In This Issue A sticky question… Budget negoti

first_imgIn This Issue.*A sticky question… *Budget negotiations stall… *BOJ to announce more stimulus… *Gold and Silver reverse…And, Now, Today’s Pfennig For Your Thoughts!Is all debt bad???Good day. I was met with the above question as I walked through the door last night.  As I came home from work my 14 year old asked me the answer to the question ‘Is all debt bad?’.  My daughter, Lauren, is in the middle of exams and she was upset that she had missed this question on a civics exam.  She occasionally reads the Pfennig, and has listened in on enough of our dinner conversations to realize that much of the world is currently in a debt crisis.  So when she was presented with a true false question regarding debt, she answered True – all debt is bad. From reading your comments about yesterday’s Pfennig, many of you would have given Lauren extra credit, but unfortunately I had to let her know that her answer is technically wrong.  As I explained to Lauren, not all debt is bad.  There are times when a country, company, or individual needs to borrow money.  Debt can be used to fund all sorts of very good projects, and keeps economies rolling through slowdowns.  But debt is meant to eventually be paid off, not accumulated in a never ending cycle. So yes, Lauren missed that question on her civics exam; but in a way I am glad she missed it as I don’t think it is a bad thing that my daughter is a bit scared of debt.  I just wish some of our leaders in Washington would match my daughter’s concern over debt accumulation. But enough of my dinner table economics lecture, let’s get to the currency markets.It was a ‘risk off’ day in the currency markets, but the moves were dampened by the holiday thinned trading desks.  The yen finally reversed its recent sell off, and the dollar also climbed a bit as US lawmakers moved further apart on a budget deal.  President Obama told business leaders that budget talks have regressed and accused Republicans of wasting a lot of time with political posturing (perhaps a bit of the pot calling the kettle black). Today we have an absolute plethora of data which will be released here in the US.  We start off the morning with GDP projections for the 3rd quarter which are expected to show the US economy grew just under 3% compared to previous estimates of 2.7% growth.  It is Thursday, so we will also get the weekly jobs numbers which are projected to show another 360k workers filed for jobless claims last week.  Continuing claims are predicted to have increased to 3200k in another indication the labor market will be very slow to recover.  This employment data will be followed up with existing home sales and leading indicators.  Yesterday’s data showed a drop in Housing starts (down 3% MOM) but an increase in building permits (3.6%MOM).  Definitely some conflicting data, so the existing home sales may help give investors a better picture of the housing recovery.  Finally, the leading indicators are expected to show a decrease of .2% during November following an increase of the same amount in the previous month.The yen had dropped for three straight days as investors worried the new Prime Minister would successfully push for more aggressive rounds of stimulus.  The BOJ ends their two day meeting today, and are expected to announce additional stimulus moves. Adding to the worries regarding the yen was a Japanese government report released yesterday which showed the trade deficit widened in November. Traditionally Japan has run a trade surplus, and the deficits have caused investors to re evaluate their demand expectations for the yen.  A country which runs a trade surplus creates demand for their currency, while trade deficits will typically drive the demand for (and value of) a currency lower. The yen has bounced back a bit this morning as some investors apparently believe the three day selloff was overdone.The euro continued to climb through most of the morning yesterday, moving just above $1.33 for a short period.  But the renewed worries out of Washington caused it to give back some of these gains and it is now holding in the $1.32 handle.  I had a reader scold me for not writing more on the Swiss Franc and its recent rise.  I haven’t mentioned the Swiss franc simply because of its peg to the Euro.  So as the euro moves, so will the Swiss franc.  The 3.44% increase in the euro over the past month has been matched with a 3.36% increase in the Swiss franc vs. the US$.  As long as the Swiss National Bank defends the peg to the euro, there is really no need to talk about the Swiss as it is tied to the euro.  Now it will certainly be interesting if/when the peg is relaxed, and you can bet Chuck or I will inform all of you when we start hearing any indications of that.  Until then, readers can simply watch the euro.Several readers asked me to comment on the big drop in gold prices over the past couple of days.  Many of you pointed me toward various manipulation theories, but I think there are two possible explanations for the recent drop in prices.  First, there was improved confidence that a compromise would be reached between the two parties over the fiscal cliff.  As we approached the year end, demand for gold climbed as investors looked for an asset they could hide in if/when our leaders in D.C. took us over the cliff.  A second possible explanation is year-end selling due to the probable increase in tax rates.  Silver has had a nice 12 percent rise this year, and gold is up 6.72% so investors could just be taking these gains off the table before 2013.  By the way, this will be the 12th consecutive year of gains in the price of gold. No matter what caused the selloff, both metals rebounded yesterday as concerns over the fiscal cliff agreement returned.  Negotiations in Washington have deteriorated, so my first theory on what caused the recent sell-off has been flipped and gold is now climbing again.  Most of the gold refineries are also going into a end of year / holiday shutdown, so additional supply will be limited over the next couple of weeks.On a longer term basis, I am confident that demand for precious metals will be increasing.  The fiscal problems facing many of the Western nations will shake global investor confidence in ‘fiat’ currencies.  And my thoughts on the ‘rise of the Chinese consumer’ also support higher metals prices.  As consumers in both China and India see even a slight increase in disposable income, a percentage of that income will likely be invested into the precious metals markets.  Gold and Silver are much more accepted as forms of wealth storage in the Asian cultures, so any increase in disposable incomes should lead toward an increase in demand.  Just another reason I think precious metals should be a part of every investors diversified portfolio.And then there was this. The Fed’s holding of interest rates at record low levels have had a very different impact on two separate classes of investors.  A story I spotted on Bloomberg this morning pointed out the dramatic divergence between savers and professional investors.  The story, written by Bob Ivry starts out with this line “Deepak Narula’s mortgage-bond fund is up 39 percent this year.  George Sanchez’s monthly annuity payout is down 41 percent.”  Ivry goes on to explain some of the unintended consequences of the FOMC’s interest rate policies. “The near-zero interest rate the Federal Reserve charges financial firms, as well as securities purchases that will balloon the central bank’s balance sheet to almost $4 trillion next year, have made it easier for Narula’s $1.6 billion fund to thrive and more difficult for Sanchez, a former college library director, to enjoy retirement.”The story includes an excellent quote by Nobel Prize-winning Columbia University economist Joseph E. Stiglitz: “Monetary policy has been indirectly, surreptitiously helping the top and hurting the bottom.”  Stiglitz blames the Fed policies for starving money-savers of income and boosting certain asset prices, widening the gap between the rich and the rest of the country.  Bob Ivry has written some excellent pieces on the Fed, and I always enjoy reading his take on things. To recap. Debt is not always bad, but the constant accumulation of debt is! Budget negotiations hit a snag, sending investors back toward safe havens.  Today will be a big day for data here in the US markets, but holiday thinned trading desks should keep volatility down. The BOJ is expected to announce more stimulus, but the yen has already been adjusted for the expected increase in supply. Gold reversed its recent sell off, and started moving back up on worries on the budget negotiations. And the FOMC’s zero rate policies have caused a divergence in returns for savers vs. professionals.Currencies today 12/20/12. American Style: A$ $1.0493, kiwi .8343, C$ $1.0113, euro 1.3255, sterling 1.6262, Swiss $1.0974. European Style: rand 8.5159, krone 5.5498, SEK 6.5114, forint 216.0, zloty 3.0708, koruna 19.0335, RUB 30.6835, JPY 84.10, SGD 1.2184, HKD 7.7501, INR 54.8544, China 6.2306, pesos 12.7715, BRL 2.0619, Dollar Index 79.163, Oil $89.88, 10-year 1.78%, Silver $31.22, Gold $1,670.62, and Platinum $1591.24.That’s it for today. Congratulations to Antione Lawrence as his lovely wife Brooke gave birth to a beautiful baby girl yesterday.  It is the couple’s first child, and the first of three babies on their way for the WorldMarkets desk (Both Mikes, Harrell and Meyer, are also expecting).  We anxiously awaited the news yesterday morning after Antione let us know he and Brooke were headed into the hospital.  Both baby and mom are doing fine, and I’m sure proud papa Antione is beaming!  Sounds like we could see our first snow of the year, it is currently raining but the temps are supposed to drop and the rain should turn to snow later today.  I will wrap up today’s Pfennig on that great news.  I hope everyone has a great day, and thanks for reading the Pfennig!Chris Gaffney, CFA Vice President EverBank World Markets 1-800-926-4922 1-314-647-3837last_img read more

