Wednesday, July 26, 2017

The Market And Energy Page, Part II, T+187 -- July 26, 2017

Updates

Later, 6:32 p.m. Central Time: I've been wondering why XLNX was not riding the coat tails of Nvidia; and then why XLNX was not riding the coat tails of Advanced Micro .... wonder no more ...  after a so-so day for XLNX, it soared near the end, and finished almost 3% higher. Whoo-hoo! [Later: perhaps now. Now I see that XLNX may have done it on its own -- Xilinx beats 1Q17 forecast -- 63 cents vs 60 cents forecast. Can't wait to see market tomorrow. Miss on revenues.]

Later, 5:20 p.m. Central Time: update on Foxconn building facility in Wisconsin. From jsonline, data points:
  • $10 billion investment
  • will require $3 billion in subsidies from state taxpayers 
  • southeastern Wisconsin
  • a virtual village: manufacturing plant(s); housing; stores; service businesses
  • spread over at least 1,000 acres
  • 1.5 square miles
  • 20 million square feet: 3x the size of the Pentagon; will be one of the largest manufacturing campuses in the US
  • will initially employ 3,000 workers; average wage/salary: $54K 
  • "The single largest economic development project in the history of Wisconsin, one of the largest in the history of the US."
  • "America does not have a single LCD plant to produce a complicated system. We are going to change that."
  •  this would not have happened under a third-term Obama presidency/Hillary unless it came with a lot of political donations and/or funding for The Foundation
Original Post
Inept? Hillary and company were unable to find Wisconsin during the 2016 presidential campaign. On the other hand, Apple and Foxconn appear to have had no trouble finding the state. In my mind, there is absolutely not one reason for Foxconn to build in Wisconsin, but it appears that this is a Trump-reward for the president carrying that state. According to CNBC, there are twenty states that have a better business climate than Wisconson. The state ranked 15th and 17th in education and technology/innovation, respectively. Hardly noteworthy. More at Crain's.

T: shares pop almost 5% on earnings beat. Posted 79 cent/share; better than the 74-cent forecast and better than 72 cents/share last year.

Fake news: with all the media hype about T-Mobile having the best network, it turns out to be "fake news." In most recent survey, T-Mobile ranks fourth -- which is almost dead last. Top three: Verizon, ATT, and Sprint. From Fortune.
The company's testing showed that all four major carriers–AT&T, Verizon, T-Mobile, and Sprint—improved average speeds in at least 20 markets in the first half versus the end of 2016. "Taken together, this suggests that investments are being made that counteract any demands on the networks from unlimited data plans," Hamilton said.
But, of course, T-Mobile cried foul. LOL.  Regardless of how they placed in the competition, they all get a participation trophy.

Nation's largest job fair. Data points:
  • Amazon
  • 50,000 job openings
  • 10 fulfillment centers across the US 
Boom: US new home sales rise for second straight month. "Out west" June new home purchases surged to a 10-year high. Ten years. Hmmmm..... the entire Obama presidency fits into that lost decade.

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More On T

From the linked article above:
Digging deeper into the segment numbers, the company’s wireless business added 2.8 million net subscribers. Of that total, 2.3 million were in the U.S., while 476,000 were from Mexico. Notably, U.S. wireless subscribers achieved its best-ever postpaid phone churn of 0.79%, while Total postpaid churn was 1.01% — both above Street estimates.

The company lost only 89,000 postpaid phone subscribers. Not only did that total narrow its loss from 180,000 in the year-earlier-period, it also topped analysts forecast for a loss 256,000 postpaid subscribers.

On their own, these numbers aren’t breathtaking. But when taken into context with respect to dominance of T-Mobile, AT&T doesn’t appear to be in the sort of dire straits T-Mobile’s boastful CEO John Legere has implied. In T-Mobile’s own Q2 results released last week, the company added 1.3 million total net subscribers, of which branded postpaid net adds were 817,000 and postpaid phone net adds were 786,000.

T-Mobile management insisted they would capture more than 100% of industry’s postpaid growth, meaning there would be nothing left for either AT&T or market leader Verizon Communications Inc. But AT&T’s results, combined with the improving churn rate, suggests otherwise.
The company’s wireless business is making up for shortfalls elsewhere such as in the landline U-verse TV service, which shed 195,000 subscribers.

6 comments:

  1. As for T-Mobile, competition is good. The only reason Verizon customers enjoy unlimited data is because T-Mobile offered it.

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    1. You are so correct. Same with Amazon as I noted in an earlier post -- two-day shipping has become the norm, and free-shipping is often thrown in.

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  2. As for housing and the market as a whole, expect the party to end abruptly. Sorry, the president having a D or R in front of their name, or whether they are a decent human being or ignorant piece of human garbage (at present) doesn't matter. This stuff is the result of monetary policy and complex market forces, not what personality attends ribbon cutting ceremonies.

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    1. I sort of look back at two lost decades: the "decade" of George W Bush and the "decade" of Barack Obama and wonder ....

      ... just as with McDonald's --- horrendous three years under previous CEO; new CEO turns things around in a little over one year.

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    2. Apparently Ivan the Terrible said:

      "This stuff is the result of monetary policy and complex market forces, not what personality attends ribbon cutting ceremonies."

      So what are we doing, channeling Milton Friedman today?

      In his 1965 review of Friedman and Schwartz’s 'A Monetary History of the United States, 1867–1960,' the late Yale economist and Nobel laureate James Tobin gently chided the authors for going too far. “Consider the following three propositions,” he wrote. “Money does not matter. It does too matter. Money is all that matters. It is all too easy to slip from the second proposition to the third.” And he added that “in their zeal and exuberance” Friedman and his followers had too often done just that.

      John Kenneth Galbraith, writing in 'Money: Whence It Came, Where It Went,' also did quite a takedown of Friedman's "faith in monetary policy" and his belief that "all problems could be solved by the magic of monetary management."

      "Partly this was the result of the fading memory of earlier failures," Galbraith adds. "Partly it was the normal human hope that salvation might somehow be found in magic, sorcery or witchcraft as these are revealed to experts."

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    3. You know, it's interesting. "What personality attends ribbon cutting ceremonies." I have to think back on Ronald Reagan's speech in Berlin: "Tear down this wall."

      No money involved; simply a "personality" at a "ribbon cutting ceremony." LOL.

      I think many folks misunderestimate (to quote another president) the power of personalities.

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