Saturday, December 10, 2011

A Rulebook For Selecting A Food Caterer For Your Corporate Conference

Planning a large corporate event entails matching a great number of particulars. Both you and your staff will have to select a location that can cater to attendees even while reducing the price and travel needs for the greatest number of people. You will have to look into accommodations and ground transporting to make certain those that attend have easy access to the venue. And you will have to employ a catering company you can trust to deal with the difficulties posed by a big event.

Unless you’ve worked with dependable caterers and event planners in the past, this last undertaking can be challenging. Very few catering companies have access to the equipment and employees necessary to satisfy the needs of a big conference, seminar, or convention. Below, we will provide a quick guide to help simplify the procedure.

Start Your Search as Early as Possible

Depending on the kind of event you’re planning, you may not know how many people may ultimately attend. Ticket sales, along with a forecast determined by earlier events, may help, but there will be an element of doubt; this can make it hard to hire a catering service.

Despite this challenge, begin looking as quickly as possible. Expert, well-regarded catering companies that handle large affairs typically become reserved early on. Waiting very long will restrict your choices and given that many food caterers let you adjust your food items and beverage minimums up to a month prior to your event, you are best off booking early.

Check Whether the Venue Has a Preferred List

A lot of locations keep a small listing of caterering companies with whom they’ve worked well before. Unless of course you’ve a strong personal preference for an unlisted firm, begin here; the firms on the checklist may already be familiar with the location, including any specific instructions by the supervisor. They will be less likely to make mistakes in the course of and following the event.

Request Prior References Of H! igh-Scal e Clients

A lot of caterers will claim they could accommodate a large trade event or conference, but have little expertise handling these kinds of events. Ask for referrals. Check with clientele who’ve hired the firm for massive affairs similar to the one you’re planning.

The references may likely have good things to declare about the catering company. Try to uncover additional details that can help you to determine whether or not the company is a great fit for your function. As an example, ask the clients whether or not they would have preferred to see anything done differently at their events; ask if they’d hire the food caterer down the road. Ask about places by which the caterer company demonstrated a bad performance.

Make Certain What The Food Caterer Is Going To Provide

Each and every catering company operates just a little differently. A few provide little more than the food and table delivery. Others will work tightly with the venue’s staff to make certain a sufficient number of chairs, tables, and table covers can be found. Still others may offer to organize the event with other distributors which can be involved with the food (i.e. delivery service, bartending staff, etc.).

Make sure you’re conscious of the products which will be handled by the catering service, and those you’ll have to address by yourself.

Make Note The Degree Of Expertise Throughout The Preparations

If you’re working with a food caterer that’s unfamiliar to the venue’s supervisors, observe their dependability. Are they on time for group meetings (in person or on the phone)? Do they seem to be structured? Do they make themselves accessible to you, or return your calls and email messages in a timely manner?

If the caterer is professional all through the negotiation and planning stages, they’ll probably show the same degree of professionalism during your function. Lateness, rudeness, and other traits are furthermore indica! tive of long term overall performance.

Finalizing the Last Details

Before formally employing the catering service, it is essential to clarify several “small” particulars. First, ask whether they can accommodate minor changes in timeline. If a speaker runs longer than intended, may the staff quickly adapt? Second, can the company supply veggie dishes, in addition to those that meet specific dietary needs (e.g. no nuts) for participants? Third, identify the lead individual with whom you should communicate changes and ask questions during the event.

Employing a food caterer for a large convention, trade exhibition, or fundraiser is different than doing so for a smaller function. Reference the tutorial above to select one that can dependably handle the job.

Looking for an event management company? Then visit wikipedia to get more info.

Pep Boys Earnings Preview

Pep Boys (NYSE: PBY  ) hasn't been able to establish an earnings trend, bouncing between beating and falling short of estimates during the past fiscal year. The company will unveil its latest earnings on Monday, Dec. 6. Pep Boys is engaged mainly in automotive repair and maintenance and in the sale of automotive tires, parts, and accessories through a chain of stores.

What analysts say:

  • Buy, sell, or hold?: Analysts are bullish on this stock, with four analysts rating it as a buy and only one rating it as a sell. That rating hasn't budged in three months as analysts have remained unchanged in their opinion of the stock.
  • Revenue forecasts: On average, analysts predict $523.2 million in revenue this quarter. That would represent a rise of 5.4% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.13 per share. Estimates range from $0.09 to $0.15.

What our community says:
CAPS All-Stars are solidly behind the stock, with 82.1% assigning it an outperform rating. The community at large concurs with the All-Stars, with 79.4% giving it a rating of outperform. Fools have embraced Pep Boys, though the message boards have been quiet lately, with only 87 posts in the past 30 days. Despite the majority sentiment in favor of Pep Boys, the stock has a middling CAPS rating of three out of five stars.

Pep Boys's profit has risen year over year by an average of more than twofold over the past five quarters. Revenue has now gone up for three straight quarters.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.







Gross Margin





Operating Margin





Net Margin





We can help you keep tabs on your companies with My Watchlist, our free, personalized service. Add Pep Boys now.

Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Earnings estimates provided by Zacks.

China to Kick Off $300 Billion Investment Vehicle for FX

(Photo: AP) (Photo: AP)

China is on the verge of launching a new $300 billion investment vehicle that would boost returns on foreign exchange reserves by setting up funds targeting two separate regions—the U.S. and Europe.

The vehicle had been planned prior to the onset of the European debt crisis, and was designed to boost returns on China's foreign exchange reserves by making more aggressive overseas investments, Reuters reported. The vehicle, according to two sources who declined to be named, is to operate two funds, one focused on U.S. investments and the other on European investments.

The new vehicle, details of which are still under discussion, would be affiliated with China's State Administration of Foreign Exchange (SAFE). That is the portion of the central bank that is responsible for the daily management of China's $3.2 trillion in foreign exchange reserves.

The U.S.-focused fund would be named Hua Mei, or China-US, and the Europe-focused fund is named Hua Ou, or China-Europe. Fund styles will be similar to that of the low-key Hong Kong-based Hua An, which in English is known as SAFE Investment Company Ltd., said the source, and through which SAFE has purchased stocks in dozens of overseas-listed companies.

Beijing has indicated recently that it intends to invest in the real economies of Europe and the U.S. aside from bond investments. The new venture will likely be Shanghai-based, according to the source, who said, "The company will issue yuan bonds. Then it can use the yuan to buy foreign currency from the central bank or even commercial banks for overseas investment."

The new vehicle is expected to have an arrangement similar to that of the China Investment Corp (CIC), the country's sovereign wealth fund. When CIC was created in 2007, China's Ministry of Finance issued 1.55 trillion yuan in special yuan bonds to swap yuan for $200 billion worth of foreign currency from SAFE as the initial batch of funds for CIC to manage.

Short Messaging Service (SMS) for Enterprise Messaging

SMS for Enterprise Messaging Value added services

Short message service, usually called SMS, is a globally accepted wireless service for enterprise messaging (mobile value added services) that enables the transmission of alphanumeric messages between mobile subscribers and external systems such as electronic mail, paging, and voice-mail systems.

The text comprises letters or numbers or an alphanumeric combination. SMS was created as part of the GSM Phase 1 standard. Each short text message is up to 160 characters is length when Latin alphabets are used and 70 characters in length when non-Latin alphabets such as Arabic and Chinese are used.

SMS comprises two basic point-to-point services:

  • Mobile-Terminated short message (MT)
  • Mobile-Originated short message (MO)

SMS Mobile-Terminated (SMS MT)

SMS (MT) are transported from the SMSC to the handset and can be submitted to the SMSC by other mobile subscribers via MO-SM or by other sources such as voice-mail systems, paging networks, or operators

SMS MT Services allow the deployment of various applications such as:

  • Information Services (loyalty card members, delivery confirmation etc.)
  • Real-time notifications and alerts (banking, finance and stock alerts, travel, sporting results)
  • Direct Marketing offerings (promotions, new product announcement, events and shows, m-coupons)
  • Ring tones, Logo downloads
  • Quiz, live games

SMS Mobile-Originated (SMS MO)

SMS MO are transported from a MO-capable handset to the SMSC and can be destined to other mobile subscribers or for subscribers on fixed networks such as paging networks or Internet protocol (IP) networks (including the Internet and private e-mail networks).

SMS MO Services are typically used in deploying applications to receive information from Mobile users to an external short messaging entity, which is typically a computer connected to the internet. Such request for information is made by s! ending a n SMS from their mobile phones to a service number linked to the service of the content provider.

Typical SMS MO service examples are dedicated requests, voting or quiz applications. A customer can register his request for information e.g. Text Product ABC to +44 7979458584 to know the product details of the product or to text Yes to a mobile number to confirm presence in an event.

Why do enterprises need SMS based mobile data services?

SMS based mobile data services are not necessary for every enterprise or every division within an enterprise. As with any new communications/ IT application or service, the investment and cost of an implementation must be balanced by a sufficient economic return. Several research firms have stated that two to three years after a mobile data services implementation a company should see a positive return on their investment.

