Tag Archives: idaho

Business/Economics, International, Technology, U.S.

Corporate Hypocrisy: FMC spends money to take over companies that clean up pollution, yet refuses to clean up Idaho Super Fund site? FMC issues millions in debt notes, to join the growing trend of stock buybacks by Corporate America.

From 1949 to 2001, U.S. based FMC operated a phosphorus processing plant in southeastern Idaho, just west of Pocatello and Chubbuck.  Ten years later that plant is now an EPA Superfund site, and locals are still waiting for FMC to clean it up!

The hypocrisy is that FMC has been going around spending money buying up companies that specialize in environmental clean up!  The most recent purchase was Canada’s Adventus Intellectual Property: “Adventus presents an exceptional opportunity for FMC to broaden its growing portfolio of advanced specialty solutions serving the global site remediation market.”-Mark Douglas, FMC Industrial Chemicals

FMC site, west of Pocatello and Chubbuck, south of Fort Hall Reservation

So if FMC can buy up companies that specialize in environmental clean up, why can’t FMC clean up it’s old phosphorus plant in southeastern Idaho?

FMC claims to have annual sales of approximately $3.1 billion!  Yet FMC has just completed the sale of U.S.$300 million worth of debt notes.  Why does it need to do that?  According to FMC officials they’re jumping on the new trend of Corporate America buying back their stocks.  FMC wants to buy back at least $200 million of their own shares!  Instead, shouldn’t they spend that on cleaning up their Idaho Superfund site?

Recently the Environmental Protection Agency held public meetings in southeastern Idaho, to discuss ways to clean up the old FMC site.  Capped ponds at the site are emitting toxic phosphine gas.  There was also decades of dumping before the EPA was created. There is concern that contamination is leaking into the ground water, and nearby rivers.

 

Business/Economics, Idaho, International, U.S.

What Economic Recovery? Is Hewlett Packard lying about investing in U.S. operations? Spends tens of billions of dollars in Taiwan, hires hundreds of Taiwanese while laying off hundreds of Americans

On November 25, the Taiwan government’s Ministry of Economic Affairs (MEA) recognized U.S. based Hewlett Packard (HP) as the number one foreign buyer of Taiwan made computer related products.

The MEA refused to give an exact dollar amount but said it was at least 10% more than what HP spent in 2010.  In 2010 HP spent U.S.$25 billion on Taiwanese products!

HP officials told the Taiwan media they plan on buying $30 billion worth of Taiwanese made products in the next two years.  On top of that they plan to hire hundreds of Taiwanese for their Taiwan operations.

This greatly contrasts with what Hewlett Packard is doing with it’s U.S. operations.  Slashing and burning operating budgets and laying off hundreds of U.S. employees.

In a recent interview, the new CEO of HP, Meg Whitman, said this: “We’re relatively pessimistic about the economic outlook in two of our three major regions. 2012 just looks tough to me.”

Apparently the United States is one of the two regions she’s pessimistic about, because that’s not what HP officials are saying about their Taiwan operations.  Several Taiwan media sources reported that HP officials feel very “upbeat” about the economic situation in Taiwan, and Asia in general.

In July HP bought back $10 billion of their own stocks, then laid off 500 U.S. employees in September.  At the beginning of November, news of more lay offs was leaked by people claiming to work at HP’s Boise, Idaho, factory.  Idaho media contacted HP and was told that a press release was in the works.  So far no press release.

 

 

 

Business/Economics, Idaho, International, Technology, U.S.

Global Economic War: Chinese owned Hoku about to start operations in Idaho. Will U.S. investigation into Chinese solar products put the brakes on Hoku’s operations?

“We believe the Department of Commence investigation will show that Chinese government and Chinese solar manufacturers are, and have been, engaged in illegal practices that threaten to decimate a vitally needed renewable energy industry.”-Gordon Brinser, SolarWorld Industries

After many problems affecting construction and causing long delays, on November 21, Hoku’s CEO, Scott Paul, announced they cleared a milestone in getting their Pocatello, Idaho, polysilicon factory up and running; connection to permanent electrical power supplied by Idaho Power.