Lois Lerners emails are back from the dead—sort o

first_imgLois Lerner’s emails are back from the dead—sort of. The former IRS director’s BlackBerry, however, is still long gone. The IRS intentionally destroyed it in June 2012 (after congressional staffers interviewed Lerner about the IRS targeting conservative groups) as the Deputy Assistant Chief Counsel acknowledged in a recent sworn declaration. We’ve all met someone we just don’t trust but don’t know why. There’s often a pretty good reason to feel that way. Has someone ever made an insincere attempt to flatter you? Their words might be complimentary, but their body language, tone, and/or context let you know the compliment is phony. Does this guy really think I’m that stupid? So, up goes your trust wall. If he’ll lie about this, he’ll lie about anything. The IRS debacle is a prime example of why we build trust walls. The emails Congress requested had (supposedly) been deleted when several hard drives crashed. I asked our in-house technology guru, Alex Daley, what the probability was of that happening. Here’s what he had to say: Everyone who ever owned a computer knows that hard drives are finicky beasts. In fact, Google uses a LOT of hard drives and so they have published all kinds of research on their failure rates. The gist: there’s about a 1 in 36 chance a hard drive fails in any given month. The math says then that if the IRS was practicing good data center management practices—we have to assume, however silly it might seem, that the agency responsible for holding the most personal information on American citizens outside the NSA is following best practices—then the chance of seven hard drives failing at the same time and wiping out the data on them is about 1 in 78 billion. How rare is that? The odds of winning the Florida Lottery are roughly 1 in 23 million. So it’s 340 times more unlikely than you winning a state lottery. The odds of winning the Powerball are 1 in 175 million; for Mega Millions, the odds are 1 in 259 million. Of course, we give the IRS too much credit. The risk of hard drives failing increases with age, and we suspect the IRS, like much of the government, isn’t spending a lot of time rotating hard drives. The odds also increase if you keep all the drives in one place, using old-fashioned persistence techniques. Then a fire, flood, electrical issues, or any other number of problems could easily wipe out the whole lot at once. At one point there seemed to be only one plausible explanation for allowing so much data to disappear: negligence. Turns out, however, the data weren’t even gone. As Judicial Watch President Tom Fitton announced on Monday: Department of Justice attorneys for the Internal Revenue Service told Judicial Watch on Friday [August 22] that Lois Lerner’s emails, indeed all government computer records, are backed up by the federal government in case of a government-wide catastrophe. The Obama administration attorneys said that this back-up system would be too onerous to search. The DOJ attorneys also acknowledged that the Treasury Inspector General for Tax Administration (TIGTA) is investigating this back-up system. …. There are no “missing” Lois Lerner emails—nor missing emails of any of the other top IRS or other government officials whose emails seem to be disappearing at increasingly alarming rate. All the focus on missing hard drives has been a diversion. It sure seems clear why so many Americans feel put down. Does the government really think we’re that stupid? Maybe. I look at it this way: I suppose it’s possible a dog can eat your homework. It’s still a lousy excuse that no one will believe. It’s no wonder politicians rank so low on our trust scale.Whom Can You Trust? The IRS is in our lives, period. If you live here in the US or you’re a US citizen living abroad, you can’t sever the relationship. Here’s the upside, though: for the most part you can choose to conduct your private affairs with trustworthy people. One of the most common emails I receive is from subscribers looking for a trustworthy broker or financial advisor. Most come with sad tales: they had to fire their advisor because something felt fishy. Maybe they’d been directed to overly risky investments or high-fee mutual funds. Some couldn’t pinpoint their advisor’s exact offense but just knew in their gut something was amiss. We should all expect the people we pay to help manage our money to put our interests ahead of their own. One subscriber said that paying fees to an advisor to put his money into high-fee investments made it almost impossible to end up with the growth he needed. He clearly wasn’t getting the service he deserved and had good reason to look elsewhere. I recently finished reading The Female Brain by Louann Brizendine, M.D. Dr. Brizendine shares quite a bit of scientific evidence to support the existence of female intuition. In brief, women score higher on tests for reading nonverbal communications and on average have more receptors for those cues than their male counterparts. That explains why my youngest daughter recently fired an attorney. I was quite proud. She explained, “I got tired of feeling like I was being talked down to!” When I asked her to elaborate, she felt he thought she was stupid and should blindly follow his advice without question. She was picking up on the little things that might seem trivial but cause our subconscious mind to take notice. At one point in my career, I sought advice from a top public speaker. (Maybe I wanted to be more like my daughters.) This speaker had an uncanny ability to “read, sense, and feel” his audience. He did this mostly through nonverbal clues and suggested I read Body Language by Julius Fast to help my subconscious mind tune in to nonverbal cues. I read the book and learned that much of it was based on works like ‪Kinesics and Context: ‪Essays on Body Motion Communication by ‪Ray L. Birdwhistell. So I read those books too and worked to sharpen my subconscious mind’s nonverbal recognition skills. Afterward my student critiques even went up a full point. Perhaps that also helped me picked up on the suspect explanations coming from the IRS. It’s certainly helped me trust my gut when deciding whether or not to do business with someone. An attorney, stockbroker, money manager, or certified financial planner can have a great track record and all the requisite credentials you could ask for. That’s not enough. If he or she makes you uncomfortable but you aren’t sure why, don’t ignore your instincts. Switching course and hiring someone new can be an expensive headache, but in the long run, you’ll be glad you did.On the Lighter Side Last Saturday we went to the Frog Follies in Evansville, Indiana. It’s a huge vintage car show, with almost 4,500 cars, all made before 1949. My grandson mentioned that a lot of old people really like car shows, and he’s correct. The classics remind us of our youth, and we often have stories to tell about particular models. I hope future generations preserve their history to share with their grandchildren, too. I snuck away from the grandkids last week for an interview with Kerry Lutz of the Financial Survival Network about annuities. With that in mind, I hope all of our subscribers read through our free special report, The Truth About Annuities: Three Dangers You Must Avoid When Shopping for Annuities. Download your complimentary copy here. And finally… Until next week…last_img read more