However, there are a few compelling reasons for enterprises to get on to tap the potential of SMS based mobile data services. For many enterprises, such wireless initiatives form ways to advance customer service, productivity, cost reduction, or simply functionality necessary to remain competitive. A good example is the financial industry where wireless services have played a role in maintaining competitive position in the consumer market. Many leading banks, stock brokers and mutual funds have already started such service in which their customers receive pre-defined business-rules driven alerts or notifications. These notifications or alerts are a result of SMS enabling of business processes. Such a service eliminates the need of conventional getting connected on voice, thereby reducing direct communication cost and indirect costs (time of people making voice calls) and complexity involved in the business process.

Of late, innovative and cost effective and business models for SMS based mobile data services have emerged by which the enterprises are not required to own the wireless communication infrastructure required for t! he said service. Instead, they get all the benefits by the hugely successful pay-as-you-go model. This reduces total cost of ownership of the new initiative.

There are a few Mobile Value Added Service Providers (MVASP) that have emerged in the past couple of years which provide high quality service as compared to operators, who do not focus in enterprise wireless messaging as the size of the market is sub-optimal from the perspective of operators. Moreover, the expertise required in providing high quality and end-to-end service requires expertise in both IT industry and telecommunications verticals which makes this service offering unique. Many enterprises globally are already benefiting from such SMS based wireless initiative to reduce cost and increase operational efficiency at work.

To deliberate and decide, whether SMS based mobile data services will provide tangible economic benefit to their business, there are a number of questions enterprises should ask can themselves. This type of strategising is a first step in defining the value SMS based mobile data services provide and is necessary to avoid initiatives that provide neat" capability without sufficient and early return. When evaluating your needs for mobile data services, questions to ask include:

  • What all business processes, in which if the concerned person gets to know relevant information on the move, he/she will be able to take desired action?
  • Is a significant percentage of an organisations work or workforce away from a fixed place of business?
  • Is my enterprise ready for such a kind of initiative?
  • Would such an initiative have the potential to reduce my total cost of communications?
  • Can remote users easily access pertinent information from internal systems?
  • What are my competitors doing with regard to wireless applications?
  • Will using SMS based mobile data services improve my customer service?

Mobile data services are aimed to increase operational efficiency and reduce costs. When co! mputing the actual return on a wireless initiative, one must look at cost savings from increased efficiencies, productivity, customer satisfaction, and other such metrics. This is substantially more complex than discounting revenue generation, because many of the metrics are approximates and many of the benefits very subtle, but this estimation gives the most accurate measure of success.

Many companies provides mobile data services like ValueFirst Messaging Pvt. Ltd. is a leading enterprise messaging services company in India provides SMS on GSM/CDMA/GPRS also provides SMS sending software / applications services and products.

There are a number of metrics that will assist in determining the return of a wireless initiative. Take careful attention to assure that the metrics used relate directly to the type of solution. For example, when deploying SMSbased mobile data services for maintenance, look at the amount of time spent on a sales call. If billing is incorporated into the system, check the change in the billing cycle, to see that it has decreased. Some other metrics that may help measure the success of a wireless implementation are:

  • Increased sales per employee
  • Decreased time per maintenance call
  • Increased customer service levels
  • Reduced turnaround time
  • Reduced communication costs

ECB Cuts Interest Rates Ahead of EU Summit

The European Central Bank cut interest rates for a second straight month in a policy meeting today, and may take additional measures to stimulate bank lending and fight off a recession.

ECB policymakers meeting Frankfurt today lowered the benchmark interest rate by 25 basis points to 1 percent, matching a record low. They may also loosen collateral criteria to give banks greater access to cheap cash, said three euro-area officials with knowledge of deliberations, and might also offer longer-term loans than are currently available.

��They will have listened to the banks and will start some measures to alleviate some of the strains in markets,�� said Christoph Rieger, head of fixed income strategy at Commerzbank AG in Frankfurt. ��They will also keep open the option to go below 1 percent on rates, that��s no longer the magic floor.��

The ECB is focusing on getting banks lending again rather than increasing its purchases of government bonds, instead leaving it up to euro leaders to frame a “comprehensive” solution to the debt crisis. Later today, Europe’s leaders will meet in Brussels to frame the fifth “comprehensive” solution in 19 months.

ECB President Mario Draghi will hold a press conference at 2:30 p.m in Frankfurt. Investors will be looking for signs that the ECB would be willing to step up its bond purchases to cap government borrowing costs if leaders agree on a concrete plan and timeline to stamp out the debt crisis.

Draghi said on December 1 that the ECB��s bond buying ��can only be limited.�� However, he added that, if governments move toward a ��fiscal compact,�� there may be room for ��other elements,�� without elaborating.

For now, the ECB will likely focus on addressing signs of a credit squeeze, which falls squarely within its remit. The central bank has ��observed serious credit tightening�� and is ��aware of the continuing difficulties for banks, due to the stress on sovereign bonds, the tightness of funding markets and ! scarcity of eligible collateral in some financial segments,�� Draghi said on December 1

The ECB is already lending banks as much money as they want against eligible collateral for periods of up to a year, and will likely add two-years loans to its arsenal today.

Shippers Face More Woes on Over-capacity (DRYS, DSX, GNK, AMKBF)

We’ve been watching the Baltic Dry Index, BDI, for a while now as it slides further and further down. The index, which measures freight rates for ships carrying commodity cargoes such as iron ore and coal, has slipped to 1,790 from about 4,200 in about a month and a half.? The drop in shipping rates has depressed the value of dry bulk shippers like DryShips, Inc. (NASDAQ:DRYS), Diana Shipping Inc. (NYSE:DSX), and Genco Shipping and Trading Ltd. (NYSE:GNK). There’s even more bad news on the horizon for these shippers, based on some new evidence from A.P. Moeller Maersk (OTC:AMKBF).

Maersk Brokers have said that new dry carriers totalling 34.8 million deadweight tons, dwt, were delivered in the first half of 2010. Another 55 million dwt are on tap to be delivered by the end of the year. Maersk forecasts that 117 million dwt will be delivered in 2011.

The increase in tonnage increases competition for cargoes, and is almost certainly the cause for the dramatic drop in the BDI. Further evidence of the effect on new vessels is a report that three capesize ships, the largest in the dry bulk fleet, have been anchored in Singapore. When a large vessel is, essentially, mothballed, that means that shipping rates have fallen so far that it is no longer practical to keep a ship afloat. Capesize vessels are now being booked at $15,000/day, a price equal to the handysize carriers which displace less than 20% of capesize tonnage.

For a time, the falling BDI was thought to be connected to lower demand for commodities like iron ore. But iron ore shipments are currently stronger than ever. Seasonal demand from grain shippers helped hide the effects of the growing fleet size, which are just now becoming evident.

In a related development, demand for very large crude carriers, VLCCs, has also fallen. Day rates are down from $70,000/day to $10,000/day. VLCCs are capable of carrying up to 2 million barrels of crude, and as many as 74 ships were being used as fl! oating s torage for crude oil while the cargo owners wait for the price of crude to rise. Iran has recently released six VLCCs, with about 12 million barrels of oil, and sent the carriers to Europe.

New VLCCs are also being added a high rate, with 55-50 new tankers expected to be delivered by year-end. These deliveries are being offset somewhat as some 40 single-hulled tankers are removed from service.

The down market for VLCCs is expected to last through the rest of 2010.

DryShips and Genco are down about 30% since the beginning of the year, while Diana is off about 10%, although all are up slightly more than 1% in today’s trading.

The good news is that the collapse in the BDI probably does not indicate that the global economy is headed for the dreaded double dip. The not-so-good news is that the shipping companies are going to need an even bigger uptick in shipping than they’ve already gotten in order to soak up all the dry bulk capacity that’s coming.

Paul Ausick

Socialcast building better businesses with simple social tools

( -- A simple emoticon can tell you wonders about the emotional state of your company, Socialcast and founder Timothy Young revealed Thursday at GigaOM’s Net:Work conference. Socialcast experimented with a simple emoticon test in a Japanese factory, at the end of the workday asking each employee in an email to click on a happy, average or sad face, gauging how satisfied they were with the day’s work experience.

It’s a simple test, Young said, but it was also one that all employees could easily participate in. The resulting data points could be used to not only rate an individual employee’s satisfaction with his or her job, but also to help promote cohesion between team members and identify if certain groups or employees, such as graphic designers or salespeople, were becoming disenfranchised.

More from
  • A database to help the military share its airwaves
  • 955 Dreams tackles music discovery with Band of the Day
  • 10 ways to deal with cybersecurity in a smart grid world

VMWare recently acquired Socialcast, making Young VP of Social Enterprise. Despite the sophistication of its virtualization software implementations, Young said it has kept Socialcast true to its principles of providing simple business solutions can cut through the normally high level of complexity at an enterprise.

&ldq uo;We’re not really building software here,” Young said. “We’re helping people to unleash their power internally, become heroes and become more affective at their jobs. If we can provide really simple tools — not complex tools inside the workplace that they have to spend a lot of time training on and learning, trying to figure out how they drive value for their own jobs — if we give them really simple tools, they can use them to flourish.”

Photo by Pinar Ozger.