Hoku also announced they will now be selling finished photovoltaic modules through a subsidiary called Tianwei Solar USA.  The finished products are made in China, by a company called Tianwei New Energy.  While Tianwei Solar USA is a subsidiary of Hoku Corporation, Hoku is actually a subsidiary of Tianwei New Energy, in China.

Now comes the U.S. Department of Commerce and the International Trade Commission.  They are investigating claims by seven U.S. based photovoltaic manufacturers, that Chinese based companies (like Tianwei, which controls Hoku) are breaking trade laws.

The International Trade Commission will render a decision around December 5.

Now comes China’s Ministry of Commerce.  In retaliation for the U.S. investigation into Chinese companies dumping their finished photovoltaic products on the U.S. market, the China Photovoltaic Industry Alliance claims the U.S. is dumping polysilicon at below cost prices in China!

So, Hoku’s polysilicon production for Chinese customers, mainly their majority owner Tianwei, is being threatened by an investigation by the Chinese government, AND, Hoku’s selling of Tianwei’s photovoltaic products is being threatened by an investigation by the U.S. government!

Hoku is trapped between a rock and a hard place.

WHAT ECONOMIC RECOVERY? HOKU, IDAHO, FINALLY TO START POLYSILICON PRODUCTION?

Business/Economics, Idaho, U.S.

What Economic Recovery? Corporate layoffs & stock market games, part of Corporate America’s stock buy back scheme. Hewlett-Packard case in point

“We’re relatively pessimistic about the economic outlook in two of our three major regions. 2012 just looks tough to me.”-Meg Whitman, new CEO of Hewlett-Packard

“It’s an extraordinarily unimaginative way to use money.”-Robert Reich, former U.S. Secretary of Labor

What’s the former U.S. Secretary of Labor talking about? Why Corporate America buying back its own stocks.  Companies are able to do this because they are not spending money on research and development, and, according to a New York Times article, it’s the real reason companies are still laying off employees. They’re using the money they would have paid for the labor to buy back company stocks.

In November employees at the Boise, Idaho, Hewlett-Packard (HP) factory reported that layoffs were in the works.  In July HP bought back U.S.$10 billion of their own stocks, then laid off 500 employees in September.  HP officials avoided directly answering questions about layoffs in Idaho by saying they were working on a “press release”.  It’s been a couple of weeks now and no press release.

A lot of problems are being created by the way Corporate America is buying back their stocks.  For one it artificially increases the value of their stocks:  “Unless earnings per share are adjusted to reflect the buyback, then to base a bonus on raw earnings per share is problematic. It doesn’t purely reflect performance.”-John L. Weinberg, University of Delaware

Number two, it’ll delay any economic recovery: “It’s a symptom of a deeper problem, which is a lack of investment in the long term. If we’re not investing in research, innovation and entrepreneurship, we’re going to be a slow growth country for a decade.”-William W. George, Harvard Business School

And thirdly, it’s increasing unemployment, which is only adding to the downward spiral of the economy.

On November 22, Meg Witman, former eBay CEO, former California Gubernatorial candidate, and new CEO of Hewlett-Packard, was questioned about HP’s huge cuts in R&D.  Here’s her response: “It’s not (return on investment) in year one or two. I think the investments we make in 2012 you’ll start to see in 2014 and 2015. I wish I could tell you differently but it’s not true. And you’re right. We cut out a lot of muscle in R&D at this company and we have to invest back in it. It’s a long term play. I will tell you, this management team, we are now building HP, we’re building it to last. We’re not building it for next month or next quarter. We are building this company to be great over the next decade. And you’ll see improvements every single year. You’ll be able to measure us on how we’re doing. But we’re making some long term bets here because we can’t continue to run this company for the short term.”

Knowing that the latest trend in Corporate America is buying back their own stock, at the expense of R&D and employment, is that what Whitman means when she says “…we’re making some long term bets…”?

Whitman’s answer is confusing.  Traditional economics tells you that investing in R&D is a long term “bet”.  Yet Whitman calls it “short term”. 

So is that what Whitman means when she says we should see returns on investment in 2014/2015?  The investment meaning buying back their own stocks?

