank 1,500 of its stores to avoid antitrust issues. It even offered to pay a $500 million break-up fee if indeed antitrust issues killed the deal. Now Dollar General is going right to the shareholders to entice them with its very generous offer  CEO Howard Levine, who happens to be the largest Family Dollar shareholder, would probably be out of a job, if the deal goes through. However, he still stands to pocket as much as $750 million – which should tide him over for a little while.

Can I get in on that?

Image courtesy of cute image/FreeDigitalPhotos.net

Image courtesy of cute image/FreeDigitalPhotos.net

Wall Street is gearing up to welcome the newest addition to one of its indexes. Alibaba, whose IPO is expected to leave Facebook’s 2012 $16 billion record-breaking IPO in the dust, is looking to offer those shares for between $60-$66 per share. About 320 million of those shares will be eagerly offered up to retail and institutional investors. It’s likely the mega e-commerce site is going to raise around $20 billion. Alibaba, is a lot like Amazon. Except that it’s China-based. And ridiculously larger on so many levels. Good thing Yahoo owns a sizable chunk of it. The company’s value is expected to reach somewhere in the stratosphere of $160 billion, give or take a few billion.

Kreme’d…

Image courtesy of holohololand/FreeDigitalPhotos.net

Image courtesy of holohololand/FreeDigitalPhotos.net

Krispy Kreme released its earnings with mixed signals.  You see, the makers of arguably the most delectable donut on the planet experienced a 22% rise in profit, as it should. A proper reward for making such a delicious pastry. But alas, the company missed expectations, causing shares of Krispy Kreme to go down 6%. I know, it just isn’t right. Or fair. Net income was $5.75 million from $4.7 million a year ago gaining around $0.07 per share.  Revenue was up around 7%. The North Carolina-based company is currently in the process of bringing its delicacies abroad to bestow its sugary happiness on other parts of the world. This is expected to not only cause great joy and sugar highs, but a nice fiscal boost, as well.

 

Phil Mickelson Teeing Off the Feds? Million Dollar Dream Date and Donut Downer

The Bleachers (No. Not the band. But they do have an amazing song you should check out)…

Image courtesy of nuttakit/FreeDigitalPhotos.net

Image courtesy of nuttakit/FreeDigitalPhotos.net

Looks like Phil Mickelson’s got bigger problems than his flailing golf game. The Feds are investigating the golf great for insider trading. It should be duly noted that there are no official allegations yet. It all began in 2011 when Carl Icahn developed a thing for cleanliness and started buying up copious amounts of shares of Clorox (CLX). Oh the irony of Carl Icahn buying shares of something he’s likely never used. He then went for a takeover bid. So the stuff you use to clean your bathroom is making major financial headlines. In any case, shares of the company rose a lot as they tend to do under these circumstances. But before there was mention of a takeover bid, Mickelson and Las Vegas Sports bettor William Walters also bought lots and lots shares. Which kind of made the Feds and the SEC start to wonder if the golfer and bettor knew about the impending takeover from the investor. And that, my friends, is a very big problem.

Whose picking up the check?

Image courtesy of KEKO64/FreeDigitalPhotos.net

Image courtesy of KEKO64/FreeDigitalPhotos.net

How much would you pay for a dream date? What if that dream date was with the very dreamy Warren Buffet? It may not be what you had in mind but people are willing to shell out millions of dollars to spend some quality dining time with the Oracle of Omaha. Bidding has begun for the much sought after lunch date with the CEO of Berkshire Hathaway (BRKA). Proceeds go to the San-Francisco based Glide Foundation, an organization that provides numerous invaluable resources for the homeless. In 2012, the winning bid was almost $3.5 million. Last year’s winning bid was only just over a million dollars. This year’s bidding is currently up to just over $350,000. But you needn’t fret. There are still three days left to cast your winning bid for what had better be the ultimate dining experience.

Krispy Krummy…

Image courtesy of Witthaya Phonsawat/FreeDigitalPhotos.net

Image courtesy of Witthaya Phonsawat/FreeDigitalPhotos.net

Krispy Kreme’s (KKD) stock is going to mush. The ultimate in donut perfection, surprisingly, shockingly, horrifyingly, missed its earnings forecast. The maker behind one of America’s greatest innovations pulled in $121.6 in first quarter revenue and you might think that’s a lot of donuts. But Wall Street was expecting over $126 million – which is a bit harsh, if you ask me. Maybe Wall Street needs to spread some donut love. Naturally, the harsh winter was blamed. Curse you winter of 2014 for causing our beloved donut to be fiscally tarnished!