Greece finally struck a deal… Over the weekend G

first_imgGreece finally struck a deal… Over the weekend, Greece held an “emergency summit” with its creditors. Negotiations dragged on for 17 hours. At 9 a.m. Monday, the two sides finally agreed on a deal that will keep Greece in the eurozone. Greece will receive €86 billion ($95 billion) in bailout funds. In exchange, it must radically transform its socialist economy. Greece agreed to slash spending, raise taxes, and fix its bloated pension system. It will also sell government assets to pay off some of its debt. Investors are happy to avoid a “Grexit.” The Euro Stoxx 50, an index of European blue chip stocks, climbed 1.8% on the news. The German DAX rose 1.5%. No word yet on when Greek banks will reopen. We told you how the Greek government closed all Greek banks during the crisis and how it would only let people withdraw €60 ($66) per day. The Athens stock exchange is still closed too. •  The Greek debt crisis will fade from the headlines for now… But this bailout doesn’t solve the real problem. Greece owes Europe more than €300 billion it can never repay. Yesterday’s bailout just kicks the can down the road… again. Its Greece’s third bailout since 2010. Europe and the International Monetary Fund had already loaned Greece more than €240 billion since 2010, before this latest bailout. BBC reported that the European Union believes this latest bailout could help Greece pay its bills for three years. After that, Greece will likely run out of money again. So expect to hear about the Greek debt crisis again sometime in 2018. On the brighter side, Greece’s debt crisis has created screaming bargains in some Greek stocks. The Athens stock market is down 84% from its 2007 peak. Nick Giambruno plans to recommend a Greek company in the next issue of Crisis Speculator. He’s found an exceptional Greek business trading for pennies on the dollar. This company is unique because it’s the victim of not one but two crises. That’s all we can tell you for now… more on this opportunity soon. I’ve just seen a shocking file from Bill Bonner… He’s been tracking a threat so big that it could cut us off from basic things that we depend on every day: ATMs, credit cards and more. Sounds crazy, but it looks like it’s finally about to hit. Stay Safe – See It Here. Recommended Links – Until Midnight Tonight, You Can Claim 1 Free Year of Professional Speculator It normally costs $2,500… But until midnight tonight, editor Paul Mampilly is sharing one of the biggest predictions of his career and letting you claim 1 free year of his work to see his top recommendation, and why he believes it could make you an extraordinary 26 times your money over the next decade. Click here for details.  — •  In other news, Japan is close to restarting its nukes… In March 2011, a massive tsunami slammed Japan. It killed 18,000 people. It also caused a meltdown at Japan’s Fukushima Daiichi nuclear power plant. It was the worst nuclear disaster since Three Mile Island. Before the tsunami hit in 2011, Japan got 27% of its power from nuclear. Japan was the third-largest generator of nuclear power on the planet. But the country shut down all its nukes after Fukushima. Now, four years later, Japan plans to restart its first nuclear reactor in mid-August. It will fire up another reactor in September. Japan currently plans to restart 15 reactors total. Japan is a tiny island with few natural resources. It has been paying vast sums to import energy to keep its lights on. Japan paid $270 billion to import fossil fuels (mostly natural gas) in 2013. That caused Japan to have a trade deficit of $112 billion… its worst trade deficit ever. Louis James, editor of International Speculator, and his analyst team recently explained how has Japan no choice but to turn its nukes back on… There’s no way Japan can meet its electricity needs without restarting its reactors. Oil and liquefied natural gas (LNG) prices will not stay low forever either. Japan’s Nuclear Regulation Authority should begin to streamline the restart application process. We then expect a faster pace of restarts in the second half of 2015 and beyond. •  This is good news for the price of uranium… Uranium is what powers a nuclear power plant… just like coal powers a coal power plant. We asked Louis if Japan’s nukes could “move the needle” in uranium prices. Here’s his reply… As it happens, I’m kicking rocks on a uranium exploration project today. There certainly is buzz among the analysts here about the restart of that Japan reactor bringing more buying to the sector. It’s happened before. I’m not so sure, with other forms of energy (like natural gas and coal) so cheap and looking to remain that way. But whether or not the market ticks up on that news, it’s a clear sign of where things are headed, for Japan to be doing this. Very bullish. Uranium is in a bear market. The price of uranium is down 72% from its all-time high of $130 per pound set in 2007. Japan restarting its reactors may or may not revive uranium prices in the short term. But there’s no question that uranium has a promising future. There are currently 437 nuclear power reactors operating worldwide. 60 more are under construction, another 165 are planned, and 331 more are proposed. The number of nuclear power plants in the world could easily double in the next couple decades. China alone plans to build 46 new ones by 2020. It will take a lot of uranium to fuel all those new plants. That means uranium prices will likely have to rise from their depressed levels. Paladin Energy, a uranium miner, reports that the cost of extraction for 60% of global production is above uranium’s market price. In other words, many uranium miners are struggling to make any money at all. Unless uranium prices rise, it’s not worth their while to produce the uranium needed to fuel all those new nuclear power plants. Louis James recently told International Speculator readers about his favorite uranium pick. He said this company is the “best-positioned producer to benefit from the coming bull market in uranium. This is true regardless of any potential weakness in uranium prices in the short term.” Louis thinks this company’s stock will eventually “go much higher” than its price before the Fukushima disaster. And right now, it’s selling for dirt-cheap. This is the company you want to own when the uranium price turns higher. You can learn about it by taking a risk-free trial to International Speculator.last_img read more

