It was my intention to write a year in review type article but I tabled that idea. There is only one year in review you all should read and that is the one written by Dave Barry. Check out the link at the bottom of the page and do read it. Very funny and very well done as always.
I decided instead to pass out awards for the top performers in 2005. Some are funny, some are sad and some might seem weird but here goes. Drumroll please...
The Civic Duty Award - Goes to the jury on the Michael Jackson trial. Apparently these 12 rubes were not present on this planet during the months the Jackson trial took place. If they were they would have known that "Jacko" was guilty. Alas, they followed the leadership of such other fine California juries (OJ Simpson, the Menendez Brothers, etc) and let him Moonwalk all the way to Bharain (his new home).
Medal of Valor Award - Tie between New Orleans Mayor Ray Nagin, Louisiana Governor Kathleen Blanco and FEMA Director Mike Brown. These three sad individuals botched, rebotched and then botched again the entire mess that ensued before, during and after Hurricane Katrina. All are equally culpable yet each conveniently blames the other while stating they were the "only ones showing leadership." All three should be forced to sweep the streets of New Orleans during Mardi Gras and Southern Decadence.
Corporate Leadership Award - Goes to none other than the Dolan family. This first family of New York media had an out and out feud between father and son over a failed satellite service called VOOM. The old man and son rattled sabers at each other before finally agreeing (begrudginly) to close VOOM and sell the assets. All the while the company's stock took a massive tumble.
The Please Make It Stop Award - Goes to Fox News correspondents Greta Van Susteren and Geraldo Rivera. Geraldo for the Terri Schiavo case and Greta for the Natalee Holloway case. This fine news channel has been co-opted by these two schmos and they need to be outsourced somewhere where no one we'll watch them. Like MSNBC.
The Big Whiner Award - Goes to all the Manchester United fans who claimed Man U would be "ruined" by the purchase of the club by American Malcom Glazer. These weenies claimed the famed club would lose their fan base and there would be repercussion of epic proportions. The result: Man U still sells out and while they are running 5th in the Premiership, they are making money and playing in front of all those rabid fans who vowed never to show up again.
The Boy Did We Get Fleeced Award - Goes to all the Hollywood studios for the pointless trash they greenlighted and that no one went to see. With few exceptions, everything Tinseltown put out landed at the box office with a loud thud. Guys, the key to making good movies is actually "writing a script that's interesting." I know that flies in the face of the new way to do movies which is to blow up lots of stuff and have minimal dialogue but give it a try. You may be surprised.
The Please Pay Attention to Me Award - Goes to North Korean dictator and cartoon looking freak, Kim Jong-Il. Kim, desperately trying to get the attention of anyone, continues to to play nuclear poker with the world. His motive appears to be his need for people to take his phone calls because his "country" doesn't appear to be gaining any additional support nor are they striking any more fear into the world. Perhaps in 2006 Kim will attempt to strike a deal that actually gets food to all those people living around him.
The I Cannot Tell a Lie Award - Goest to baseball "legend", Viagra pitchmen and all around smarmy character Rafael Palmeiro. Shortly after appearing before Congress and emphatically denying taking steriods, Raffy fails a drug test for, wait for it, steroids. Strong work.
The Lion in Winter Award - Goes to General Motors. The titan of the auto industry found 2005 to be a hard year. From poor sales, dealers in revolt, rising health care costs and 217 year old Kirk Kerkorian, GM faces a hard reality and the outcome could be very ugly. The stock is in the tank and their bonds are trading at junk status. Everything from selling off parts of GMAC to filing for bankruptcy is on the table for 2006. Hopefully the venerable car company will find traction very soon.
That's it for 2005. The Hawk has enjoyed his blogging so far and looks forward to more fun and nonsense in 2006. Hope you'll stop by from time to time.
Hawk...
The Year in Review
http://www.mercurynews.com/mld/mercurynews/entertainment/13511044.htm
Saturday, December 31, 2005
Sunday, December 11, 2005
Should California Save Tookie?
On Tuesday the state of California will likely carry out its most controversial execution since the reinstatement of the death penalty in the early 1970's. The case involves Stanley "Tookie" Williams. Mr. Williams is on "The Row" for his involvement in 4 homicides in 1979. In addition Mr. Williams was the co-founder of The Crips street gang, which still exists today.
Mr. Williams case is a cause celebre for many individuals. Death penatly opponents to Hollywood celebrities have lined up and spoke up on his behalf, demanding he be granted clemency.
The rationale for this is based on the fact that Williams has turned his life around in prison. In his 24 years in prison, Williams has gone from a gang founder to an outspoken opponent of gangs and violence. Along the way he has written several children's books and been nominated for the Nobel Prize 6 times (5 for peace and one for literature).
To be fair the main arugment Wiliams supporters have is the above, but upon further review, those points are tad more hollow than they seem...
Nobel Prize Nominations: While The Hawk is still seeking his elusive first Nobel Prize nomination for this weblog, it should be pointed out that being nominated for a Nobel is not as special as it is cracked up to be. First off, anyone can be nominated. Secondly, nominations are never released by the Nobel committee. Finally, Mohandis Gahndi, Martin Luther King and Desmond Tutu all won the Prize but Adolf Hitler, Joseph Stalin and Benito Mussolini were all in the running for one as well.
Writing Children's Books: It's nice that he has a hobby but writing children's books does not mean that one should get total redemption from one's past crimes.
Speaking Out Against Violence: One would hope as Mr. Williams got older he would speak out against the violence that got him on "The Row" in the first place. That is the benefit of getting older, you tend to get wiser and more mature.
He's Sorry For His Crimes: Mr. Williams still proclaims his innocence through all of this despite 16 years of failed appeals. At the end of the day, he doesn't want clemency he wants out of prison. While The Hawk does not think that a man should cop to a crime he did not commit, it is not a stretch that a street gang founder, high on PCP could in fact commit such crimes. Again, no evidence (DNA or witness) has come up to suggest Mr. Williams is innocent. It was his gun who killed those people and that we know for certain.
Hawk's View: In the end, Mr. Williams, like everyone on death row, should be granted clemency because The Hawk does not believe in the death penalty. Not because I think the prisoners deserve better but for the exact opposite. The death penalty turns madmen and monsters into martyrs and those folks simply do not deserve anyone's time. Lock them up and throw away the key. They may be alive but they are not living, they are existing in a metal cage to think of all of their past misdeeds. That's the toughest punishment of all. Along the way if some do reform, good for them, but they still have to live with the fact that they will spend the rest of their days irrelevant behind bars waiting for their day to come. That's a long time to live with the shame of crime.
Note: Please read the link above from the Washington Post's Eugene Robinson. Very interesting.
Mr. Williams case is a cause celebre for many individuals. Death penatly opponents to Hollywood celebrities have lined up and spoke up on his behalf, demanding he be granted clemency.
The rationale for this is based on the fact that Williams has turned his life around in prison. In his 24 years in prison, Williams has gone from a gang founder to an outspoken opponent of gangs and violence. Along the way he has written several children's books and been nominated for the Nobel Prize 6 times (5 for peace and one for literature).
To be fair the main arugment Wiliams supporters have is the above, but upon further review, those points are tad more hollow than they seem...
Nobel Prize Nominations: While The Hawk is still seeking his elusive first Nobel Prize nomination for this weblog, it should be pointed out that being nominated for a Nobel is not as special as it is cracked up to be. First off, anyone can be nominated. Secondly, nominations are never released by the Nobel committee. Finally, Mohandis Gahndi, Martin Luther King and Desmond Tutu all won the Prize but Adolf Hitler, Joseph Stalin and Benito Mussolini were all in the running for one as well.
Writing Children's Books: It's nice that he has a hobby but writing children's books does not mean that one should get total redemption from one's past crimes.
Speaking Out Against Violence: One would hope as Mr. Williams got older he would speak out against the violence that got him on "The Row" in the first place. That is the benefit of getting older, you tend to get wiser and more mature.
He's Sorry For His Crimes: Mr. Williams still proclaims his innocence through all of this despite 16 years of failed appeals. At the end of the day, he doesn't want clemency he wants out of prison. While The Hawk does not think that a man should cop to a crime he did not commit, it is not a stretch that a street gang founder, high on PCP could in fact commit such crimes. Again, no evidence (DNA or witness) has come up to suggest Mr. Williams is innocent. It was his gun who killed those people and that we know for certain.
Hawk's View: In the end, Mr. Williams, like everyone on death row, should be granted clemency because The Hawk does not believe in the death penalty. Not because I think the prisoners deserve better but for the exact opposite. The death penalty turns madmen and monsters into martyrs and those folks simply do not deserve anyone's time. Lock them up and throw away the key. They may be alive but they are not living, they are existing in a metal cage to think of all of their past misdeeds. That's the toughest punishment of all. Along the way if some do reform, good for them, but they still have to live with the fact that they will spend the rest of their days irrelevant behind bars waiting for their day to come. That's a long time to live with the shame of crime.
Note: Please read the link above from the Washington Post's Eugene Robinson. Very interesting.
Tuesday, December 06, 2005
Time Warner's Icahn Problem
In the Spring I posted a couple of stories regarding blowhard investor Carl Icahn and his target at the time (Blockbuster). The first dealt with Icahn being hung up on during a web conference for all the world to hear. The second dealt with heavy handed approach CEO John Antiocco was taking when dealing with Icahn. At the time "Uncle" Carl (as he likes to be known, very man of the people) was lodging a complaint that Blockbuster was not acting in the best interest of the shareholders. Icahn got what he wanted (board seats) and has rest assured made life miserable for Mr. Antiocco since he and his band merry investors ascended onto the board.
Now Icahn has moved on to a bigger target. None other than Time Warner (formerly AOL Time Warner, formerly Time Inc and Warner Brothers, formerly Turner Broadcasting and...well you get the picture). Icahn has put TW CEO Richard Parsons on notice: spin-off the entire cable division, increase the dividend and get rid of AOL or else...
The "or else" in that statement means that if Carl doesn't exact his pound of greenmail that he'll pull the same thing on TW that he pulled with Blockbuster. No doubt making Mr. Parsons life equally miserable as he did for Mr. Antiocco.
Icahn's M.0. is veiled in "unlocking shareholder value." But in essence what he does is take a big stake and then force companies to pay him off in the short term via dividends or buybacks. If he doesn't get what he wants he takes his fight public and drags the company in question out into a war.
The problem is Icahn's moves generally make company's worse off because they are forced to abandon long-term strategies or worse yet put them in a poor negotiating position (E.G., it'll be tough for Parsons and crew to negotiate a "fair" AOL deal if even I know that they are being pushed hard to sell it).
However, Mr. Parsons should not be underestimated. Underneath that sweet veneer is a man who knows how to negotiate and lead in times of peril. It is he who pared down TW's debt, unwound the difficult cable partnership with Comcast and sold the music business for a tidy profit. He can handle Icahn if the board backs him up. The question is of course, will they?
Hawk's View: This is a bit of a cage match but I like it to end in a draw with Icahn getting a nice fat check to go bother some other media company (are you paying attention Viacom?). Look for buybacks to go up and for AOL to get sold off (Microsoft is the one). However, don't expect Parsons to give in when it comes to spinning off the entire cable operation. Parsons knows that business is a long term strategic play and giving it all up now will not nearly bring them enough money for the leverage they will lose. Look for a portion of the cable business to be spun off by late Summer with TW still holding a majority position. And look for Icahn to be stalking some other company by then.
Now Icahn has moved on to a bigger target. None other than Time Warner (formerly AOL Time Warner, formerly Time Inc and Warner Brothers, formerly Turner Broadcasting and...well you get the picture). Icahn has put TW CEO Richard Parsons on notice: spin-off the entire cable division, increase the dividend and get rid of AOL or else...
The "or else" in that statement means that if Carl doesn't exact his pound of greenmail that he'll pull the same thing on TW that he pulled with Blockbuster. No doubt making Mr. Parsons life equally miserable as he did for Mr. Antiocco.
Icahn's M.0. is veiled in "unlocking shareholder value." But in essence what he does is take a big stake and then force companies to pay him off in the short term via dividends or buybacks. If he doesn't get what he wants he takes his fight public and drags the company in question out into a war.
The problem is Icahn's moves generally make company's worse off because they are forced to abandon long-term strategies or worse yet put them in a poor negotiating position (E.G., it'll be tough for Parsons and crew to negotiate a "fair" AOL deal if even I know that they are being pushed hard to sell it).
However, Mr. Parsons should not be underestimated. Underneath that sweet veneer is a man who knows how to negotiate and lead in times of peril. It is he who pared down TW's debt, unwound the difficult cable partnership with Comcast and sold the music business for a tidy profit. He can handle Icahn if the board backs him up. The question is of course, will they?
Hawk's View: This is a bit of a cage match but I like it to end in a draw with Icahn getting a nice fat check to go bother some other media company (are you paying attention Viacom?). Look for buybacks to go up and for AOL to get sold off (Microsoft is the one). However, don't expect Parsons to give in when it comes to spinning off the entire cable operation. Parsons knows that business is a long term strategic play and giving it all up now will not nearly bring them enough money for the leverage they will lose. Look for a portion of the cable business to be spun off by late Summer with TW still holding a majority position. And look for Icahn to be stalking some other company by then.
Tuesday, November 29, 2005
We Don't Need a Fence
I can't believe a guy of my political leanings is writing this but, I'll take my chances.
Recently there has been a movement afoot to build a fence from the Pacific Ocean to the Gulf of Mexico along the US/Mexican border. The fence movement is spurned by many groups who are tired of the millions of people streaming over the border on a daily basis.
The idea comes from an experiment taking place in San Diego where an 18 mile fence was built. The results were positive. Illegal crossings were way down. As a result the idea blossomed to take the fence across the country (see above for diagram)
To be fair the "fence people" are not suggesting we close our border to people here to work. They have a "guest worker" program that would allow individuals to be here legally and enjoy the protection of being a citizen of the US. What they are trying to solve is those who do not work or those of a criminal element (drug dealers, arms smugglers, etc) and of the terrorist element. To be sure national security is the main drum they are banging.
They are right that the fence would make it easier for our border patrol and would be cheaper in the long run than adding more and more people to monitor the border.
But building a fence is not what we do in America. Yes we have an illegal immigrant issues here in the US but the fence won't stop it. The fence will make it harder and more dangerous but it will not stop the problem.
The problem is Mexico is an abomination in developing its economy. The thriving industrial areas are being overrun by corrupt officials and the rule of law is fading. Kidnappings on expats are up to an all time high and the country lost control of the Nuevo Laredo area earlier this year to rival drugs (see link info) http://narcosphere.narconews.com/story/2005/5/10/215352/497
A fence won't stop these problems.
Hawk's View: I'd rather see the US take the "fence money" and enact both an economic and anti-corruption plan for Mexico. Let's face it, without one you can't have the other (see Russia as an example that tries to have a free market sans rule of law). Yes, it sounds pie in the sky and the fence is the quickest way to get short term gains on the "war on illegals" but short term does not solve our problem. The bottom line is America is lucky with its geography. We have no neighbors to the east or west and our northern neighbor is the world's friendliest country. Yes we have a problem with our southern neighbor but a fence will only shield us from the greater issues going on. The best way to protect us is to make our neighbor stronger.
The Bastille is Being Stormed...Again
Most of you saw that France has been mired in a "Car Burning Extravaganza" over the past three weeks. The festivities, triggered by the accidental death of two youths hiding from police, has torn the country in two and brought to light decades of hidden racism among France and it's immigrant population.
France has prided itself as a place that is open to all (except Republicans) and has trumped for years a society of acceptance. However that has always been a (well hidden) facade. In reality, France has run a society that has segregated immigrants (specifically Muslim immigrants) and has created a permanent underclass of people. The uprising is really the modern day "proletariot" rising against the "bourgeois" demanding a better life.
France's government responded in the only fashion they know how: cowardly. First they denied the problem was anything but a "small group of thugs" then they ignored the reason for the issue alltogether. In their attempt to "fix" the problem France decided that tightening immigration and making it harder to be a citizen was the right way to solve this indignity.
Of course, they are wrong. The problem is the individuals who are rising up are doing so only because they seek to be treated equally. They want to be treated like all the other French citizens. They are upset that unemployment is double amongst their populace. They are upset that they cannot express themselves (EG, wearing headscarves as dictated by religious law). In short they want to be treated like humans not as cattle.
Finally, the world can see France for what it really is and always has been: a society of elitist.
Hawk's View: Tightening immigration does not solve the problem, because the problem is with people who are in France now and are LEGAL. Not only will this backfire, I don't think it will play well in the EU either. The first step toward solving this problem is to admit you have one and then make necessary steps. I'll even suggest what the first one would be: begin to break up the enormous ghettos that reside in and around Paris. Attempt to bring new French citizens into French society. Openness will always win over draconianism.
France has prided itself as a place that is open to all (except Republicans) and has trumped for years a society of acceptance. However that has always been a (well hidden) facade. In reality, France has run a society that has segregated immigrants (specifically Muslim immigrants) and has created a permanent underclass of people. The uprising is really the modern day "proletariot" rising against the "bourgeois" demanding a better life.
France's government responded in the only fashion they know how: cowardly. First they denied the problem was anything but a "small group of thugs" then they ignored the reason for the issue alltogether. In their attempt to "fix" the problem France decided that tightening immigration and making it harder to be a citizen was the right way to solve this indignity.
Of course, they are wrong. The problem is the individuals who are rising up are doing so only because they seek to be treated equally. They want to be treated like all the other French citizens. They are upset that unemployment is double amongst their populace. They are upset that they cannot express themselves (EG, wearing headscarves as dictated by religious law). In short they want to be treated like humans not as cattle.
