I'M CONVINCED

The world is loaded in the handbasket and on its way. Why am I convinced? It isn’t just the Chinese securities markets collapsing at a rate not seen since the height of the Great Recession/Financial Crisis in 2007, and it isn’t the statement by Everett D. Mitchell, the Director of Community Relations at the University of Wisconsin-Madison--also reported to be an attorney, pastor, and community leader--who said it is ok to steal from Wal Mart and Target because they have insurance.

Nope, I became convinced when it was disclosed that TEXAS, FLORIDA AND NEBRASKA were not listed in the AP Top 25, pre-season. None of them! First time since that poll was created in 1950 that the Top 25 didn’t include at least one of those teams.

Pretty convincing evidence of something BIG about to happen. Hide the wimmen n chillen. Oh, and have a nice day.

FIORINA I

Calling this "I" because my guess is that I will be saying more about her over the next year and a half or so.

This is the first I have seen of her description of her tenure at HP. Most "journalists" strip mine the parts that fit their agenda that day, but here is what she has to say, including something about the size of the government:

(CNSNews.com) - "We have never succeeded in shrinking the size of government," Republican Carly Fiorina told "Fox News Sunday." She said she would do it.

"We have a bunch of baby boomers who are going to retire out of the federal government over the next five to six years. I will not replace a single one," she promised. 

"And yes, we need to actually get about the business of reducing the size, the power, the cost, complexity and corruption of this federal government."

Host Chris Wallace played a video clip of Democratic National Committee Chair Debbie Wasserman Schultz (D-Fla.) criticizing Fiorina for nearly driving Hewlett-Packard, a Fortune 500 company, "into the ground." Schultz noted that Fiorina "fired 30,000 people when she was CEO."

"You know, if you end up as Republican nominee, the Democrats are going to put that in every ad -- she fired 30,000 people," host Chris Wallace told Fiorina. "It's exactly the kind of thing, Ms. Fiorina, that sunk Mitt Romney."

Fiorina said she's "flattered" that the head of the DNC would come after me because it must mean she's "gaining traction.”

"But here's the facts: I led Hewlett-Packard through a very difficult time, the dotcom bust post-9/11, the worst technology recession in 25 years. I would remind Debbie Wasserman Schultz that it has taken the NASDAQ 15 years to recover.

Sometimes in tough times, tough calls are necessary. However, we also took a company from $44 billion to almost $90 billion. We quadrupled its growth rate, quadrupled its cash flow, tripled its innovation to 11 patents a day, and went from lagging behind to leading in every product category in every market segment.

And yes, I was fired at the end of that, in a boardroom, which I've been very open about. And I was fired because when you challenge the status quo, which is what leadership is about, you make enemies.

Steve Jobs was fired. Oprah Winfrey was fired. Walt Disney was fired. Mike Bloomberg was fired. I feel like I'm in good company. And we need somebody to challenge status quo of Washington, D.C. and get something done."

Wallace predicted that Democrats will find "that poor, unfortunate person" who was fired, and suffered, because of Fiorina's management.

She said there's nothing harder for a chief executive to do than to tell an employee, "we don't have a job for you."

"It's also true that the vast majority of Americans know that in tough times sometimes tough decisions have to be made. And what they're frustrated by is the federal government never makes a tough decision."

 

We were there when the doc.com bust happened, living and working in Silicon Valley. Our experience was worse than HP, by far. But have you noticed? People tend to judge the actions of people in the past according to the mores of today, ignoring the landscape.

BASEBALL IN AUGUST

Truly, I will pledge to keep the baseball comments to a minimum until October when I hope the Royals will be playing extra games. But this week is just too tempting.

First, who woulda thunk that the Royals would be 12 games ahead in their division with the second best record in baseball behind their fellow Missourians, the Cardinals? But in a game that is fascinated with statistics, this one amazes me, and if any of my statistician readers want to tell me what the heck this about, let's hear it:

Tuesday, August 11 was the first time in over 100 years (since 1914) that all home teams won in a full schedule. Yes, 15 home teams, 15 home teams came out the winners. Back in 1914, there were only 24 teams, so it was 12 home wins, but that was never tied and after expansion, it didn't happen either.