Anyone who’s taken economics, or business courses should know that traditional investment into your own company means R&D; to come up with more efficient ways to produce products, or coming up with new products/services, better marketing, etc.  But it does not mean buying back your own stocks.

Perhaps stock buybacks are the real reason there are layoffs coming for HP’s Boise operation, and officials are still trying to come up with a good sounding reason for their forthcoming “press release”?

Hopefully, since Whitman just started her job as HP CEO, she’s talking about a return to traditional economics. Hopefully it’ll mean an end to HP’s stock buy backs and a return to putting money into R&D and employment, she did say: “We cut out a lot of muscle in R&D at this company and we have to invest back in it.” Oh well, wishful thinking.

 

Business/Economics, Idaho, U.S.

What Economic Recovery? Idaho farm tractors being stolen for scrap metal

“We’ve had a lot of scrap metal stolen. This is totally off the wall here.”– Jackie Morris, Power County Chief Deputy Sheriff

A farmer in American Falls, Idaho, had two old International tractors stolen right off his farm, in broad daylight.  Witnesses say they saw the tractors being hauled away on trailers pulled by pick up trucks.

The drivers of the pick ups were recognized as individuals who’re recently asking locals if they had any scrap metal they wanted to get rid of.

Farmers are being warned by law enforcement to inventory their farm equipment at least once per week.

 

Business/Economics, Idaho, Technology, U.S.

What Economic Recovery? Former HP employee, and MBA holder, finds new job by NOT talking about his college education

“Nobody ever thinks, ‘Hey, I’m having trouble getting a job now.  Let me go get this extra degree and I’m sure I’ll still have trouble.’”-Nathan Bussey

In 2008, Idahoan Nathan Bussey lost his coveted job with Hewlett-Packard.  He used the unexpected time off to get an MBA.

Forget the rhetoric coming out of Corporate America, that they can’t find “qualified” applicants, Bussey discovered that having a college degree actually hurt his chances of getting a job.   That’s because the only jobs available don’t really require college.

This year Bussey took a job with a dreaded call center.  He did not tell them about his MBA, because it would’ve hurt his chances for getting hired.  He’s getting paid much less than when he was working for HP, but he and his wife are desperate: “We have no savings anymore. If something happened, if one of us got hurt or sick, we certainly would be in a much worse situation now.  We’ve used our buffer.  That rainy day fund is now gone.”

 

 

Business/Economics, Idaho, U.S.

What Economic Recovery? Idaho’s Coldwater Creek continues its fall, but, is this a case of buy low now, and if Coldwater Creek recovers, you can sell high?

“Coldwater Creek (NASDAQ:CWTR) is one of today’s worst performing low-priced stocks…”-Adrienne Chilton, analyst

The month of October and November was so bad for the Idaho company that, maybe, it should be put out of its misery.

During the second week of November, there were reports that Coldwater Creek could be delisted from the NASDAQ.  That’s because in the second half of October their stock price dropped to just a little more than .90 cents per share.  At the begining of November, Coldwater Creek was downgraded to “underperform” by Zacks Investment Research Analysts.

By the end of  the first week of November their stock price jumped back over $1.10.  But more bad news.  By the second half of November their stock price is now below .90 cents; as of November 23 it was trading at .88 cents per share.

Things are so desperate that in a move to motivate investors, and maybe keep from getting delisted, the CEO of Coldwater Creek, Dennis Pence, bought U.S.$7 million worth of his own company’s stock.

At around .90 cents per share that’s a heck of a lot of stocks!

Pence claims this is a case of buy low, sell high.  He claims he still believes in the company and is sure they will turn things around.  If he’s right investors could make a killing.  One analyst thinks investors could end up with a 200%-500% return, over three years!  But that’s assuming a $60 million improvement in Coldwater Creek’s expenses and operating income performance.

The anonymous analyst, going by the nom de plume Violent Capitalist, also admits: “…this is a very very risky investment…”

Another analyst, with the nom de plume of Pimlico, responded to the buy low, sell high sales pitch with: “This one really looks doomed. I have rarely seen shareholder equity decelerate as quicky as I have with this one.”

