stlplace(Update July 17) I went to Fazoli this evening to take some food home. Surprisingly there are many people again. Another sign average people are feeling the pinch in this recession.
(Original) Fazoli has been my favorite lunch places for a while. Recently it got more and more crowded during lunch time. This seems strange because in current economy recession, one would think people would bring their own lunches more and eat less outside. So, what’s the reason?
Greenspan (regulators): for he kept interest rate too low (1%) for too long, during the recession after dot com bubble.
Bush (politicians): for his failed Iraq war which cost American tax payers more than 500 billions so far. He asked American “go shopping” after 911, in addition to buying a car or a house. Democrats are no better in this aspect: Fannie Mae and Freddie Mac have deep roots in Democrats leadship.
(Video by LATimes: anxious customers on day 2 of IndyMac Fed takeover)
Fannnie and Freddie crisis
I read Burham’s beat Fannie Mae’s Golden Goose article last Friday, after seeing the dramatic stock actions of FNM and FRE on that day. Following that, I also reviewed Barrons March 11 article, IS this Fannie Mae Toast?
Yeah, it looks like it. The bad thing is, those executives at Fannie and Freddie have made their money, we (tax payers) are bailing them out. So is the US still a free market capitalism country? Seems more like cronyism capitalism to me 🙂
An emotional day in St. Louis
As you may heard from the news, Anheuser Busch accepted the latest cash offer from InBev, and the AB global headquarter in STL will be the North American HQ of combined company Anheuser Busch InBev. Because it’s a cash offer, the current shareholders (Busch family, and Warren Buffett) will NOT have a stake in the new company. Interestingly, this morning I heard from radio Mayor Slay turned 180 degree about the merger, saying “I will work with AB/InBev starting tomorrow, next day, next week, next month…to ensure the success of AB/InBev in the region”.
Hm, what did he say a while earlier (before AB shareholders and board accepted the sweetened offer from $65 to $70 a share). Something like “this merger will destroy the shareholder value, lay off workers in AB, reduce the commitment to community”. All kind of bad things. What a difference $5 can make. Now everybody is happy.
Friday evening I was checking out the air fare for the planned China trip later this year. And I found aa.com price irresistible: $1000 from STL to PVG. So I jumped on it. With sky high gas price (and jet fuel), this price seems cheap to me. I remember last year I paid close to $1100 for similar air ticket.
So why is the price relatively cheaper? I think one reason is AA needs cash (unearned revenue in this case) badly. Another less likely reason is AA thinks oil price will go down. Separately, I read from news the airline executives wrote an open letter to ask congress to clamp down on the oil speculators, because according to the airlines “oil speculators drove up the oil price”. I see two problems in this argument: 1) Airlines also hedge their jet fuel positions, i.e., they are speculators too; 2) Speculators can cause short term price volatility, but in longer term, it’s the supply and demand determine the price. It seems the airlines executives forgot the Econ 101 here 🙂
Odds and Ends
Here in St. Louis, some churchs are organizing prayers for “lower oil price”. Reminds me in ancient China the farmers praying for “good weather/havest season”. In modern days I have seen people praying for “stock prices going up”.
(Update) I actually went to the Apple store in West County mall this afternoon, and played with the new iPhone 3G. The first thing noticed is the sign “iPhone 3G is sold out” blah blah blah. I saw a couple in 50s (T-mobile customers) looking for iPhone, and had to leave empty handed. The sales associate acknowledged only a few early birds got the phone. I tried the browser, the touch keypad and youtube. It seems to me the web surfing speed is so so, but again I don’t have benchmark. For some reason I think this thing more like iToy 🙂
(Original) iPhone is here. Yesterday when I drove to work after 9AM, I saw many fans lined up at AT&T store (Creve Coeur, MO).
There are also wide reports on the glitches in new iPhone 3G launch, such as this one from CNET. This is something I was not surprised, just like the “can not activate using iTune server” I heard last year. I can certainly appreciate the complexity of such an event, but I was not confident on AT&T and Apple’s scaling capabilty here, which is key if Apple wants success in enterprise market. Just like the BlackBerry service outage, those kinds of things are not only annoying for end users but could also lead CIOs to give up on them.
Plus side
Amid all the craziness on oil, stock market and iPhone, yesterday I realized the Beijing Olympics is coming in 4 weeks, and it seems I can not go there for the event. Fortunately I got a piece of Olympics since 2004. In the picture below, at the left is a Coca Cola limited edition can made for torch relay in St. Louis (June 17 2004), at the right is a can features Beijing Olympics logo. Note Coca Cola is Olympics global sponsor (the highest level).
Maybe those politicians who said boycotting the opening ceremony can honor their words, and let me use their seats 🙂
Ted Koppel is on the top of the journalists I admire. He always asks tough questions in a polite manner, and he has very good insights on international matters. That’s why I was sad to see he leaving ABC NightLine a while ago; and yesterday I was glad to learn his latest project Koppel on Discovery, People’s Republic of Capitalism (PRC), will be shown from July 9 to 12, on Discover Channel each night 10 PM (ET). Here is an excerpt of the show.
======
We’ll trace the interconnected web of U.S./China trade, from Mexican migrant workers in North Carolina to a Chongqing teenager working on a boombox assembly line; quality control inspectors at Ethan Allen to a Chinese homemaker shopping at Wal-Mart in Chongqing; and laid-off workers from Briggs & Stratton’s Rolla, Missouri plant to the American who runs the Briggs & Stratton plant in Chongqing.
======
Hm, Rolla is where my Alma Mater University of Missouri – Rolla (now Missouri S&T) is. Ethan Allen is one of the very first US stocks I bought (in 2002 🙂
With the iPhone coming, and initial positive review from personal technology Guru such as Walter Mossberg. It’s not easy time for RIM investors and Blackberry users. For one, your friend who gets new iPhone in a few days will laugh your Blackberry is so old tech, with his/her iPhone features touch screen, two fingers zooming in/out a picture, iPod for music and video, all of which a Blackberry can not do. 3G? The Blackberry Bold is coming but at least a month after iPhone launch. Ouch.
Crackberry
But not that fast. While RIM has all the disadvantages compared to iPhone, strangely the blackberries are still selling like crazy, and its subscribers base is also growing: it just added 2.3 million in the quarter ended May 31 (fiscal 1Q 09 call). One thing RIM and Apple users in common is they have kind of cult culture. Check out this crackberry.com and you will get an idea. Seriously I think compared to Apple/iPhone, RIM/Blackberry has the following advantages:
You Tube video: John Templeton interviewed at Wall Street Week at PBS. He was talking about the market in 1989: Germany; Japan stock market hit the top and started going down; Hongkong; US, etc.
John passed away today, at age of 95.
This Friday will be another big day for the Apple fans, the 3G iPhone will be unveiled globally. The past weekend I stopped by the local Apple store, I have not been to there for 6 months so my impression maybe more genuine. Besides the iPod touch (iPhone was absent), I found some of the sales associates are incredibly young, they look like high school kids. This reminds me many high school kids carrying MacBooks at the county library. So in a word, Apple was doing peer to peer marketing here?
What’s the use for iPhone?
I saw this question posted in Trader1688. Don’t laugh, this is a legimate question. My initial thought is the usual stuff such as MP3/video playback, web browsing, GPS,…as desribed in its offical web page.