By EB Tucker editor Strategic Investor

first_imgBy E.B. Tucker, editor, Strategic Investor E.B. Tucker Editor, Strategic InvestorP.S. I’ll be at the second annual Legacy Investment Summit in Southern California from September 23-25. I’d love to meet you and chat about investments, traveling, art, and more.I hope to see you there.If you’re interested in joining, don’t delay… Spaces are filling up fast. Click here to reserve your tickets. Regular readers know I like to share what I’m doing outside of the markets.I believe it’s the experiences away from the desk that do more for long-term success than anything you can accomplish at the office.With that, I’m excited to share details on my latest trip with you. It’s a special two-part series on art that I hope you find useful.Let’s get started…Last month, I went to Marfa, Texas. It’s an out-of-the-way place with a population of 1,800. It’s not a place you’d expect to see world-famous art.In the 1970s, artist and architect Donald Judd moved to Marfa. He had risen to a somewhat famous status in New York City but he was frustrated with the art scene.Judd wanted to be away from people. He liked the American West. He took out a map and circled rural areas that seemed like they’d suit him. Marfa won. Marfa, Texas is three hours southeast of El Paso, not far from the Mexican borderFor about 100 years prior, Marfa wasn’t much more than a dried-up town where the train used to stop. After the end of the coal-powered steam engine, the town’s status as a water refueling station didn’t mean much. Downtown MarfaMarfa also has a military history. During World War II, there were several military training areas in the region. Judd bought a small, walled complex of abandoned buildings in the town formerly used by a military quartermaster. He transformed the complex into his home and studio.The locals thought this was strange. They were right. Judd went on to buy an old 340-acre military site south of town. It housed Nazi POWs during the war. With dozens of abandoned buildings on-site, he set out to turn the base into a permanent art installation.Permanent art means it sits there forever. The idea is you look at it, ponder it, and then move on. I’ll explain why that’s an important part of art later.In the picture below, notice the large silver boxes positioned in a straight line. They’re made of aluminum. Each one weighs 2,000 pounds. Judd had each of the 100 boxes fabricated with different internal dimensions. He placed them in three perfect lines roughly 30 years ago, and they haven’t moved since.Standing in the middle of this building is a unique experience. The giant quarter-pane windows let in a lot of west Texas sunlight. The symmetrical organization of the exhibit is purposeful. Former military building at Donald Judd’s Chinati Foundation in MarfaJudd insisted people not take photos while looking at his work. He was on to something. These days, people can’t look at anything without taking a photo of it on their smartphone. Judd realized that when you stare at a device and not the art, you’re not experiencing it.The Point of ArtJudd died in 1994. He left behind several foundations to preserve his work. He was an odd guy.For instance, he had thousands of books in his library organized by the author’s birthdate. I saw his library in Marfa. He also built uncomfortable furniture for the library. He thought that while reading you shouldn’t get too comfortable, or you’d lose focus.This is all part of why I enjoy art. It’s odd. The point of it is merely to observe and enjoy. It took me decades to discover this simple pleasure.I grew up in rural eastern North Carolina. I don’t remember people talking about art. My guess is they feared being mistaken for a liberal, which was essentially a communist in their eyes.Most of the artworks I saw were dark oil paintings depicting a fox hunt, a Civil War scene, or something related to early American history. I just didn’t get it.It wasn’t that we were hayseeds – far from it. We visited all the major U.S. cities. We visited the requisite museums to see the important stuff. What I didn’t know was how to look at a piece of art and simply enjoy it.Let It Speak to YouPeople said a piece of art spoke to them. My first thought was if a painting talks to you, you’re clinically insane. All of a sudden, that phrase made sense to me. It happened one day five years ago.I was in Paris waiting for Bill Bonner. In 2014, I helped him launch The Bill Bonner Letter (now The Bonner-Denning Letter). If you keep up with Bill, you know he spends a lot of time in “out of the way” places.That summer, he was on the way to his chateau in central France. It’s a few hours south of Paris. Since the directions were complicated, he asked me to wait for his other guests in Paris before heading south.With a few days to kill in Paris, a friend from Brussels gave me a list of several lesser-known museums to visit. He’s a major player in the art world. He told me there are around 130 museums in Paris. Most people only visit the Louvre.I ended up at a small museum on the north side of Paris. It had nothing but Claude Monet paintings. I spent half the day sitting and staring at his works. I figured out why I didn’t understand the detailed oil paintings I remembered from childhood. Monet smashed that style, kicking off the Impressionist movement.I’m simplifying a big part of art history, of course. The style change of the 1870s wasn’t something we should reduce to a few sentences. However, the contrast between Monet and his predecessors is shocking. Impressionist paintings are generally bright and a little messy, and they’re begging you to find the portrayed scene within that mess.I discovered that I liked Impressionist work. I liked Monet and his contemporaries. And that’s enough to enjoy art.Back to MarfaMarfa is an art mecca. If you enjoy culture, excellent cuisine, and progressive art all situated in the middle of nowhere, you might want to visit.On the drive from El Paso, you’ll pass a seemingly random building. It’s a replica of a Prada store. The shoes and handbags are real, yet there’s no one in the store. The contrast of the haughty brand against the barren west Texas landscape is interesting. “Prada Marfa” permanent art exhibit near Valentine, TexasOf all the art I saw over several days in Marfa, I did have a favorite.When Judd bought the abandoned military base south of Marfa, he had a plan. He gave each of his artist friends one of the buildings. He asked that they each create a permanent art installation in their building.Judd’s friend Dan Flavin chose six U-shaped former barracks. He painted the walls and ceilings white. He asked viewers to enter the building at the tip of the “U,” walk to the back, then turn and view each of the six exhibits. Dan Flavin’s permanent light exhibit at the Chinati FoundationFlavin designed the exhibit before his death in 1996. Other artists took his plans and completed the work. Walking building to building looking at the six exhibits from each side is a unique experience. If you enjoy art, it’s something to see.Art Can Be an InvestmentTraveling to see obscure art is an exciting hobby. It will also keep you away from homogenous mobs of Americans flocking to see overcrowded sites like Yellowstone or Mount Rushmore.The art a person enjoys seeing says something about them. The art a person chooses to hang on his wall says everything about them.I’ve turned my art hobby into an investment. I don’t intend to make a fortune from the pieces I buy. However, I also don’t want to own things I can’t sell.There’s nothing wrong with buying a painting you like for sale on Main Street in a ritzy tourist town. Just don’t expect to ever sell that painting for more than $100. I call this consumption art. I want to own investment art.I found a way to enjoy and invest in art at the same time. I had some help discovering it. I’ll tell you all about it tomorrow in part two.Regards,last_img read more