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

  • Millennials in the enterprise, part 1: strategies for supporting the new digital workforce
  • Infrastructure Q2: Big data and PaaS gain more momentum
  • The Case for Increased M&A in 2011: Actions and Outlooks

AutoNation: Insider and Institutional Investor Stock Sales in Third Quarter

Insiders are generally long-term investors due to restriction in making short-term profits. In contrast, wealth management institutions always have short-term investment. Wall St. Watchdog reveals information regarding the insiders and institutions which recently decreased stock shares of AutoNation Inc. (NYSE:AN).

SEC data indicate these insiders have sold AutoNation Inc.��s stock since 06/30/2011:

  • Lampert Edward S: act as 10% Owner. On 10/28/2011, sold 1,222,456 shares, worth $49,203,900.
  • Bill & Melinda Gates Foundatio: act as (See Footnote 5). On 11/10/2011, sold 914,898 shares, worth $30,987,600.
  • Bill & Melinda Gates Foundatio: act as (See Footnote 3). On 11/08/2011, sold 833,020 shares, worth $29,788,800.
  • Bill & Melinda Gates Foundatio: act as (See Footnote 2). On 11/04/2011, sold 617,833 shares, worth $22,594,200.
  • Bill & Melinda Gates Foundatio: act as (See Footnote 3). On 11/03/2011, sold 594,396 shares, worth $22,176,900.

SEC data indicate that these institutions significantly reduced their stock shares of AutoNation Inc. in Q3 2011:

  • VALINOR MANAGEMENT, LLC: On 06/30/2011, held 125,000 shares, worth $4,097,500. On 09/30/2011, held 0 shares.
  • PUBLIC EMPLOYEES RETIREMENT ASSOCIATION OF COLORADO: On 06/30/2011, held 54,529 shares, worth $1,787,461. On 09/30/2011, held 0 shares.
  • HANSEATIC MANAGEMENT SERVICES INC: On 06/30/2011, held 38,170 shares, worth $1,251,213. On 09/30/2011, held 0 shares.
  • JEFFERIES GROUP INC /DE/: On 06/30/2011, held 37,039 shares, worth $1,214,138. On 09/30/2011, held 0 shares.
  • TEXAS PERMANENT SCHOOL FUND: On 06/30/2011, held 31,511 shares, worth $1,032,931. On 09/30/2011, held 0 shares.

About the company: AutoNation, Inc. retails, finances, and services new and used vehicles. T! he Compa ny also provides other related services and products, such as the sale of parts and accessories, extended service contracts, aftermarket automotive products, and collision repair services. AutoNation operates throughout the United States.

Competitors to Watch:?Group one Automotive, Inc. (NYSE:GPI), Penske Automotive Group, Inc. (NYSE:PAG), Sonic Automotive, Inc. (NYSE:SAH), Asbury Automotive Group, Inc. (NYSE:ABG), Copart, Inc. (NASDAQ:CPRT), CarMax, Inc (NYSE:KMX), Lentuo Intl. Inc (ADR) (NYSE:LAS), Lithia Motors, Inc. (NYSE:LAD), AutoChina Intl. Ltd. (NASDAQ:AUTC), General Motors (NYSE:GM), Toyota (NYSE:T), Ford (NYSE:F), CarMax (NYSE:KMX), AutoZone (NYSE:AZO) and America��s Car-Mart, Inc. (NASDAQ:CRMT).

Sprint: RBC Says Hold On Cash Burn, Network Uncertainty

RBC Capital’s Jonathan Atkin this morning cut his rating on shares of Sprint-Nextel (S) to Sector Perform from Outperform, and cut his price target to $3 from $4, writing that the company’s entering its “peak cash burn” phase for several quarters, and there’s unlikely to be a “positive catalyst” during that time.

Atkin cut his Ebitda estimate for next year to $3.4 billion from $3.8 billion and ramped up his capital expenditure forecast for Sprint to $5.4 billion from $4.7 billion.

Cash will be drained by the construction of the company’s “Network Vision” upgrade to its facilities, and by spending on subsidies for Apple’s (AAPL) iPhone.

But the biggest issue he seems to foresee is the uncertainty about just how the company will successfully balance all the computing networks and technologies it now possesses or plans to implement:

We see significant uncertainty around the pace of Network Vision 4G implementation, iDEN termination, the ability to transition the iDEN customer base to CDMA, dual-mode FDD/TDD LTE phone availability and function, and the progression of Clearwire��s LTE build. Thus, the eventual margin accretion impacts from Network Vision, iPhone, and iDEN termination are difficult to project.

Sprint shares today are down 8 cents, or 3%, at $2.53.

Where To Go For Help And Advice To Start A Business

The Internet is a great resource for people who are thinking of setting up a home business - as well as all the articles you can find with practical advice, there are also many forums, where you can read about others' experiences, and ask questions.

Scary as it might seem to be getting advice on anything from the government, most governments go really out of their way to produce all sorts of easy-to-understand material on starting your own business. Encouraging you in business is a great way for them to both strengthen the economy and increase tax revenues.

Depending on your area, you might find that local government agencies are also keen to give you help and advice, and might even have some kind of 'small business centre' that you can visit.

Mentors are usually volunteers who think it would be nice to offer local businesses help and advice. They often have years of business experience, and can be really useful - if you find one, hang on to them.

Always willing to help and sadly neglected in our 'wired' age, you really should talk to a librarian. Libraries generally contain all sorts of business books and resources that they'll be able to point you towards, and they'll be more than happy to do research into obscure areas for you.

Pricey as they might be, lawyers know all about starting businesses - they've almost certainly done it thousands of times over. It can be well worth paying for an hour of a lawyer's time and just asking them every question you can think of.

A less expensive alternative to lawyers, accountants also know their stuff, especially (obviously) on the financial side. If you want your business to be profitable, you should take on board what your accountant tells you - and if you don't have one, you should get one. By the time they've helped you navigate through all the tax mazes, they'll almost certainly have made their fee back for you anyway.

If you think your business would be an attractive proposal to peo! ple who back businesses for a living, then you can try going to a 'business incubator' or some other kind of investor with your idea. If they like it, they'll often have a quick process set up to get your company up and running as soon as possible.

Work at Home

If you are tired of your present job, laid off, want to spend more time with family, and want to be your own boss, it is possible to work at home. Home jobs can include finance relates jobs such as bookkeeping, writing jobs such as copywriting, computer related jobs such as graphic artist, customer service related jobs such as sales, and professional related jobs such as architecture.

In trying to decide what kind of home business to start, you should do research to see if the business can be successful. Look at competing businesses and see what they charge. Read books, and search on the Internet. Also if you live with people, make sure you have their support for your home business. Have a spouse help with the kids. Explain to the kids how they can help make the business a success. Make sure you have enough money saved before you start to work at home. If you were a regular contributor to the household income, have at least six months' salary saved.

A mission statement can help define the purpose of you work at home business. A mission statement consists of your goals for the business. Define your business and write where you hope to be in six months, a year, and so on.

You can also write what income you hope to make. A mission statement can be changed as your business grows. Try to set a regular schedule for your business. You will feel more professional if you have certain times devoted to your work. Set aside a place to work. Try to make a home office and have the necessary office supplies. Don't be shy about setting prices. You shouldn't overcharge, but you shouldn't under price your work either.

When you work at home, it's important to keep up with your bookkeeping. Send out invoices as soon as possible. Record your expenses such as phone and Internet bills. Network with other people in your field.

Besides online communication, attend meetings, conferences, and trade shows. Choose a good business name, but don't choose the same name as another business. Determine w! hat busi ness structure you want, sole proprietorship, partnership, or corporation.

If you need financing, look at loans, lines of credit, and grants. See if you need insurance coverage for your business. Determine if you need to set up a business account at the bank in addition to your personal account. Figure out how much you need to spend on advertising with online and print ads, products( pens, paper, clocks, calendars) with your business name on them, sales kits, and other promotional ideas.

The biggest part of starting your home business is to have persistence and patience. There will be failures and setbacks, but as long as you do the proper research and listen to your customers, you can have a profitable home business.

This Week's 5 Dumbest Stock Moves

Stupidity is contagious. It gets us all from time to time. Even respectable companies can catch it. As I do every week, let's take a look at five dumb financial events this week that may make your head spin.

1. Netflix buries the lede
A funny thing happened with the way Netflix (Nasdaq: NFLX  ) describes itself this week in its press releases. Instead of referring to Netflix as a place with "more than 25 million members" around the world, Netflix is now serving "more than 20 million streaming members" around the world.

Yes, Netflix is now keying in solely on its streaming subscribers, but why 20 million? Are things worse than last month's guidance suggests? Netflix had 22.93 million streaming subscribers at the end of the third quarter, and its guidance calls for it to close the current quarter with 21.6 million to 23.5 million streaming couch potatoes.

One can argue that Netflix favors round numbers like 20 million and 25 million, but earlier this year it had no problem referring to itself as a service with "more than 23 million" members worldwide.

