Has Obama Lost Control with Gun Control?; Microsoft vs. China; Brainiac App Not So Smart After All

Out with a…whimper…

ID-100383821

Image courtesy of Sira Anamwong/FreeDigitalPhotos.net

As I mentioned yesterday, Smith & Wesson had a banner year for 2015 and even raised its fiscal forecast for 2016. Its stock went up today almost 10% at one point, while shares of Sturm Ruger & Co., the United States’ largest gun manufacturer, went up close to 7%. All this as President Obama announced new rules for gun control, including extending background checks and stricter requirements to purchase firearms online and at gun shows.  It’s debatable whether people are rushing out to buy these guns over personal safety concerns or because they want to get their firearms purchases in before the new laws take effect. But following the epic tragedy at Sandy Hook Elementary, there was also a surge in firearms purchases –  a chilling side note to horrifying nightmare.  However, President Obama wants citizens to know that these new rules are still “entirely consistent with the Second Amendment and people’s lawful right to bear arms.” Second amendment or not, Smith & Wesson is expected to pull down $650 million this year.

That’s so 2014…

ID-100384489

Image courtesy of Sira Anamwong/FreeDigitalPhotos.net

It’s China vs. Microsoft as China’s State Administration of Industry and Commerce (SAIC) are demanding that one of the world’s biggest companies explain itself. Apparently some “major issues” came up when digital data was obtained as part of an ongoing anti-trust investigation into Microsoft by Chinese authorities. The issues seem to involve the Windows operating system that was launched waaaaayyyy back in 2014. The probe started in July 2014 and Microsoft offices in the China were raided in a number of cities including Shanghai and Beijing. Microsoft will need to submit plenty of additional information and offer up a very convincing argument to win back over Chinese authorities, especially if it wants to make sure it keeps its presence there. And it’s a safe bet that the company will do just that. After all, China is the second largest economy in the world and there’s too much money to lose by not fully cooperating. Besides, Microsoft has a bunch of deals in the works with some of China’s biggest companies and it would be a shame to see those fall apart.

Brain drain…

ID-100322121

Image courtesy of Sira Anamwong/FreeDigitalPhotos.net

Lumosity, the app notable for its “brain training” games is now going to be notable for something else: a $2 million settlement with the FTC. The government agency took exception to Lumosity’s claims which included improved functionality at work, better performance in school, improved cognitive impairment alà Alzeheimer’s!, alleviation of ADD and even ingrown toenail elimination. I was just kidding. About the last one anyway. The FTC says Lumosity’s claims are “unfounded” and did nothing more than freak people out about potential cognitive decline. Besides, science has yet to prove any of Lumosity’s claims. FTC felt Lumosity employed poor marketing tactics in addition to churning out solicited testimonials- a big no no as far as the FTC is concerned. A bunch of neurology and psychology researchers got in on the action – about 70 in all – and called into question the whole “brain training” industry finding that the claims of its benefits are “frequently exaggerated.”  Lumosity offers a monthly subscription for $14.95 or a lifetime subscription for $299.95. But now the company has to notify its subscribers – all 70 million of them – about this new unpleasant FTC development and graciously offer to cancel all those subscriptions sans penalties. With estimated sales of over $40 billion, a slew of cancellations could deal a mighty blow to Lumosity and its parent company Lumos Labs.

So Long and Goodbye to Twitter’s Dick Costolo; Where Have All the Cereal Eaters Gone for General Mills; Hillary Clinton’s Bringing Her Grassroots Game On