Well over 200,000 games have been played in the last 100 years at the major league level, and you would think that the law of random events or bell-shaped curves or whatever would have taken care of this--after all, there are over 2,400 games each year and...well, it just seems odd.

But, then, the Royals ahead like this is a bit odd, too.

TESLA AND TESLA REDUX

TESLA REDUX

The post below was written 11 months ago. I don't think it was ever posted, which is no surprise as I write a lot of stuff that never sees the light of day...fortunately!! But the date was September 4, 2014 and the observations were made below. Just wanted to update.

 

The stock was at $290 and the sky was the limit. By April, the stock dropped to $180; yesterday it was $270 and this morning it is opening in the $240 range, or down 10% plus. That’s volatility.

The previous article pointed out the small production and it is still a problem as 2015 was the year that they would achieve a pace of 100,000 units per year. Well, folks, it ain’t gonna happen—they changed “guidance” by -15% and still think 100,000 is going to happen…next year.

Meanwhile, the company loses $16,000 per car, up from a loss of $11,000 per car last December. The $2.3 billion raised in the market last year is essentially gone, burned up.

Are we starting to see a trend here? It is still valued at $34 billion (which is less than Apple, valued at $650 billion) but I can’t reconcile that with the current GM value of $50 billion.

Is anybody else thinking tulip bulbs? Google “tulip bulb craze.”

Soooo, the logical thing to do is short the stock, right? Not so fast, there, Baba Looey. It is already close to being “fully shorted” meaning a lot of short interest which is also dedicated buying interest since the shorts have to be covered eventually. The bigger influence, in my mind, is the power of Wall Street. Don’t discount the ability of the brokers who are going to pick up hundreds of millions when they place the $2 billion or $3 billion in the next financing round.

Let us just sit back and keep track and determine if the markets are, indeed, efficient.

TESLA

I have not been an electric car fan, principally because I think it requires too much government support to make them even marginally competitive in the marketplace. Now, Tesla is getting about $3 billion or more in tax breaks to put a factory in Nevada.

The second reason I don't think electric cars should have a place on the planet involves the ecological damage created by the batteries. The awful ecological disaster in Canada where the raw material is mined has been used by NASA because it resembles a moonscape. The factories where the lithium is processed in China are polluters on a cosmic scale.

But...since the cars run part of the time on batteries (Tesla's are all electric, not hybrid as I understand it), they are "green." Now, the power plants that supply the electricity to power the batteries are deemed to be enemies of the environment by the politicians, but that doesn't appear to matter.

Now, get this:

Excitement over Tesla’s future has caused Wall Street to give this momentum stock a $35 billion market capitalization, versus General Motors’ $55 billion. Tesla sold 39,149 cars through June 30, while GM sold north of 9.7 million vehicles last year alone. Tesla has posted net losses of $581.93 million from January 2012 through June 2014, while GM has posted net income of $13.84 billion over the same period...

Not in this article, but in another it was noted that Mountain View, California saw a lot of Tesla purchases. I guess you can afford one when your house is worth $1 million, $773 per square foot.

ROONEY AND TEAR GAS

We were arranged by alphabet, last name. My platoon had all the guys whose names started with P or R or S, like Phillips, Schuppan and Rooney.

Private Rooney should not have been sent to the Army, but some well-meaning numbskull thought it would "do him good." The Drill Sergeant asked me (errrr, not exactly how he said it) to teach Rooney some basic drill commands. Left face, Right face, About face. Well, Rooney didn't know his right and left and About Face was similar to the golf swing described as an octopus falling out of a tree.

Not my job, but I told the DS that Rooney was not capable of learning this stuff, and I was absolutely positive it was not faked, but genuine.

One really hot day, when every part of your body and uniform was soaked, it was time to "test our gas masks." It was founded in something a lot more sadistic than that, I am sure. Instructions: Put on your gas mask. Walk into a concrete block room. Stand in lines. When the Drill Sergeant gives you the command, remove your gas mask, state your name, rank and serial number, salute, wait for the return salute and the command, Excused, and walk outside.