2. It's all about the Ohhhhhh (Nasdaq: OSTK  ) is backing away from its rebranding.

After months of confusing shoppers with its shorter domain through ads, apps, and even the Coliseum in Oakland where the Raiders, A's, and Golden State Warriors play, Overstock is going back to its original moniker.

It will still keep for its mobile and international initiatives -- and even the stadium name -- but it's retreating quickly to for the holidays.

A company executive confesses to Advertising Age that too many people confused with (which is currently not available for registration). I'm sure the folks at Advertising Age had a good laugh about the botched strategy that will continue to send mixed messa! ges.

3. The price is right at GameStop
GameStop (NYSE: GME  ) shares took a hit after another disappointing quarterly report yesterday. However, this is the second quarter in a row that finds the company sticking to its fiscal 2011 profit guidance, while hosing down its revenue and same-store sales growth projections.

This isn't a matter of margin resiliency. GameStop's guidance is getting worse. The video game retailer has been buying back its stock like there's no tomorrow. The move whittles away at the shares outstanding denominator in the EPS equation, masking the weakness in the numerator (i.e., earnings).

There is nothing wrong with share repurchase plans, especially if a company is able to buy back stock at the bottom. However, physical distribution -- and the resale of physical goods -- isn't a good long-term bet in the realm of video gaming.

4. Linked out
Corporate-minded social networking website LinkedIn (Nasdaq: LNKD  ) completed its secondary offering this week, but it was flooded by a larger number of insiders selling than the market originally expected.

Secondary offerings aren't fatal. It's a popular course these days for companies that go public with a limited number of shares offered, only to hit the market with a secondary offering at higher prices several months later.

Insiders selling shares aren't dilutive, but they do beef up the float. In short, the thin supply that was orchestrated before is now no longer a factor keeping the shares afloat. Given LinkedIn's lofty valuation -- the shares are trading for 258 times next year's earnings -- don't be surprised if the stock is trading lower a few months from now.

5. Joe DiMaggio hangs up his fund-managing cleats
Shares of mutual fund giant Legg Mason (NYSE: LM &nbs! p;) sli pped 3% yesterday, worse than the soft market as a whole, after the announcement that legendary fund manager Bill Miller would step down as co-manager of the Legg Mason Capital Management Value Trust. He'll continue to serve as chairman and co-manage a smaller fund.

There's no one that can take away Miller's amazing streak. His flagship fund beat the market 15 years in a row from 1991 through 2005. This is unlikely to happen again in our lifetime. It's a hitting streak of DiMaggio proportions. However, the fund's performance since then has been abysmal. The fund has lost badly to the S&P 500 in four of the five past years, including a gut-wrenching 55% defacing in 2008. The same fund that once watched over more than $20 billion in assets four years ago is now a $2.8 billion vehicle today.

Peter Lynch has been able to carve out a guru career because he went out on top at Fidelity Magellan. Miller won't have that kind of marketable luxury, making it odd that Legg Mason shares would get pounded on the news.

If you want to track these companies to make sure that they don't make another dumb mistake soon, consider adding them to My Watchlist.

  • Add to My Watchlist.
  • Add Netflix to My Watchlist.
  • Add LinkedIn to My Watchlist.
  • Add Legg?Mason to My Watchlist.
  • Add GameStop to My Watchlist.

5 Steps To Successful Joint Ventures

JV's are THE MOST preferred and fastest way to increase sales and cash flows.

It's no longer a secret!

Everyone knows a good JV is the master key to online success.

But... why many people are failing to use this master key? Why so many website owners are not able to make use of this powerful strategy?

Here are some reasons:-

1) Other marketers are NOT WAITING for your JV offer. Before sending your JV offer, make sure to address the question 'What's in it for the JV Partner?'. Unless you give a compelling reason, most partners are not looking forward to your offer. No, it won't work that, you offer one of your products for free and your partner will gladly endorse it to her list. No, it won't.

It takes time to craft an irresistible offer. The offer should be beneficial to your potential partner and her customers/subscribers.

Take it from me... I told you it takes time... but it's definitely possible.

2) Many JV offers are passed onto the 'recycle bin' with even being read (I told you... they are NOT waiting)

Some leading marketers get about 200 JV proposals every week! May be more. Most of these JV offers doesn't catch the attention of the busy marketer.

Some are lost due to SPAM email filters.


Follow-up is the key. If you consistently follow-up, your chances of getting the attention of your potential JV partner is very high. Usually a second email will get the response.

A mixed-mode follow-up is sure to get higher success rates. An initial email followed by another email reminder and a phone call should normally get you going.

3) Another strong de-motivating factor is NOT sending personalized JV offers. If your proposal does not 'speak' directly to your partner, it's chances of succeeding are very thin.

That's why I told you earlier, it takes time to create your JV proposal. You need to visit your partner's website, subscribe to their newsletter, study their online content and read their publ! ications and articles before you attempt to draft your proposal.

Your JV proposal should address your potential partner directly, using their name. Mentioning a few things about their website, products, ezines or articles in your offer will surely catch their attention.

4) JV partners are not your affiliates. Differentiate your resellers with your strategic JV partner. To drastically raise the success rate of your proposal, offer a higher commission than your affiliates.

For example, if you are offering a 50% commission for your affiliates, your JV partner should be offered 60% or more.

5) Targeting a large corporation for your JV is a surefire way to failure. First, try and do several JV's with businesses similar or smaller than your own and build a track record. Then you can approach bigger businesses with a record of your successes.

Large businesses have large problems everyday to tackle. They have struggled hard to build their enterprise. They have their own range of products to sell and keep their customers happy.

However, if you have a compelling story to tell, along with factual proof of your claims, it will definitely bring you windfall profits.

I'm not discouraging you to keep away from these giants. I'm just telling you the right way to approach.

You see friend, I've revealed to you some key tips on Joint Ventures. Now, it's up to you. Follow these rules and create a compelling offer and I'm sure you will succeed in making highly profitable Joint Ventures.

No Cheaper Shot at Costco

Costco (Nasdaq: COST  ) is impervious to negativity. Although the discount retailer missed analysts' expectations, investors are taking the news in stride. Anybody who was waiting for a temporary plunge in Costco's stock price in order to take a position will have to wait a little longer.

Fiscal first-quarter net income inched 2.6% higher to $320 million, or $0.73 per share, including charges related to settling an income tax audit related to its Mexican joint venture and a contribution to a coalition supporting the reform of alcoholic beverage laws in Washington state; combined, these charges dinged earnings by about $0.07 per share.

Costco's net sales surged an impressive 13% to $21.18 billion, with same-store sales increasing by 10%. Excluding the effects of gas price inflation and foreign currencies, comps increased 7%.

Although Costco's shrinking margins contributed to the profit falling short of analysts' expectations, maybe the reason investors are taking the news in stride is the fact that Costco's sales increases are impressive in the current environment. Despite the fact that Costco recently raised its membership fees, it doesn't look like it's pulling a Netflix (Nasdaq: NFLX  ) and alienating loyal customers, since membership fee revenue increased by 7.5%. While this is below the 10% fee hike, it is near enough that I don't worry about an exodus of customers.

Costco is one of the strongest retailers out there; that's one of many reasons I purchased the stock for the Rising Star portfolio I'm managing for about a year ago. It's also a longtime Motley Fool newsletter service favorite.

Clearly Costco is holding its own in this difficult, highly competitive retail environment against low-priced rivals such as Wal-Mart (NYSE: WMT  ) , Best Buy (NYSE: B! BY  ) , Target (NYSE: TGT  ) , and Big Lots (NYSE: BIG  ) . Costco was a major winner among the retailers that reported November same-store sales last week, too; its comps increased 9%, while Target's jumped just 1.8% and J.C. Penney's (NYSE: JCP  ) fell 2%.

If some investors were secretly hoping for a big miss so they could grab a stake at a better price, there's no such cheap shot at Costco right now. The stock is trading at 20 times forward earnings, quite higher than big-box peers such as Wal-Mart, Target, and Best Buy. However, Costco's an exemplary company, renowned for growth and execution, so it's still worth the premium price.

Are you aware of a company that's described as the Costco of Latin America? Check out the details by downloading the special report "The Motley Fool's Top Stock for 2012" free of charge.

Why Are No Bankers in Jail?

It’s the lingering question about the financial crisis, writes editor-at-large Howard R. Gold.

Why are no top executives of major Wall Street banks in jail more than three years after Lehman Brothers collapsed? Why have none even been charged with crimes?

Surely, someone must be guilty of something. Enron and the corporate scandals of the 2000s and the savings & loan failures of the early 1990s each resulted in more than 1,000 criminal convictions.

But this time is different, and I wanted to find out why. So I spoke with several federal prosecutors from the S&L and Enron eras, the people who actually brought successful criminal white-collar cases.

They told me it boils down to proving criminal intent beyond a reasonable doubt, resources, and commitment.

Let’s start with the first point, which was made on 60 Minutes last week and in The Wall Street Journal, where a former FBI official, David Cardona, said the Justice Department had decided to let regulators “take civil-enforcement actions”—like, say, the SEC’s actions against Citigroup (C), which Judge Jed S. Rakoff threw out last week—rather than go for criminal prosecutions, which have a much higher burden of proof

  • Read Howard’s piece on why the SEC needs to do more to take on big Wall Street firms.