Finally, the world can see France for what it really is and always has been: a society of elitist.
Hawk's View: Tightening immigration does not solve the problem, because the problem is with people who are in France now and are LEGAL. Not only will this backfire, I don't think it will play well in the EU either. The first step toward solving this problem is to admit you have one and then make necessary steps. I'll even suggest what the first one would be: begin to break up the enormous ghettos that reside in and around Paris. Attempt to bring new French citizens into French society. Openness will always win over draconianism.
Wednesday, September 28, 2005
The Hawk's Plan for New Orleans
The newspapers and media have been dominated by Hurricane Katrina and all the horrible things that happened. From "Iron" Mike Brown's so-called FEMA leadership to Mayor Ray Nagin conveniently blaming everyone, save for himself, for all the issues that transpired.
As much fun as it would be to take potshots, I've decided to focus my time, energy and fleeting sleep schedule on what should happen next to New Orleans. I've listed five ideas (along with new city names) that I'm sure the feds will take into consideration (they read this blog you know). All plans for rebuilding the city call for - wait for it - building the city "above" sea level. What a novel idea. Even an Iowa State engineer can figure that one out.
Drumroll please...
1. Vene-Orleans - My favorite plan is to turn New Orleans into a sort of Venice American Style (not to be confused with the poor 70's TV show Love American Style). This idea is kind of cool and the good news is the New Orleans already has a lingering bad smell (similar to Venice). Instead of gondolas the city could use flat bottom airboats.
2. Las New Orleans - That's right, turn the place into Vegas south. They were already there anyway. New Orleans has a casino and the necessary corrupt government and mob ties. All they were missing was the right marketing campaign. How about "What Gets Projectile Vomited in New Orleans, Stays on Streets of New Orleans." OK, maybe something a tad more subtle but work with me here.
3. Dome Orleans - They are probably going to want to pick a different name but why not just dome the whole damn place? It can even be retractable for all three of the days of the year where it is not stifling hot and humid. Think of the construction contract! I still haven't figured out how to land planes in a dome but I'm working on it.
4. AtlantisOrleans - OK, I lied. Not EVERY plan for the city included building it above sea level, but work with me here. Why fight nature. It's underwater, let's work with it. Now's our chance to prove to the world man CAN build a city underwater. We already have a head start as 60% of the buildings are sumbmerged anyway. I'm sure Trump would be interested in getting a casino built. We could call it TrumpTank.
5. Baja Orleans - Let's face it, all we really need from New Olreans is the port, other than that we could probably do without the city. The folks who have been displaced will no doubt find better lives in better cities. Jazz music can move to Memphis and the only other reason to keep New Orleans (the Sugar Bowl) could be moved to Houston. We could give Mexico the city and they could run it and employ all those illegal immigrants in the bars, casinos and strip joints that litter the city. Plus Mexico could get that warm fuzzy feeling that comes with regaining land you lost after getting slapped around a century ago. They get the city, we get paid in oil. What a deal.
Hawk's View: OK, more than likely I'm ahead of my time on my ideas but all kidding aside, New Orleans should be rebuilt (above ground) because that's what America does, it marches on. Look for a new, regentrified, city to be on the drawing board and look for America to embrace it and come back. Because there is nothing more that we love than a comeback story. Go New Orleans.
As much fun as it would be to take potshots, I've decided to focus my time, energy and fleeting sleep schedule on what should happen next to New Orleans. I've listed five ideas (along with new city names) that I'm sure the feds will take into consideration (they read this blog you know). All plans for rebuilding the city call for - wait for it - building the city "above" sea level. What a novel idea. Even an Iowa State engineer can figure that one out.
Drumroll please...
1. Vene-Orleans - My favorite plan is to turn New Orleans into a sort of Venice American Style (not to be confused with the poor 70's TV show Love American Style). This idea is kind of cool and the good news is the New Orleans already has a lingering bad smell (similar to Venice). Instead of gondolas the city could use flat bottom airboats.
2. Las New Orleans - That's right, turn the place into Vegas south. They were already there anyway. New Orleans has a casino and the necessary corrupt government and mob ties. All they were missing was the right marketing campaign. How about "What Gets Projectile Vomited in New Orleans, Stays on Streets of New Orleans." OK, maybe something a tad more subtle but work with me here.
3. Dome Orleans - They are probably going to want to pick a different name but why not just dome the whole damn place? It can even be retractable for all three of the days of the year where it is not stifling hot and humid. Think of the construction contract! I still haven't figured out how to land planes in a dome but I'm working on it.
4. AtlantisOrleans - OK, I lied. Not EVERY plan for the city included building it above sea level, but work with me here. Why fight nature. It's underwater, let's work with it. Now's our chance to prove to the world man CAN build a city underwater. We already have a head start as 60% of the buildings are sumbmerged anyway. I'm sure Trump would be interested in getting a casino built. We could call it TrumpTank.
5. Baja Orleans - Let's face it, all we really need from New Olreans is the port, other than that we could probably do without the city. The folks who have been displaced will no doubt find better lives in better cities. Jazz music can move to Memphis and the only other reason to keep New Orleans (the Sugar Bowl) could be moved to Houston. We could give Mexico the city and they could run it and employ all those illegal immigrants in the bars, casinos and strip joints that litter the city. Plus Mexico could get that warm fuzzy feeling that comes with regaining land you lost after getting slapped around a century ago. They get the city, we get paid in oil. What a deal.
Hawk's View: OK, more than likely I'm ahead of my time on my ideas but all kidding aside, New Orleans should be rebuilt (above ground) because that's what America does, it marches on. Look for a new, regentrified, city to be on the drawing board and look for America to embrace it and come back. Because there is nothing more that we love than a comeback story. Go New Orleans.
Wednesday, August 24, 2005
Posting Update: Man United - The Yanks Go Marching In...
Man United, the venerable UK soccer (NOT football) club, won at home this past weekend for their first home win in this season Premier League.
The biggest news was that people were actually in the stands. When the club was sold to the Glazer family earlier this Summer Man United fans took to the streets with the crown of thorns sitting firmly atop their heads. They promised boycotts of Man U products and matches. No way those dastardly Americans would succeed owning this piece of British Culture.
As predicted by The Hawk, nothing has come of these blowhards. The stands at Old Trafford were full of beer imbibing soccer fans. The British Empire has not come to an end (if the cooking or Camilla Parker Bowles didn't do it, this certainly wouldn't).
Again, if the Glazer's use the type of forthright they did with the Tampa Bay Buccaneers (sports worst franchise ever when they took over) than the boys from Man U will be fine. That's unfortunate for those boycotting blokes...
The biggest news was that people were actually in the stands. When the club was sold to the Glazer family earlier this Summer Man United fans took to the streets with the crown of thorns sitting firmly atop their heads. They promised boycotts of Man U products and matches. No way those dastardly Americans would succeed owning this piece of British Culture.
As predicted by The Hawk, nothing has come of these blowhards. The stands at Old Trafford were full of beer imbibing soccer fans. The British Empire has not come to an end (if the cooking or Camilla Parker Bowles didn't do it, this certainly wouldn't).
Again, if the Glazer's use the type of forthright they did with the Tampa Bay Buccaneers (sports worst franchise ever when they took over) than the boys from Man U will be fine. That's unfortunate for those boycotting blokes...
Tuesday, August 23, 2005
Coming to a Cable System Near You...The AK-4700 Club Hosted by Pat Robertson
Just when you thought you had heard it all, out comes this. The story of a America's favorite televangelist (just ask him) sounds off that we need to rub out the President of Venezuela.
You just can't make it up. Pat Robertson, he of Liberty University, The 700 Club and failed presidential runs, has decided that we need to take out the dastardly "Honest" Hugo Chavez of Venezuela.
Make no mistake Chavez is a clown. He's forced himself into power (via "elections") in the western hemisphere's largest oil producer. He's buddy-buddy with Fidel Castro and wants to use Venezuelan oil as a "weapon" against the US. Never mind that Venezuela currently happily sells oil to the US.
While the above is all true, Robertson's response is one of those things you think but DO NOT SAY. Especially on national TV (although The Hawk feels Robertson's audience probably agreed with him). Maybe Robertson's old and just doesn't care or maybe he's pining for attention. Either way his comments are a pathetic attempt by a man who's days as a relevant social voice are behind him. I even wonder if Robertson has some sort of business interest in Venezuela that makes him lean toward have "Honest" Hugo bumped off. Certainly if that is the case we will know more about that soon.
Hawk's View: Chavez is a thorn in the side of the US and make no mistake we want him out of there. But it won't come to us rubbing him out or even invading. We'll neuter him the way we do other despots. In the end Hugo will realize that the only way he can stay in power is by selling oil to the US. As for Robertson, maybe he can have a show on the NRA Network called the AK-4700 Club. Stay tuned.
You just can't make it up. Pat Robertson, he of Liberty University, The 700 Club and failed presidential runs, has decided that we need to take out the dastardly "Honest" Hugo Chavez of Venezuela.
Make no mistake Chavez is a clown. He's forced himself into power (via "elections") in the western hemisphere's largest oil producer. He's buddy-buddy with Fidel Castro and wants to use Venezuelan oil as a "weapon" against the US. Never mind that Venezuela currently happily sells oil to the US.
While the above is all true, Robertson's response is one of those things you think but DO NOT SAY. Especially on national TV (although The Hawk feels Robertson's audience probably agreed with him). Maybe Robertson's old and just doesn't care or maybe he's pining for attention. Either way his comments are a pathetic attempt by a man who's days as a relevant social voice are behind him. I even wonder if Robertson has some sort of business interest in Venezuela that makes him lean toward have "Honest" Hugo bumped off. Certainly if that is the case we will know more about that soon.
Hawk's View: Chavez is a thorn in the side of the US and make no mistake we want him out of there. But it won't come to us rubbing him out or even invading. We'll neuter him the way we do other despots. In the end Hugo will realize that the only way he can stay in power is by selling oil to the US. As for Robertson, maybe he can have a show on the NRA Network called the AK-4700 Club. Stay tuned.
Wednesday, August 03, 2005
Big Labor Gets Competitive Again
Last week in Chicago the AFL/CIO had its annual meeting/Democratic fundraiser. Usually the meeting is a backslapper with the obligatory bashing of all things non-labor (Read: Wal-Mart).
Only this meeting provided a few more fireworks. As expected, AFL/CIO President John Sweeney won a reelection, but in the face of it he is staring at a massive defection that has never been seen before in the labor union.
Both the Teamsters and the SEIU have stated they will be splitting off and taking their members with them. More than likely other unions will follow suit. The reasoning for the split is both simple and reasonable. The AFL/CIO has become too concerned with raising political dollars and in the process put recruiting new members on the backburner.
The decision to split makes sense. Labor representation in the workforce is at historic lows and everywhere you look companies are either shunning labor (Wal-Mart) or shafting them (the auto and airline industry). The mantra that the AFL/CIO has followed for years (being lap dogs to the Democratic party) has done zero to advance the cause of the labor union.
Hawk's View: Competition is a good thing. Having two competiting groups out there fighting for members will mean less time will be spent on funding Ted Kennedy's campaign and more time advancing the labor cause. Frankly this split should have happened ten years ago and that if nothing else it will make for great fun to watch the two groups out there shouting their message. The Hawk has his wings crossed that their first target will be Wal-Mart.
Only this meeting provided a few more fireworks. As expected, AFL/CIO President John Sweeney won a reelection, but in the face of it he is staring at a massive defection that has never been seen before in the labor union.
Both the Teamsters and the SEIU have stated they will be splitting off and taking their members with them. More than likely other unions will follow suit. The reasoning for the split is both simple and reasonable. The AFL/CIO has become too concerned with raising political dollars and in the process put recruiting new members on the backburner.
The decision to split makes sense. Labor representation in the workforce is at historic lows and everywhere you look companies are either shunning labor (Wal-Mart) or shafting them (the auto and airline industry). The mantra that the AFL/CIO has followed for years (being lap dogs to the Democratic party) has done zero to advance the cause of the labor union.
Hawk's View: Competition is a good thing. Having two competiting groups out there fighting for members will mean less time will be spent on funding Ted Kennedy's campaign and more time advancing the labor cause. Frankly this split should have happened ten years ago and that if nothing else it will make for great fun to watch the two groups out there shouting their message. The Hawk has his wings crossed that their first target will be Wal-Mart.
Monday, August 01, 2005
Hockey's Back
In case you didn't notice (and judging by their previous TV ratings, you didn't), hockey is back. I'll pause as the 12 guys in the bar in Yellowknife slam a Molson in excitement.
Yes the sport that brought you toothless men, the coolest trophy around and guys who think "eh" is actually a word will drop the puck in October in front of dozens of people in arenas around North America.
The sport missed last season due to a lockout as billionaire owners, who seemingly forgot how they became billionaires (guys, if you spend more than you take in that means you LOSE money...) finally realized they needed to be saved from themselves. But boy were they in for a lesson. The owners were up against a union that was stuck in its principal. "When it comes to a salary cap, we will not waiver" they screamed to the media. The players were prepared to fight it out and show those good for nothing owners (OK, just the guys who own the Blackhawks are good for nothing) who's in charge.
And boy did they do just that. Not since the French let the Germans roll through Paris WWII had a collection of individuals lay down collectively like the players association, and their fearless leader Bob "General Custer" Goodenow, did in these negotiations. For those of you who think I'm being too harsh, check out the scorecard below...
Salary Cap:
Player's Take: Not over my hockey-hair headed body
Reality: $37 MM cap
Salary Cuts
Player's Take: We scoff at that idea...
Reality: 24% rollback for everyone
Individual Salary Cap
Player's Take: What do you think this is the WNBA
Reality: No salary higher than $7MM
I think it's safe to say the owners ten runned the players on this one. However, the rub is that had the Union gotten serious about negotiating earlier they would have gotten a better deal. Goodenow and crew never thought the owners would shut down the season. Little did they know that the Gang of 30 would have been just fine taking a Winter off. When it got down to crunch time the Union hemmed and hawed at a salary cap of $42 MM. When they waited too long the owners pulled the deal. And the Union ended up getting less. The whole thing cost Union head Bob Goodenow his job (as it should).
Hawk's View: I don't consider myself much of a puckhead but I think hockey can make it back. Hockey fans are notoriously loyal and I expect teams will draw well (although don't expect the owners new found "cost certainty" to reflect in lower ticket prices). Where hockey really has a shot is with High Definition TV. The game represents better than any sporting event out there in HD (yes, even football) and is a lot more fun to watch. It'll take time but the Hawk feels that the future of the NHL is bright. Don't you agree, eh...
Yes the sport that brought you toothless men, the coolest trophy around and guys who think "eh" is actually a word will drop the puck in October in front of dozens of people in arenas around North America.
The sport missed last season due to a lockout as billionaire owners, who seemingly forgot how they became billionaires (guys, if you spend more than you take in that means you LOSE money...) finally realized they needed to be saved from themselves. But boy were they in for a lesson. The owners were up against a union that was stuck in its principal. "When it comes to a salary cap, we will not waiver" they screamed to the media. The players were prepared to fight it out and show those good for nothing owners (OK, just the guys who own the Blackhawks are good for nothing) who's in charge.
And boy did they do just that. Not since the French let the Germans roll through Paris WWII had a collection of individuals lay down collectively like the players association, and their fearless leader Bob "General Custer" Goodenow, did in these negotiations. For those of you who think I'm being too harsh, check out the scorecard below...
Salary Cap:
Player's Take: Not over my hockey-hair headed body
Reality: $37 MM cap
Salary Cuts
Player's Take: We scoff at that idea...
Reality: 24% rollback for everyone
Individual Salary Cap
Player's Take: What do you think this is the WNBA
Reality: No salary higher than $7MM
I think it's safe to say the owners ten runned the players on this one. However, the rub is that had the Union gotten serious about negotiating earlier they would have gotten a better deal. Goodenow and crew never thought the owners would shut down the season. Little did they know that the Gang of 30 would have been just fine taking a Winter off. When it got down to crunch time the Union hemmed and hawed at a salary cap of $42 MM. When they waited too long the owners pulled the deal. And the Union ended up getting less. The whole thing cost Union head Bob Goodenow his job (as it should).
Hawk's View: I don't consider myself much of a puckhead but I think hockey can make it back. Hockey fans are notoriously loyal and I expect teams will draw well (although don't expect the owners new found "cost certainty" to reflect in lower ticket prices). Where hockey really has a shot is with High Definition TV. The game represents better than any sporting event out there in HD (yes, even football) and is a lot more fun to watch. It'll take time but the Hawk feels that the future of the NHL is bright. Don't you agree, eh...
Motown Becomes Woetown
Good news came to all 300,000,000 Americans earlier this Summer - everyone of us was hired by the Big 3 automakers in Detroit. Yes that's right, each one of us now gets the employee discount. The same price every Ford, GM and Chrysler serf pays for their domestically made bucket of bolts.
The Motor City Madmen have once again reached a new low when it comes to selling cars. They are all so desperate to keep factories running so pension and health care costs can be met that they must churn out cars or perish. Yes, in the short run things will look good. However, the issue on the table has not changed - people still think Detroit still makes blah cars. The blip that all three will see in the short run will wear off quickly and they will all return back from Dreamland.
Throw out heavy trucks and a couple of models by GM (Cadillac) and Chrysler/Dodge and Detroit is still giving us a little better version of the cars we saw in Michael Moore's well done 1985 epic Roger and Me. Design, quality and marketing still win the war.