Theres a Gender Pay Gap for eBay Sellers

first_img Register Now » February 19, 2016 Even on eBay, men make more.That’s the new finding from a study of over a million eBay transactions across the U.S. published Friday in the journal Science Advances.How much more? Comparing sales on brand-new items, women make on average about 80 cents for every dollar a man does.With help from eBay Labs, sociologist Tamar Kricheli-Katz and economist Tali Regev peered into transaction data from 2009-2012, looking at which sellers were men, which were women, and how much each made selling identical items online.Regev says what’s interesting about studying pay disparities on a website like eBay is that unlike workforce wage gap studies, the difference in pay in an online auction can’t be explained by human factors, such as experience.“In labor markets you can always say there are differences between men and women,” Regev says. But when two people are selling the exact same brand new product on eBay? “There’s not much you can say about the differences in the product itself,” Regev adds.The pay gap on eBay mirrors what economists know about the American labor market. The U.S. Bureau of Labor Statistics reports that women make approximately 81 cents on the dollar, a figure that’s been widening recently. For female CEOs, the gap is worse: they make about 70 percent compared to male chief executives.Kricheli-Katz and Regev weren’t satisfied just seeing the eBay data though; they wanted to be sure online auctioning biases were real. So they set up their own experiment. They invited 116 people, both men and women, to bargain for a $100 gift card. Some study participants bought their gift card from an imaginary online vendor named “Allison,” while some placed bets on “Brad’s” $100 card. “Allison” made on average 7 percent less than “Brad” for the exact same gift card.But it’s not just women who get a raw deal hawking on eBay.In a separate study published in the Rand Journal of Economics last October, professors at Yale Law School and Harvard University found when photos of baseball cards on eBay were held in a black hand, they made 20 percent less than white-handed sellers.“The way we interact in markets is affected by our beliefs about status and the social script we have in mind,” Regev says.Regev’s colleague Kricheli-Katz says she hopes people presented with this new data will become more aware of their own biases. “Maybe if people know that, this process will become more conscious, and over time the gap will narrow,” she says.But sometimes, it does pay to be a woman on eBay.Women outsold men in certain categories, including baby products and toys for pets. Women also had higher “star” ratings, indicating better feedback from buyers. And when women sold used goods, the wage gap nearly disappeared: women earned on average 97 cents on the dollar.The researchers think there may be something about the perceived gender of a product that affects the gap. Is it possible women get more for items like handbags, but men get more for a set of golf clubs?The answer to that question … will be sold to the highest bidder. There’s a Gender Pay Gap for eBay Sellers Hilary Brueck 3 min read Add to Queue This story originally appeared on Fortune Magazine –shares Gender Gap Next Article Learn how to successfully navigate family business dynamics and build businesses that excel. Free Webinar | July 31: Secrets to Running a Successful Family Businesslast_img read more

Samsung Flags 53 Billion Profit Hit From Note 7 Failure

first_imgSamsung Next Article Add to Queue Samsung Electronics Co. Ltd. on Friday said it expected to take a hit to its operating profit of about $3 billion over the next two quarters due to the discontinuation of its fire-prone Galaxy Note 7 smartphone.The outlook brings to about $5.3 billion the total losses the global smartphone leader has forecast as a result of the overheating issues, after it said on Wednesday it would suffer a $2.3 billion hit to third-quarter profit.The premium device that was meant to compete with Apple Inc.’s latest iPhones at the top end of the smartphone market had to be scrapped earlier this week, less than two months after its launch, due to safety fears.The South Korean tech giant said in a statement on Friday it expected the blow to profit to be in the mid-3 trillion won over the next two quarters — in the mid-2 trillion won range in the October-December period and about 1 trillion won ($900 million) for the first quarter of 2017.Samsung shares, which have fallen about 8 percent this week, edged up 0.6 percent as of 0228 GMT on Friday, versus a 0.5 percent gain on the broader market.To make up for the lost revenue, Samsung said it would expand sales of gadgets like the Galaxy S7 and S7 edge phones, and make “significant changes” in its quality assurance processes to improve product safety.Investors and analysts said that while the company had to move quickly to reassure the market about the potential financial costs, deeper losses from one of the tech industry’s most spectacular product failures could not be ruled out.Reputational damage remained the great unknown and potentially more harmful than recall costs, with rivals in the cut-throat industry eager to pounce on any sign of weakness in the market leader’s standing among consumers.”The sales impact on other models remains unclear,” said Kim Sung-soo, a fund manager at LS Asset Management, which owns Samsung Electronics shares.”The end of the premium model will damage Samsung’s brand, and hurt demand for its other models. It is difficult to measure such impact.”Samsung posted earnings of $7.2 billion in the second quarter, with mobile profits — its biggest earner — soaring 57 percent.Rebuilding trustThe Note 7 debacle has come at an awkward time for South Korea’s biggest family-run conglomerate, which is in the middle of a leadership succession and is facing calls for a major restructuring from U.S. hedge fund Elliott Management.Park Jung-hoon, a fund manager at HDC Asset Management which owns shares in Samsung affiliates, said that although future losses would not be as bad as the third quarter the company had to work hard to rebuild confidence.”What’s important is whether the flagship S7 can fill the gap left by the Note 7, and how much trust Samsung can regain from consumers by the time the S8 comes out,” he said. Analysts expect the S8 to be released in the first quarter.Key to brand recovery would be rapidly finding out and communicating what went wrong with the Note 7, which was recalled when some devices were found to be combustible and finally discontinued when customers reported similar faults in their replacements.The company blamed faulty batteries for the original problem but it has given no inkling about the cause of overheating in the replacements.”Samsung must announce clearly what the reason was and dispel uncertainty,” Park said.Investors were also expecting the company to show its “commitment to shareholders” by announcing share buybacks or higher dividends, he said.Samsung has announced financial incentives for U.S. and South Korea customers who exchange Note 7s for other Samsung products, as part of efforts to stem customer defections.(Reporting by Se Young Lee and Hyunjoo Jin and Joyce Lee; Editing by Stephen Coates) Image credit: Reuters | Kim Hong-Ji October 14, 2016 Register Now » Samsung Flags $5.3 Billion Profit Hit From Note 7 Failure Free Webinar | July 31: Secrets to Running a Successful Family Business 4 min read This story originally appeared on Reuters Learn how to successfully navigate family business dynamics and build businesses that excel. The premium device that was meant to compete with the latest iPhones at the top end of the smartphone market had to be scrapped earlier this week. –shares Reuters last_img read more