Samuel Buell, a professor at Duke University School of Law who was a lead prosecutor on the Department of Justice’s Enron Task Force from 2002 to 2004 told me the challenge in these cases is “coming up with strong evidence of criminal mental states.”

In other words, “you knew that you were putting out [material] that was false and misleading and you did it anyway” he said.

That was what the government did with Enron top executives Kenneth Lay (who died after being convicted),! Jeffrey Skilling (who is appealing his conviction), and Andrew Fastow (who co-operated with the government, pled guilty, and served time).

Enron’s finances were in some ways as complex and sophisticated as the derivatives trades made by the big banks, and the consequences were huge.

Everybody recognized at the time that this was a cataclysmic event for the financial system. We had never seen a Fortune 10 company blow up overnight,” Buell explained.

But at Enron, there were blatant misstatements by top executives who clearly knew things were worse than they said they were.

There were also clear victims—investors and employees who lost their life savings in the company’s 401k plan. “In any fraud case you need a victim,” said Buell. “In Enron, you could tell a story of mom-and-pop investors who were deceived.”

During that time, CEOs of companies like WorldCom and Adelphia Communications also were convicted and sentenced to long prison terms.

But in the financial crisis, the questionable transactions were conducted by big banks with other large institutions, whose executives presumably should have known what they were buying—and even that the banks might short the very instruments they were purchasing. The rest of us were just collateral damage.

  • Read Howard’s piece explaining Goldman Sachs’ (GS) many conflicts of interest.

Linking top executives to specific instances of fraud is a big problem, says Joshua Hochberg, who ran DOJ’s fraud section during Enron and is now a partner at McKenna Long & Aldridge in Washington, DC.

 “How do you tie them to the actual fraudulent mortgages or sale of products they knew were bad?” he asked. (Obviously that could be different for the mortgage originators themselves, like Countrywide, if the allegations in the 60 Minutes piece were correct.)


That wasn’t a problem with the savings & loans. “The thrift savings cases largely involved people [profiting] directly from the loans they were authorizing” said Hochberg.

Friday, December 9, 2011

Media Digest (12/7/2011) Reuters, WSJ, NYTime, FT, Bloomberg

The board of Olympus may resign by late February. (Reuters)

China says its annual rate of growth slowed between October and November. (Reuters)

Congress pressures the CFTC for stronger regulation after the MF Global incident. (Reuters)

Verizon (NYSE: VZ) will launch a content service to compete with Netflix (NASDAQ: NFLX). (Reuters)

Trouble in the solar industry causes consolidation and brings more Chinese companies into the market. (Reuters)

Verizon says it will not block the use of Google Wallet. (Reuters)

Carl Icahn to make a hostile bid for Commercial Metals (NYSE: CMC) for $1.73 billion. (Reuters)

Treasury Secretary Geithner will press EU finance ministers to stop the crisis in the region. (WSJ)

The chairman of the House Financial Services Committee to hold a vote on insider trading by members of Congress. (WSJ)

Yahoo! (NASDAQ: YHOO) wants better terms from bidders for?a minority stake. (WSJ)

Private-equity firm Sycamore Partners?makes an offer for Talbots (NYSE: TLB). (WSJ)

The EU is considering antitrust charges against e-book publishers. (WSJ)

Microsoft (NASDAQ: MSFT) will offer a product that competes with Apple (NASDAQ: AAPL) apps. (WSJ)

Spain may invest billions of dollars to clean up its banking system. (WSJ)

General Electric's (NYSE: GE) financial arm may take retail deposits. (WSJ)

Bank of America's (NYSE: BAC) Merrill Lynch & Co. agrees to pay $315 million to end a mortgage-securities lawsuit. (WSJ)

Free shipping could cost retailers more than the revenue they receive is worth. (WSJ)

JCPenney (NYSE: JCP) may buy a piece of Martha Stewart Omnimedia (NYSE: MSO). (NYT)

Citigroup (NYSE: C) to fire 4,500 people. (NYT) (NASDAQ: AMZN) begins push into children's books. (NYT)

India kills a retail reform proposal that would have let companies like Walmart?(NYSE: WMT) own retail operations in the country. (FT)

Bank of America is less confident about the size! of its dividend than most other large U.S. banks. (FT)

Large buyouts set in the 2006 to 2008 period face poor returns, according to Moody's. (FT)

Geithner supports a plan by Germany and France to increase regulation of nations with large deficits. (Bloomberg)

BP (NYSE: BP) and Shell (NYSE: RDS-A) to restart oil operations in Libya. (Bloomberg)

Douglas A. McIntyre

");//]]>-->Starbucks Wi-Fi Latest Part of Coffee SBUX Reinvention

Starbucks (SBUX) has been on the resurgence in the last year and a half, with sales picking back up and shares racing up +240% since the March 2009 lows �C almost five times better than the broader market. SBUX stock shows no sign of slowing down either, with Starbucks up about 22% year-to-date while the market is essentially flat.

Part of the reason for Starbucks�� success recently is a commitment to reinvent the coffee shop. From the SBUX retail sales push with its Via line and other packaged Starbucks goods to the first ever Starbucks dividend, the company has been trying to reconnect with consumers and investors alike.

The latest effort from Starbucks is free Internet access for its customers. The company announced on Monday that starting July 1st and Starbucks would make the transition to free Wi-Fi access. Not only that, but they will also be launching the Starbucks Digital Network in a partnership with Yahoo! (YHOO), a web portal that will include job searching tools for Starbucks customers. Users who access the internet through Starbucks locations will have access to local news content from AOL (AOL) in addition to access to paid content at other business’ web portals, including News Corps’ (NWS) The Wall Street Journal, and Zagat. Users will also have access to exclusive content on Apple Inc’s (AAPL) iTunes service.

One of the most important factors that led to Starbucks’ heavy consumer foot traffic over the past decade was the company’s early adoption of publicly available wireless internet. Starbucks partnered with AT&T (ATT) to offer laptop, PDA, and Blackberry toting caffeine addicts could access the internet for small fees. The problem for Starbucks has been consumer’s unwillingness to pay access fees at public Wi-Fi hotspots. Barnes and Noble (BKS),! a Starb ucks partner itself, has offered free Wi-Fi access through AT&T since July 2009, but Starbucks has been reticent to introduce the service to independent locations. With more and more competing food chains like McDonald’s (MCD) offering free Wi-Fi, Starbucks’ hand has been forced.

Providing free Wi-Fi access at all of their locations should help improve Starbucks’ customer traffic, especially in urban centers, and subsequently improve the overall health of the company. For Starbucks stockholders, the new initiative should help make stock in the company a more attractive proposition in the coming months.

The deal should also excite Yahoo stockholders. As we wrote about just last week, Yahoo is aggressively redefining its brand in 2010. This partnership with Starbucks, in addition to their integration of functionality with popular social networking services Facebook and Twitter, should help make Yahoo stock more appealing by 2011.

As the recession kicked into gear, the closure of 900 separate Starbucks stores and the cutting of nearly 10,000 non-retail and unfilled positions within the Seattle coffee giant’s corporate structure showed that change was in the works for SBUX stock. Though Starbucks stock, has certainly not regained its late 2006 peak before its breakneck expansion plans were frozen and scaled back, the addition of Wi-Fi among other moves may be just what SBUX needs to get back on top.

As of this writing, Anthony Agnello did not own a position in any of the stocks named here.

Tell us what you think here.

Is a Revenue Miss Coming for Merge Healthcare?

There's no foolproof way to know the future for Merge Healthcare (Nasdaq: MRGE  ) or any other company. However, certain clues may help you see potential stumbles before they happen -- and before your stock craters as a result.

A cloudy crystal ball
In this series, we use accounts receivable and days sales outstanding to judge a company's current health and future prospects. It's an important step in separating the pretenders from the market's best stocks. Alone, AR -- the amount of money owed the company -- and DSO -- the number of days' worth of sales owed to the company -- don't tell you much. However, by considering the trends in AR and DSO, you can sometimes get a window onto the future.

Sometimes, problems with AR or DSO simply indicate a change in the business (like an acquisition), or lax collections. However, AR that grows more quickly than revenue, or ballooning DSO, can also suggest a desperate company that's trying to boost sales by giving its customers overly generous payment terms. Alternately, it can indicate that the company sprinted to book a load of sales at the end of the quarter, like used-car dealers on the 29th of the month. (Sometimes, companies do both.)

Why might an upstanding firm like Merge Healthcare do this? For the same reason any other company might: to make the numbers. Investors don't like revenue shortfalls, and employees don't like reporting them to their superiors.

Is Merge Healthcare sending any potential warning signs? Take a look at the chart below, which plots revenue growth against AR growth, and DSO:


Source: S&P Capital IQ. Data is current as of last fully reported fiscal quarter. FQ = fiscal quarter.

The standard way to calculate DSO uses average accounts receivable. I prefer to look at end-of-qua! rter rec eivables, but I've plotted both above.

