In early October, the L.A. Times wrote a story about Disney and its influence on Anaheim, California. The city is home to the California Disneyland and its multiple theme parks for Disney movies this year include: Beauty and the Beast, Guardians of the Galaxy Vol 2, Thor: Ragnarok and Star Wars. The combination of traditional Disney movies, Marvel comics and Star War franchise and trying to use all form of multi-entertainment from each franchise makes Disney a powerful force. In the L. A. Times article, the story examined whether Disney pays its fair share of taxes – often for a large employer for it to operate at continuing levels and increase its investments in the host city, the company asks and often receives Civic improvements which benefit it. If you examined the quest for the next Amazon headquarters – it was amazing what cities and states were offering for potential 50,000 jobs. The question is do the benefits outweigh the incentives offered and how strong is the loyalty bounds. There tends to be no specific answer but large organizations always ask for more and the opposition is not allowed to ask what happens if the company moves or shifts its investments?

In the case of Disney which is headquartered in Los Angeles, they were mad at the L.A. Times and said their people would not longer talk to them,  the silliness was over in 3 days and now each go about their business.

Linking to dividend paying stocks, all companies which earn a profit and can continue operating on a consistent basis have a great deal of influence over where they locate their facilities and given the internet and the ability to work almost anywhere – locking the companies to a location is generally a one sided negotiation. Companies can do it above board or they can enter into what they bleed from the government. These are the same people who then say we pay our taxes (heavily subsidized) and expect others to pay the full rate. As investors, we often do not know what the company is paying or not paying, but we believe it is paying near full rate. Often times listening to the senior management will give you an idea of how close to full rate they pay or would like you to believe they pay.

There are more questions than answers, till the next time – to raising questions.