What a long strange social media trip it’s been…

Image courtesy of iosphere/FreeDigitalPhotos.net

Image courtesy of iosphere/FreeDigitalPhotos.net

Dick Costolo might just have some extra time on his hands tomorrow seeing as how today is the CEO’s last day at Twitter. Okay, maybe not so much time. He’s still going to remain on the board. Costolo has the dubious distinction of having been the longest serving CEO at Twitter and it was under his leadership that the company even went public, leaving it with a $23.5 billion valuation. But from an all-time high of $69 back in January of 2014, the stock seemed to have lost its mojo and well…apparently so did Costolo.  Dick Costolo had mentioned in an exit interview how he underestimated the pressures and short-term fiscal expectations of running a publicly traded company. The soon-to-be ex Twitter CEO took a lot of heat, and not just from investors who were underwhelmed by Twitter’s slow growth and disappointing revenues. Many critics also thought Costolo didn’t do enough to stop abuse and terrorist activity.  Then there were all these pesky geopolitical issues that came up. Like how people that it was odd, and even a bit hypocritical of Twitter, that Iranian authorities use the social media platform all the time to communicate their thoughts and evil decrees, yet the citizens of Iran are forbidden to use the micro-blogging site. Until Twitter finds a more permanent solution, Jack Dorsey, who conveniently enough, is one of Twitter’s co-founders, will serve as its interim CEO.

No love for the Cheerios…

Image courtesy of  bearvader/FreeDigitalPhotos.net

Image courtesy of bearvader/FreeDigitalPhotos.net

For some odd reason, sales of General Mills are down. Well, the reason, in fact, is not that odd. It seems the gluten-free food movement and high-protein diets have been biting into the Cheerio maker’s numbers sending sales and shares down for its fourth quarter. Let us also not forget to put some blame on the strong dollar of ours that affected sales for the company in other parts of the world. Then there’s the issue with its Green Giant brand. Yeah, they own that too. General Mills had to write down the value of the brand that sports the over-sized, leafy green dude for a whopping $263 million. It seems that, in addition to the gluten-free and high-protein trends, consumers also now prefer their veggies fresh as opposed to the frozen varieties that Green Giant does so well. However, it should be duly noted that Green Giant still does well and scores plenty of cash for the company. Just not as much as it used to. General Mills, which also owns Yoplait and Betty Crocker, pulled in about $187 million in profits with 71 cents per share added and revenues of $4.3 billion. Analysts expected revenues to come in closer to $4.5 billion and 75 cents added per share.

This means war…

Image courtesy of digitalart/FreeDigitalPhotos.net

Image courtesy of digitalart/FreeDigitalPhotos.net

It really does’t matter how you feel about Hillary Clinton running for President. What does matter are her numbers.  As in, the number of dollars she already banked for her presidential primary war chest. That magical number has already hit $45 million, exceeding the $42 million President Obama raised for his  2011 primary bid. That magical number also managed to exceed Hilary Clinton’s previous 2008 $36 million presidential primary war chest. I dare you to say that one three times fast. And don’t think for a second that all that cash is coming from just a small handful of wealthy donors. Hillary Clinton has garnered some major grassroots support with over 91% of contributions coming in at $100 or less. Yeah, she’s that popular.

Fitbit Fit for Wall Street; President Obama Not Making Dems Happy; Softbank’s Robot Wants Your Affection

Fiscal fitness…

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Fitbit made its highly anticipated Wall Street debut today and beefed up its valuation to a very fit and healthy $4 billion. CEO James Park, who had some 20 million shares, has now banked a very robust $600.6 million. Even though $732 million was raised for the IPO and the initial price per share was but $20 a pop, the stock surged 52% on its very first day of trading. Opening up the fiscally glorious day at over $30 per share, Fitbit clearly sent a message to Wall Street that it has arrived and that investors totally dig the stock. The company, which trades under the very aptly named FIT (catchy, huh?) has been drawing some not so flattering comparisons to Blackberry. There is currently a number of other companies offering similar devices. And despite Fitbit’s insistence that it is different from the rest, many analysts are still wondering if Fitbit can keep ahead of the competition, as it seems to be doing now. Or will it lose its swagger with consumers if it can’t innovate quickly and effectively enough. Hmmm….

Things could get ugly…

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

It’s called the “fast-track trade bill” a.k.a. “trade promotion authority” and it’s causing quite the stir in Washington. Basically, it’s a bill that lets the President negotiate global trade deals and Congress can opt to reject or approve them. It just can’t make any changes to them. It’s a take it or leave it kind of thing. Sounds completely harmless, right? That depends on whom you ask. Democrats, and unions don’t like the bill. They feel it will cost American jobs. Of course, American businesses are totally down with the bill and want to see it passed because they feel it would lead to more opportunities which is just fancy talk for: lots of money. The House of Representatives already voted in favor of it and the bill’s fate is now in the hands of the Senate. This bill is all part of President Obama’s master plan to pass the Trans-Pacific Partnership that would make trading between the U.S. and 11 other countries so much easier and take away a bunch of pesky obstacles. If the Senate votes to pass it, well then, I guess you’ll have some very ticked off Dems and union members. Oh well.

