In the last election, President Trump wanted US steelmakers to make more steel in the US, although when he built some of the buildings with his name of them, he used imported steel. However, he needed the votes and vowed to protect domestic steel making. All eyes went to Pittsburg because at the legacy of Andrew Carnegie and the US Steel as the number one steel maker in the world. Mr. Carnegie died in 1919 and much as changed, including US Steel is not the number one steelmaker in the world. Earlier this year, President Trump gave approval for Nippon Steel to buy the company for $14 billion.

In an article by Marc Levy of the Associated Press, there was an explosion at the steel making plant in Clairton, Pennsylvania which is located in the Mon Valley just outside of Pittsburg. The explosion was significant besides killing 2 workers and injury to 10 others, it took hours to find 2 missing workers beneath the charred wreckage and rubble.

It will considerable amount of money to fix the damage or the spending of more money than anticipated. The production of the facility will be down for a considerable period because the blast affected 2 of the blast furnaces and the other 4 are on reduced production because of the explosion.

Accidents are nothing new at Clariton, the coke ovens use high temperature to make coke. a key component in steelmaking and produces combustible gases and its byproducts.

In the early 1970’s US steel production led the world thanks to 62 coke plants and 141 blast furnaces. No one in the US has built a blast furnaces since. The world leader is presently China and they are heavily invested in coal-based steelmaking. New technology of electric arc furnaces which use electricity not coal. (if you ever heard of Clayton Christensen and the disruptive innovation, you should watch the YouTube video).

Linking to dividend paying stocks, when a company is a market leader the public has some attachments to it, but markets and technology change and it is hard for companies to remain a market leader for generations. It is not impossible, if you examine the Fortune 500 companies from. 1950 to 1970 to 1990 to 2000 to 2010 to 2020 there are changes. It is rare for companies to stay in the group unless they have made acquisitions or merged such as Exxon merged with Mobil to create ExxonMobil and it remains as a top tier company. It is great to own a profitable company which pays dividends but it does not mean you do not continue to evaluate it and look at alternatives.

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