However, Detroit is not built that way. So hamstrung by concessions they have given to the UAW over the years, the Big 3 have a cost obligation that has completely dominated their scope for the better part of 15 years. It's all about volume, volume, volume and less about what people want.
The bottom line here is we should get used to the fact that good news coming out of Detroit will only arrive when moneylosing deals are thrown to customers. Right now the Big 3 are playing prevent defense just trying to survive the day. While they do that, Japan and even Korea for heaven's sakes, are running up the score on the legendary companies.
Hawk's View: I find the car industry fascinating (although I have a well known hatred of actually buying cars). Historically it has proven what is great about America. It is, to me, still what drives our economy. However, it is sad to see and industry that was once so great, be run as if it is taking cues from the Soviet Union central planning office. Detroit needs to get sober and find a middle ground with the Unions that will get costs in line. If it can't be negotiated than it may be time for a reorg to get this great industry back in the game.
The Motor City Madmen have once again reached a new low when it comes to selling cars. They are all so desperate to keep factories running so pension and health care costs can be met that they must churn out cars or perish. Yes, in the short run things will look good. However, the issue on the table has not changed - people still think Detroit still makes blah cars. The blip that all three will see in the short run will wear off quickly and they will all return back from Dreamland.
Throw out heavy trucks and a couple of models by GM (Cadillac) and Chrysler/Dodge and Detroit is still giving us a little better version of the cars we saw in Michael Moore's well done 1985 epic Roger and Me. Design, quality and marketing still win the war.
However, Detroit is not built that way. So hamstrung by concessions they have given to the UAW over the years, the Big 3 have a cost obligation that has completely dominated their scope for the better part of 15 years. It's all about volume, volume, volume and less about what people want.
The bottom line here is we should get used to the fact that good news coming out of Detroit will only arrive when moneylosing deals are thrown to customers. Right now the Big 3 are playing prevent defense just trying to survive the day. While they do that, Japan and even Korea for heaven's sakes, are running up the score on the legendary companies.
Hawk's View: I find the car industry fascinating (although I have a well known hatred of actually buying cars). Historically it has proven what is great about America. It is, to me, still what drives our economy. However, it is sad to see and industry that was once so great, be run as if it is taking cues from the Soviet Union central planning office. Detroit needs to get sober and find a middle ground with the Unions that will get costs in line. If it can't be negotiated than it may be time for a reorg to get this great industry back in the game.
News Corp's Family Feud
Today the Wall Street Journal featured a cover story on the sudden resignation of Lachlan Murdoch - Rupert Murdoch's son-in-waiting at News Corp.
The money on the table was Lachlan was likely to take over after his father leaves the earth sometime in the next 20 years. His resignation to "spend more time with his family" rings hollow to some who think that the real reason Lachlan is heading back Down Under is because there is a growing rift between the Old Man and his four eldest children.
Turns out that theory may be true. According to the Journal, there is a serious family feud brewing between Rupert's original family (4 grown children) and the new family (a thirtysomething wife with 2 young children). Apparently Rupert and his wife are changing around the family trust which is seriously diluting the inheritance (and power) the older children were said to be expecting to reap.
Apparently this spat and Rupert's constant meddling in Lachlan's affairs (he was COO of News Corp prior to his resignation) were to much for the lad. He chose to go the route of Rupert's two older daughters who have fled News Corp. Only Harvard drop-out and current bSkyb CEO James remains in the Empire. He is now the new leader in the clubhouse in the CEO sweepstakes.
Only don't be so sure. Another angle that has not been addressed is that Rupert's "publicly traded" company may end up in the hands of an outsider after he leaves. Specifically current president Peter Chernin. Rupert has said he wants his children to take over the company but only James remains (unless Rupert hangs around for another 20 years in time for either daughters Grace or Chloe - 2 and 3 respectively to take over). Another prospect - perish the thought - is that current wife Wendi Deng takes over (she was a former News Corp exec in Asia). Either way this promises to play out like one of Fox's insufferable reality shows.
Hawk's View: The Feud will be the stuff only the tabloids can love (maybe even one of Rupert's own rags will get the scoop) but investors should not fret the issue. At his heart the conservative Murdoch is a true capitalist. News Corp will not suffer a negative backlash from a family issue (unlike Cablevision). The Hawk believes in the bloke from Australia and will continue to ride his less-than-significant investment in News Corp. At $17 a share it's a bargain, family feud or not.
The money on the table was Lachlan was likely to take over after his father leaves the earth sometime in the next 20 years. His resignation to "spend more time with his family" rings hollow to some who think that the real reason Lachlan is heading back Down Under is because there is a growing rift between the Old Man and his four eldest children.
Turns out that theory may be true. According to the Journal, there is a serious family feud brewing between Rupert's original family (4 grown children) and the new family (a thirtysomething wife with 2 young children). Apparently Rupert and his wife are changing around the family trust which is seriously diluting the inheritance (and power) the older children were said to be expecting to reap.
Apparently this spat and Rupert's constant meddling in Lachlan's affairs (he was COO of News Corp prior to his resignation) were to much for the lad. He chose to go the route of Rupert's two older daughters who have fled News Corp. Only Harvard drop-out and current bSkyb CEO James remains in the Empire. He is now the new leader in the clubhouse in the CEO sweepstakes.
Only don't be so sure. Another angle that has not been addressed is that Rupert's "publicly traded" company may end up in the hands of an outsider after he leaves. Specifically current president Peter Chernin. Rupert has said he wants his children to take over the company but only James remains (unless Rupert hangs around for another 20 years in time for either daughters Grace or Chloe - 2 and 3 respectively to take over). Another prospect - perish the thought - is that current wife Wendi Deng takes over (she was a former News Corp exec in Asia). Either way this promises to play out like one of Fox's insufferable reality shows.
Hawk's View: The Feud will be the stuff only the tabloids can love (maybe even one of Rupert's own rags will get the scoop) but investors should not fret the issue. At his heart the conservative Murdoch is a true capitalist. News Corp will not suffer a negative backlash from a family issue (unlike Cablevision). The Hawk believes in the bloke from Australia and will continue to ride his less-than-significant investment in News Corp. At $17 a share it's a bargain, family feud or not.
Sunday, June 19, 2005
Dam The People
One of my favorite things to read about these days is the building of the Three Gorges Dam in China. When completed the dam will the world's largest and will free the Chinese people from the perils of the ravenous Yangtze River which has for years been a pox on the lives of those who lived near it.
The dam is not without its doubters. Naysayers ranges from environmentalists who claim the dam will fill up with silt and overflow, to geologists who are concerned that the dam is being built on a fault line to Amnesty International who is upset with how China is "moving" citizens out of the dam area.
They all may be right in their concerns but the one that sticks out to me right now is the issue with how China is treating the peasants living near the dam area. On the outside the government is claiming they are being careful and considerate with moving their citizens but what is happening is not the case. People are being forced out without compensation, some violently, and there is very little that can be done about that.
Or maybe not. The link in the article reads about how peasants are starting to fight back. Despite being outgunned and outmanned they are definitely no longer going quietly into the night.
This does not bode well for the "other China." The China we read all about talks about how the economic growth is something we have never witnessed in our lives. While that maybe true there are in fact two China's. The one we read about and the one that lives in almost medievel conditions. The fact that the second China is rising up and demanding better treatment is alarming to the overall stability of the country. There are a lot more poor people then well off people in the country. If the poor continue to fight back it might become even a bigger issue.
Hawk's View: I think that China's problems with their poorest citizens is the elephant in their room of progress. Yes they have a gifted and industrious society. But they also have what amounts to a new age feudal system and that does not sit well. Look for the issues to get much worse before they begin to get better. And also look for the dam to be an environmental nightmare.
www.threegorgesprobe.org
The dam is not without its doubters. Naysayers ranges from environmentalists who claim the dam will fill up with silt and overflow, to geologists who are concerned that the dam is being built on a fault line to Amnesty International who is upset with how China is "moving" citizens out of the dam area.
They all may be right in their concerns but the one that sticks out to me right now is the issue with how China is treating the peasants living near the dam area. On the outside the government is claiming they are being careful and considerate with moving their citizens but what is happening is not the case. People are being forced out without compensation, some violently, and there is very little that can be done about that.
Or maybe not. The link in the article reads about how peasants are starting to fight back. Despite being outgunned and outmanned they are definitely no longer going quietly into the night.
This does not bode well for the "other China." The China we read all about talks about how the economic growth is something we have never witnessed in our lives. While that maybe true there are in fact two China's. The one we read about and the one that lives in almost medievel conditions. The fact that the second China is rising up and demanding better treatment is alarming to the overall stability of the country. There are a lot more poor people then well off people in the country. If the poor continue to fight back it might become even a bigger issue.
Hawk's View: I think that China's problems with their poorest citizens is the elephant in their room of progress. Yes they have a gifted and industrious society. But they also have what amounts to a new age feudal system and that does not sit well. Look for the issues to get much worse before they begin to get better. And also look for the dam to be an environmental nightmare.
www.threegorgesprobe.org
Friday, June 17, 2005
Senator Byrd Fesses Up
There's a new book coming out by Senator Robert Byrd (D) West Virginia. The book chronicles Byrd's life growing up in the coal mines of his home state and his rise to power in the United States Senate.
To its credit the book discusses Byrd's turn in the Ku Klux Klan during the early 1940s. Byrd even credits his time in the KKK as his catalyst for entering politics. He won his local election to be "Immortal Cyclops" and was known as one of the best recruiters in the state.
When Byrd ran for office in 1946 he was called on to the carpet for this time in the white hood. He claimed to have only spent parts of 1942 through 1943 in the group but there is evidence to suggest he hung around longer.
What really got me on this one was Byrd "spinning" the Klan as a sort of "Southern Rotary Club" and full of upstanding citizens like doctors and lawyers. That may be all well and good but calling the Klan a Southern Rotary club is like calling the Irish Republican Army a recreational paint ball team. It is just all a bunch of nonsense.
Hawk's View: Byrd was in the Klan and why I don't condone that one bit he claims he was not part of any violent acts. There is no evidence to suggest he was and I don't think he ever did. But what is a complete sham is his suggestion that it was more of a social club than a place to promote hate. Byrd's decision to leave the Klan was the moral choice, period. What is not moral is trying to sell us all on how the Klan was "different" back then. No it wasn't and all Byrd had to say was he realized his life was taking him down a path he didn't want to go and that's why he made the change. People can understand that reason, but like The Hawk, they can't understand the reason he gave.
To its credit the book discusses Byrd's turn in the Ku Klux Klan during the early 1940s. Byrd even credits his time in the KKK as his catalyst for entering politics. He won his local election to be "Immortal Cyclops" and was known as one of the best recruiters in the state.
When Byrd ran for office in 1946 he was called on to the carpet for this time in the white hood. He claimed to have only spent parts of 1942 through 1943 in the group but there is evidence to suggest he hung around longer.
What really got me on this one was Byrd "spinning" the Klan as a sort of "Southern Rotary Club" and full of upstanding citizens like doctors and lawyers. That may be all well and good but calling the Klan a Southern Rotary club is like calling the Irish Republican Army a recreational paint ball team. It is just all a bunch of nonsense.
Hawk's View: Byrd was in the Klan and why I don't condone that one bit he claims he was not part of any violent acts. There is no evidence to suggest he was and I don't think he ever did. But what is a complete sham is his suggestion that it was more of a social club than a place to promote hate. Byrd's decision to leave the Klan was the moral choice, period. What is not moral is trying to sell us all on how the Klan was "different" back then. No it wasn't and all Byrd had to say was he realized his life was taking him down a path he didn't want to go and that's why he made the change. People can understand that reason, but like The Hawk, they can't understand the reason he gave.
Wednesday, June 15, 2005
Our State Fair is Better Than Your State Fair...
I've noticed that my posts lately have been a little serious so I thought I would break that mold and lighten it up a bit today.
The Hawk can't believe it but a right of passage in the midwest is closer than it seems. Yes that's right the State Fair is nearby and as is every year there will be lots of new rides, exhibits and food on display.
Using my connections well within the halls of the state fair committee, The Hawk found out what the committee rejected this year. I can't believe these didn't make it...
Top 5 Rejected Games:
1. Pin-the-tail on the angry Alaskan Timberwolf
2. Name 10,000 lakes in Minnesota
3. Jart tossing
4. Spot the message of the DFL party
5. Amish cage match
Top 5 Rejected Exhibits
1. CarnieGrooming
2. Make your own Spam
3. In search of the reason of how Garrison Keillor became a star
4. The great literary works of Jesse Ventura
5. The terror in the fall: deer hunting from the deer's perspective
Despite the above, our state fair promises to be a rip roarin' fried foood eatin whale of a time. You won't want to miss it...
Hawk
The Hawk can't believe it but a right of passage in the midwest is closer than it seems. Yes that's right the State Fair is nearby and as is every year there will be lots of new rides, exhibits and food on display.
Using my connections well within the halls of the state fair committee, The Hawk found out what the committee rejected this year. I can't believe these didn't make it...
Top 5 Rejected Games:
1. Pin-the-tail on the angry Alaskan Timberwolf
2. Name 10,000 lakes in Minnesota
3. Jart tossing
4. Spot the message of the DFL party
5. Amish cage match
Top 5 Rejected Exhibits
1. CarnieGrooming
2. Make your own Spam
3. In search of the reason of how Garrison Keillor became a star
4. The great literary works of Jesse Ventura
5. The terror in the fall: deer hunting from the deer's perspective
Despite the above, our state fair promises to be a rip roarin' fried foood eatin whale of a time. You won't want to miss it...
Hawk
Monday, June 13, 2005
Jacko Moonwalks...
POST UPDATE: As I'm sure you have already heard/read, Michael Jackson moonwalked on all charges today in Santa Barbara. Jacko is now a free man.
While I was not in the jury, I do not see how this guy could get off on every charge (especially the serving of alcohol to a minor which he admitted to doing). In the end his behavior, while bizarre and questionable, was still a case of hearsay. My own opinion is that he did what he was charged with but I did not get to make that call.
While the case against Jackson is over, it is time we start a new campaign against the parents of these children. These sick, disgusting, pathetic people knowingly pimped out their children in a quest for a cash payout. The idea that someone would do that to their own child is beyond all rationale. In a perfect world, the parents would be behind bars.
Along with Jackson...
While I was not in the jury, I do not see how this guy could get off on every charge (especially the serving of alcohol to a minor which he admitted to doing). In the end his behavior, while bizarre and questionable, was still a case of hearsay. My own opinion is that he did what he was charged with but I did not get to make that call.
While the case against Jackson is over, it is time we start a new campaign against the parents of these children. These sick, disgusting, pathetic people knowingly pimped out their children in a quest for a cash payout. The idea that someone would do that to their own child is beyond all rationale. In a perfect world, the parents would be behind bars.
Along with Jackson...
Sunday, June 12, 2005
The Labor Movement Goes Silent
It's not easy these days being the member of a union. If you're in the automotive world, you're under siege from both GM and Ford to make concessions on your pension and benefit plans. If you're in the airline industry, you have the same worries along with the added benefit that every stinkin' carrier is either in bankruptcy or careening toward it.
America owes a lot to the labor movement (hey, they brought us the weekend). Without them we might still be lorded over by a nation of Montgomery Burns' from The Simpsons. They came along at a time when America needed a voice for the working man (sorry for the sexist writing ladies, but that's who was working back then). The ability to bargain collectively brought the working man into the middle class and provided good lives for millions of American families.
Today the tale is not as cheery. The global economy has commoditized so much of the so-called "skilled labor" that it is difficult for nation's who have a vibrant "blue collar" class to compete. Case in point: A UAW worker makes over $36.00 an hour in pay/benefits while a Chinese worker makes around $1.70 an hour. That is a shocking disparity.
In fact it makes you wonder how we can even save the cause for the working stiff. What good is the ability to bargain collectively when you can be outsourced for amazing cost savings?
As a result unions are finding themselves under immense pressure not just from management to give concessions but from competition. In fact, Northwest Airlines is reportedly putting out ads on Monster.com to for flight attendents (needed in case of a strike). That same airline is toying with the idea of outsourcing mechanic work overseas to save money as well.
All of this adds up to critical diagnosis for America's trade unions. What can they do to save themselves and their cause?
Hawk's View: Never underestimate an American with his/her back against the wall. Unions came about because of unfair treatment and they can reinvent themselves again using that same mentality. I don't pretend to have the answer, although I think a tighter union/management partnership with the union having more ownership of the company than they do now could help, but somebody needs to be this centuries John L. Lewis. Without leadership that promotes competition, instead of protecting, is at least a start in the road to winning the day. If the trade unions continue their stance of protectionism they will go the way of the dodo.
America owes a lot to the labor movement (hey, they brought us the weekend). Without them we might still be lorded over by a nation of Montgomery Burns' from The Simpsons. They came along at a time when America needed a voice for the working man (sorry for the sexist writing ladies, but that's who was working back then). The ability to bargain collectively brought the working man into the middle class and provided good lives for millions of American families.
Today the tale is not as cheery. The global economy has commoditized so much of the so-called "skilled labor" that it is difficult for nation's who have a vibrant "blue collar" class to compete. Case in point: A UAW worker makes over $36.00 an hour in pay/benefits while a Chinese worker makes around $1.70 an hour. That is a shocking disparity.
In fact it makes you wonder how we can even save the cause for the working stiff. What good is the ability to bargain collectively when you can be outsourced for amazing cost savings?
As a result unions are finding themselves under immense pressure not just from management to give concessions but from competition. In fact, Northwest Airlines is reportedly putting out ads on Monster.com to for flight attendents (needed in case of a strike). That same airline is toying with the idea of outsourcing mechanic work overseas to save money as well.