All I want for Christmas…

Image courtesy of  Boians Cho Joo Young/FreeDigitalPhotos.net

Image courtesy of Boians Cho Joo Young/FreeDigitalPhotos.net

Softbank, in a joint deal with China’s Alibaba and Taiwan’s Foxconn, is putting its adorable robot “Pepper” up for sale beginning June 20. Well, in Japan anyway. But don’t worry. It’s set to make its U.S. debut sometime next year. Now, adorable may not be the first word that comes to mind when you think of robots, but consider that Pepper enjoys contact with humans, particularly on its head and hands, and was initially used as a greeter in Softbank’s phone stores. Pepper, affectionately dubbed the “robot with a heart” goes on sale for $1,600 with an additional $200 for monthly service fees and maintenance. The bot is apparently also good with kids and makes for a great employee as well, though not necessarily in that order. There must be a joke in there somewhere.The cuddly bot is also able to recognize human emotions and can even react with anger and joy. I’m pretty sure there was a sci-fi horror flick based on that premise.

Airbnb Books It For Cuba; Headed Out of Indiana; Walmart’s Beef With Discrimination Bill

Bienvenido…

Image courtesy of  taesmileland/FreeDigitalPhotos.net

Image courtesy of taesmileland/FreeDigitalPhotos.net

With the normalizing of relations between the United States and Cuba, you can be sure that businesses are on the hunt for the countless opportunities that can be found on the island nation. Netflix made its Cuban debut a few months back, along with a handful of other companies. Now its Airbnb’s turn. The online rental website for wallet-conscious travelers saw a 70% spike in searches for rentals on the island nation following President Obama’s announcement about the easing of restrictions there. The way Airbnb sees it, “We are actually plugging into an existing culture of micro-enterprise in Cuba. The hosts in Cuba have been doing for decades what we just started doing seven years ago.” So far the website has over a thousand rental listings. But the rentals can only be used by U.S travelers and travelers must have one of the required licenses to even travel there. Many feel that Cuba could become one of Latin America’s biggest markets, but some are skeptical that Airbnb is going to be able to take much advantage of that. With 15% of Airbnb’s fee being split between the renter and the owner, it seems likely that Cubans would rather forego Airbnb’s services and keep that extra cash for themselves. Then there’s the issues about the lack and slowness of internet access which just might impede some travel opportunities, not to mention profits, that are found online.

It’s only getting worse…

Image courtesy of stockimages/FreeDigitalPhotos.net

Image courtesy of stockimages/FreeDigitalPhotos.net

Salesforce.com CEO Marc Benioff is socking it to Indiana and its very unpopular decision to sign the Religious Freedom Restoration Act. The San Francisco-based global cloud computing company is offering relocation packages to employees who don’t feel comfortable in the Hoosier state as a result of the new law. Several employees have already taken advantage of the relocation offer. “One thing that you’re seeing is that there is a third [political] party emerging in this country, which is the party of CEOs.” In fact, more than 39 CEO’s signed a joint statement protesting the law and while Indiana Gov. Mike Pence said there would be “fixes” put into place that would offer protections for certain sexual orientation and gender identities, many remain unconvinced, and the economy in Indiana could suffer mightily. While Benioff wouldn’t mind totally ditching Indiana, he still has about 2,000 employees which makes that endeavor a little improbable. But he still has plans to significantly scale back operations there. “We want to invest in states where there is equality.” So basically, you can cross Indiana off the list.