Investors should wait until November 30, when Coldwater Creek will report its 3rd quarter earnings.  Most analysts surveyed are predicting negative earnings.

Of interest, for the past four months, analysts have advised stock holders to “hold” onto their Coldwater Creek shares (as reported by Reuters). Is there hope?

Business/Economics, Idaho, U.S.

Occupy America! Diesel disparity in Idaho. Gas prices way down, Diesel way up. Blame increase in U.S. exports! Blame pricing games! Warning for California. Fracking really for fuel production. Grow your own!

In eastern  Idaho, the difference between the price of one gallon of regular gasoline, versus diesel, is now a full one dollar.

Phillips 66, next to the Bannock County court house, Pocatello, Idaho

On November 19, the average price, in the Pocatello/Chubbuck area, hit $3.18 per gallon for regular gasoline, and $4.18 for diesel.

The U.S. Energy Information Administration (USEIA) says gas prices are falling, in general, due to the usual seasonal drop in usage.  I’ve never seen it drop by this much, here in eastern Idaho.  Back in May, the average price was $3.65 per gallon, and it stayed that way through most of the summer.  In the past two or three months the price has dropped almost 60 cents.

The USEIA also says regional fuel refining has a lot to do with prices, but back in September I discovered that PADD 4 gasoline production was being kept below demand. The latest data on PADD 4 gas production shows that, after months of keeping it around 290 thousand barrels per day, regional refineries are now pushing out more than 324 thousand barrels per day.  This is why gas prices, in the Rocky Mountain area (PADD 4) are, or should be, dropping.

In California it’s a different story.  The latest gasoline price survey shows the average price around $3.54 per gallon, with many areas paying $3.79.  California taxes are one reason for the higher prices, but the other reason is that California refines its own fuel, and the refineries are in trouble.

According to the USEIA, despite having the third largest refinery industry in the country California’s refineries are maxed out, there’s just too many people driving too many vehicles.  The USEIA is warning of a fuel price catastrophe in California: “California refineries need to be running near full capacity to meet the State’s gasoline demand. If more than one of its refineries experiences operating problems at the same time, California’s gasoline supply may become very tight and prices can soar. Even when supplies can be obtained from some Gulf Coast and foreign refineries, they can take a relatively long time to arrive due to California’s substantial distance from those sources. The farther away the necessary relief supplies are, the higher and longer the price spike will be.”

Regarding the rising cost of diesel fuel, it looks like some of what I warned about back on November 5 is coming true.  Bottom line; around the world diesel production is down, while international demand is going up and up.

The latest reports on diesel commodity prices show a slight decrease.  The decrease is so small that the global increase in demand for diesel will still cause pump prices to go up.

And how does the global demand affect us here in the U.S.?  According to the American Petroleum Institute (API), most diesel fuel produced in the Untied States is actually being exported to other countries (a 37.6% increase, in both diesel and gasoline exports, in the past year).  That means less diesel for the domestic market.

Diesel fuel is part of the “distillates” family of fuels.  In the U.S. ultra low sulfur diesel is referred to as “Distillate Fuel Oil 15 ppm (parts per million) and under of Sulfur”.  According to USEIA records, ultra low sulfur production, in the United States, varies between 3.2 million and 3.6 million barrels per day.  Now realize that international demand has gone up, and that U.S. refineries are exporting much of their diesel.  Since overall production is remaining in the 3 million to 4 million barrels per day rang, that doesn’t leave much for us.  The result is diesel prices will continue to go up, until U.S. distillate refiners greatly increase production.

For those of us in the Rocky Mountain (PADD 4) area, the USEIA shows an up and down pattern for “Distillate Fuel Oil 15 ppm (parts per million) and under of Sulfur”.  From March through May, diesel production was stuck at about 160 thousand barrels per day.  By the end of July it increased to 195 thousand barrels per day.  Since the end of August it’s dropped, to 185 thousand.  That explains why diesel pump prices in the Rocky Mountain area are going up.