All of this adds up to critical diagnosis for America's trade unions. What can they do to save themselves and their cause?
Hawk's View: Never underestimate an American with his/her back against the wall. Unions came about because of unfair treatment and they can reinvent themselves again using that same mentality. I don't pretend to have the answer, although I think a tighter union/management partnership with the union having more ownership of the company than they do now could help, but somebody needs to be this centuries John L. Lewis. Without leadership that promotes competition, instead of protecting, is at least a start in the road to winning the day. If the trade unions continue their stance of protectionism they will go the way of the dodo.
Friday, June 10, 2005
NYC Drops the Baton on The Olympics
On Wenesday New York saw its quest for the Olympics come to a crashing halt. The coveted West Side Stadium project (championed by Mayor Michael Bloomberg) was shot down by a special committee. The Stadum was the catalyst in New York's 2012 Olympic bid. It was also to be used for the New York Jets football team as well as host the 2010 Super Bowl.
Now that is all over. While The Hawk feels that New York losing the Olympics is really not a huge deal (they're New York, they don't need the extra tourism dollars) he does see it as a sign as to how much the "machine" politics of major urban areas has changed over the years.
For decades towns like New York, Chicago, Philadelphia, Washington DC, etc were run by political machines that were essentially city-state fiefdoms. The mayors in these towns could make anything happen and were seen almost as urban royalty. Heck, the Daley Dynasty in Chicago even delivered the 1960 election for John Kennedy.
These machines could make any miracle happen. If a town like New York wanted to host the Olympics in the 1950s, it would have been done. A stadium would have been built and the city would be cheering its construction.
Clearly these days are over. NYC's inability to get a stadium done was one of the final nails in the coffin of machine politics. The current climate does not allow for fiefdoms to flourish. 24/7 media and proliferation of the Internet allow the little guy to get their message out to the masses. Mobilization is easier and getting that message out is a snap. The challenges New York faced in this stadium battle were probably no different than decades past, except the opponents were now able to get their message out.
Now the US is out of the running for 2012 (we wouldn't have gotten it anyway, Paris was clearly the leader in the clubhouse). Mayor Bloomberg feels NYC let down the country and that New York is no longer a place where "things can get done."
Hawk's View: The Mayor's line of thinking is simply misguided. The city voted down the stadium because it was a bad business deal and they in turn shot down the Olympics because having them would probably be a detriment to the city. The Mayor's real reason for being despondent over the stadium defeat should be rooted in the fact that machine politics can no longer get whatever it wants. While that's bad for the Mayor it is good for America. We call that Democracy...
Now that is all over. While The Hawk feels that New York losing the Olympics is really not a huge deal (they're New York, they don't need the extra tourism dollars) he does see it as a sign as to how much the "machine" politics of major urban areas has changed over the years.
For decades towns like New York, Chicago, Philadelphia, Washington DC, etc were run by political machines that were essentially city-state fiefdoms. The mayors in these towns could make anything happen and were seen almost as urban royalty. Heck, the Daley Dynasty in Chicago even delivered the 1960 election for John Kennedy.
These machines could make any miracle happen. If a town like New York wanted to host the Olympics in the 1950s, it would have been done. A stadium would have been built and the city would be cheering its construction.
Clearly these days are over. NYC's inability to get a stadium done was one of the final nails in the coffin of machine politics. The current climate does not allow for fiefdoms to flourish. 24/7 media and proliferation of the Internet allow the little guy to get their message out to the masses. Mobilization is easier and getting that message out is a snap. The challenges New York faced in this stadium battle were probably no different than decades past, except the opponents were now able to get their message out.
Now the US is out of the running for 2012 (we wouldn't have gotten it anyway, Paris was clearly the leader in the clubhouse). Mayor Bloomberg feels NYC let down the country and that New York is no longer a place where "things can get done."
Hawk's View: The Mayor's line of thinking is simply misguided. The city voted down the stadium because it was a bad business deal and they in turn shot down the Olympics because having them would probably be a detriment to the city. The Mayor's real reason for being despondent over the stadium defeat should be rooted in the fact that machine politics can no longer get whatever it wants. While that's bad for the Mayor it is good for America. We call that Democracy...
Thursday, June 09, 2005
Jackson Faces the Man in the Mirror
As a rule I try to avoid writing about all things Hollywood for several reasons. One, I find that as an industry it is incredibly overrated and two, I find the players involved to be wholly shallow, self-centered and not the least bit interesting.
But I make an exception to this when the topic comes to Michael Jackson. Yes, like most Americans, Jacko has become a bit of a tragic figure to me. The trial that he is currently mired in is for charges that, if true, are incredibly heinous and unacceptable. However that trial is not why I am writing today.
I'm writing because I am wondering aloud how one man can be in such a dire financial situation after making so much money. Jackson was THE ultimate talent of the early 80's racking up impressive sales and expanding his own personal brand into an international sensation.
But the success clearly was not a tonic for Jackson's main issue: his feeling of self loathing. Despite fame, fortune and adulation, Jackson went from a talented legendary talent into a walking freakshow. Along the way he made a vast fortune and now appears to have lost it all.
In yesterday's Wall Street Journal it was reported that Jacko is on the hook for $270M in loans. His situation is so dire that he will probably have to sell some or all of his 50% share in Sony/ATV music (a music catalog that includes most of The Beatles recordings).
How a man could fall this far, spend so much money is beyond the thought process of rational humans. However that is the point in all of this. Jackson is not rational. He's not because he was forced into Showbiz at a young age by an overbearing father and became the family breadwinner. Once he finally broke free of the family in the late 70's and found success, his issues with his childhood rose to the surface and he started his sad pathetic journey to the life he has today.
Now he's broke and owes more money than a third world government. His immense talent wasted, his life a shambles. If convicted Jackson will lose everything (and still might even if acquitted).
Hawk's View: The sad case of Jackson is yet another of celebrity gone bad. It is a reminder of how superficialness in life tends to lead to a life that is unfulfilling. I don't feel sorry for Jackson for what he has become. However, I do feel that his fall from grace is a lesson to all of us.
But I make an exception to this when the topic comes to Michael Jackson. Yes, like most Americans, Jacko has become a bit of a tragic figure to me. The trial that he is currently mired in is for charges that, if true, are incredibly heinous and unacceptable. However that trial is not why I am writing today.
I'm writing because I am wondering aloud how one man can be in such a dire financial situation after making so much money. Jackson was THE ultimate talent of the early 80's racking up impressive sales and expanding his own personal brand into an international sensation.
But the success clearly was not a tonic for Jackson's main issue: his feeling of self loathing. Despite fame, fortune and adulation, Jackson went from a talented legendary talent into a walking freakshow. Along the way he made a vast fortune and now appears to have lost it all.
In yesterday's Wall Street Journal it was reported that Jacko is on the hook for $270M in loans. His situation is so dire that he will probably have to sell some or all of his 50% share in Sony/ATV music (a music catalog that includes most of The Beatles recordings).
How a man could fall this far, spend so much money is beyond the thought process of rational humans. However that is the point in all of this. Jackson is not rational. He's not because he was forced into Showbiz at a young age by an overbearing father and became the family breadwinner. Once he finally broke free of the family in the late 70's and found success, his issues with his childhood rose to the surface and he started his sad pathetic journey to the life he has today.
Now he's broke and owes more money than a third world government. His immense talent wasted, his life a shambles. If convicted Jackson will lose everything (and still might even if acquitted).
Hawk's View: The sad case of Jackson is yet another of celebrity gone bad. It is a reminder of how superficialness in life tends to lead to a life that is unfulfilling. I don't feel sorry for Jackson for what he has become. However, I do feel that his fall from grace is a lesson to all of us.
Sunday, June 05, 2005
NightmareWorks Faces a New Ogre: Wall Street
On Friday, Dreamworks SKG (the brainchild of Steven Spielberg, David Geffen and Jeffrey Katzenberg) got its first taste of life as a public company: they got sued.
Yes, apparently those pesky shareholders who bought into the vision of the three amigos were a bit miffed by Dreamworks huge quarterly profit miss. The miss was due to the major wiff job Shrek 2 had in the DVD market.
OK, in fairness I should restate that last sentence. The miss was due to Dreamworks horrific forecasting and expecations of Shrek 2 in the DVD market. The video itself did not do too poorly, it was the expectations that Katzenberg and team led their shareholders to believe that was the problem. To sum it up, here's what happened...
1. Katzenberg travels all over the world promoting that Shrek 2 will be bigger than cold fusion
2. Dreamworks floods the market with copies of the movie
3. The movie debuts in the DVD market to huge numbers (Katzenberg figures he'll get 33% of total sales in the first week)
4. Ooops, turns out new titles are burning out much faster (around 50% of sales are done in the first week). Note to Jeffrey: pick up a Video Business magazine once in a while, even I knew that one.
5. Because of their inability to understand the DVD market as it actually is (versus how they want it) Dreamworks is flooded with returns.
6. The returns and lack of sales equal a huge miss in profit expectations (25% miss). Stock takes a dive.
7. Dreamworks gets sued.
OK, here's the deal, yes businesses make mistakes, but what they don't do is forget to WARN Wall Street about a potential miss. Dreamworks screwed up big time by not letting The Street know what was going on with Shrek 2. The Street found out when the rest of us in the Proletariot did (that's never good) and responded accordingly.
Shareholders, feeling that past guidance given by management was clearly misguided, got the shaft and responded in the only way they know how: via a class action lawsuit.
Hawk's View: The bottom line is Katzenberg's hubris got in the way. This is no longer a private company. The public has a huge interest and a right to know what is going on. Dreamworks board and CEO should have taken a more conservative approach in announcing the expectations of Shrek. Katzenberg is an animator and creator at heart. He should not be the face of the company when it comes to giving a financial view to The Street. Look for current CEO Richard Enrico to take a bigger role in the future and look for Dreamworks to write a check to the angry shareholders.
Yes, apparently those pesky shareholders who bought into the vision of the three amigos were a bit miffed by Dreamworks huge quarterly profit miss. The miss was due to the major wiff job Shrek 2 had in the DVD market.
OK, in fairness I should restate that last sentence. The miss was due to Dreamworks horrific forecasting and expecations of Shrek 2 in the DVD market. The video itself did not do too poorly, it was the expectations that Katzenberg and team led their shareholders to believe that was the problem. To sum it up, here's what happened...
1. Katzenberg travels all over the world promoting that Shrek 2 will be bigger than cold fusion
2. Dreamworks floods the market with copies of the movie
3. The movie debuts in the DVD market to huge numbers (Katzenberg figures he'll get 33% of total sales in the first week)
4. Ooops, turns out new titles are burning out much faster (around 50% of sales are done in the first week). Note to Jeffrey: pick up a Video Business magazine once in a while, even I knew that one.
5. Because of their inability to understand the DVD market as it actually is (versus how they want it) Dreamworks is flooded with returns.
6. The returns and lack of sales equal a huge miss in profit expectations (25% miss). Stock takes a dive.
7. Dreamworks gets sued.
OK, here's the deal, yes businesses make mistakes, but what they don't do is forget to WARN Wall Street about a potential miss. Dreamworks screwed up big time by not letting The Street know what was going on with Shrek 2. The Street found out when the rest of us in the Proletariot did (that's never good) and responded accordingly.
Shareholders, feeling that past guidance given by management was clearly misguided, got the shaft and responded in the only way they know how: via a class action lawsuit.
Hawk's View: The bottom line is Katzenberg's hubris got in the way. This is no longer a private company. The public has a huge interest and a right to know what is going on. Dreamworks board and CEO should have taken a more conservative approach in announcing the expectations of Shrek. Katzenberg is an animator and creator at heart. He should not be the face of the company when it comes to giving a financial view to The Street. Look for current CEO Richard Enrico to take a bigger role in the future and look for Dreamworks to write a check to the angry shareholders.
Friday, June 03, 2005
Air War Update
Updated Post:
My last post dealt with the current Air War going on between Airbus and Boeing. I wrote how Airbus left Boeing in the dust because of their drive toward gaining market share and taking advantage of Boeing's lackadaisical approach to aircraft building.
Why I don't change my thoughts, it is interesting to note the Airbus and their new plane, the A380, is having problems. The A380 is a skyscraper on its side that flies as well. The mongo plane was hailed by many as the next frontier of jet travel. It was backed by several orders from airlines throughout the globe.
Turns out the A380 has found turbulence. The Australian airline Qantas announced today that its 12 jet order will be delayed for as long as six months. Apparently Qantas is not the only one having problems as other airlines are reporting similar delays (including Air France, Emirates and Singapore Air). All of this could force Airbus to pay exorbinant penalties for missing deadlines.
Meanwhile, Boeing is putting pressure on them with their answer to the A380, the 787 Dreamliner. Should be interesting to see how this unfolds.
Hawk
My last post dealt with the current Air War going on between Airbus and Boeing. I wrote how Airbus left Boeing in the dust because of their drive toward gaining market share and taking advantage of Boeing's lackadaisical approach to aircraft building.
Why I don't change my thoughts, it is interesting to note the Airbus and their new plane, the A380, is having problems. The A380 is a skyscraper on its side that flies as well. The mongo plane was hailed by many as the next frontier of jet travel. It was backed by several orders from airlines throughout the globe.
Turns out the A380 has found turbulence. The Australian airline Qantas announced today that its 12 jet order will be delayed for as long as six months. Apparently Qantas is not the only one having problems as other airlines are reporting similar delays (including Air France, Emirates and Singapore Air). All of this could force Airbus to pay exorbinant penalties for missing deadlines.
Meanwhile, Boeing is putting pressure on them with their answer to the A380, the 787 Dreamliner. Should be interesting to see how this unfolds.
Hawk
Wednesday, June 01, 2005
Air War
One of the more interesting issues going on in the world of business and politics today is the upcoming Boeing/Airbus case to be heard in front of the WTO.
To sum it up the US is filing a grievance against EADS (Airbus' owner) for significant government subsidies given by the various European governments that back EADS. The US contends this is unfair labor practice and is crying foul.
All of that would be fine and dandy except Boeing spends as much time in the subsidy lunch line as their European competition. The state of Washington has essentially become Boeing own personal credit card, doling out billions in "indirect"grants to the state's largest employer.
The problem here is twofold: lack of competition and Boeing falling asleep at the wheel in the commercial jet business. The first one is hard to fix. The jet business is expensive and competitors fled the market long ago for more profitable business. The barrier to entry is high and I don't see that changing any time soon.
However on the second issue, Boeing has no one to blame for their troubles than themselves. Despite having a virtual lock on the commercial jet business for decades the company got fat and happy and took it's eye off the prize (think KMart only in the jet business). Along the way, poor management (first by Phil Condit and then by Harry Stonecipher) diversified Boeing away from its bread and butter and into other more "sexy" businesses. The avalanche began shortly after former CEO Condit moved Boeing out of Seattle to Chicago (a move many believe was done to distance the company from its airplane heritage).
Turns out Boeing was much better at building planes than doing any of its other projects the problem is by the time they realized that they were woefully behind in R&D and had taken an eye off of their customers. Now they are running to catch up.
Hawk's View: The WTO case is a joke. This is a duopoly with the US in one corner and the EU in the other. Boeing doesn't lose out because of subsidies, they lose out because of poor business decisions. Look for the US (not a fan favorite in the world today) to get whipped at the WTO.
To sum it up the US is filing a grievance against EADS (Airbus' owner) for significant government subsidies given by the various European governments that back EADS. The US contends this is unfair labor practice and is crying foul.
All of that would be fine and dandy except Boeing spends as much time in the subsidy lunch line as their European competition. The state of Washington has essentially become Boeing own personal credit card, doling out billions in "indirect"grants to the state's largest employer.
The problem here is twofold: lack of competition and Boeing falling asleep at the wheel in the commercial jet business. The first one is hard to fix. The jet business is expensive and competitors fled the market long ago for more profitable business. The barrier to entry is high and I don't see that changing any time soon.
However on the second issue, Boeing has no one to blame for their troubles than themselves. Despite having a virtual lock on the commercial jet business for decades the company got fat and happy and took it's eye off the prize (think KMart only in the jet business). Along the way, poor management (first by Phil Condit and then by Harry Stonecipher) diversified Boeing away from its bread and butter and into other more "sexy" businesses. The avalanche began shortly after former CEO Condit moved Boeing out of Seattle to Chicago (a move many believe was done to distance the company from its airplane heritage).
Turns out Boeing was much better at building planes than doing any of its other projects the problem is by the time they realized that they were woefully behind in R&D and had taken an eye off of their customers. Now they are running to catch up.
Hawk's View: The WTO case is a joke. This is a duopoly with the US in one corner and the EU in the other. Boeing doesn't lose out because of subsidies, they lose out because of poor business decisions. Look for the US (not a fan favorite in the world today) to get whipped at the WTO.
Clog Stomp
Post Update:
As expected the Dutch slam dunked the EU Constitution into a canal in downtown Amsterdam. The loss was worse than the one in France and will probably kickoff a time of "reflection" in the EU parliament. The Brits take over the rotating presidency later this Summer and will attempt to get the healing process started. Should be interesting...
Hawk
As expected the Dutch slam dunked the EU Constitution into a canal in downtown Amsterdam. The loss was worse than the one in France and will probably kickoff a time of "reflection" in the EU parliament. The Brits take over the rotating presidency later this Summer and will attempt to get the healing process started. Should be interesting...
Hawk
Monday, May 30, 2005
California Dreamin'
Like most guys, I'm a huge sports fan. While my preference is college football/basketball and baseball (go Cubs, this is our year) I also have an affinity for the NFL. In this case my team has and always will be the Kansas City Chiefs.
