Facebook Shoots It’s Foot Off. Probably will sell you the picture. $FB #instagram

Image representing Facebook as depicted in Cru...

Image via CrunchBase

So Facebook (Nasdaq:FB) will now be selling your pictures without notice or compensation. Apparently you cannot opt out. I hope Facebook has set aside some money for lawsuits.

Facebook is proving itself to be the biggest financial honey trap since the Borgia Cardinals and Popes ran the Vatican. Here is how the rebellion will come about. Lawsuits. The litigation and tort community is just salivating at the teeth. Lawsuit after lawsuit will pile up. Vexing Facebook which has yet to prove itself profitable.

The lawsuits will damage the brand as users become enraged and abandon. Corporations who may be using imagery will suddenly face the prospect of losing control. Not happy. I`m personally waiting for the misuse of Mark Zuckerberg photo`s. Someone will come up with something devious. you just know they will.

In the meantime if you posted some family photo`s. Mark and the boys can make a few bucks from it. Globally you just know there will be jurisdictions that will not allow it.

Win, lose or draw this will be a tar baby for Facebook.

George Gutowski writes from a caveat emptor perspective. Follow him on twitter@financialskepti or his evil twin brother who writes Wall Street Murder Thrillers at twitter@georgegutowski

Kohl’s Directors Conducting Life Boat Drills. All Rats Leave Early! $KSS

Kohl's at the Gateway Shopping Center in north...

Kohl’s at the Gateway Shopping Center in northeast Portland, Oregon. (Photo credit: Wikipedia)

Kohl’s Corporation (NYSE:KSS) entered the prime Christmas Selling season with several key insiders selling their shares. All retailers are highly sensitive to reports of Christmas Sales. This is like the super bowl for pro football. You  have to be great and there is no tomorrow,

Check out these massive insider sales transactions

  1. Long-service director William Kellogg, who as a former CEO and Chairman at Kohl led a MBO of the company in 1986, hit the sell button for 1.5 million shares in early November valued at almost $82 million, 600,000 shares in September valued at more than $32 million, and 900,000 shares in August valued at over $46 million.
  2. Similarly, long-service director and former COO John Herma sold about 740,000 shares at the beginning of November for more than $40 million, about 260,000 shares in September worth over $14 million, and 500,000 shares in August worth nearly $26 million.
  3. Prior to these transactions, Mr. Kellogg had made no sales since 2009 while Mr. Herma had made no sales since 2011. Moreover, their transactions were generally made on the same days.

Coincidence. I’ve long given up on the tooth fairy. In a retailer by Aug/Sep your Christmas Game Plan is already set. You’re into execution mode. So when the big guns are selling you do not need fundamental analysis.

The stock ran up from around $43 late June to $55 first week of Nov. Then the bad news all started to come out. Sales are off dramatically and the stock has dropped. The olde dogs saw it coming and sold out. Surprisingly the money flow still clocks in at 1.23. Not a good set up.

George Gutowski writes from a caveat emptor perspective. Follow him on twitter@financialskepti and follow his evil twin brother who writes wall street murder thrillers at twitter@georgegutowski

Rolls Royce Bad Ethics or Reality Based Marketing $RYCEY

Rolls Royce is clearing out some dirty laundry. You see apparently like between 1996 to 2002 which is at least ten years ago some naughty things happened in Indonesia and they are only now getting around to discussing the matter with the British Serious Fraud Office. Bribes were paid in cash and a blue Rolls Royce to President Suharto’s son who eventually served time in jail.

The allegations came out when a Rolls Royce functionary was forced into early retirement after he spoke up about some strange spending on his bosses expense account in Indonesia. So the person decided to retaliate after he opened up the corporate kimono; specifically his bosses kimono. ,

The whole affair smacks of a pissing match with more unsavory details to follow. Personally I’m predicting a ménage à trois with cross gender nuances. So you have to ask your self why after ten years does someone get pissed off. Ten year is a long time to stew over something.

Then and only then do you go public. Oh really so you rock the boat ten years after. Rolls Royce is smarter than that and had waited for the rumble. They report themselves, take the upper hand and position you as the bad guy.

I for one am not against a few bribes here and there. The bribe kept many workers employed and much food on the table. Their cultures will not play ball with christian-judeo values. Cash will. We will have a lot of investigation, smoke and mirrors. Rolls Royce will promise to upgrade governance and compliance. sins of ten years will fade. No one will care. The technology that was installed as a result of this bribe is rapidly becoming obsolete and needs upgrading.

If Rolls Royce can do what it takes in third world developing economies the shareholder will do well. The shrill regulator will be long forgotten.

George Gutowski writes from a caveat emptor perspective. Follow him on twitter@financialskepti and his evil twin who writes Wall St murder thrillers at twitter@georgegutowski

Wrapping Paper Sales Confirm Retail Sales. Do Your Own Channel Checks. $XRT, $M, $JPM, $COST, $SHLD, $TGT, $WMT

US Retail Sales 1992–2010

US Retail Sales 1992–2010 (Photo credit: Wikipedia)

If the retailers had good Christmas trade they are selling lots of wrapping paper, bows and ribbons. If the sales are bad the wrapping paper is not moving. Do your own channel checks. Go to retailers and see how wrapping paper sales seem to be. If the clerk is not busy the shareholders are in a pickle.

A week before Christmas this is the sure-fire way to forecast sales.