Expanse Appoints Sherry Lowe as Chief Marketing Officer

first_imgLowe joins Expanse to Lead Global Marketing and Accelerate the Company’s Rapid Customer Growth across Fortune 500 and Government OrganizationsExpanse, the leader in helping IT operations and security teams discover, manage, and secure all of their global internet assets, announced it hired veteran marketing executive, Sherry Lowe, as Chief Marketing Officer. Lowe will spearhead the company’s global brand and demand generation efforts and will report directly to Tim Junio, co-founder and CEO of Expanse.Lowe brings more than 20 years of marketing leadership and enterprise software experience across cloud, storage and platform technology. She joins Expanse after serving as Chief Marketing Officer at Druva, where she oversaw marketing strategy and broadened Druva’s awareness worldwide. Prior to that, Lowe was the Vice President of Worldwide Corporate Marketing and Communications at Splunk, where she built out the corporate marketing team of more than 50 employees and was pivotal in leading the company’s corporate marketing and communications teams during its transition to a public company in one of the largest tech IPOs of 2012.Marketing Technology News: SessionM Demonstrates How to Turn Data into Loyalty at Salesforce ConnectionsPrior to Splunk, Lowe served as Vice President of Marketing at MarkLogic, where she led all inbound and outbound marketing programs. She also held various marketing positions at Actian (formerly Ingres), Savvion (acquired by Progress Software) and Business Objects (acquired by SAP). Prior to becoming a Silicon Valley marketing executive, Lowe was an award-winning broadcast journalist. She was one of the first female sportscasters in the country, working for FOX and ABC affiliates. Lowe has degrees from Arizona State University and Indiana State University.“Sherry is a seasoned leader who brings outstanding judgment and extensive marketing, branding, public relations and go-to-market expertise to Expanse,” said Tim Junio, co-founder and CEO of Expanse. “We are now primed to scale rapidly. We just closed our Series C. We have product market fit with over $100 million in federal contracts across all military services and a growing customer base in the Fortune 500. Sherry will play a critical role in building a global brand and expanding our mission and vision to capitalize on this incredible market opportunity.”Marketing Technology News: Actions, Not Words: The Economist Group Unveils Global Social Purpose Research at Cannes Lions International Festival of Creativity“I have admired Expanse for quite some time and am excited to lead a marketing organization that is helping drive the phenomenal growth and traction that Expanse has seen in just a few short years,” said Sherry Lowe, Chief Marketing Officer of Expanse. “Digital transformation is driving business today – across the enterprise and in government – but it is leading to a state of insecurity. Expanse is a one-of-a-kind platform that keeps our customers safe by telling them in real-time what they own, what’s at risk and how to protect their most critical internet assets. It is an incredible story to tell and as a marketer I’m excited to share it as part of the opportunity to build an iconic brand at a rapidly growing company.”The addition of Lowe as Chief Marketing Officer comes on the heels of hypergrowth at Expanse. In April,  Expanse raised $70 million in Series C funding led by TPG Growth, and with return investments from NEA, IVP, Founders Fund, and MSD Capital. The company has tripled sales year-over-year since product launch in 2016 and has dozens of Fortune 500 and government organizations using its services, including CVS/Aetna, PayPal, Capital One, Allergan, Hudson’s Bay Company, the US Army, US Navy, US Air Force, and the Departments of Defense, Energy, and State.Marketing Technology News: AUDIENCEX Continues Momentum with 300% Revenue Growth and Strategic Leadership Appointments ExpanseMarketing TechnologyNewsSherry Lowe Previous ArticleMarTech Interview with Alan Braun, CEO at IngageNext ArticleADK, Japan’s Third-Largest ad agency, partners with CHEQ for Brand Safety and Anti-Fraud Prevention Expanse Appoints Sherry Lowe as Chief Marketing Officer PRNewswireJune 20, 2019, 1:35 pmJune 20, 2019 last_img read more

Image Navigation announces worlds most advanced imageguided implant dentistry system

first_img Source:https://image-navigation.com/ The last few years have seen new opportunities open up in dentistry with significant growth in the dental implant market combined with technological improvements and cost reductions.It is estimated that more than eight million dental implants were placed in patients across the world in 2018, with more than three million in the United States alone. This USA figure is expected to increase by 33 percent to four million by 2022 and the growth rate in other areas, especially in Asia Pacific, is expected to be even faster. In the UK, there were an estimated 260,000 implants in 2018 which is double the number five years ago.Related StoriesTAU’s new Translational Medical Research Center acquires MILabs’ VECTor PET/SPECT/CTResearch sheds light on sun-induced DNA damage and repairPET/CT imaging spots cardiovascular disease risk factors in OSA patientsRecent data also indicates dramatic shifts in the usage of technology for the placement of dental implants. In the USA alone, the market for dental CT scanners (CBCT Cone Beam scanners) has increased by over 300 percent from approximately 8,000 in 2012 to over 28,000 in 2018 and is forecast to be more than 40,000 by 2022.When using the IGI system, the dental surgeon views the tip of the drill and the pre-operative plan both superimposed onto a 3 dimensional CT scan that displays the bone, adjacent teeth, nerve canal, roots and sinus area.  The IGI’s on-screen display has a unique fluent tracking system with zero latency. It adds real-time navigated digital surgery to digital imaging, digital planning, and digital restorations, thereby completing the digital puzzle. This new image-guided implant (IGI) system extends the use of CBCT scanners to include intra-surgical navigation and has real-time, speed of light, tracking with absolutely no on-screen lag. It also has sub-millimeter accuracy and a robotic auto-stop for maximum safety where the drill motor stops automatically and instantly turns off the drill if it is placed outside of the planned surgical area. Our new system seamlessly integrates the advantages of freehand surgery, including unfettered vision of the surgical site, retention of the surgeon’s tactile feel and the application of intra-surgical clinical judgment.”Mr Lawrence Obstfeld, CEO of Image Navigation, developer of the world’s leading dental navigation technology This new image-guided implant system enables dentists to undertake their procedures with reduced stress as it allows them to be totally precise in their actions and gives them the assurance that they will be able to repeat their work with consistency.”Lawrence Obstfeldcenter_img Data shows that more general dentists across the world are using the new, more affordable, technology which minimizes post-operative complications, reduce surgical treatment time and ensure greater accuracy when placing implants. The surgeon is able to monitor the drilling path on-screen and make precise adjustments to ensure the most accurate dental implant placement during surgery.”Lawrence Obstfeld Mar 11 2019Image Navigation is announcing, at the 2019 IDS in Cologne, the world’s most advanced image-guided implant dentistry system.last_img read more