For years the Chiefs have played in front of packed crowds at historic Arrowhead stadium. It has long been considered the toughest place to play in the league (except in the playoffs, of course) and its following is second to none.
Now that all could be ending. The Chiefs announced today (somewhat indirectly) they are now in the LA Derby. The Race to the Rose Bowl. The Cascade to The Coliseum. Yes, LA has been without a team for 10 years now and the league wants a club their in the worst way. Expansion is out as the league is at 32 teams and wants to keep it that way. That leaves teams with bad cribs as the likely choice. The Hawk lists out the top 4 and why they are prime candidates:
Indianapolis Colts: They play in a bad dome in a small town. They also have the most exciting team in the league. Indy is not a large town by any means and it is a Pacers town first and foremost (its Indiana, basketball rules). Plus owner Bob Irsay is a movie producer. Odds on moving: 66%.
San Diego Chargers: They actually used to play in LA and are only 2 hours down the highway. San Diego is a small town that doesn't appear to be all that thrilled with ponying up for a new stadium. The town is in love with the Padres new facility Petco Park but not enough to want to double down on a new football stadium. Odds on moving: 20%.
New Orleans Saints: They play in a rat trap, but this is a football town. Owner Tom Benson's ridiculous ideas of moving to either San Antonio or, heaven forbid, Albuquerque, show that they need to clear the air ducts in his luxury box because he is sniffing something weird. However, their stadium is falling apart and the state does not appear to be willing, or able, to pitch in to help renovate. Odds on moving: 5%.
Kansas City Chiefs: Like Indy they play in a small town, but they have a long tradition and football is what defines the city. Although an amendment to raise a sales tax to refurb historic Arrowhead failed last Fall, look for this to get worked out. The Chiefs have said they don't want a new facility (the only one on this list who feels that way) they just want a renovation. However, if the legislature doesn't act, the Hunt's won't wait around. They are the saaviest owners of the 4 on this list and they would be the most likely to cut an aggressive deal in LA. Odds on moving: 4%.
Out of the Running...
Minnesota Vikings: New owner Zygi Wilff is a real estate developer and already has grand plans for a Zygi World in nearby Blaine. The stadium would be just a piece of it. The Vikes will stay put.
San Francisco 49ers: In 97' the 49ers actually WON a ballot initiative for $100 in financing for a new stadium/mall near Candlestick Point. But Honest Eddie DeBartolo fell out of favor with the law shortly thereafter and the deal died. Now that ownership has stabilized (albeit poorly) under Eddie's sister, look for Mayor Gavin Newson to get a deal done in the next two years.
LA represents a great opportunity for a team. Yes the league has survived without a team but being the owner of LA's football team is still a great opportunity. It is hard to blame any owner with a bad stadium to stick in his current home.
Hawk's View: In the stadium game it is all about leverage. Once LA is gone the three remaining teams in my top 4 will have significantly less leverage than before. Sure KC, New Orleans or San Diego could say they are moving to Indy (after the Colts flee and head to LA in 09') but that is not the same leverage point. Look for all 4 to try to get their stadium saga done before LA is announced. However, expect all four to work in parallel with the league to punch their ticket to Hollywood.
For years the Chiefs have played in front of packed crowds at historic Arrowhead stadium. It has long been considered the toughest place to play in the league (except in the playoffs, of course) and its following is second to none.
Now that all could be ending. The Chiefs announced today (somewhat indirectly) they are now in the LA Derby. The Race to the Rose Bowl. The Cascade to The Coliseum. Yes, LA has been without a team for 10 years now and the league wants a club their in the worst way. Expansion is out as the league is at 32 teams and wants to keep it that way. That leaves teams with bad cribs as the likely choice. The Hawk lists out the top 4 and why they are prime candidates:
Indianapolis Colts: They play in a bad dome in a small town. They also have the most exciting team in the league. Indy is not a large town by any means and it is a Pacers town first and foremost (its Indiana, basketball rules). Plus owner Bob Irsay is a movie producer. Odds on moving: 66%.
San Diego Chargers: They actually used to play in LA and are only 2 hours down the highway. San Diego is a small town that doesn't appear to be all that thrilled with ponying up for a new stadium. The town is in love with the Padres new facility Petco Park but not enough to want to double down on a new football stadium. Odds on moving: 20%.
New Orleans Saints: They play in a rat trap, but this is a football town. Owner Tom Benson's ridiculous ideas of moving to either San Antonio or, heaven forbid, Albuquerque, show that they need to clear the air ducts in his luxury box because he is sniffing something weird. However, their stadium is falling apart and the state does not appear to be willing, or able, to pitch in to help renovate. Odds on moving: 5%.
Kansas City Chiefs: Like Indy they play in a small town, but they have a long tradition and football is what defines the city. Although an amendment to raise a sales tax to refurb historic Arrowhead failed last Fall, look for this to get worked out. The Chiefs have said they don't want a new facility (the only one on this list who feels that way) they just want a renovation. However, if the legislature doesn't act, the Hunt's won't wait around. They are the saaviest owners of the 4 on this list and they would be the most likely to cut an aggressive deal in LA. Odds on moving: 4%.
Out of the Running...
Minnesota Vikings: New owner Zygi Wilff is a real estate developer and already has grand plans for a Zygi World in nearby Blaine. The stadium would be just a piece of it. The Vikes will stay put.
San Francisco 49ers: In 97' the 49ers actually WON a ballot initiative for $100 in financing for a new stadium/mall near Candlestick Point. But Honest Eddie DeBartolo fell out of favor with the law shortly thereafter and the deal died. Now that ownership has stabilized (albeit poorly) under Eddie's sister, look for Mayor Gavin Newson to get a deal done in the next two years.
LA represents a great opportunity for a team. Yes the league has survived without a team but being the owner of LA's football team is still a great opportunity. It is hard to blame any owner with a bad stadium to stick in his current home.
Hawk's View: In the stadium game it is all about leverage. Once LA is gone the three remaining teams in my top 4 will have significantly less leverage than before. Sure KC, New Orleans or San Diego could say they are moving to Indy (after the Colts flee and head to LA in 09') but that is not the same leverage point. Look for all 4 to try to get their stadium saga done before LA is announced. However, expect all four to work in parallel with the league to punch their ticket to Hollywood.
Sunday, May 29, 2005
Europe Struggles to Find Itself
On Saturday France gave the EU the big FU when they voted down ratifying the EU treaty. The French (the 10th member to vote and the first to reject it) were unified from both sides of the political spectrum: they hated the idea of a EU constitution. The end result was a humiliating defeat for French premier Jacques Chirac, who had staked much of his political future on a oui' vote.
The no vote by the French just hastened the death of the EU contstitution. The Dutch (scheduled to vote later this week) would have given it a clog stomp anyway, so the demise of the constitution does not fall squarely at the feet of our beret wearing friends.
What it does is underscore a European wide problem. The now 25 member EU is, essentially, two organizations. You have the haves (Italy, Great Britain, France, etc) and the extremely have-nots (Estonia, Latvia, Greece). The problem is that the haves seemingly have less lately. Let's take a roll call to see how well they are doing...
Great Britain: Yes, Tony Blair won his election. But his party got slammed by the Tories and there is little doubt that he will not serve all of his third term. Immigration continues to be a hot topic as well as issues around the educational system. Plus, Great Britain continues to struggle to find its leadership role in the world. They are not the US and they don't have enough support in the EU. Plus, the new Queen to-be looks more like a King.
Italy: Now in their 175th government since WWII, the Italians seem to be struggling with this whole non-sensical idea of "globalization." Italian industry remains mostly small with the bigger firms squarely in bed with the government (I'm talking about you, FIAT). In addition, the country is run by a man who controls not just the government TV stations but the private ones as well (think Ruper Murdoch crossed by Ted Turner). Unemployment is up, morale is down and the new Pope isn't even Italian.
Germany: The fun loving Germans are swimming in high unemployment, an immigration problem and a rash of angry youth (an idea that history tells us should make us all nervous). That coupled with the fact they have one of the world's strongest and toughest trade unions (IG Metall) has made life less fun for the folks in Berlin. Regional elections slated for later this week may turn out the ruling Social Democrat party. But, hey, at least we're not...
France: Yes our beret wearing, wine swilling friends are having a rough go. As in everywhere else in Europe immigration is a huge problem and a divisive topic (especially toward Muslim immigrants). The country continues to try to balance its lifestyle needs (35 hour work weeks) with the realities of a global economy. Plus they have pushed to be THE leader in the EU but the bouncing of the EU constitution has soiled that dream.
Spain: Spain's biggest problem seems to be no one wants to be Spanish. Both the Basque region and the Catalonia region want more autonomy and less interference from Madrid. The government has to balance those needs while still keeping the country together.
Hawk's View: OK, they voted down the constitution but the EU is still the right way to go. Most of Europe's individual country problems are the same (immigration, unemployment, etc) and by sticking together they have a shot at solving them peacefully. They have already accomplished a common currency and (essentially) borderless nations. Most thought that would never happened but they pulled it off. They need to remember that and stay the course. Take the French rejection as a sign that the whole continent is not yet ready for a USA of Europe as Churchill desired. They need to use the rejection as motivation to understand what the citizens of Europe want and how its leaders can get it there together.
The no vote by the French just hastened the death of the EU contstitution. The Dutch (scheduled to vote later this week) would have given it a clog stomp anyway, so the demise of the constitution does not fall squarely at the feet of our beret wearing friends.
What it does is underscore a European wide problem. The now 25 member EU is, essentially, two organizations. You have the haves (Italy, Great Britain, France, etc) and the extremely have-nots (Estonia, Latvia, Greece). The problem is that the haves seemingly have less lately. Let's take a roll call to see how well they are doing...
Great Britain: Yes, Tony Blair won his election. But his party got slammed by the Tories and there is little doubt that he will not serve all of his third term. Immigration continues to be a hot topic as well as issues around the educational system. Plus, Great Britain continues to struggle to find its leadership role in the world. They are not the US and they don't have enough support in the EU. Plus, the new Queen to-be looks more like a King.
Italy: Now in their 175th government since WWII, the Italians seem to be struggling with this whole non-sensical idea of "globalization." Italian industry remains mostly small with the bigger firms squarely in bed with the government (I'm talking about you, FIAT). In addition, the country is run by a man who controls not just the government TV stations but the private ones as well (think Ruper Murdoch crossed by Ted Turner). Unemployment is up, morale is down and the new Pope isn't even Italian.
Germany: The fun loving Germans are swimming in high unemployment, an immigration problem and a rash of angry youth (an idea that history tells us should make us all nervous). That coupled with the fact they have one of the world's strongest and toughest trade unions (IG Metall) has made life less fun for the folks in Berlin. Regional elections slated for later this week may turn out the ruling Social Democrat party. But, hey, at least we're not...
France: Yes our beret wearing, wine swilling friends are having a rough go. As in everywhere else in Europe immigration is a huge problem and a divisive topic (especially toward Muslim immigrants). The country continues to try to balance its lifestyle needs (35 hour work weeks) with the realities of a global economy. Plus they have pushed to be THE leader in the EU but the bouncing of the EU constitution has soiled that dream.
Spain: Spain's biggest problem seems to be no one wants to be Spanish. Both the Basque region and the Catalonia region want more autonomy and less interference from Madrid. The government has to balance those needs while still keeping the country together.
Hawk's View: OK, they voted down the constitution but the EU is still the right way to go. Most of Europe's individual country problems are the same (immigration, unemployment, etc) and by sticking together they have a shot at solving them peacefully. They have already accomplished a common currency and (essentially) borderless nations. Most thought that would never happened but they pulled it off. They need to remember that and stay the course. Take the French rejection as a sign that the whole continent is not yet ready for a USA of Europe as Churchill desired. They need to use the rejection as motivation to understand what the citizens of Europe want and how its leaders can get it there together.
Friday, May 27, 2005
China Goes Thirsty
The May 21st issue of The Economist features a sobering article on page 46 regarding the dire problem China is facing in regards to water.
Never blessed with huge reserves of water to begin with, China's problems are becoming more and more outfront as the country's economy continues to grow at breakneck speed. While that is good for the country, it is bad for those in the country who yearn for things like drinking water.
China posseses less than a third of water, per capita, than the world average. Part of the problem is supply but the other is market issues. Up until 1985 water was free to the masses and today it is sold at well under market rate. The voracious thirst in the cities has left the countryside in the dust (1 out of 3 lack sufficient drinking water). So far China has paid only lip service to this problem. It is the elephant in the pagoda that is not being discussed.
But it better be discussed. Lack of water leads to big problems. It's not like there is a burgeoning global water market (like oil) that the Chinese can tap into to. Action is needed immediately.
Hawk's View: China is a country blessed with natural entrepreneurs who have shown they can do anything. Now it is time to put that ingenuity to good use and fast. China has things countries want, so they have bargaining chips to improve their water issues. However, if they don't look for a huge problem to arise. First from the countryside acting up toward the urban center's and then the country as a whole taking drastic measures to give itself a drink.
Never blessed with huge reserves of water to begin with, China's problems are becoming more and more outfront as the country's economy continues to grow at breakneck speed. While that is good for the country, it is bad for those in the country who yearn for things like drinking water.
China posseses less than a third of water, per capita, than the world average. Part of the problem is supply but the other is market issues. Up until 1985 water was free to the masses and today it is sold at well under market rate. The voracious thirst in the cities has left the countryside in the dust (1 out of 3 lack sufficient drinking water). So far China has paid only lip service to this problem. It is the elephant in the pagoda that is not being discussed.
But it better be discussed. Lack of water leads to big problems. It's not like there is a burgeoning global water market (like oil) that the Chinese can tap into to. Action is needed immediately.
Hawk's View: China is a country blessed with natural entrepreneurs who have shown they can do anything. Now it is time to put that ingenuity to good use and fast. China has things countries want, so they have bargaining chips to improve their water issues. However, if they don't look for a huge problem to arise. First from the countryside acting up toward the urban center's and then the country as a whole taking drastic measures to give itself a drink.
Wednesday, May 25, 2005
A View from Bizarro World
It's Wednesday which means it is writing day. Usually I like to wax poetic on the world of business but today I must admit I'm not finding a ton of motivation.
So I digress to my favorite target, North Korea. If you click on the link in the story title you will be taken to the official site of the North Korean "News" Agency. They post press releases on what is going on in Kim Jong-Il Town. When you go there, don't expect to read a positive stuff about the US. The North Korean's view of the US is a tad negative.
I recommend you check it out because it is both a funny and sad tale on what can happen to a nation under a totalitarian regime. It is shocking in this day and age of the Internet and 24/7 information that a place exists where the outside world is completely shut out.
It does exist and the best part is they have a nuke as well.
I'll be back with more banter on Friday.
Hawk
So I digress to my favorite target, North Korea. If you click on the link in the story title you will be taken to the official site of the North Korean "News" Agency. They post press releases on what is going on in Kim Jong-Il Town. When you go there, don't expect to read a positive stuff about the US. The North Korean's view of the US is a tad negative.
I recommend you check it out because it is both a funny and sad tale on what can happen to a nation under a totalitarian regime. It is shocking in this day and age of the Internet and 24/7 information that a place exists where the outside world is completely shut out.
It does exist and the best part is they have a nuke as well.
I'll be back with more banter on Friday.
Hawk
Monday, May 23, 2005
The Saga of Manchester United: Now Even the Brits Hate Us
For over a year, Malcolm Glazer (the amish beard sporting lad who owns the Tampa Bay Buccaneers) has been on a quest to buy the world's most popular (and profitable) sports franchise: Manchester United.
"Man U" as it is called in the business owns a global brand and is revered throughout the world (yes, even in the states). Fans pay hundreds of pounds a year for MANUTV and they line up in countries throughout the globe for the teams annual "barnstorming" tours.
So the idea of a "Yank" like Glazer buying out a coveted brand like this has caused quite a stir from Man U fans and the Brits responded in their usual restrained manner. See below...
Cars owned by Manchester United directors who sold their shares to Glazer have been damaged; a party held by one of Glazer's financial advisers, J.P. Morgan (nyse: JPM - news - people ), was invaded by fans, with wine being tipped over guests; and an invasion of the Manchester offices of another of Glazer's advisors, N.M. Rothschild, was only thwarted when the would-be protesters got stuck in an elevator.
The 30,000 strong fans who are part of "Shareholders United," A small but very vocal group who owns a minority interest in the club have threatened to boycott the club by cancelling season tickets and picketing outside of Man U's Old Trafford Stadium.
It's too bad that won't matter. Glazer owns 76% of the club (he bought over 40% from two Irish horse racing magnates) and he is now fully in charge. He plans to take the club private on June 22nd and install his son as the managing partner (now that's a good idea). Glazer's purchase has piled debt onto once debt free Man U and will put the pressure on the club to get it done on the pitch. With player costs skyrocketing in the Premiership (and across Europe as well) Man U will have to continue to pony up to keep the pound sterling flowing in.
Hawk's View: Glazer is going to pull a Soccer version of Jerry Jones and the Dallas Cowboys. When Jones bought the "Boys" in 1989 he quickly became the Black Sheep of the NFL. He cut his own deals and dared the league to do something about it. Glazer will try the same thing with the Premiership TV deal (which he is looking to vacate after next year) and may do the same with his worldwide sponsors. In the end, Man U's fans may not like the fact a Yank owns their club, but anybody who can turn the Tampa Bay Buccaneers into a winner cannot be underestimated. Look for Man U to get its swagger back both on the Pitch and in the boardroom.