George Gutowski writes from a caveat emptor perspective. He has bought bags and tissue paper because he cannot wrap to save his life. follow him on twitter@financialskepti and his evil twin that writes Wall Street Murder Mysteries at twitter@georgegutowski

Signs of Black Swans

I love reading posts from GMI ratings (GMI.com). They recently published a post on Black Marks on Black Swans: 16 Subtle Signs of Stocks Teetering on the Cliff

George Gutowski writes from a caveat emptor perspective. Follow him on twitter@financialskepti or his evil twin who writes financial murder thriller at twitter@georgegutowski

 Here is the essence of the post:
16 Signs of High Black Swan Risk
Accounting Governance/High Risk Events
Asset Turnover Compensation: CEO /CFO Total Comp
Cost of Goods Sold/Revenue Compensation: Incentive/Total Comp, CEO & CFO
Goodwill/Total Assets Divestitures
Intangible Assets/Assets Mergers-Acquisitions
Leverage Ratio: Debt/Equity Officer Changes
Accounts Receivable/Sales Officer: Chairman is also CEO
Depreciation Expenses/PPE Share Repurchases
Operating Revenue/Operating Expense Restructuring

Can on Observant Muslim Regulate US Financial Insitutions. Sharia Law Implications? $XLF

Rep. Keith Ellison (D-MN) was the first Muslim ever to be elected to Congress. He also serves on the House Financial Services Committee.

How does he observe his faith which teaches interest is wrong and regulate Financial Institutions whose business model revolves around interest rates.

George Gutowski writes from a caveat emptor perspective. He likes to earn interest not pay it. Follow him on twitter@financialskeptic and his evil twin on twitter@georgegutowski

Mayan Calender Y2K Redux Girl Friends Past!

As the millennium changed from 1999 to 2000 my girlfriend and I were out for a swanky New Years Eve soiree. On a credit card. We hedged our bets and were within walking distance of our nest for the night. {We made good nest}

B0th of us were professionals (something to do with money) we that heard of Y2K hysteria and were wondering. We had a good time. The bill was large. Several weeks later American Express confirmed we had a good time. Y2K did not affect my credit card. My girlfriend confirmed she had a good time also. I am confident she has shared this with her new husband. Really quite convinced.

So this Mayan thing! Not seeing anybody serious at the present. But I expect American Express to be in character and confirm whatever it was that I did. I cycle mid January.

George Gutowski writes from a caveat emptor perspective. I like to have a good time on New Years Eve and other eves as well. Follow him on twitter@financialskepti or his evil twin at twitter@georgegutowski Mayan calendar bring it on.

Solarcity Not Energy Not Solar Long Bonds Stink Baby $SCTY

Image representing SolarCity as depicted in Cr...

Image via CrunchBase

SolarCity (Nasdaq:SCTY) is finally out. The IPO is done. They dropped the price, got the IPO investors frenzied and watched the after market price jump almost 50%. Well at least for one day.

Management had an apologia prepared about the higher sales price. They claimed institutional investors have bad memories of solar power and they stayed away from the party. Maybe.

They should have marketed themselves as an energy company. Stupid institutional investor for not getting that. They really are an energy company. Yeah well maybe. But they cut the price anyway and stayed with the old narrative.

Energy company. There are lots of energy companies. Most of them price off a carbon energy model.

What SolarCity does is install roof top solar panels, cut your electricity bill and take a middleman fee. Arbitrage. Broker. Flipper? They create a long-term twenty year cash flow.

Twenty years why that’s like a bond isn’t it. Yes grasshopper that is a bond. An unrated naked risk bond. Worse it is a long bond. Currently long bonds are the most dangerous high risk sector of the financial markets.

So why would you want to buy the equity version of an unrated long bond. Sucker deal.

No names of underwriters have been mentioned in s a few relevant media stories. They must be hiding like under a rock or something.

George Gutowski writes from a caveat emptor perspective. Follow him on twitter@financialskepti

#FiscalCliff bring it on. Tired of Tax Walls


Tax (Photo credit: 401(K) 2012)

Today I was in a rush so I bought a foot long breakfast Sub. Paid about a buck in taxes. Been paying a lot of taxes every time I do something convenient.

Fiscal Cliff bring it on.

I’m tired of hitting the tax wall every time I want or need something that I can pay for.

George Gutowski writes from a caveat emptor perspective. He was munching on the sub as he wrote this blog. Follow him on twitter@financialskepti

Amazon Discounts Kindle Fire Evil Genius or Desperate Stupidity $AMZN #kindle $AAPL

Image representing Amazon as depicted in Crunc...

Image via CrunchBase

Amazon (Nasdaq:AMZN) has dropped its Kindle Fire retail price by $50; dropping to some $249. Some view they may be under guidance as they are leaving $50 on the table. But as you head into the short frenetic end of the Christmas season a price drop will improve sales and long-term customer loyalty. The main goal of a tablet is to suck money out of your bank account into theirs. So the supposed $50 price drop will be more than compensated by increased sustainable revenues.

The money flow action is 0.96. Marginally negative but nothing to worry about. Investors are starting to over focus on the short-term issues. Yes Amazon is in a strategic fight for on-line retail dominance.

But watch for the following possible moves which can change perceptions to the better.

  1. Amazon can start paying a dividend and signal they believe their cash flow is stable and sustainable.
  2. Amazon can borrow a billion dollars long-term at low-interest rates and lock in positive spreads as rates start to climb.

The big moves will be with capital structure not tactical pricing issues for key products.

George Gutowski writes from a caveat emptor perspective. Follow him on twitter@financialskepti