NY startup aims to take on Teslas Powerwall

first_img This document is subject to copyright. Apart from any fair dealing for the purpose of private study or research, no part may be reproduced without the written permission. The content is provided for information purposes only. Pro­fessor of materials/​physics chem­istry discusses Tesla’s Powerwall for home energy storage Italian entrepreneurs who migrated to Stony Brook University’s energy incubator to form an innovative-battery startup are planning to take on the Powerwall of Elon Musk’s Tesla Inc. Explore further Citation: NY startup aims to take on Tesla’s Powerwall (2019, February 28) retrieved 17 July 2019 from https://phys.org/news/2019-02-ny-startup-aims-tesla-powerwall.htmlcenter_img ©2019 Newsday Distributed by Tribune Content Agency, LLC. Their Stony Brook company, StorEn Technologies, is adapting vanadium-flow batteries—typically the size of shipping containers and found in utility or industrial settings—for light commercial or household use.StorEn’s battery units, about the size of a large, cylindrical vending machine, could be used as a backup in case of a power outage.Chief executive Carlo Brovero said the entrepreneurs joined the Clean Energy Business Incubator Program at Stony Brook in 2016 after considering Northeast incubators from Boston to New York City. They founded StorEn the following year.”It’s very much focused on energy and energy storage,” he said of the university’s incubator program and Advanced Energy Research & Technology Center.The New York State Pollution Prevention Institute at the Rochester Institute of Technology and other partners are testing a StorEn prototype battery at the energy center to “validate” the technology, said David C. Hamilton, executive director of SBU’s program and director of operations at the center.The testing program is expected to help StorEn raise funds for additional development and marketing.StorEn has raised $659,824 through a now-closed crowdfunding effort on startengine.com, and Brovero said the company is in talks with additional unnamed investors, including some on Long Island.Unlike Tesla’s Powerwall, which uses solid-state lithium-ion batteries and is aimed at the home market, StorEn’s batteries use liquid electrolytes that contain the metal vanadium in a solution.StorEn’s batteries “can easily last 25 years with no decay in capacity,” while lithium-ion batteries decay at a much faster rate, Brovero said.Tesla’s warranty on the direct-current Powerwall 2 says it will retain 70 percent of its storage capacity 10 years after the initial installation.The Powerwall 2, priced at $6,700 per unit, can provide electricity at a lower cost per kilowatt, based on the expected price of a StorEn battery, Brovero acknowledged.But StorEn’s battery has a longer life and can run through many more cycles—when a battery is fully charged and discharged—without decaying, he said, meaning that the lifetime cost is lower. StorEn’s pricing for home units has not been finalized, he said.Like the Powerwall, StorEn’s batteries can be connected to solar panels as a backup power system.Tesla officials did not immediately respond to a request for comment.StorEn already has orders for three batteries, including one destined for installation at the Queensland University of Technology in Brisbane, Australia.That order is scheduled to be shipped at the end of April.Spearheading the company’s research and development is chief technical officer Angelo D’Anzi, who sold a previous vanadium-flow battery company, Proxhima, to a European utility company in 2015.Two more of the five Italian founders continue to work at the company: Maurizio Tappi and Gianluca Piraccini, both senior engineers.All of the founders are from Bologna except Brovero, who is from Turin. Credit: CC0 Public Domainlast_img read more

Government introduces bill to ban commercial surrogacy

first_img Next Government introduces bill to ban commercial surrogacyOn Monday, the government introduced the Surrogacy (Regulation) Bill, 2019 in the Lok Sabha that also provides for constitution of surrogacy boards at national and state levels, as well as that the intending couples should not abandon such a child under any condition.advertisement Press Trust of India New DelhiJuly 15, 2019UPDATED: July 15, 2019 15:44 IST File photo for representation.Commercial surrogacy will soon be banned and only close relatives will be permitted to act as surrogates to infertile couples for “ethical altruistic” reasons.On Monday, the government introduced the Surrogacy (Regulation) Bill, 2019 in the Lok Sabha that also provides for constitution of surrogacy boards at national and state levels, as well as that the intending couples should not abandon such a child under any condition.Only Indian couples who have been legally married for at least five years would be allowed to opt for surrogacy, as per the Statement of Objects and Reasons of the bill, which was introduced by Health and Family Welfare Minister Harsh Vardhan.The bill seeks to “allow ethical altruistic surrogacy to the intending infertile Indian married couple between the age of 23-50 years and 26-55 years for female and male, respectively.”A woman should be allowed to act as a surrogate mother only once and should be a close relative of the intending couple and “should be an ever-married woman having a child of her own and between the age of 25-35 years.”According to the statement, India has emerged as a surrogacy hub for couples from different countries for past few years.”Due to lack of legislation to regulate surrogacy, the practice of surrogacy has been misused by surrogacy clinics, which leads to rampant commercial surrogacy and unethical practices…,” it noted.The bill was passed by Lok Sabha in December, 2018 but lapsed as it could not get the nod from Parliament.ALSO READ | 8 companies with great parental leave policiesALSO READ | After Zomato, drug firm Novartis announces 26-week paid parental leave for both men and womenALSO WATCH | Surrogacy has an important role for women, says Dr. Firuza ParikhFor the latest World Cup news, live scores and fixtures for World Cup 2019, log on to indiatoday.in/sports. Like us on Facebook or follow us on Twitter for World Cup news, scores and updates.Get real-time alerts and all the news on your phone with the all-new India Today app. Download from Post your comment Do You Like This Story? Awesome! Now share the story Too bad. Tell us what you didn’t like in the comments Posted byNayanika Sengupta Tags :Follow Surrogacy (Regulation) BillFollow SurrogacyFollow Lok SabhaFollow Harsh Vardhanlast_img read more