Speaking of which…

Image courtesy of iosphere./FreeDigitalPhotos.net

Image courtesy of iosphere./FreeDigitalPhotos.net

Walmart has done something nobody expected it to do. Not a company known to embrace social issues, it helped shoot down a bill that was similar to the Religious Freedom Restoration Act passed in Indiana. Even though the retailer has been known to support many conservative causes, both fiscally and otherwise, this time it took to social media to protest this particular bill. Walmart CEO Doug McMillon wrote: “Every day, in our stores, we see firsthand the benefits diversity and inclusion have on our associates, customers and communities we serve.” To be fair, it would have been sheer fiscal stupidity not to protest the bill. It made perfect business sense. McMillon further added that the bill “…threatens to undermine the spirit of inclusion present through the state of Arkansas and does not reflect the values we proudly uphold.” He then went on to ask Arkansas Gov. Asa Hutchinson to veto the bill and wouldn’t ya’ know it? When the mighty Walmart talks, the Arkansas governor listens. Gov. Hutchinson amended the law.

President Obama Tells CEO’s How to Invest (it’s true); Tesla Electrified Owners; Hershey Welcomes Back Sugar

 Oh and by the way…

Image courtesy of cooldesign/FreeDigitalPhotos.net

Image courtesy of cooldesign/FreeDigitalPhotos.net

As I mentioned yesterday, the Business Roundatble got together to dish out its thoughts and projections for the economy. If you recall, the BRT is a group of CEO’s “of leading U.S. companies working to promote sound public policy and a thriving U.S. economy.” I’m down with that. Not to be outdone, President Obama, who is not a CEO, told the BRT group, who by the way, represent around $7.4 trillion in annual revenue, that they should invest in infrastructure which apparently is a fabulous “foundation for growth.” It should be duly noted that this business advice is coming from the same person who is responsible for the very unaffordable Affordable Healthcare Care Act. Just saying. President Obama also went on to say that the thorn in his executive side, the bane of his Presidential existence, also known as Republicans, would be sure to challenge any source of funding if it meant new taxes. And just when I was looking forward to paying more taxes together with my unaffordable health care, darn it! Hence, according to Mr. President, you needn’t hold your breath for any new infrastructure bill to pass. And while private investment in infrastructure is no new concept, especially in other countries, here in the United States, legal and tax issues don’t exactly scream, “Invest in infrastructure!”

Zap to it…

Image courtesy of Danilo Rizzuti/FreeDigitalPhotos.net

Image courtesy of Danilo Rizzuti/FreeDigitalPhotos.net

Can Tesla do no wrong? Well it can but apparently not when it comes to Consumer Reports, which just reported that the Tesla Model S is so beloved amongst its owners that 98% of them would repurchase the vehicle (But what of the other 2%?). The car which goes for close to $70,000 is even a fave with the team over at Consumer Reports. Other cars that owners loved were the Chevrolet Corvette Stingray and the Subaru Forester. Apples and oranges, I know. The Kia Rio, sad to say (actually ambivalent) failed to impress its owners. However, it was the Nissan Versa that found itself at the bottom of the list. And while life is good at the top for Tesla, it best be warned: BMW is nipping at its shiny bumper. Especially with its i3.  While Tesla’s superchargers across the country (and beyond) can be used only with Teslas, BMW is about to put out its own series of superchargers that will be compatible with other models. Except for Teslas. And Nissans (especially that Versa).

I know this sounds corny but…

Image courtesy of artur84/FreeDigitalPhotos.net

Image courtesy of artur84/FreeDigitalPhotos.net

High-fructose corn syrup beware! You’re on the chopping block having gotten a bad rep over the last several years by getting blamed for a rise in obesity and diabetes. While there isn’t enough evidence that corn-syrup is exclusively to blame,  The Hershey Co. has still decided to kick that ingredient out of its delectable confections.  Instead it will once again use perennial favorite , and old time classic, sugar, instead of the high-fructose corn syrup/sugar cocktail it had been using for so many years. Sugar, that formidable staple which holds a prominent place in my own personal food pyramid, will once again reign supreme for Hershey confections.  However, there is no official time-frame for the switch –  only an acknowledgement that consumers, my self included, much prefer sugar over high-fructose corn syrup.  One of the many groups not pleased by this turn of events are those involved in corn futures. Refiners have even cut costs just to compete with sugar. But seriously, can you really compete with…sugar?