"Man U" as it is called in the business owns a global brand and is revered throughout the world (yes, even in the states). Fans pay hundreds of pounds a year for MANUTV and they line up in countries throughout the globe for the teams annual "barnstorming" tours.
So the idea of a "Yank" like Glazer buying out a coveted brand like this has caused quite a stir from Man U fans and the Brits responded in their usual restrained manner. See below...
Cars owned by Manchester United directors who sold their shares to Glazer have been damaged; a party held by one of Glazer's financial advisers, J.P. Morgan (nyse: JPM - news - people ), was invaded by fans, with wine being tipped over guests; and an invasion of the Manchester offices of another of Glazer's advisors, N.M. Rothschild, was only thwarted when the would-be protesters got stuck in an elevator.
The 30,000 strong fans who are part of "Shareholders United," A small but very vocal group who owns a minority interest in the club have threatened to boycott the club by cancelling season tickets and picketing outside of Man U's Old Trafford Stadium.
It's too bad that won't matter. Glazer owns 76% of the club (he bought over 40% from two Irish horse racing magnates) and he is now fully in charge. He plans to take the club private on June 22nd and install his son as the managing partner (now that's a good idea). Glazer's purchase has piled debt onto once debt free Man U and will put the pressure on the club to get it done on the pitch. With player costs skyrocketing in the Premiership (and across Europe as well) Man U will have to continue to pony up to keep the pound sterling flowing in.
Hawk's View: Glazer is going to pull a Soccer version of Jerry Jones and the Dallas Cowboys. When Jones bought the "Boys" in 1989 he quickly became the Black Sheep of the NFL. He cut his own deals and dared the league to do something about it. Glazer will try the same thing with the Premiership TV deal (which he is looking to vacate after next year) and may do the same with his worldwide sponsors. In the end, Man U's fans may not like the fact a Yank owns their club, but anybody who can turn the Tampa Bay Buccaneers into a winner cannot be underestimated. Look for Man U to get its swagger back both on the Pitch and in the boardroom.
Sunday, May 22, 2005
Olympic Sized Problems
NEW POSTING SCHEDULE: After a brief sabbatical, I've returned and plan to keep up a more robust schedule. Since this weblog thing has been a lot fun I decided that I needed to put myself on a regular schedule. Starting today I will post on Sunday, Monday, Wednesday and Friday. Without further ado let's get on with it.
Two weeks ago the Wall Street Journal penned a story on all the issues the country of Greece is having post-2004 Olympics. Apparently the nation that brought us Plato, Socrates and unrivaled air pollution found that hosting the Olympics 2000 years ago was much cheaper than it is in modern times.
Not only is Greece billions of dollars in the hole, they are stuck with venues they can't use and they have suffered a loss (yes, loss) in tourism revenue. Also, the generous handouts they used to receive as the last country on the bench for Team European Union are being pared down excessively due to the fact a JV squad of countries (Latvia, Estonia, Lithuania, Cyprus, etc) has joined the fold. Put those two together and Greece's economy is sliding further in the tank.
The Olympics are a phenomenal event that are unrivaled. Yes professionalism has spoiled it a bit but not even The World Cup captures the imagination of the world quite like the Olympics does every quadrennial. That being said, the hosting of the Olympics is a boondoggle. Country's become lackies and bobo's to the star-studded Olympic Committee in hopes their country will get picked to stage the Games. Country's feel that hosting of the Olympics is a historic opportunity that will bring them riches and wealth and catapult their nation into the hearts and minds of the world.
Only that is not the case. Budgets are overrun, facilities that will never be used again sit idle and suck off more taxpayer dollars (as an FYI, Motreal has still not paid off Olympic stadium after 30 years) and, most importantly, tourism does not go up.
This is where we get back to Greece. I've been to Greece and found it to be a magical place (outside of Athens, which makes New Orleans look like Geneva). Greece did not NEED the Olympics to give it relevance. The people and the land do that all on their own. However, when the first nation lost out on the 96 Games they were beside themselves. They felt that the centennial games could be held nowhere else but their land (and indeed today many Greeks feel every Summer Games should be held in Athens). They took it as a national quest to get the games back for 2004 and they stopped at nothing to make it happen. They got the victory they wanted but it was a hollow one.
Hawk's View: In the future nation's need to take the view offered by Great Britain's own Economist magazine. Earlier this year they begged the world to please not give the Olympics to the Island but give it to Paris instead. They argued that all the "development" that the Olympics would supposedly bring was not only false but was not even based on strong economic theory. In the end they argued that a country as great as Great Britain was better off without the Olympics. Yes, the Olympics are great but they do not warrant the heavy debt and burden that has become the price of admission for holding them.
Two weeks ago the Wall Street Journal penned a story on all the issues the country of Greece is having post-2004 Olympics. Apparently the nation that brought us Plato, Socrates and unrivaled air pollution found that hosting the Olympics 2000 years ago was much cheaper than it is in modern times.
Not only is Greece billions of dollars in the hole, they are stuck with venues they can't use and they have suffered a loss (yes, loss) in tourism revenue. Also, the generous handouts they used to receive as the last country on the bench for Team European Union are being pared down excessively due to the fact a JV squad of countries (Latvia, Estonia, Lithuania, Cyprus, etc) has joined the fold. Put those two together and Greece's economy is sliding further in the tank.
The Olympics are a phenomenal event that are unrivaled. Yes professionalism has spoiled it a bit but not even The World Cup captures the imagination of the world quite like the Olympics does every quadrennial. That being said, the hosting of the Olympics is a boondoggle. Country's become lackies and bobo's to the star-studded Olympic Committee in hopes their country will get picked to stage the Games. Country's feel that hosting of the Olympics is a historic opportunity that will bring them riches and wealth and catapult their nation into the hearts and minds of the world.
Only that is not the case. Budgets are overrun, facilities that will never be used again sit idle and suck off more taxpayer dollars (as an FYI, Motreal has still not paid off Olympic stadium after 30 years) and, most importantly, tourism does not go up.
This is where we get back to Greece. I've been to Greece and found it to be a magical place (outside of Athens, which makes New Orleans look like Geneva). Greece did not NEED the Olympics to give it relevance. The people and the land do that all on their own. However, when the first nation lost out on the 96 Games they were beside themselves. They felt that the centennial games could be held nowhere else but their land (and indeed today many Greeks feel every Summer Games should be held in Athens). They took it as a national quest to get the games back for 2004 and they stopped at nothing to make it happen. They got the victory they wanted but it was a hollow one.
Hawk's View: In the future nation's need to take the view offered by Great Britain's own Economist magazine. Earlier this year they begged the world to please not give the Olympics to the Island but give it to Paris instead. They argued that all the "development" that the Olympics would supposedly bring was not only false but was not even based on strong economic theory. In the end they argued that a country as great as Great Britain was better off without the Olympics. Yes, the Olympics are great but they do not warrant the heavy debt and burden that has become the price of admission for holding them.
Wednesday, May 11, 2005
More Engine Trouble for the Airline Industry
I've had it. I'm sick and tired of reading time after time about large airlines who can't make money. From United to American, to Delta to US Airways the insanity must stop.
What put me over the edge you say? It was reading yesterday that both United and Delta are headed for bigger and bigger losses and are (again) seeking more union concessions, to right their slagging business.
Management's first reaction to these type of issues is to always blame the unions. I'm certainly the farthest thing from a union apologist but this is not all their doing. It's management who cuts the deals with the unions, management needs to be held accountable. The only case where this does not hold serve is United because the employees own 45% of the company. But nonetheless it is the consistently bad deals that are being cut that astound and aggravate me.
Part of my ire comes from the fact that the airlines always think they have a safety net: the government. Unfortunately, they are right and history has played this out time and again that either the feds or the state will come to the rescue of a flaying carrier.
Why do we do this? Airline travel has a built-in demand but what it doesn't have is a guaranteed supply base. This is not Europe (where time and again national "flag" carriers are propped up as a matter of civic pride). What right do these businesses have expecting the government (read: taxpayers) to come to their rescue when they make lousy business decisions.
Hawk's View: This time my view is simple, no more bailouts. The free market always can show us the way. Let the airlines know that the great slush fund is over. A federal law needs to be enacted to save us from ourselves and make it illegal to bail out the airline industry. I even have the the perfect candidate to sponsor my idea: Senator John McCain. It would give the lifelong presidential candidate plenty of TV time and cleanse us from our past sins.
What put me over the edge you say? It was reading yesterday that both United and Delta are headed for bigger and bigger losses and are (again) seeking more union concessions, to right their slagging business.
Management's first reaction to these type of issues is to always blame the unions. I'm certainly the farthest thing from a union apologist but this is not all their doing. It's management who cuts the deals with the unions, management needs to be held accountable. The only case where this does not hold serve is United because the employees own 45% of the company. But nonetheless it is the consistently bad deals that are being cut that astound and aggravate me.
Part of my ire comes from the fact that the airlines always think they have a safety net: the government. Unfortunately, they are right and history has played this out time and again that either the feds or the state will come to the rescue of a flaying carrier.
Why do we do this? Airline travel has a built-in demand but what it doesn't have is a guaranteed supply base. This is not Europe (where time and again national "flag" carriers are propped up as a matter of civic pride). What right do these businesses have expecting the government (read: taxpayers) to come to their rescue when they make lousy business decisions.
Hawk's View: This time my view is simple, no more bailouts. The free market always can show us the way. Let the airlines know that the great slush fund is over. A federal law needs to be enacted to save us from ourselves and make it illegal to bail out the airline industry. I even have the the perfect candidate to sponsor my idea: Senator John McCain. It would give the lifelong presidential candidate plenty of TV time and cleanse us from our past sins.
Memo to John Antiocco: That Flickering Light You See is Your Career Flaming Out...
Last week I wrote (rather joyfully I might add) about the nonsense that took place during Blockbuster's earnings call. The highlight being Blockbuster's largest shareholder being hung up on during a diatribe toward CEO John Antiocco.
Oh what a difference a week makes. Today during a proxy vote three people lost their board seats to candidates backed by Carl Icahn (who was also voted on to the board). One of the three who lost their seat was Antiocco. Quite an in-your-face for a company CEO. Icahn stated he wants Antiocco to stay on, but his reason are not all altruistic. One is Antiocco's parachute is $54M and there's no way Uncle Carl's ponying up that kinda cash. The second reason is Icahn can now mock, torture and ridicule Antiocco for the next three quarters. The CEO may as well paint a target on his chest to make it easier.
So what does this mean for Blockbuster? Simply the following:
1. Bye-bye online rental business: Antiocco has spent millions (and pledged 150M more this year) to boost Blockbuster's online business. Icahn is no fan of this program and I do not think there is any way he will continue to support it. If he decides to keep the online business, look for him to try to swing a deal to buy NetFlix.
2. A mucho dividend is coming: Icahn is seeking a big time dividend. As an owner of almost 10% of Blockbuster's shares you can see why he would want that one. He's notorious for wringing companies out of cash for dividends and cash rich Blockbuster certainly will have the means to pay out.
3. An LBO (No Reasonable Offer Will Be Refused!): Since taking over another video chain is out (because Blockbuster got beat out by MovieGallery for Hollywood Video) Uncle Carl is going to be combing the halls of Wall Street looking for a buyer. Perhaps it will be the individual he was starting to tell us about last week before Antiocco hung up on him.
Hawk's View: Blockbuster's stock is now a short term play and Icahn (despite preaching patience publicly) will want to cash out this puppy ASAP. Don't be surprised if Blockbuster is not under the ownership of a KKR or Providence Equity Partners by the start of football season.
Oh what a difference a week makes. Today during a proxy vote three people lost their board seats to candidates backed by Carl Icahn (who was also voted on to the board). One of the three who lost their seat was Antiocco. Quite an in-your-face for a company CEO. Icahn stated he wants Antiocco to stay on, but his reason are not all altruistic. One is Antiocco's parachute is $54M and there's no way Uncle Carl's ponying up that kinda cash. The second reason is Icahn can now mock, torture and ridicule Antiocco for the next three quarters. The CEO may as well paint a target on his chest to make it easier.
So what does this mean for Blockbuster? Simply the following:
1. Bye-bye online rental business: Antiocco has spent millions (and pledged 150M more this year) to boost Blockbuster's online business. Icahn is no fan of this program and I do not think there is any way he will continue to support it. If he decides to keep the online business, look for him to try to swing a deal to buy NetFlix.
2. A mucho dividend is coming: Icahn is seeking a big time dividend. As an owner of almost 10% of Blockbuster's shares you can see why he would want that one. He's notorious for wringing companies out of cash for dividends and cash rich Blockbuster certainly will have the means to pay out.
3. An LBO (No Reasonable Offer Will Be Refused!): Since taking over another video chain is out (because Blockbuster got beat out by MovieGallery for Hollywood Video) Uncle Carl is going to be combing the halls of Wall Street looking for a buyer. Perhaps it will be the individual he was starting to tell us about last week before Antiocco hung up on him.
Hawk's View: Blockbuster's stock is now a short term play and Icahn (despite preaching patience publicly) will want to cash out this puppy ASAP. Don't be surprised if Blockbuster is not under the ownership of a KKR or Providence Equity Partners by the start of football season.
Monday, May 09, 2005
MCI's Shareholders to Qwest: OK, Now We Want You to Stick Around...
Newsflash: After walking away from the MCI board because they were repeatedly treated like an undocumented worker at the Republican National Convention, Qwest is being courted by several of MCI's largest bond and shareholders to "stay in the running" for the telco.
Apparently MCI's shareholders have finally learned to carry the one and realize that Qwest's offer of $30 is more than Verizon's offer of $26 a share (no seriously, it is more. I checked.).
Hawk's View: I'd love to say that Qwest should pull a Blockbuster and hang up on MCI but if they really want them, it now appears they have a shot. Although if Qwest CEO Richard Notebaart has a stick of backbone to him he will let the masses know that his best offer is on the table.
Stay tuned...
Apparently MCI's shareholders have finally learned to carry the one and realize that Qwest's offer of $30 is more than Verizon's offer of $26 a share (no seriously, it is more. I checked.).
Hawk's View: I'd love to say that Qwest should pull a Blockbuster and hang up on MCI but if they really want them, it now appears they have a shot. Although if Qwest CEO Richard Notebaart has a stick of backbone to him he will let the masses know that his best offer is on the table.
Stay tuned...
Saturday, May 07, 2005
Crank Yanker Carl Gets Punk'd by Blockbuster
Admitteldy I was down in the dumps last week. My two favorite punching bags (MCI and VOOM/Cablevision), had moved through a lot of their nonsense and I was without a favorite target.
But just then, the phone rang and a buddy of mine told me about the clown show that took place during Blockbuster's Q1 call. Had I heard about it? No I said but I would definitely check it out. Boy am I glad I did.
Blockbuster's Q1 call was one for the ages. The company, reeling through several major changes lately (ending of "late fees", losing the battle for Hollywood Video to rival MovieGallery and launching an online rental service a la Netflix) shared their Q1 earnings to the world. The news was not a blockbuster.
But that wasn't what made it great. The great part was Blockbuster's largest shareholder Carl Icahn calling in to rip current CEO John Antiocco about Antiocco's past and future decisions.
Icahn is launching a proxy fight to replace 3 board members (and he would love to shove Antiocco out the door). He has not said it publicly but past history suggests that Carl wants either an LBO or a huge dividend to take place so he can maximize his return on investment. Carl has made his living with this type of "investing" and if you think I'm nuts ask the folks in Saint Louis who used to work for Carl when he "rescued" TWA in the early 90's.
After reading off the company numbers, Antiocco went through a 15 minute spiel that basically ripped Icahn and his "ideas" for the company. Upon completion, the call-in portion of the program took place. After three softball questions, Icahn was up (FYI...kudos to Antiocco for letting the operator take Icahn's call, although I bet he wishes he hadn't).
Icahn had two basic questions: Would Antiocco forego any bonus pay this year if the company did not hit their targets and would he also put the whole board up for reelection if, again, the company failed to make their numbers?
Antiocco promptly put on his top hat, grabbed his cane and cued the music. It was time to start dancing. His tap routine was pretty good as he did not answer any of Icahn's questions (both fair in my book).
Icahn then told Antiocco he was, essentially, lying when Antiocco said there was no credible LBO offer for Blockbuster. Icahn started to say he personally heard of more than one offer but...
But he didn't get to finish, because they hung up on him. Yes, mid-sentence, Blockbuster hung up on its largest shareholder. That's the equivalent of shoving your best customer out the door because it's five minutes past closing. Bad idea and Carl has a long memory. By the way if you have not heard the call, go to blockbuster's website and check it out. Carl comes in 45 minutes into the conversation.
Hawk's View: Next week will be a fun one as the proxy vote to replace three board members takes place. Look for Icahn's guys to lose, but also don't be surprised if Blockbuster tries to pull a Verizon and buy out Icahn just to get him out of their hair. Antiocco and company can't afford to spend the next year fighting Icahn every step of the way. "Uncle" Carl won't quit until he gets what he wants (the board and Antiocco replaced). If Blockbuster wants to continue down its path, it needs total focus. While it does need money from guys like Carl Icahn to finance its dreams, it does not need Carl Icahn.
But just then, the phone rang and a buddy of mine told me about the clown show that took place during Blockbuster's Q1 call. Had I heard about it? No I said but I would definitely check it out. Boy am I glad I did.
Blockbuster's Q1 call was one for the ages. The company, reeling through several major changes lately (ending of "late fees", losing the battle for Hollywood Video to rival MovieGallery and launching an online rental service a la Netflix) shared their Q1 earnings to the world. The news was not a blockbuster.