But here’s one more reason, and one that many diesel fuel users have speculated on; the high pump prices of diesel is an attempt by producers to make a bigger profit, since they’ve actually been keeping gasoline pump prices artificially low.  A Reuters article states just that: “This in turn crimps diesel output until the cost of the fuel gets high enough to offset losses from additional gasoline sales.”

The Reuters article explains, not very well, that ultra low sulfur refining requires hydrocracking, a process involving hydrogen.  It’s also used for gasoline.  The problem is that many refineries in the U.S. can not produce both diesel and gasoline.  This might explain the swings in production; one month gasoline production up, and diesel down, the next month it’s reversed.

The push for fracking natural gas, is actually for the fuel refining industry, because it turns out that using the hydrogen in natural gas is a good cheap way to conduct hydrocracking in fuel refining.

Eventually more diesel will be produced, because of the global demand.  Several companies in the Gulf Coast area have invested billions of dollars to build new refineries to extract the hydrogen from natural gas to hydrocrack new diesel fuel.

Diesel fuel users should really look into making their own biodiesel, even though you could get into trouble with the Federal and State tax collectors, as well as the EPA.  Here’s some links:  Backwoods Home Official BioDiesel Home BioDiesel Diesel Master JR Whipple (good for moonshine too, remember diesel is a distillate) There plenty more sites on the internet about making your own diesel, do the research.

 

Idaho, Opinion, U.S.

United Police States of America: Idaho bars media from executions, violating Federal rules

“To determine whether lethal injection executions are fairly and humanely administered, or whether they ever can be, citizens must have reliable information about the ‘initial procedures’ which are invasive, possibly painful and may give rise to serious complications.”-9th U.S. Circuit Court,  2002 ruling

On November 18, Idaho will execute a man using lethal injection, for the first time.

Attorney’s have protested saying lethal injection has been proven to be inhumane.

Now, the Idaho Department of Correction is barring all the media, in full violation of the Federal court’s ruling, from witnessing the execution: “The procedures were developed so that we would preserve the dignity of the offender.”-Jeff Ray, Idaho Department of Correction

Can you say: Bull Crap on that?   “Preserve the dignity” of a guy convicted of killing three people in three separate incidents, my ass!  Prison officials don’t give a rat’s ass about prisoners’ dignity, there’s plenty of evidence of that!  More like keep the fact that lethal injection has turned out to be a highly painful way to die (it’s described as similar to people who are undergoing operations, and are fully conscious, and can feel everything yet can’t move or talk, even though the doctors think they’re under the effects of anesthesia).  Some witnesses to lethal injection executions say they could see the convict crying after the injections had taken effect.

Several other groups have been barred as well.  The American Civil Liberties Union is also protesting.  The Associated Press is joining almost all of Idaho’s major media organizations in official protest.  Idaho officials claim the Federal Court ruling applies only to California.

I still say a bullet to the head is the fastest most humane way to execute someone.

Business/Economics, International, Technology, U.S.

End of Lawsuit may re-invigorate Idaho’s Micron, gets big boost from George Soros, rumors of insider trading

Finally, after more than a year (the last 8 weeks in deliberations), a California jury has decided in Micron’s favor, ending the possibility of Micron having to pay $11.9 billion in restitution.

A California company was suing Idaho’s Micron, along with a South Korean company, claiming they worked together (colluded) to fix computer chip prices, and to interfere with the California company’s ties with Intel.

Since 2009 Micron has fallen from being Idaho’s top employer, after laying off thousands of employees. If they had lost the lawsuit it would have been their death blow.

Even before the verdict the value of Micron stock started going up (possibly due to George Soros).  Bloomberg News reported that Micron stocks are making “unusual moves” upward.

A big reason Micron stock is going up is that billionaire investor, George Soros, recently bought up 484.5 million senior convertible Micron Technology securities, valued at $$477.6 million!  Maybe a positive turnaround for Idaho’s Micron is finally in the works?

Here’s the problem: George Soros started buying up Micron stock days before the California jury made their decision.  This is now starting rumors of insider trading.  But it’ll be tough to prove, after all, how could anyone know what a jury is going to decide, right?  Oh well, it’s happened before.