By the time I got to the front of the line, my skin was burning, especially where the CS gas got into creases, like your neck or your elbows. Taking that breath after saying that stuff was awful. By the time I got outside, I thought I would drown on all the fluid coming from my eyes, mouth, and nose. Coughing, gagging, and it persists.

Meanwhile, Rooney ended up in the back of one of those lines. When the first guy was instructed to take off his mask, Rooney thought they were talking to him. And he just stood there for a while until somebody noticed that he was going to die in that enclosed room and got him out of there.

They took him off to sick call, and we never saw him again. Hope they didn't think it would be a good idea to recycle him.

Among life's little learning experiences, I learned that if they wanted me to demonstrate and tear gas was threatened, I would just cheer from the sidelines, far away from that stuff.

LEARNING THE PHONETIC ALPHABET

I guess I knew there were such things as the phonetic alphabet and tear gas, but in 1970 I became intimately acquainted.

Anyone who has known me has heard all these stories, and Rooney and Tear Gas will post later. Let’s talk about learning the phonetic alphabet, which we were supposed to know when we arrived in the class.

The drill instructor was…sharp. Creases in the uniform, proper tilt to the Smokey Bear hat, direct stare that was difficult to take, impossible to return. Tall, impossibly thin, black and apparently from Boston because some words were pronounced funny…”alpher,” “Indier” and Lima sounded like a primate from Madagascar. And he carried a big stick.

The stick was his attention-getter. When we made a mistake, the stick was whacked against the side of the podium with the result something like a rifle shot. We were already a little bit spooked, so this was effective. Plus, he would boom out, "KOOOOO REC SHUN!!"

The class was about 50 and when we came in, we counted off. Not knowing why, you promptly forgot your number, so when DI yelled, “Birdblue three niner, this is Birdblue one, over!” the guy who counted off to 39 usually just sat there. Silence. Gunshot slap of the stick…repeat the call. Pushups all around.

Now, notice, it is not “bluebird.” You had to pop up at attention, say “Birdblue one, this is Birdblue three niner, over.” And it is not “thirty-nine,” it is “three niner.” And so on. He changed up the call signs all the time, and they were always ripe for mispronunciation. And that damned stick. And yelling "Correction."

Reflecting, however, we considered our MOS—Armor Scout. We were supposed to go in front of the tanks, find something to shoot at and, before they killed us (which in Viet Nam was pretty quick), call in some coordinates. NOT YOUR OWN, SOLDIER!! The enemy’s location. When doing this, it would not be in the calm comfort of your arm chair, most likely calling in close air support, under fire in the mud, so you needed to be able to perform radio protocol second nature. Without thinking about it. Just like Staff Sergeant Rifle Stick taught you.

Wonder if they can get away with this kind of training these days—after all, it was harassment. The millennials who have always gotten a ribbon, win or lose, will surely be offended.

NO MONEY VERSUS BEING POOR

Growing up in rural Nebraska in the 1950’s and 1960’s, it seemed we had very little money. But it didn’t feel like we were poor. We had two pairs of jeans, one pair of shoes for work and another for Sunday, and enough to eat. Operating the dairy allowed our family to keep the farm while our friends and neighbors went broke and moved to California.

When we sponsored the foreign military students at Ft. Leavenworth, we made some terrific friends and met some great people. One of the couples we met were educators at a small town north of Leavenworth, and they described a situation that would be defined, in my book, as “poor.”

The little girl came to the first day of third grade in shabby clothes and had only a bag of chips for lunch. Upon inquiring the teachers found out that she and her family had just moved there and the reason she had no “real” food was because they didn’t have a refrigerator.

The teachers and administrators took up a collection, bought a second hand refrigerator and delivered it to the family. They were thrilled, and the little girl started to come to school with good lunches. Then, one day, it looked like things had really changed because she showed up with a new dress and new shoes.

“Looks like you got a new dress?”

“Yep. We sold the refrigerator.”