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January 08, 2015

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RETAIL SALES not there again. You listen to the business news and you would believe the economy is on fire. On fire? 11.8 Million unemployed. Millions in temporary jobs. Millions work week cut to 30 hours. Today the inventory numbers were UP. Of course they are. In my retail stores if inventory was up after Christmas then I did not sell enough. Wow, gasoline this morning at my pump was $1.89. The money we are all saving is going where? Likely it is going into the things we have all put off: Cars. The average car in the US is 11.5 years old. we have likely held off as long as we can. I phones and Beats head phones. Electronics is grabbing $$ in big hunks and Apple is getting most of it. But, to buy Apple products you need services such as Verizon and ATT. Cable TV shows on Net Flicks, HBO, etc. Just look who won all the Globes this week: few of the winners were on NBC,CBS or ABC. Homeland, House of Cards, etc. are were the consumer is going. And, those are services. Baby boomers are using the strong US dollar not to buy clothes but rather to see the world. Last time I considered going to Europe the Euro was 1.44. Yesterday it was around 1.17. I'm planning a trip. Remember the US housing market and all the people stuck in under water houses. It is still struggling. Repairs are more services that take priority over a new salt shaker. go back and look at were the new jobs, meager as they are, have come from: services. Don't look for the consumer to buy retail products too soon. Wells Fargo termed out my one year ARM last month and doubled my mortgage payment. There goes the retail budget for the next twenty years. The impact of bank regulators hides in the shadows but they are there. Tiffany reported weak numbers--hmmm. That should have been a warning on retail sales last week. People are hurting and you can trace it to the "leveling of the playing field". Middle class are paying for most of the leveling.


Amazon announced yesterday they have added 6000 jobs in Europe and now employ 32,000 people in the EU. EU? Those are not depressed labor markets. But, the strong US dollar is giving US corporations an opportunity to spend their dollars using the leverage of higher buying power. US corporations have Trillions of dollars trapped overseas by US tax laws. But, before you think they will bring it back here realize that globalization of the world economy offers US CEOs an opportunity to use their cash wherever they can find profits and gross margins. RULE NUMBER ONE OF BUSINESS SCHOOL: consider the likely actions of government in your strategic planning. So don't think US business leaders don't watch and influence what government does and anticipate it. Big international companies expand overseas. The nation's biggest employers, small business, are trapped here and at the mercy of US government. You are now seeing the result of leveling the playing field on small businesses and the US employment base's wages.

THE ONSLAUGHT CONTINUES: Here come the leveling crews. Democrats have decided they have the answers to creating more jobs in America. After 6 years of printing money and passing regulations designed to rob from the rich corporations and give to their poor workers past and present, they are now rushing to shore up the wage numbers. Wages continue to drop. They have driven enough people into temporary jobs and out of the workforce to make the unemployment rate 5.6%. Now the President has a plan: raise the minimum wage and give two years of FREE community college to ALL. Forget the fact that 25 states already raised the minimum wage. Forget the fact that ALL Americans do not need 2 years of community college. America needs trained healthcare workers and IT trained workers. Both can be trained in High School VO TECH and if necessary a year or two beyond. SO, forget the President--he has no clue and continues to prove it in year 7. Now comes the mayor of NYC. Let's tax corporations who do business inside NYC. Basically DC's version of a business sales tax for foreign invaders--another method to deter business with firms with creative juices to offer who do not reside in NYC. Democrats can't seem to ever come up with an idea that does anything positive to stimulate business. Always a penalty. Now the Republicans are in on the act: No CEO can have a bonus or a raise unless he gives the workers a raise is the latest idea from the Republican Congress.

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