I've always adored the bookkeeping/accounting software called MYOB, because when I bought my first copy back in 1990 it worked! Fully integrated, everything I need, and a "accounting challenged" fellow like me could operate it. PC and Mac versions, and it is both cheapest and best of all the programs out there.
If you have another bookkeeping program now, I would not convert, but if you have none, do start with MYOB.
Now they come with a version for retail, and wireless so you could copy what they do in the Apple Stores, when you buy a computer the clerk rings you up from a card reader on his person. Way cool!
Friday, August 8, 2008
Makes Me Want To Open A Retail Store
Thursday, August 7, 2008
Hillary Will Win in '08
How anyone can doubt that Hillary will be the next president is beyond me. IN 1992, Bill disappeared for the Summer as he met with anyone and everyone who mattered and cut the deals necessary to be president. Where's Hillary while Obama wastes time and ticks off every democratic constituency?
Time magazine says at the Denver convention there is a move to have Hillary's "... name be placed in nomination at the convention, a symbolic move that would be a reminder of the bruising primary battle." Ha! These people are Clintons! A symbolic move! A symbolic vote. Hillary wins the vote. Obama gets to be VP.
China Cools Money
Folks,
Not only does USA government policy make protecting your savings difficult, the Chinese government does not want you to protect yourself by investing in China.
I speak to many people who are devising exit strategies from the US, given the coming economic difficulties and political repression. If it gets that bad, what makes these people think they will be welcome overseas? Investing in China is a form of escape, and look at the surprising reaction of the Chinese to foreign investment.
On the other hand, for any hedging or protection you might find overseas, there is an equal hedge here at home, and it also has the advantage of being close at hand.
Rosa Parks said it best, "I ain't movin'"
John
Amy Checks In On A Fundamental Question
On Aug 6, 2008, at 10:26 PM, Amy wrote:
John, .... Wasn't the goal of importing + exporting to find the best places to produce the items in a cost efficient manner while taking up the advantages of these factories who can produce good quality kitchen towels?
Amy
Amy,
Importing and exporting is a result, the goal is serving customers. Foolish government policies cause people to misallocate resources and malinvest. In the measure the policies are foolish, in that measure there will be distortions that make a supplier overseas more attractive than a supplier in one's home country.
Importing and exporting are not businesses, they are just events. I may have a business selling canned peaches. It does not matter if I can the peaches in the garage or import the canned peaches. The business is selling canned peaches.
There is little Malaysia cannot make for itself. Same is true of USA. Certainly USA needs to import chromium since we have little of it, but we are the biggest exporters of copper in the world, and the biggest importers of copper in the world. We are fighting a war in Iraq for oil, and oil is the USA's #3 export in dollars. That is just nuts.
Serving customers makes me in business. Where I get my product does not matter, except in the sense of serving the customer. Say Amy loves beautiful hand towels and her favorite material is linen. You have retailers who have said your ideas are good and do not exist. Since the best linen comes from France, and you are in Malaysia, to serve your customers best you will specify French linen to your supplier. There are plenty of people in Malaysia who can embroider beautifully, but Malaysian government policy encourages people to do other things than embroidery. So where do you go for embroidery? You study the question and find that Japanese importers are getting their embroidery designs sewn on in villages in Poland. Therefore you make money doing what you love, and by accident you are importing French linen embroideried in Poland and having it shipped to Japan. And as government policies fail, such as is occurring now in USA, trade lines and sources will migrate to new locations, and so will you.
And at the specialty level, cost and price is not a major factor, if at all. What tells you if a specific factory is the best is not the cost or the quality, but if your competitors use that factory. That is the salient point.
Does this make sense?
Wednesday, August 6, 2008
William Checks in On Touts
Dear John,
I took one of your classes online and enjoyed it. It was thru South Suburban College in South Holland, IL. I constantly get email from different sources mainly the Asian market on what seems to be trade opportunities. They claim to be searching for a contact in the U.S. One claims to already do business with Wal-Mart and Costco to name a few. I also get email from another sources saying that they have different products available such as used computers, used cell phones, etc. Do you know anything about this type of thing and what are your thoughts. How would I know if these are real opportunities?
William
William,
These people want to steal from you. There are one thousand ways they can do it, but essentially if you do not answer they cannot steal from you.
No matter what, you need customers. If you get customers first, then you can work with the best supplier. Start with what byou bwant to do, not what otehrs want you to do.
John
1500 Jobs Gone
Weyerhauser is laying off 1500 people Here is the beginning of my post, delete this sentence.
Weyerhauser is a forestry products company, which got its start in Georgia. (You know why they never have big forest fires down south? The forests are privately owned.) It has been in the Seattle area for over 100 years. It has been through many economic eras.