But that wasn't what made it great. The great part was Blockbuster's largest shareholder Carl Icahn calling in to rip current CEO John Antiocco about Antiocco's past and future decisions.
Icahn is launching a proxy fight to replace 3 board members (and he would love to shove Antiocco out the door). He has not said it publicly but past history suggests that Carl wants either an LBO or a huge dividend to take place so he can maximize his return on investment. Carl has made his living with this type of "investing" and if you think I'm nuts ask the folks in Saint Louis who used to work for Carl when he "rescued" TWA in the early 90's.
After reading off the company numbers, Antiocco went through a 15 minute spiel that basically ripped Icahn and his "ideas" for the company. Upon completion, the call-in portion of the program took place. After three softball questions, Icahn was up (FYI...kudos to Antiocco for letting the operator take Icahn's call, although I bet he wishes he hadn't).
Icahn had two basic questions: Would Antiocco forego any bonus pay this year if the company did not hit their targets and would he also put the whole board up for reelection if, again, the company failed to make their numbers?
Antiocco promptly put on his top hat, grabbed his cane and cued the music. It was time to start dancing. His tap routine was pretty good as he did not answer any of Icahn's questions (both fair in my book).
Icahn then told Antiocco he was, essentially, lying when Antiocco said there was no credible LBO offer for Blockbuster. Icahn started to say he personally heard of more than one offer but...
But he didn't get to finish, because they hung up on him. Yes, mid-sentence, Blockbuster hung up on its largest shareholder. That's the equivalent of shoving your best customer out the door because it's five minutes past closing. Bad idea and Carl has a long memory. By the way if you have not heard the call, go to blockbuster's website and check it out. Carl comes in 45 minutes into the conversation.
Hawk's View: Next week will be a fun one as the proxy vote to replace three board members takes place. Look for Icahn's guys to lose, but also don't be surprised if Blockbuster tries to pull a Verizon and buy out Icahn just to get him out of their hair. Antiocco and company can't afford to spend the next year fighting Icahn every step of the way. "Uncle" Carl won't quit until he gets what he wants (the board and Antiocco replaced). If Blockbuster wants to continue down its path, it needs total focus. While it does need money from guys like Carl Icahn to finance its dreams, it does not need Carl Icahn.
Thursday, May 05, 2005
Detroit Gets Thrown into the Junk Drawer
Yesterday I waxed poetic about Kirk Kerkorian's huge purchase of GM shares. The move sent GM's stock soaring and despite issues around their huge pension committments, made it a sunny day in Detroit.
What a difference a day makes. Today GM AND Ford had their bonds downgraded to junk status (so much for my theory that Kerkorian's purchase would improve GM's bond status.
Right, wrong of indifferent, the auto industry is the sounding board for our overall economy. The auto industry touches so many different facets of our economy that when it is up usually the US is doing great. However, when it is down, usually the economy follows suit.
The fact that two of our big three auto titans now have a junk rating is not good news for Detroit. Junk status bonds means higher borrowing costs and generally leads a company down a dark path.
Hawk's View: Yesterday I stated that Kirk Kerkorian's purchase would lead to heavy handed with the UAW to get serious benefit concessions. I still think that is true, but now that both GM and Ford are trading bonds at Kmart (pre Eddie Lampert) levels means the situation is graver than I suspected. Expect the rhetoric to be fierce and venomous.
At least the Motor City has the Super Bowl to look forward to...
What a difference a day makes. Today GM AND Ford had their bonds downgraded to junk status (so much for my theory that Kerkorian's purchase would improve GM's bond status.
Right, wrong of indifferent, the auto industry is the sounding board for our overall economy. The auto industry touches so many different facets of our economy that when it is up usually the US is doing great. However, when it is down, usually the economy follows suit.
The fact that two of our big three auto titans now have a junk rating is not good news for Detroit. Junk status bonds means higher borrowing costs and generally leads a company down a dark path.
Hawk's View: Yesterday I stated that Kirk Kerkorian's purchase would lead to heavy handed with the UAW to get serious benefit concessions. I still think that is true, but now that both GM and Ford are trading bonds at Kmart (pre Eddie Lampert) levels means the situation is graver than I suspected. Expect the rhetoric to be fierce and venomous.
At least the Motor City has the Super Bowl to look forward to...
Wednesday, May 04, 2005
Kirk Takes GM for a Drive
Kirk Kerkorian, the 176 year old investor extraordinaire, announced today his intention to double his investment in General Motors to almost 9% of all outstanding stock. The news sent GM's stock up $5 in daily trading and no doubt made life in the Motor City a little sunnier.
For those of you unaware, GM is being crushed under a pension health care burden brought on by its drunken sailor like negotiations in the late 90's with the United Auto Workers (UAW). Today this burden represent around $1500 a car and will only get worse as GM's employees age and visit the doctor more often. The crisis has led to a wide game of speculation about GM's future. Specifically would the old dog of Detroit seek bankruptcy protection to get out from under this burden.
Lucky for them Old Kirk sees GM as a value. His investment didn't just jolt the stock price, but it also pushed up GM's bonds (trading near junk status). Thus making borrowing a little cheaper.
Kerkorian's lifeline certainly helps GM but the burden of pension and health care costs (GM currently has to support 2 retired employees for each current employee). The upcoming negotiations with UAW will no doubt be bloody.
Hawk's View: OK, Kirk's not really 176 (he's 87 and looks pretty good for it as well). But the idea that he won't seek a board seat or push for more control is a tad naive. Just as he drove Chrysler into the arms of Daimler-Benz 10 years ago (done primarily because of his hostile takeover bid) look for Kirk to leverage his huge influence and extract painful changes to GM's corporte culture (especially the unions). See the quote below from the linked article as potential proof of coming actions.
Kerkorian's hand could pressure GM and the United Auto Workers union to cut jobs and close plants to make the company more competitive, said David Cole, director of the Center for Automotive Research in Ann Arbor, Michigan.
Stay tuned...
For those of you unaware, GM is being crushed under a pension health care burden brought on by its drunken sailor like negotiations in the late 90's with the United Auto Workers (UAW). Today this burden represent around $1500 a car and will only get worse as GM's employees age and visit the doctor more often. The crisis has led to a wide game of speculation about GM's future. Specifically would the old dog of Detroit seek bankruptcy protection to get out from under this burden.
Lucky for them Old Kirk sees GM as a value. His investment didn't just jolt the stock price, but it also pushed up GM's bonds (trading near junk status). Thus making borrowing a little cheaper.
Kerkorian's lifeline certainly helps GM but the burden of pension and health care costs (GM currently has to support 2 retired employees for each current employee). The upcoming negotiations with UAW will no doubt be bloody.
Hawk's View: OK, Kirk's not really 176 (he's 87 and looks pretty good for it as well). But the idea that he won't seek a board seat or push for more control is a tad naive. Just as he drove Chrysler into the arms of Daimler-Benz 10 years ago (done primarily because of his hostile takeover bid) look for Kirk to leverage his huge influence and extract painful changes to GM's corporte culture (especially the unions). See the quote below from the linked article as potential proof of coming actions.
Kerkorian's hand could pressure GM and the United Auto Workers union to cut jobs and close plants to make the company more competitive, said David Cole, director of the Center for Automotive Research in Ann Arbor, Michigan.
Stay tuned...
Tuesday, May 03, 2005
Qwite a Shafting
Yesterday I closed the books on the non-stop nonsense that was VOOM. Today I extend that same courtesy to the Fixed Line Freaks from MCI, Qwest and Verizon.
In case you missed the memo, Verizon (as written here previously) came back to MCI with an offer 0f $26 bucks a share (less of course than Qwest's $30) and as expected, MCI took it.
That's right folks. The days of taking the best offer for your shareholders is now officially over. It is now chic to except less (4 bucks I guess is the baseline) for your company. I know, I know, Qwest is under a mountain of debt and everybody loves Verizon's $99B in market cap, but the bottom line is the MCI's board did a lousy job of negotiating this deal. As a matter of fact they owe Qwest a great big thank you (in lieu of the F-you they gave them) for driving up the price. If it wasn't for Qwest MCI's shareholders would have limped away under Verizon's first offer (low 20's).
As a result of this maneuver, the Hawk is adding an award (given to the lamest move by an executive/company/board) to bizpinions.com. I'm calling it the Enron Prize (I'm actually commandeering the name from Houston based Enron, who actually gave out an Enron Prize in the late 90's to world humanitarians. Shockingly, it is no longer give out). The first Enron Prize goes to MCI CEO, and master negotiator, Michael Cappelas. If this guy is sitting at your poker table, he's the sucker.
Hawk's View: Qwest, Public Citizen and several other "consumer" groups will sue to try to stop this deal but they will lose. Verizon will swallow up MCI and Qwest will be left twisting in the wind looking longingly for another partner. Maybe they can team up with Charter and form the world's most leveraged company...
In case you missed the memo, Verizon (as written here previously) came back to MCI with an offer 0f $26 bucks a share (less of course than Qwest's $30) and as expected, MCI took it.
That's right folks. The days of taking the best offer for your shareholders is now officially over. It is now chic to except less (4 bucks I guess is the baseline) for your company. I know, I know, Qwest is under a mountain of debt and everybody loves Verizon's $99B in market cap, but the bottom line is the MCI's board did a lousy job of negotiating this deal. As a matter of fact they owe Qwest a great big thank you (in lieu of the F-you they gave them) for driving up the price. If it wasn't for Qwest MCI's shareholders would have limped away under Verizon's first offer (low 20's).
As a result of this maneuver, the Hawk is adding an award (given to the lamest move by an executive/company/board) to bizpinions.com. I'm calling it the Enron Prize (I'm actually commandeering the name from Houston based Enron, who actually gave out an Enron Prize in the late 90's to world humanitarians. Shockingly, it is no longer give out). The first Enron Prize goes to MCI CEO, and master negotiator, Michael Cappelas. If this guy is sitting at your poker table, he's the sucker.
Hawk's View: Qwest, Public Citizen and several other "consumer" groups will sue to try to stop this deal but they will lose. Verizon will swallow up MCI and Qwest will be left twisting in the wind looking longingly for another partner. Maybe they can team up with Charter and form the world's most leveraged company...
Monday, May 02, 2005
The Curtain Falls on VOOM
Yesterday was the end of the company that got me started as a "blogger." VOOM, the poorly conceived satellite company from Cablevision, shut down yesterday after hundreds of millions of dollars in losses. Along the way a family was divided, an intense boardroom battle took place, board members were fired and a one time visionary saw his dreams for one last big score dashed.
It was a spectacular failure. One that will be discussed throughout the years in business schools around the world.
Now it is over. Satellite geeks held an impromptu vigil via a chatroom waiting for the moment until the service went dark. Alas it did at around 6AM EST.
With VOOM gone, I'll have to move on to other targets (there will no doubt be many) but I will always have a soft spot in my heart for the Family Dolan. It was they who inspired me to start my rants and it was the feedback from my colleagues that kept me going.
To stay in character I will close the book on VOOM with a top five list of things the family can do to stay busy. Cue the clown music...
1. Jimmy Dolan can hit the road and promote his book "The Idiot's Guide to Running an NBA Franchise."
2. The whole family can go out on a crusade to demand the closing of the Statue of Liberty and the Empire State Building as they are "competitors" for the NYC entertainment dollar (editor's note: the Family Dolan, owners of Madison Square Garden, has been trying to torpedo the Jets stadium deal on these grounds, why not expand).
3. Launch a satellite service that will offer no local channels BUT will offer 21 obscure channels that no one will watch (check that, they already did this one).
4. Remove landmines on the property between Jimmy and Old Man Dolan's house.
5. Go on tour to various satellite conventions where rubes from www.satelliteguys.com can attend and treat them as if they are Star Trek like royalty.
Hawk's View: Cablevision's board finally get their company back but some of us will miss the nonsense. Notably me. To show my affinity, I've aimed my satellite dish at half staff.
It was a spectacular failure. One that will be discussed throughout the years in business schools around the world.
Now it is over. Satellite geeks held an impromptu vigil via a chatroom waiting for the moment until the service went dark. Alas it did at around 6AM EST.
With VOOM gone, I'll have to move on to other targets (there will no doubt be many) but I will always have a soft spot in my heart for the Family Dolan. It was they who inspired me to start my rants and it was the feedback from my colleagues that kept me going.
To stay in character I will close the book on VOOM with a top five list of things the family can do to stay busy. Cue the clown music...
1. Jimmy Dolan can hit the road and promote his book "The Idiot's Guide to Running an NBA Franchise."
2. The whole family can go out on a crusade to demand the closing of the Statue of Liberty and the Empire State Building as they are "competitors" for the NYC entertainment dollar (editor's note: the Family Dolan, owners of Madison Square Garden, has been trying to torpedo the Jets stadium deal on these grounds, why not expand).
3. Launch a satellite service that will offer no local channels BUT will offer 21 obscure channels that no one will watch (check that, they already did this one).
4. Remove landmines on the property between Jimmy and Old Man Dolan's house.
5. Go on tour to various satellite conventions where rubes from www.satelliteguys.com can attend and treat them as if they are Star Trek like royalty.
Hawk's View: Cablevision's board finally get their company back but some of us will miss the nonsense. Notably me. To show my affinity, I've aimed my satellite dish at half staff.
Wednesday, April 27, 2005
MCI's Board Finally Passes Math 101
MCI's board finally came to its senses. After months of blowing off Qwest's pursuit of acquiring them (they had the gall to offer shareholders more money), MCI finally admitted to the world that Qwest's new offer of $30.00 a share ($16 in cash and $14.00 in stock) was more than Verizon's offer of $23.10. I'll pause now while you all digest that logic...
Heck even Verizon agrees that $30 is more than $23 (see quote from linked article below).
"The MCI board decided that their bid of $30 (per share) was higher than our bid of $23.10 (per share). That shouldn't be a surprise to anybody. 30 is higher than 23," Verizon said in the transcript.
So now Qwest is in the driver's seat. Verizon may up its offer but they won't go to $30. MCI would probably prefer a Verizon offer anyway because a combined Qwest/MCI company may drag down Qwest's already dragging stock price. Since 40% of Qwest's offer is in their stock, MCI would assuredly be happy to see Verizon get into a bidding war.
But they won't. Verizon knows that despite all of the bad press around this deal, MCI desperately wants to be acquired by them. If they were to up their offer to what they gave shareholder Carlos Slim (see article bel0w) that might close the deal.
Hawk's View: Clearly Qwest's call out to all of their employees to check between the cushions of their couch for loose change worked. They are now presenting their third and final best offer. However, despite all of that and Qwest's ability to line up private equity to balance the company out, post-merger, Verizon will walk away with this one. The Hawk still feels it's MCI's duty to take Qwest offer in the spirit of shareholder return, but alas, he does not think that will happen. Look for an offer increase from Verizon within the next two weeks and MCI's board running lovingly into their arms.
Heck even Verizon agrees that $30 is more than $23 (see quote from linked article below).
"The MCI board decided that their bid of $30 (per share) was higher than our bid of $23.10 (per share). That shouldn't be a surprise to anybody. 30 is higher than 23," Verizon said in the transcript.
So now Qwest is in the driver's seat. Verizon may up its offer but they won't go to $30. MCI would probably prefer a Verizon offer anyway because a combined Qwest/MCI company may drag down Qwest's already dragging stock price. Since 40% of Qwest's offer is in their stock, MCI would assuredly be happy to see Verizon get into a bidding war.
But they won't. Verizon knows that despite all of the bad press around this deal, MCI desperately wants to be acquired by them. If they were to up their offer to what they gave shareholder Carlos Slim (see article bel0w) that might close the deal.
Hawk's View: Clearly Qwest's call out to all of their employees to check between the cushions of their couch for loose change worked. They are now presenting their third and final best offer. However, despite all of that and Qwest's ability to line up private equity to balance the company out, post-merger, Verizon will walk away with this one. The Hawk still feels it's MCI's duty to take Qwest offer in the spirit of shareholder return, but alas, he does not think that will happen. Look for an offer increase from Verizon within the next two weeks and MCI's board running lovingly into their arms.
Thursday, April 21, 2005
Allen's Folly: Not on the Chart for Consolidation
This week brought an exciting time in the cable business. One time star but currently bankrupt Adelphia was bought out by cable titan Time Warner and Comcast. The deal adds 1.8M subs to Comcast and 4M to TW. In addition, both swapped out systems to get better economies of scale (known as clustering in the cable world) and Comcast got a nice chunk of change for its former 21% stake in TW.
The deal touched off a debate as to what will happen next (regarding consolidation) in the cable world. The first name that popped up was Charter Communications (also known as Allen's Folly as it is captained by former Microsoft geek Paul Allen). Charter is logical because it is currently trading at only $1.45 a share and it has over 5M subs (ranking it the fourth largest cable co. behind Comcast, TW and privately held Cox Communications). However, The Hawk will show you just why Charter will be left at the alter.
1. $17Bilion in debt: Yes that's billion with a "b" and that number is not in pesos. Charter's debt is so high that some central African governments would feel sorry for them. The debt comes from Charter's deal daze of the late 90's where they overpaid for several cable systems and slammed them together to make what is today's Charter. Even 5M subs is not worth it for $17B .
2. Lousy systems: Yes Charter has tried to follow the cable model of "clustering" but they have bad clusters. The firm has several clusters on the outskirts of large metro areas (Seattle, Minneapolis-St. Paul and even Los Angeles) but their particular systems do not serve what we ID as high paying customers. Their best system is Saint Louis and why I love the Arch in Springtime, it is not enough to anchor a sale of the whole shootin' match.