Watching the trends
When that red line (AR growth) crosses above the green line (revenue growth), I know I need to consult the filings. Similarly, a spike in the blue bars indicates a trend worth worrying about. As another reality check, it's reasonable to consider what a normal DSO figure might look like in this space.


LFQ Revenue


Merge Healthcare $60 117
McKesson (NYSE: MCK  ) $30,216 29
Medidata Solutions (Nasdaq: MDSO  ) $46 47
Allscripts Healthcare Solutions (Nasdaq: MDRX  ) $369 91

Source: S&P Capital IQ. DSO calculated from average AR. Data is current as of last fully reported fiscal quarter. LFQ = last fiscal quarter. Dollar figures in millions.

Differences in business models can generate variations in DSO, so don't consider this the final word -- just a way to add some context to the numbers. But let's get back to our original question: Will Merge Healthcare miss its numbers in the next quarter or two?

Investors should watch the top line carefully during the next quarter or two. For the last fully reported fiscal quarter, Merge Healthcare's year-over-year revenue grew 32.9%, and its AR grew 54%. That's a yellow flag. End-of-quarter DSO increased 15.8% over the prior-year quarter. It was up 12.5% versus the prio! r quarte r. That demands a good explanation. Still, I'm no fortuneteller, and these are just numbers. Investors putting their money on the line always need to dig into the filings for the root causes and draw their own conclusions.

What now?
I use this kind of analysis to figure out which investments I need to watch more closely as I hunt the market's best returns. However, some investors actively seek out companies on the wrong side of AR trends in order to sell them short, profiting when they eventually fall. Which way would you play this one? Let us know in the comments box below, or keep up with the stocks mentioned in this article by tracking them in our free watchlist service, My Watchlist.

  • Add Merge Healthcare to My Watchlist.
  • Add McKesson to My Watchlist.
  • Add Medidata Solutions to My Watchlist.
  • Add Allscripts to My Watchlist.

Sina Shareholders Still Flee Fetters

Chinese tech company Sina��s (NASDAQ:SINA) shares have somewhat stabilized today after a precipitous fall yesterday. The sell off was triggered by Sina’s decision to fall in line with the Chinese government��s directive to regulate the company��s Weibo micro-blogging service. The government��s action stems from its objective to censor internet chatter and prevent internet users from becoming an agitating force.

However, fears of regulatory risks may be overblown for several reasons. First, shutting down Weibo would have adverse political consequences. Second, censorship is a fact of life in China (NYSE:FXI). Investors know what they are getting into.

Other Chinese Internet stocks got blasted on fears of government interference:?Baidu?(NASDAQ:BIDU),?,?Shanda Interactive?(NASDAQ:SNDA),?,?,?Dangdang Inc.?(NYSE:DANG), and?RenRen?(NYSE:RENN).

Sina’s (NASDAQ:SINA) stock closed at $90.02 today, down 2.95%. Shares are up 30.8% year to date. The stock’s trading range for the year is between $48.50 and $147.12.

Make Money

How do people make money with websites? There are literally tens of thousands of things people make money on from the net. From hard goods of all kinds (anything that can be shipped, including cars and boats!) to information and memberships.

People make money selling insurance, car parts, reports on every imaginable topic people want to know more about, selling affiliate products, and even fundraising for charity!

Thats right! People make money helping their favorite charities raise money. By creating an in-demand product for a charity to sell to their members, and letting them keep at least 50%, you can make money as a professional fundraiser.

I know someone who makes money selling a dog biscuit and dog food cookbook! Thats right, a cookbook for dog lovers to make treats for their pets. I told you! Anything goes on the net as long as there are buyers looking for what you sell.

Its truly mind boggling how some people make money online. You just have to be creative and understand how the net works and how people shop online. You have to know how to get into the search engines so people can find you.

And most of all you need a couple good ideas, or find other people with great ideas and sell THEIR stuff for commission! There is no excuse for failure the world of internet marketing is your oyster!

There are tons of resource sites that can help you understand every single minute detail of making money online from setting up a website to choosing a hosting service to taking credit cards and filling orders. Theres nothing else like it in the world.

I have a site that helps people find ways to make money online. I make money with information products, and help others learn how to make money online doing the same thing.

Some people make money on Ebay auctioning things people are searching for right now all over the world. Still other people sell their time as Virtual Assistants helping busy executives and other business owners complete mundane but impor! tant tas ks the business owner has no time to do.

With some referrals, over time you can be busier than you ever imagined with clients beating down your door because they heard you do great work at reasonable rates. All this without ever meeting ANY of your clients face-to-face. Working online makes working for people in other countries a snap, as long as you speak the language, its no different than if the person you sell to or work with lives right down the street.

Bottom line: You CAN make money online if you are the type of person who is a self-starter and motivated to work toward your goals even when the going gets tough

Productivity Grew Worldwide in 2010; Future Unclear

According to data reported Monday by The Conference Board, even though employment lagged in 2010, GDP in most countries recovered well from the financial downturn and productivity grew.

The Conference Board Total Economy Database revealed that, among nations, emerging economies are the ones driving growth, with advanced countries seeing less strength. Currently the U.S. is experiencing stronger growth than Europe, but data indicate that, because of rising employment, in 2011 growth in U.S. productivity will slow and may even fall below that in the European region.

The data also indicate that productivity growth also recovered significantly in emerging economies in 2010, particularly, according to key findings, “in those regions that suffered most from the global crisis such as developing Asia (excluding China and India), Latin America, Central and Eastern Europe, and Russia and other countries of the Commonwealthof Independent States.”

The emerging nations China and India are, according to The Conference Board, “the largest and most dynamic economies in productivity terms, with respective productivity growth of 8.7% and 5.4% in 2010.” Other nations seeing upsurges were Turkey; Brazil, which outperformed the region of Latin America as a whole; and Russia, which recovered substantially in productivity growth.

Bart van Ark, senior vice president and chief economist of The Conference Board, said in a statement, “Global productivity growth has recovered remarkably well following the economic and financial crisis. It remains to be seen whether global productivity growth will return to its pre-recession trend as employment picks up momentum in 2011.”

He added, “U.S. productivity growth will be tempered briefly in 2011 as employment recovers from its major recession cutbacks but that's temporary—the underlying productivity growth trend in the United States remains stronger than it is in Europe.”

Korn/Ferry Shares Plunged: What You Need to Know

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of recruiting specialist Korn/Ferry (NYSE: KFY  ) were getting fired by investors today, falling by as much as 12% in intraday trading after announcing fiscal second-quarter earnings.

So what: During the quarter, Korn/Ferry's revenue rose 8.7% from last year and operating income, on an adjusted basis, climbed 16%. However, the company's adjusted earnings per share fell 3% to $0.32, missing the $0.34 target that Wall Street analysts had set.

On the bright side, revenue for the quarter was above expectations and the adjusted operating margin rose to 12.7% from 11.8% last year. On the executive recruitment side of the business, engagements billed and new engagements were up 14% and 3%, respectively.

Now what: In its reaction to earnings announcements, the market often focuses itself on simply whether a company hurdled or missed Wall Street's earnings expectation. For Kern/Ferry, the quarter was certainly a disappointment in that frame, but in a yet-tough economy, the quarter doesn't look overly poor. However, the company added further to investors' pessimism by projecting earnings for the next quarter between $0.25 to $0.33, below the analyst-expected $0.35.

The economy is clearly taking the wind out of Korn/Ferry's sails right now, but Foolish investors will be best served by looking at the big picture rather than simply being quick on the trigger in today's sell-off.

Want to keep up to date on Korn/Ferry? Add it to your watchlist.

Baby boomer retirement: The news gets worse

Baby boomers are tragically unprepared for financing their health and long-term care costs as they age. And some important new studies show their circumstances may be much worse in the wake of recent carnage in both the economy and financial markets. So writes Howard Gleckman, a senior research associate at the Urban Institute, in Kaiser Health News.

Gleckman cites one study by the Employee Benefit Research Institute that shows in 2008, the average 401(k) balance of 50-somethings was just $113,000, and for those in their 60s it was barely $125,000.

But even these grim statistics mask the depth of the problem for many. Only one out of every six of those in their 60s has 401(k) assets of more than $100,000. Many have less than $50,000.

Housing, of course, is the other major asset retirees can use to help pay for medical or long-term care costs, Gleckman writes. But many boomers borrowed heavily against their home equity during the housing bubble, and then suffered a big decline in their home values during the bust. The combination, according to the Center for Retirement Research at Boston College means that many of those entering retirement lost as much of a third of the equity they had in their homes at the peak of the market.

Boomers potentially have one other resource to get them through health and long-term care crises in old age--insurance. But, according to Gleckman, the news there is also bad. Retiree health coverage, once a mainstay for the aging, is fast disappearing. According to a new report by the Kaiser Family Foundation and the Health Research and Educational Trust, just 29 percent of employers even offered retiree health benefits to their workers in 2008. That was just a fraction of the nearly two-thirds of companies that provided this coverage 20 years ago.

That leaves Medicare, which faces an untenable financial future. Medicare premiums, especially for high-income retirees, will skyrocket in coming years without significant efforts to contain costs. As Gleckman notes in a recent column, many can expect to pay as much as $5,000 a year in combined premiums for Medicare Part B and Medicare Supplemental (Medigap) within a decade.