A housing boom is good for a forestry company, for wood alone, but Weyerhauser makes all sorts of building supplies. AS the housing boom progressed, Weyerhauser saw it was "tradable" and did well. Now that tbhings are slowing down, and since they did not take on new debt, they can now just cut back, no problem.
My question is the people who took jobs at Weyerhauser over the last ten years, and I can guess most of the 1500 were hired in the last ten years. Within Weyerhauser there are plenty of top people who could see the boom was bogus and it would end badly for many, although not for Weyerhauser. They will last another 100 years at least. Within Weyerhauser there are managers who might have said to these hires over the last decade "this job will not last. Do not take on debt becuase within a few years your income will disappear, and it will be 30 years before anyone you know will see those kinds of jobs and employment again." CErtainly there are countless people outside of Weyerhauser who said so.
Now, would these people have taken these jobs? Would they have taken these jobs and moved on after it ended? Or would they have said, "no, I think I'll do my own thing?" I wonder if people were more versed in economic theory they'd be more inclined to be self employed.
Easy Money
An obvious idea that attracts a lot of vewers, and therefore ad revenue... only a person with passion for music would think this up...
Tuesday, August 5, 2008
China Blackmailed USA!?
Mish is asking if the US was blackmailed economically by China. This puts the Chinese in a bad light, unfairly. Our Hamiltonian politicians made a bet in the 1980’s that the Chinese Communist Party would be willing to enslave the Chinese to benefit the United States. Initially, the Russians masters agreed, but have since reneged on the agreement.
The Chinese went along with a plan that they would make things for USA, and accept funny money in payment, which China would invest in T-Bills. Eventually, the theory goes, China would be trapped and enslaved by the burden of TBills, in essence, money lent to the United States. China played the game long enough to transfer the tecnhology enough to be the world’s # 1 manufacturer, get into the WTO, and hey, host an Olympics.
The problem with the game is China developed enough domestic market and export markets outside the USA in the last 25 years that China can survive without us. And so they no longer need to buy our funny TBills. If they continue to do so, it will only be if it benefits China. And they do have the wherewithal to encourage the US government to pass the risk of Fannie and Freddie on to the US taxpayer, rather than on to China. Mish is characterising this as “blackmail.”
The irony is The Communist Party of China, which no one voted into office, takes serious its responsibility to keep China and the Chinese free of foreign domination. In the United States, the democrats and republicans are voted into office, but they could give a damn about the American taxpayer. Instead of letting the Freddie and Fannie go bust and let the USA citizens sort out our problems, the US government is selling us down the river. Better to rule the ruins than lose power.
Karen de Coster and Eric Englund are explaining how we got here, GM division:
At one point they quote:
“ With deregulation of brokerage commissions in 1975, which ended the practice of fixed-rate minimum commissions, investment banks found their brokerage business drying up, undercut by Charles Schwab & Co. and other discount brokerages.”
So, that was the problem! Deregulation! From there, crime follows! Regulations deny people the right to freely contract. By denying securities investors the right to buy from whom they like at a price they choose, the government made sure through policy that one group of people was rewarded, and another was punished. If people lose their monopoly, or cartel, they then turn to crime? No, monopolies and cartels can hold only if government-backed. Government intervention rewards some and punishes others. Once the cartel or monopoly is established, thieves are attracted to the work. Take away legal protections, and the people doing the work are still thieves. Switching from government protected theft to unprotected theft is no leap at all.
Liberals will blame deregulation. That misses the point: both regimes were theft. It was theft under regulations, and it was theft under deregulation (deregulation lite, never have we had true free markets in securities).
The solution again is to get rid of the regulations, and a free people will sort it out among themselves. The democrats and republicans have both lost faith in our system, because it has failed. Thus they are happy to sell us down the river. What they miss is hamiltonianism has failed. Jeffersonian America is till doing just fine, as you can see in any toyota or honda factory in america, or at teh countless thriving small businesses.
Monday, August 4, 2008
Savings, Not Debt is Fundamental
This is a partial list, just Orange County, of retailers in trouble. You'll perceive the common thread is they cannot manage the debt they owe. This sisStarbuck's problem as well. AS I mentioned, midrange retail biz are disappearing. In the measure they took their cue from government policy signals and chose to malinvest and overinvest, they are now in trouble. It strikes me that the retailers with the most predatory business plans are suffering first. Rough justice..
I've argued we can love WalMart and Home Depot and the other mass merchandisers for their good work lowering the cost and widening the access to material goods and services. I've also argued they are not for us.
We belong in the specialty range, where high margin competing on design and frequent deals are the norm.