Hassan breaks womens mile world record on emotional night

first_imgMONACO (Reuters) – Sifan Hassan of the Netherlands broke the 23-year-old women’s mile world record on Friday when she clocked four minutes 12.33 seconds in a race dedicated to former American runner Gabe Grunewald, who died from cancer last month at the age of 32. Hassan, 26, initially looked to be off the record pace in the rarely-run event but finished strongly to edge the 4:12.56 set by Russia’s Svetlana Masterkova in Zurich in 1996.It was a fitting performance in an event named the “Brave like Gabe” Mile. There was a tribute to Grunewald on the big screens at the stadium before the race and once it was underway, Hassan, who moved to the Netherlands after leaving Ethiopia as a refugee when she was 15, was always in control.“I knew I could run fast, but the first 800 was a bit slow, so after that I wasn’t thinking it would be a world record,” said Hassan, who took more than two seconds off her previous best for the distance. Athletics 08 Jul 2019 Prabudass singing in the rain as he breaks national record Related News Athletics 06 Jul 2019 Sizzling Lyles becomes fourth fastest man ever at 200m {{category}} {{time}} {{title}}center_img Other Sport 12 May 2019 Other Sports: Athletics – Brazil stun U.S. in 4x100m final on day of upsets at IAAF World Relays Related News “When I crossed the line I was so surprised,” she added after clocking a 62 seconds final lap.”After you run the last 400 like that, and set a world record, it gives you so much confidence over 5,000m.”I want to double over 1500 and 5,000 in Doha (at the world championships in September) and the way I finished the last 400, it’s amazing.”Hassan’s was not the only classy middle-distance performance of the night as Nijel Amos ran the fastest 800 metres seen since the 2012 Olympics as he posted one minute 41.89 seconds.Nobody has gone under 1:42 since the memorable final in London seven years ago when Kenya’s David Rudisha set the current world record of 1:40.91 and Botswana’s Amos ran his own best of 1:41.73 to take the silver medal.Amos followed the pacemaker through halfway in 49 seconds on Friday and held on strongly on a perfect night for the distance, with warm, wind-free conditions.Cheruiyot Rotich of Kenya chased him all the way and posted his own personal best time of 1:42.54 as the first nine finishers clocked their fastest times of the season.”I did an impossible session on Tuesday and after that, I knew I could run 1:41,” said Amos. “The world record is not in my mind but if I’m patient, it will come.”TECHNICAL RACEThose fireworks meant that, for once, the men’s 100 metres was not the biggest race of the night – though it was still an excellent one as Justin Gatlin won it in 9.91 seconds, edging fellow Americans Noah Lyles (9.92) and Mike Rodgers (10.01).”It’s all about putting together a good technical race, to use my experience,” said Gatlin, defying all the traditional rules of sprinting at the age of 37.”It feels great to beat these guys. This season is surreal, I can’t believe I’m still winning here after more than 20 years. Noah is a great runner, so every time I race him, I’m excited.”American Kendra Harrison won an exciting 100m hurdles in a season’s best 12.43 while Diamond Trophy holder Shaunae Miller-Uibo was a clear winner in a strong field in the 200m in 22.09.In a chaotic men’s 400 metres there was a false start and Jonathan Jones of Barbados did not hear the recall.Jones ran the entire race on his own, while Colombian Anthony Zambrano ran 200 metres, with neither man able to take part in the restarted race a few minutes later.American Kahmari Montgomery, who made the false start, was allowed to start the race, which was won by Steven Gardiner, who also ran on for a while during the initial mess, in 44.51.”I covered almost 100m but I stopped when I saw everybody stop,” he said Gardiner of the Bahamas. “I came back and re-focused and went again.”Montgomery finished the race but was later disqualified. (Reporting by Mitch Phillips, additional reporting by Gene Cherry, editing by Ken Ferris)last_img read more

Fosun Group mulls US940m rescue of debtstrapped Thomas Cook

first_img Corporate News 13 Jun 2019 Tesco suffers from weak U.K. market Related News Tags / Keywords: Markets 29 Apr 2019 Britons opt for non-EU holidays in face of Brexit impasse Corporate News , M&A Business News 21 May 2019 Ryanair cautious on outlook as slumping fares weigh on earnings HONG KONG: China’s Fosun Group is considering a 750 million-pound ($940 million) rescue of Thomas Cook Group Plc, the world’s oldest travel agency, which has been struggling to pay debts amid a slowdown.The deal would give the Chinese insurance-to-drugs conglomerate control of the British company’s tour operations and a minority stake in its airline, while swapping debt for equity and issuing new shares, Fosun Tourism Group said Friday. Thomas Cook said the talks are advanced and the money would provide liquidity to trade through the winter season.A takeover of a tour operator with roots dating back to 1841 would fit into Fosun’s plans to grow by buying businesses related to health, wealth and happiness. If successful, a turnaround of Thomas Cook would track Fosun’s revival of Club Med, the resort chain it bought in 2015 and boosted partly by bringing in more Chinese tourists.”Fosun is hoping that Thomas Cooks’ brand name and global reach will expand its business among wealthy Chinese tourists,” said Andrew Collier, managing director at Orient Capital Research. “Bondholders are expecting this synergy to work, otherwise they wouldn’t convert debt to equity.”Under the proposal, Fosun Group’s tourism unit would get control of Thomas Cook’s tour operations and a minority stake in its airline, while swapping some debt for equity and issuing new shares, Fosun said. A deal would also require agreement from stakeholders and regulatory approval, the company said.Thomas Cook said its main lenders are supportive of a recapitalisation and discussions are “constructive.” Hong Kong-listed Fosun International Ltd. already owns about 18% of Thomas Cook. The plan won’t impact trade creditors, and though existing shareholders would be diluted they would have an opportunity to reinvest alongside Fosun.”While this is not the outcome any of us wanted for our shareholders, this proposal is a pragmatic and responsible solution,” Thomas Cook Chief Executive Officer Peter Fankhauser said in a statement. Margins have been weak due to intense competition, and it expects a decline in second-half operating profit, the company added.Thomas Cook had total debt of about 1.9 billion pounds as of March 31; net debt was 1.2 billion pounds, according to data compiled by Bloomberg. The company’s shares have tumbled 87% over the past 12 months, cutting its market value to 204 million pounds as of Thursday.Thomas Cook creditors have sought to exit loans on concern the company’s declining performance would weaken its ability to repay. The agency has seen bookings and its bond prices tumble amid concern about slumping travel demand.In May, S&P Global ratings and Fitch Ratings pushed the company’s credit score deeper into junk territory, citing high indebtedness.Thomas Cook has been grappling with a tough operating environment since last summer’s heatwave in northern Europe, with many of its sun-seeking customers choosing to stay at home. Uncertainty over the U.K.’s departure from the European Union has also weighed on its business.Shopping SpreeThe tour operator said in June it was in talks with Fosun Tourism Group about a possible deal. The U.K.-based tour business, which had revenue of 7.4 billion pounds last year, would significantly expand Fosun’s footprint in Europe.Taking control of Thomas Cook’s tour business would also give the group “significant synergy with Fosun’s other offshore tourism properties, including Club Med,” said Collier of Orient Capital.A deal would reflect the renewed aggressiveness of Fosun’s dealmaking, a shopping spree that comes three years after China started reining in overseas investments by some of the country’s biggest and most indebted business groups.Separately, a consortium led by Fosun is in talks to buy a majority stake in a Russian gold miner, a transaction that could value the target at $1 billion, people familiar with the matter said in June. The company is also considering a joint bid for Bayer AG’s animal-health business, which could be valued at as much as $9 billion.In 2016, Thomas Cook and Fosun set up a travel agency partnership to cater to China’s wealthiest tourists. As the Asian country’s wealth grows, tourist zones around the world have taken steps to draw more of them, especially big-spending luxury travelers.The proposed rescue Fosun is considering would “significantly” dilute existing shareholders, who may be given the opportunity to participate in the planned recapitalization, the China-based company said Friday. – Bloomberg Related News {{category}} {{time}} {{title}}last_img read more