Break-Up Value: Motorola, $26.70

Wall St. may have lost track of the fact that Motorola (MOT) is really three large business under one roof. Of the $42 million in revenue that the company is likely to have in 2006, about $28 billion will come from the handset business. The company’s telecom network infrastructure business is another $11 billion. Its set-top box division, which competes with Cisco’s (CSCO) Scientific Atlanta group, is the third operating business and should bring in about $3 billion.

The handset business has had an operating margin of about 12%. Based on the company’s recent bad news about price pressure in this part of the company, that figure could clearly drop. The infrastructure business has a margin of about 14%. The set-top box business has a 3% margin.

Motorola has debt that roughly equals cash, so there is very little discount needed from its $43.7 billion market cap ($18 a share).

Nokia, the largest handset company in the world, trades at about 1.5x revenue. Motorola is at about 1x. Nokia is putting its network business together with Siemens, so that is probably priced into its stock. At 1.5x Motorola’s revenue, the handset business would have a value of $42 billion, close the current market value for the whole company.

The infrastructure business has a few large competitors. Alcatel-Lucent (ALU) and Nortel (NT) each have a fair deal of debt for their market caps. Each company trades for about 1x sales.

The other companies that are dominant in the segment are the Nokia/Siemens (NOK)(SI) upcoming joint venture and Ericsson  (ERIC) which is buying Redback (RBAK). Ericsson trades for 2.6x sales. An analyst could argue that Cisco (CSCO) and Juniper (JNPR) are also in closely related businesses and each trades for over 5x sales.

Leaving the companies with the high premium multiples out of the valuation, Motorola’s infrastructure business has comparables in Nortel, Alcatel-Lucent, and Ericsson that range from 1.1x sales in value to 2.6x. At a ! 1.8x mul tiple, Motorola infrastructure business would be worth $19.8 billion.

Leaving the set-top box business at Motorola’s own 1x valuation would give that segment a $3 billion valuation. That would bring the valuation of the entire company to $64.8 billion or $26.70 per share, about 50% higher than the stock is now.

Douglas A. McIntyre can be reached at He does not own securities in companies that he writes about.

Report: Slumping M&A Activity Could Rebound with Tech, Healthcare Deals

The volume of merger-and-acquisition deals fell 47% in the first half of 2009 from a year earlier to 3,800 and the total deal value fell 43.6% to $707.7 billion, according to MergerMarket’s Global M&A round-up released this afternoon. During the first half of 2007 — the most active half-year period for M&A there were 7,880 transactions valued at nearly $2.1 trillion. Still, steady deal flow in the first half of 2009 suggests that M&A volumes have bottomed out. Goldman Sachs (GS) reigns as the top financial advisor to global M&A deals by value whereas UBS Investment Bank (UBS) was the leader by volume. For full results, check out this link.

The greatest slump in activity took place in the mid-market range with individual deals valued at $250-$500 million, and most notablly in Europe. European deal value and volume fell 70.2% and 67.4%, respectively. Meanwhile, large cap deals valued over $500 million fell 52.2% in volume and 38.7% in value. Thanks to forging six of the ten largest deals so far this year, U.S. large-cap deal activity fell only by less than 10%.
Not surprisingly, insolvency transactions involving companies that have filed for bankruptcy and are being bought or reorganized out of insolvency — rose in this economic downturn to 223 transactions transactions globally from 90 a year earlier. These transactiosn peaked in the second quarter at 112 compared to their previous peak of 88 deals in the second quarter of 2004.

Mergermarket says that dealmaking may rebound, citing that tech companies like Microsoft (MSFT) and Dell (DELL) may used the capital they raised through debt for acquisitions. Healthcare could be another areas. But large private-eqiuty deal acitvity remains viritually non-existant in 2009 so far, the reprot said.

– reporter Naureen Malik

Is ManpowerGroup the Perfect Stock?

Every investor would love to stumble upon the perfect stock. But will you ever really find a stock that provides everything you could possibly want?

One thing's for sure: You'll never discover truly great investments unless you actively look for them. Let's discuss the ideal qualities of a perfect stock, then decide if ManpowerGroup (NYSE: MAN  ) fits the bill.

The quest for perfection
Stocks that look great based on one factor may prove horrible elsewhere, making due diligence a crucial part of your investing research. The best stocks excel in many different areas, including these important factors:

  • Growth. Expanding businesses show healthy revenue growth. While past growth is no guarantee that revenue will keep rising, it's certainly a better sign than a stagnant top line.
  • Margins. Higher sales mean nothing if a company can't produce profits from them. Strong margins ensure that company can turn revenue into profit.
  • Balance sheet. At debt-laden companies, banks and bondholders compete with shareholders for management's attention. Companies with strong balance sheets don't have to worry about the distraction of debt.
  • Money-making opportunities. Return on equity helps measure how well a company is finding opportunities to turn its resources into profitable business endeavors.
  • Valuation. You can't afford to pay too much for even the best companies. By using normalized figures, you can see how a stock's simple earnings multiple fits into a longer-term context.
  • Dividends. For tangible proof of profits, a check to shareholders every three months can't be beat. Companies with solid dividends and strong commitments to increasing payouts treat shareholders well.

With those factors in mind, let's take a closer look at ManpowerGroup.


What We Want to See


Pass or Fail?

Growth 5-Year Annual Revenue Growth > 15% 5.4% Fail ? 1-Year Revenue Growth > 12% 20.3% Pass Margins Gross Margin > 35% 16.9% Fail ? Net Margin > 15% (0.7%) Fail Balance Sheet Debt to Equity < 50% 27.8% Pass ? Current Ratio > 1.3 1.32 Pass Opportunities Return on Equity > 15% (6.1%) Fail Valuation Normalized P/E < 20 9.41 Pass Dividends Current Yield > 2% 2.3% Pass ? 5-Year Dividend Growth > 10% 7.4% Fail ? ? ? ? ? Total Score ? 5 out of 10

Source: S&P Capital IQ. Total score = number of passes.

With a score of five, ManpowerGroup finishes in the middle of the road. The terrible job market has played havoc on recruiting practices, but recent reports suggest that there may be light at the end of the tunnel.

ManpowerGroup provides staffing and employment services around the world. Providing both temporary and permanent recruiting and consulting services, the company competes not o! nly agai nst fellow traditional companies like Korn/Ferry (NYSE: KFY  ) and Kforce (Nasdaq: KFRC  ) but also more Internet-based job services providers like Monster Worldwide (NYSE: MWW  ) and Dice Holdings (NYSE: DHX  ) . In addition, its outsourcing services line up against big players including Accenture (NYSE: ACN  ) and Towers Watson (NYSE: TW  ) .

Under ordinary conditions, ManpowerGroup and its peers benefit from the regular flow of employees across industries and throughout the economy. But obviously, the recession and the huge jump in unemployment have hurt recruiting activity, leading to big challenges. In particular, ManpowerGroup's margins compare very badly against nearly all of its competitors, making its fairly strong growth over the past year far less valuable.

Earlier this week, shares of ManpowerGroup surged as hopes for a recovery in Europe outweighed reports that slightly fewer hiring managers expect to add jobs in the first half of 2012 than they did in the second half of this year. However, the larger gains that Monster Worldwide and Dice Holdings enjoyed suggest that they may benefit more from the trend than ManpowerGroup will.

What will make or break ManpowerGroup going forward is the status of job creation both in the U.S. and abroad. If the global economy can recover, then ManpowerGroup may get a lot closer to perfection; but if the jobless recovery continues, then the company could be in for tough sailing for a long time.

Keep searching
No stock is a sure thing, but some stocks are a lot closer to perfect than others. By looking for the perfect stock, you'll go a long way toward improving your investing prowes! s and le arning how to separate out the best investments from the rest.

Click here to add ManpowerGroup to My Watchlist, which can find all of our Foolish analysis on it and all your other stocks.

Finding the perfect stock is only one piece of a successful investment strategy. Get the big picture by taking a look at our "13 Steps to Investing Foolishly."

China Attempts To Jump-Start Economic Growth

by Jason Jenkins, Investment U Research

China is cutting the amount of money its banking institutions needs to hold on its books against loans in attempt to lend these extra funds and stimulate its economy.

The Chinese government has come to terms with an economy that has seemed to put on the brakes faster than economists had forecasted in October. This week, to the world's surprise, the Chinese central bank reversed its yearlong move toward tighter monetary policy and took the needed action to encourage banks to resume lending.

The Central Bank cut the reserve requirement ratio for financial institutions by half a percentage point. It's the first such cut since 2008 and a total change in direction after rates were raised five times this year. The cut will take effect December 5.

The earlier moves were designed to curb inflation. The inflationary signs are still there, but weak economic growth has replaced inflation as the government's main concern.

Slowing Economy

The great Chinese economy is slowing down. Chinese real estate developers, small businesses and other borrowers have been complaining over the past month of dried up credit and a lack of demand.

The monetary policy moves earlier this year had been aimed at curbing inflation, which persists but appears to have been replaced by weakening economic growth as the top worry for policy makers.