So the high end and mass end are doing fine, which leaves the midrange customers like Macy;s (as opposed to say Neiman Marcus). Macy;'s and GM and others thrived when credit was cheap and the predatory lending practices covered up the overcharging these retailers practiced. Their policies attracted the least prudent customers, and now their businesses are in trouble.
I've seen this problem before... the trick is to check credit and be quick to "fire customers." I explain the credit checking process in the book, and as an overview just learn essentially "can your customers manage the debt they hold?"
Also now opportunities abound... we'll see debt-free new companies emerge who will fill in as these others disappear. WE'll see suppliers eager to accommodate new customers. Real estte will be dirt cheap. WE'll also see great swaths of unemployed, but even if the economy shrinks as bad as the Great Depression, say by 30%... big deal, we'll still be one of the largest economies in the world. There was never any chance we would fully penetrate the US market at the small business level anyway. Even if economy falls 50%, it would still be one of the largest in world... it's all about customers...
In this era trading on frequency more likely... and savings not debt will be how you thrive.
Check out who is in trouble...
Ann Taylor closing 117 stores nationwide.
Eddie Bauer to close more stores after closing 27 stores in the first quarter.
Cache, a women?s retailer is closing 20 to 23 stores this year.
Lane Bryant, Fashion Bug, Catherines closing 150 stores nationwide
Talbots, J. Jill closing stores. Talbots will close all 78 of its kids and men's stores plus another 22 underperforming stores. The 22 stores will be a mix of Talbots women's and J. Jill.
Gap Inc. closing 85 stores
Foot Locker to close 140 stores
Wickes Furniture is going out of business and closing all of its stores. The 37-year-old retailer that targets middle-income customers, filed for bankruptcy protection last month.
Levitz - the furniture retailer, announced it was going out of business and closing all 76 of its stores in December. The retailer dates back to 1910.
Zales, Piercing Pagoda plans to close 82 stores by July 31 followed by closing another 23 underperforming stores.
Disney Store owner has the right to close 98 stores.
Home Depot store closing 15 of them amid a slumping US economy and housing market. The move will affect 1,300 employees. It is the first time the world's largest home improvement store chain has ever closed a flagship store.
CompUSA (CLOSED).
Macy's - 9 stores closed
Movie Gallery ? video rental company plans to close 400 of 3,500 Movie Gallery
and Hollywood Video stores in addition to the 520 locations the video rental
chain closed last fall as part of bankruptcy.
Pacific Sunwear - 153 Demo stores closing
Pep Boys - 33 stores of auto parts supplier closing
Sprint Nextel - 125 retail locations to close with 4,000 employees following 5,000 layoffs last year.
J. C. Penney, Lowe's and Office Depot are all scaling back
Ethan Allen Interiors: plans to close 12 of 300 stores to cut costs.
Wilsons the Leather Experts ? closing 158 stores
Bombay Company: to close all 384 U.S.-based Bombay Company stores.
KB Toys closing 356 stores around the United States as part of its bankruptcy reorganization.
Dillard's Inc. will close another six stores this year.
.
Solzhenitsyn
The great Russian writer Aleksandr Solzhenitsyn died today, and if you read his works you'll miss him too. He was one of those characters who steps through the cracks that appear any any totalitarian edifice, and in this case his opportunity came when Krushchev denounced Stalin, and for a brief moment dissent was permitted. Out came The Gulag Archipelago, A Day In the Life of Ivan Denisovich, Cancer Ward ... all wonderful books. I suspect we all have such cracks open to us at all times.
Solzhenitsyn was kicked out of the Soviet Union in the 70's and lived in the USA. His welcome wore thin as he criticized his hosts in a famous Harvard address and his book Warning to the West. He returned to Russia in 1994.
It was reading Solzhenitsyn where I first realized a difference between the two superpowers: in the Soviet Union, you can be imprisoned for writing something disagreeble. In USA you can write whatever you like, it just won't get published if it is disagreeable. The USA can last longer than the Soviet's 75 years because we have more pressure valves built in. Those pressure valves are being capped right now by the republicans and democrats.
I expected Solzhenitsyn to be a powerful figure in his last years, but so far he appears to be loved but irrelevant. He survived the Gulag because when first arrested he listed among his skills "astrophysicist," a lie. Later some order was given by Stalin to assemble all the Astrophysicists in a camp near Moscow to work on a secret project. Conditions were survivable and his lack of knowledge of astrophysics no bar to Soviet state prison employment. If his lack of aptitude became apparent, no one bothered to ship him back.
Seeing this great soul have little effect on post-Soviet Russia, I wonder if the price of his whimsical lie cost him influence in his later years. Are lies that expensive?
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