3. Lag in roll-out of new services: Although they are run by a guy who prides himself in creating a Wired World, Charter is way behind in rolling out advanced services (HD, DVR, OnDemand, telephony and interactivity). The reason being is because they overspent so much for bad systems in bad areas they have not kicked out enough cash to upgrade their systems. This has led them to raise prices which has in turn led to massive customer defection to satellite.
Hawk's View: The way I see it is Paul Allen has to find a way to take this joint private. At the same time he needs to reach deeper into his velcro wallet and make a run at buying another cable co that has some systems that will give him bigger clusters (potentially Brighthouse in Florida or maybe Mediacom). Yes that will cost him a fortune but he is not check to check. A partnership with KKR to take Charter private and make a run at another cable co would be risky but it's his best option with the current hand he has dealt himself.
The deal touched off a debate as to what will happen next (regarding consolidation) in the cable world. The first name that popped up was Charter Communications (also known as Allen's Folly as it is captained by former Microsoft geek Paul Allen). Charter is logical because it is currently trading at only $1.45 a share and it has over 5M subs (ranking it the fourth largest cable co. behind Comcast, TW and privately held Cox Communications). However, The Hawk will show you just why Charter will be left at the alter.
1. $17Bilion in debt: Yes that's billion with a "b" and that number is not in pesos. Charter's debt is so high that some central African governments would feel sorry for them. The debt comes from Charter's deal daze of the late 90's where they overpaid for several cable systems and slammed them together to make what is today's Charter. Even 5M subs is not worth it for $17B .
2. Lousy systems: Yes Charter has tried to follow the cable model of "clustering" but they have bad clusters. The firm has several clusters on the outskirts of large metro areas (Seattle, Minneapolis-St. Paul and even Los Angeles) but their particular systems do not serve what we ID as high paying customers. Their best system is Saint Louis and why I love the Arch in Springtime, it is not enough to anchor a sale of the whole shootin' match.
3. Lag in roll-out of new services: Although they are run by a guy who prides himself in creating a Wired World, Charter is way behind in rolling out advanced services (HD, DVR, OnDemand, telephony and interactivity). The reason being is because they overspent so much for bad systems in bad areas they have not kicked out enough cash to upgrade their systems. This has led them to raise prices which has in turn led to massive customer defection to satellite.
Hawk's View: The way I see it is Paul Allen has to find a way to take this joint private. At the same time he needs to reach deeper into his velcro wallet and make a run at buying another cable co that has some systems that will give him bigger clusters (potentially Brighthouse in Florida or maybe Mediacom). Yes that will cost him a fortune but he is not check to check. A partnership with KKR to take Charter private and make a run at another cable co would be risky but it's his best option with the current hand he has dealt himself.
Sunday, April 17, 2005
Lil' Kim: The Dear Leader
So far in my very short weblog career I have kept my rants confined to the business world. However as I am wont to do I will from time to time veer off into the realm of world affairs (something that I find fascinating).
Today is one of those days and I am delighted to let you know that the topic is one of my favorite's and your's, the cuddly Kim Jong-Il.
As despots go, Mr. Kim (Lil' Kim as I like to call him), or the Dear Leader as he is known in North Korea, is not much of an imposing man. Five feet tall on a good day and sporting a wild hairdo, Lil' Kim has been running the North since 1994. He took over for his dad, the Supreme Leader, Kim Il-Sung (much cooler name).
Since then Lil' Kim has been preoccupied with starving his people, building a nuclear arsenal and pretty much going out of his way to irritate every leader in the world.
The world has put up with it because, frankly, we don't know what to do. The US is preoccupied seemingly everywhere else (except Africa of course), Russia is busy with its own internal issues, China also has its own internal issues and is preoccupied with getting rich.
The fact that Lil' Kim has a nuke is problem number 1 - 5. But the bigger problem is that China, Japan and Russia have dropped the collective baton in securing their regional issues. Each seems to be playing a game of hot potato with the other (probably hoping secretly that the Great Satan - the US - will ride in on its white tank and take over).
Only this is one where we should sit out. Yes the North has a nuke but more than likely if they get it airborne it is not going anywhere near the US (we don't even know for sure they can get it this far). Besides I still find it hard to believe that a country that can't even grow enough food to feed its people and who chief export is opium can get it done the bomb department.
Hawk's View: Bottom line is that Lil' Kim is going down soon. Either via coup, health, or family jealousy, he's going to be out. And as a result 4M North Koreans will begin to stream over the borders into Russia, China, Japan and South Korea. The influx of refugees will destabilize the regions of each of these countries that border the North and a problem that was once controllable (e.g., power and food for nuke dismantlement) will become, pardon the pun, a nuclear one.
Today is one of those days and I am delighted to let you know that the topic is one of my favorite's and your's, the cuddly Kim Jong-Il.
As despots go, Mr. Kim (Lil' Kim as I like to call him), or the Dear Leader as he is known in North Korea, is not much of an imposing man. Five feet tall on a good day and sporting a wild hairdo, Lil' Kim has been running the North since 1994. He took over for his dad, the Supreme Leader, Kim Il-Sung (much cooler name).
Since then Lil' Kim has been preoccupied with starving his people, building a nuclear arsenal and pretty much going out of his way to irritate every leader in the world.
The world has put up with it because, frankly, we don't know what to do. The US is preoccupied seemingly everywhere else (except Africa of course), Russia is busy with its own internal issues, China also has its own internal issues and is preoccupied with getting rich.
The fact that Lil' Kim has a nuke is problem number 1 - 5. But the bigger problem is that China, Japan and Russia have dropped the collective baton in securing their regional issues. Each seems to be playing a game of hot potato with the other (probably hoping secretly that the Great Satan - the US - will ride in on its white tank and take over).
Only this is one where we should sit out. Yes the North has a nuke but more than likely if they get it airborne it is not going anywhere near the US (we don't even know for sure they can get it this far). Besides I still find it hard to believe that a country that can't even grow enough food to feed its people and who chief export is opium can get it done the bomb department.
Hawk's View: Bottom line is that Lil' Kim is going down soon. Either via coup, health, or family jealousy, he's going to be out. And as a result 4M North Koreans will begin to stream over the borders into Russia, China, Japan and South Korea. The influx of refugees will destabilize the regions of each of these countries that border the North and a problem that was once controllable (e.g., power and food for nuke dismantlement) will become, pardon the pun, a nuclear one.
Saturday, April 16, 2005
The Sun Continues to Set on Japanese Economy
It was without a doubt one of the greatest success stories of 20th century. A country ravaged by war (admittedly they started it) and reeling by the only known nuclear attacks on any nation rose up from the ashes and became an economic power.
Yes, Japan had help but it was what they did with that help that made them great. They innovated, worked harder than anyone in the world and by the early 80's they were a world economic power.
The role the Japanese had in shaping the world economy cannot be understated (if you want to get a great example, watch Michael Moore's Roger and Me from 1985. It gives firsthand examples of how the Japanese competitiveness in the auto market exploited larded up American management and how that in turn sent the US auto industry reeling). What the Japanese did in the automotive, consumer electronics and real estate has been and will continue the subject of many stories and case studies for years to come.
But that domination is over and it has been over for 10 years. The problem is that no one in Japan seems to want to believe it. Not to oversimplify it but Japan simply got too much hubris. And with that hubris came bad business deal after bad business deal. In a country where banks are generally large shareholders in the companies they finance, the one group that could keep them honest had a serious conflict of interest.
For ten years Japan has been in an ongoing economic crisis that has seen bailout after bailout by the government, but never the rip the band-aid off approach that was desperately needed. The fact is that the crises going on in Japan right now (large corporations larded up with debt but dubbed too big to fail by the banks and government) are not new but just in their tenth year of existence.
The article attached covers the sad tale of long time Japanese retailer Daiei. Daiei was at one time a titan of Japanese retailing. But right now they are probably more akin to KMart (minus Eddie Lampert's shrewd real estate mind). They have been struggling to stay as a going concern for about 7 years and have continued to get bailout after bailout by the banks and government.
Hawk's View: What Japan needs is a big failure. A spectacular failure to shake up things. In 1999, South Korea got one when the government finally said you are on your own to two severly wounded Chaebol's (Daewoo and Hyundai). Both conglomerates went through a painful restructure but it was necessary. And it had a ripple effect. Today South Korea's major economic players (Samsung, LG, SK and even Hyundai) are making noise worldwide in everything from cars to consumer electronics and appliances. In the process they are cleaning Japan's clock.
Japan can still be great again, but in order to do so they must take a long hard look in the mirror...
Yes, Japan had help but it was what they did with that help that made them great. They innovated, worked harder than anyone in the world and by the early 80's they were a world economic power.
The role the Japanese had in shaping the world economy cannot be understated (if you want to get a great example, watch Michael Moore's Roger and Me from 1985. It gives firsthand examples of how the Japanese competitiveness in the auto market exploited larded up American management and how that in turn sent the US auto industry reeling). What the Japanese did in the automotive, consumer electronics and real estate has been and will continue the subject of many stories and case studies for years to come.
But that domination is over and it has been over for 10 years. The problem is that no one in Japan seems to want to believe it. Not to oversimplify it but Japan simply got too much hubris. And with that hubris came bad business deal after bad business deal. In a country where banks are generally large shareholders in the companies they finance, the one group that could keep them honest had a serious conflict of interest.
For ten years Japan has been in an ongoing economic crisis that has seen bailout after bailout by the government, but never the rip the band-aid off approach that was desperately needed. The fact is that the crises going on in Japan right now (large corporations larded up with debt but dubbed too big to fail by the banks and government) are not new but just in their tenth year of existence.
The article attached covers the sad tale of long time Japanese retailer Daiei. Daiei was at one time a titan of Japanese retailing. But right now they are probably more akin to KMart (minus Eddie Lampert's shrewd real estate mind). They have been struggling to stay as a going concern for about 7 years and have continued to get bailout after bailout by the banks and government.
Hawk's View: What Japan needs is a big failure. A spectacular failure to shake up things. In 1999, South Korea got one when the government finally said you are on your own to two severly wounded Chaebol's (Daewoo and Hyundai). Both conglomerates went through a painful restructure but it was necessary. And it had a ripple effect. Today South Korea's major economic players (Samsung, LG, SK and even Hyundai) are making noise worldwide in everything from cars to consumer electronics and appliances. In the process they are cleaning Japan's clock.
Japan can still be great again, but in order to do so they must take a long hard look in the mirror...
Wednesday, April 13, 2005
Carlos Slim Gets Fat on MCI
Yesterday the Wall Street Journal reported that billionaire telco magnate Carlos Slim got a sweetheart deal from Verizon for his substantial number of shares in MCI.
You remember MCI - the telco with a heart. Bankruptcy proved to be a boon for the boys formerly from Clinton, MS. Emerging with a clean balance sheet and solid properties they were a perfect acquisition target. Big shot telco Verizon stepped up to the plate first and promptly lowballed them. Qwest got into the mix but since Qwest can't seem to get arrested in the world of M and A's they were promptly rebuffed (despite their higher offer).
Here's where it gets fun. Verizon secretly made an offer to buy Slim's shares for $2 more than Verizon was offering EVERYONE else for their shares (plus a call option on some Verizon shares).
So picture this one. You are the Chairman of MCI and you have already stated that you are rejecting an offer from Qwest (that is $4 higher than Verizon) under the guise that the Qwest offer will crush both companies.
Now Verizon, who stated their best offer is a little over $23 a share, has now paid MCI's biggest shareholder a 10% premium for his shares. Bottom line is that if MCI accepts Verizon's offer as is, the board should be summarily fired and forced to work in MCI's customer service department.
So here's where we are. Verizon is holding firm with their $23 a share offer. Carlos Slim (clearly not check to check as he is worth over 23Billion) has cashed out and Qwest is holding at $27. MCI's board has sheepishly suggested that Verizon's offer is "too low" and would like to see it raised. Alert the media on that one. Verizon has no need to raise its offer. MCI is on record not wanting to sell to Qwest and now you own 13% of the company courtesy of Carlos' shares.
MCI is hosed. If they take Verizon's offer they will leave $4 per share on the table. If they walk away all together their shares will go in the tank. Either scenario means they will get sued early and often.
Hawk's View: MCI's best option is to sell to Qwest. It gives them the maximum return to the shareholders (and it gives Carlos the proverbial finger for breaking ranks and selling out). Damn the consequences for the future Qwest/MCI company. It is best to take the money and run...
You remember MCI - the telco with a heart. Bankruptcy proved to be a boon for the boys formerly from Clinton, MS. Emerging with a clean balance sheet and solid properties they were a perfect acquisition target. Big shot telco Verizon stepped up to the plate first and promptly lowballed them. Qwest got into the mix but since Qwest can't seem to get arrested in the world of M and A's they were promptly rebuffed (despite their higher offer).
Here's where it gets fun. Verizon secretly made an offer to buy Slim's shares for $2 more than Verizon was offering EVERYONE else for their shares (plus a call option on some Verizon shares).
So picture this one. You are the Chairman of MCI and you have already stated that you are rejecting an offer from Qwest (that is $4 higher than Verizon) under the guise that the Qwest offer will crush both companies.
Now Verizon, who stated their best offer is a little over $23 a share, has now paid MCI's biggest shareholder a 10% premium for his shares. Bottom line is that if MCI accepts Verizon's offer as is, the board should be summarily fired and forced to work in MCI's customer service department.
So here's where we are. Verizon is holding firm with their $23 a share offer. Carlos Slim (clearly not check to check as he is worth over 23Billion) has cashed out and Qwest is holding at $27. MCI's board has sheepishly suggested that Verizon's offer is "too low" and would like to see it raised. Alert the media on that one. Verizon has no need to raise its offer. MCI is on record not wanting to sell to Qwest and now you own 13% of the company courtesy of Carlos' shares.
MCI is hosed. If they take Verizon's offer they will leave $4 per share on the table. If they walk away all together their shares will go in the tank. Either scenario means they will get sued early and often.
Hawk's View: MCI's best option is to sell to Qwest. It gives them the maximum return to the shareholders (and it gives Carlos the proverbial finger for breaking ranks and selling out). Damn the consequences for the future Qwest/MCI company. It is best to take the money and run...
Monday, April 11, 2005
An Ultimate Demise
Yesterday why my wife was meandering through one of those bed, bath and various home accessories places (the kind that has that smell that gives most men headaches) I decided to slip away and head over to the Ultimate Electronics next door.
Ultimate has had a run of bad luck lately (being bankrupt with a stock worth .15 cents does damper morale) but they do have cool stores with a lot of cool products. The Ultimate in my neighborhood is a beautiful store that has all the things that we men tend to desire. Loud things that take a PhD from CalTech to install and burn so much electricity that you have to petition your local utility for a nuclear power permit.
Despite the full parking lot, there were not a lot of folks in the store. Maybe a handful of shoppers and a ton of employees. MEMO to Ultimate management (of course they read this everyday) one of your problems might be the fact that none of your employees will help people. Actually having sales people that sell stuff might help the stock price.
Anyway, I was actually their to buy my wife something she wanted. A portable stereo for her desk at work. The one I suggested (the big and loud one that shakes your fillings) was shot down. I had to find the dainty piece that any self respecting man would mock me incessantly for possessing.
I wandered aimlessly passing several employees too busy doing God knows what but I was certainly not a priority. Then it hit me. I realized why the employees were so busy, so focused on their task. They were redecorating the store. Yes right in front of me (in the area where the dainty stereo presided, thankfully it was out of stock) was a poster of Ultimate's former CEO, the great Dave Workman. Only the poster had been made over by the busy employees. This poster featured Dave with his trademark smile and his not so famous devil's mustache, beard and horns. Yes, I'm not making this up. Plain as day, Dave Workmen in a full devil's look, in front of all of the customers (all five of us) to see.
I guess that pretty much says it all. You just can't make it up. When people know the ship is sinking there is little allegiance to the captain. I suppose it is hard to blame the employees for acting that way. But I'm left to wonder more important things. Like how I can talk my wife into that cranium splitting sound system...
Ultimate has had a run of bad luck lately (being bankrupt with a stock worth .15 cents does damper morale) but they do have cool stores with a lot of cool products. The Ultimate in my neighborhood is a beautiful store that has all the things that we men tend to desire. Loud things that take a PhD from CalTech to install and burn so much electricity that you have to petition your local utility for a nuclear power permit.
Despite the full parking lot, there were not a lot of folks in the store. Maybe a handful of shoppers and a ton of employees. MEMO to Ultimate management (of course they read this everyday) one of your problems might be the fact that none of your employees will help people. Actually having sales people that sell stuff might help the stock price.
Anyway, I was actually their to buy my wife something she wanted. A portable stereo for her desk at work. The one I suggested (the big and loud one that shakes your fillings) was shot down. I had to find the dainty piece that any self respecting man would mock me incessantly for possessing.
I wandered aimlessly passing several employees too busy doing God knows what but I was certainly not a priority. Then it hit me. I realized why the employees were so busy, so focused on their task. They were redecorating the store. Yes right in front of me (in the area where the dainty stereo presided, thankfully it was out of stock) was a poster of Ultimate's former CEO, the great Dave Workman. Only the poster had been made over by the busy employees. This poster featured Dave with his trademark smile and his not so famous devil's mustache, beard and horns. Yes, I'm not making this up. Plain as day, Dave Workmen in a full devil's look, in front of all of the customers (all five of us) to see.
I guess that pretty much says it all. You just can't make it up. When people know the ship is sinking there is little allegiance to the captain. I suppose it is hard to blame the employees for acting that way. But I'm left to wonder more important things. Like how I can talk my wife into that cranium splitting sound system...
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