In the real estate market, prices have declined as much as 28 percent for new apartments in some Chinese cities. Real estate brokers have laid off thousands of agents as transactions have shriveled while export orders have slumped.

And to top it all off, Chinese manufacturing numbers have hit a 32-month low, according to a preliminary report for November. The world was aware that the frenetic growth was slowing down.

PBC's Reaction

The People's Bank of China is considerably more secretive than the Federal Reserve or the central banks in Europe because! they ha ve always mistrusted outside government attempts to allow for faster appreciation of the Chinese currency.

Their Central Bank has been taking most of the reserves deposited with them and using it to buy dollars in international markets so as to slow the appreciation of the Chinese currency. Easing domestic monetary policy makes it difficult for China to continue limiting the appreciation of its currency against the dollar. We've all heard and seen the commotion this practice has caused in the news between the United States and Chinese governments regarding exports.

Recently, with a lack of international investors speculating in China's currency, the central bank no longer needs to maintain its reserve requirements to continue currency intervention.

"Easing Constraints on Bank Lending"

Intended to increase liquidity, lowering the reserve requirement appeared to cause a boost Wednesday for U.S. pre-markets.

"The move will ease constraints on bank lending," wrote Mark Williams, Chief Asia Economist for Capital Economics in London, in a report for investors. "The level of excess reserves had dropped very low."

Williams said that lowering the reserve requirement by half a percentage point was equivalent to injecting 400 billion yuan, or $63 billion, into the banking industry.

The Chinese government is telling the world that we will do everything in our power to keep our growth going. Look at it as a monetary stimulus package to keep China doing what it has been over the past years.

Good Investing,

Jason Jenkins


Thursday, December 8, 2011

Cain Suspends Presidential Campaign

Republican presidential hopeful Herman Cain Saturday said he was suspending his campaign because it had been negatively affected by allegations of sexual harassment and an extramarital affair.

In a speech to supporters, Cain called the allegations "false" and "unproved," but he said they had hurt his family and hindered his campaign's ability to raise money.

Cain said that while he was suspending his "plan A" of becoming president, he would now turn to "plan B," in which he will "continue to be a voice" for the American people and continue to promote his 9-9-9 tax plan. Observers had expected Cain to drop out of the race for the GOP nomination after he said earlier this week that he was "reassessing" his candidacy in the wake of the allegations.

Cain's absence may hurt the campaign of Republican frontrunner Mitt Romney.

>To order reprints of this article, click here: Reprints

The Future of U.S. Refining

Refining is easily the least glamorous aspect of the oil and gas business. And yet, this is where the next smart play is for energy investors. An increase in energy production in North America, combined with geopolitical turmoil, is likely to ensure profitability for the U.S. refining industry for the near future.

U.S. refining situation
Perhaps the most notable U.S. energy trend outside of the shale gas boom this year has been the massive splitting and selling off of refining operations. Many integrated companies opted to shed their refining operations to focus on exploration and production. Let's recap:

  • Murphy Oil (NYSE: MUR  ) divests its refining business and sells assets to Valero (NYSE: VLO  ) and Calumet Specialty Products (Nasdaq: CLMT  ) .
  • Marathon Oil (NYSE: MRO  ) splits in two, and the refining part becomes Marathon Petroleum (NYSE: MPC  ) .
  • BP (NYSE: BP  ) aims to sell one refinery in California and one in Texas by 2013 as part of an asset purge initiative to raise money to pay for costs incurred from last summer's oil spill.
  • ConocoPhillips (NYSE: COP  ) plans to spin off its refining business, calling the new entity Phillips 66. It is also trying to sell its East Coast refineries.
  • Sunoco (NYSE: SUN  ) simply gives up. The company is desperately trying to sell its refineries on the East Coast, going as far as to simply shut them down to save money.

Pretty grim picture, right? But most of the industry doom and gloom stems from the current refining situati! on on th e East Coast. These refineries tend to be older and less sophisticated, only able to handle certain types of crudes that can be refined much cheaper in places like the Gulf of Mexico and the Midwest.

The industry outside of the East Coast is poised to pop:

  • Fool analyst Jim Mueller makes a great argument for considering Western Refining (NYSE: WNR  ) right now.
  • Tesoro (NYSE: TSO  ) had a terrific third quarter this year. Refinery utilization is at 92%, net income surged, and the company reduced debt.
  • HollyFrontier (NYSE: HFC  ) refines crude that comes from its own backyard in Oklahoma, which is why it's more successful than refineries on the East Coast that refine crude shipped from Africa.

Canada's oil sands
Speaking of imports, when the U.S. government decided to remain undecided on TransCanada's (NYSE: TRP  ) Keystone XL pipeline, environmentalists cheered, and oil and gas supporters groaned. But let's not kid ourselves; if there is money to be made, people are going to find a way to make it. Since that time, I've read numerous alternative plans to get Canada's oil into the U.S. and pushed out to U.S. refineries.

One option entails using tankers to transport crude to refineries on Lake Superior, where it's estimated that there's 2 million barrels a day of refining capacity available. Another possible option involves widening existing pipelines and reversing the flow of the essentially empty Capline pipeline that flows north from Louisiana to Chicago.

The point is that Canada's oil will make its way into the U.S. one way or the other, and that's good news for U.S. refineries.

Europe's ban on imports
The EU has already banned oil imports from Syria and is toying with the i! dea of b anning Iranian imports as well. Though there seems to be a consensus on banning imports from Iran at some point, it may not happen anytime soon. Iran is one of Europe's top three suppliers, and those nations would struggle to find a replacement supply because countries like Saudi Arabia and Russia prefer to sell oil to Asia, where the price is higher.

If a ban on Iran does happen, though, European refiners will have to pay more for crude, driving down profits, pushing up costs to consumers, potentially shutting down refineries, and ultimately wreaking havoc across the Atlantic. It will, however, benefit U.S. refiners that will be able to export their refined products overseas. If that seems far-fetched, consider that European refiners are already having trouble. European refining margins were negative in July and again in September; many refineries are operating at a loss.

U.S. domestic oil and gas production
Let's say, hypothetically, that the scenarios presented above don't actually happen -- Canada doesn't send us crude, and Europe doesn't demand our refined petroleum products after all -- U.S. refining will still increase in the coming years. Why? Because it's estimated that by developing its unconventional energy plays, by 2020 the U.S. will likely be the top oil- and gas-producing country in the world.

Even if you're skeptical of the hype and don't buy into the No. 1 ranking, there is no denying that domestic energy production is surging. You can see the evidence in the explosive growth in American oil and gas plays like the Bakken shale, the Mississippi lime, and the Marcellus shale -- not to mention the tremendous potential of plays like the Niobrara and Utica shales. The increase in domestic oil and gas production will keep capacity numbers high at U.S. refineries.

Foolish takeaway
If the price of oil stays high around the globe -- due to geopolitical risk factors abroad or what have you -- the price of gasoline will remain! high as well, ensuring that refiners will be able to maintain high margins and profitability on their products.

If you're looking for more ideas, The Motley Fool has created a new special oil report titled "3 Stocks for $100 Oil," which you can download today, absolutely free. In this report, Fool analysts cover three outstanding oil companies. To get instant access to the names of the three oil stocks, click here -- it's free.

Coworking: A window into the future of work

( -- First there was bring your own device, now there’s find your own office — and both trends could be equally revolutionary for the enterprise. That’s the gist of a coworking panel at GigaOM’s Net:Work conference that had operators, designers and consultants of coworking facilities talking about the increasing impact coworking is having on large corporations.

Don Ball, co-founder of the CoCo coworking and collaborative space said that many of the early corporate users of his facilities were “going rogue,” with supervisors not actually knowing that employees were working in a shared office space.

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But these days, more and more corporations are leveraging coworking spaces, with motivations ranging all the way from real estate downsizing to perks to increased productivity. “When I worked in an office, I spent an awful lot of time to fool around,” said Emergent Research Partner Steve King. Offices tend to be social spaces with lots of parties and other non-work activities, something that doesn’t happen as much in coworking facilities.

At coworking spaces, people tend to be more focus! ed, agre ed Herman Miller Advanced R&D Projects Lead Consultant Jennifer Magnolfi. “These spaces simply feel more appropriate for the way we work today,” she said, simply because they reflect the tools we use to work today. She added than many coworking spaces follow different design paradigms than your plain old office, inviting people to learn as well as work.

So how big is the impact this new wave of corporate coworking is having? King said that nine percent of the people who attend coworking spaces in the U.S. now come from corporations that employ more than 100 people. That may not sound much, but LiquidSpace Founder and CEO Mark Gilbreath reminded the Net:Work audience that coworking is already influencing how big corporations design their offices. It might be that the coworking space of the future doesn’t even look like today’s coworking facility, where people rent desk space by time slot. “Hotels have spent 3 billion dollars to redesign their lobbies to feel like coworking spaces,” he said.

Regardless of what coworking spaces will eventually look like, all of the participants agreed that the trend will play a huge role for big companies in the years to come. “Coworking is a window into the future of work,” said King.

Photo by Pinar Ozger.

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