For the past number of decades, the best and most profitable Wall Street firm has been Goldman Sachs. When there is a bull market, the money flows to Goldman, in a bear market they still make a profit. Goldman has many institutional and government clients across the world, if there is money to made in a country, Goldman is there.

In an article by Stephen Gandel of the New York Times News Service, Goldman Sachs reported its 2nd quarter profit falling 50% to $3 billion. Analysts were expecting a 60% fall or profit was better than expected.

Goldman’s executives said the bank was being cautious for the rest of the year and are reviewing stock buybacks but increased its dividend by 25%.

The bank recorded a 55% jump in 2nd quarter revenue from the buying and selling of bonds, currencies, equities and commodities.

In a bear market, there are fewer IPOs and revenue fell in the investment banking group, a drop of 41% from a year ago. The backlog of deals fell considerably, Goldman offered few details.

Linking to dividend paying stocks, a company such as Goldman Sachs makes money every quarter whether there is a bull or bear market, the issue is how much? If you own investments that make profits throughout the cycle you will be rewarded over the long term. There will be fluctuations in the stock price but profit making companies are good to hold on to and when the price is lower, more can be bought. If you are confident the company can make profits you can determine what is the company’s most important revenue source and when the company reports you will have your answer to hold or look for alternatives.

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

If you have a computer or laptop, there might be a advertisement from intel on it saying the chip inside. If you are similar to most people, they really do not know what is inside and which company it is made from, they just want the computer to work efficiently when they turn on the computer. However it is important to note who makes the chip inside, for the large companies involved it is a billion dollar business. The reality is most of the hardware inside the phone or computer is made outside the US, in many cases the design is made in the US, but the chips and hardware – China or Taiwan or Japan or somewhere in the Far East. For many years that was good and ok with policy makers. President Trump liked to announce a company was going to build but little ground was ever broken. The Senate has taken up the case and maybe some chips will be made in the US.

In an article by Stephen Nellis of Reuters, the Senate wishes to pass a bill that is worth $52 billion in subsides and investment tax credit to boost US computer chip manufacturers.

Similar to all bills passed or expected to be passed by government, there are some winners and losers depending on how their business model is structured.

A company such as Intel which had released press releases to spend $20 billion on a factory in Ohio as well as 2 new plants in Arizona would be expected to benefit from the bill.

Companies such as Texas Instruments and Micron Technology who design and build their chips would benefit.

Companies such as Advanced Micro Devices (AMD), Qualcomm, and Nvidia design their own chips but use partners to make the chips would see no direct benefit from the subsidies to build plants or tax support for tools. The companies support a bill which contains both the manufacturing tax credit and a tax credit for chip design. The second aspect would benefit the companies.

The association of chip designers is called the Semiconductor Industry Association (SIA) and it supports the second bill or benefits to both designers and manufacturers.

One person who is not from Intel said Intel could get $20 billion with CHIPS Act plus $5 or $10 billion under the FABS Act. So $30 billion benefit to a direct competitor and nothing to you, is that fair?

The House and Senate passed the bill in the last week of July, although they added a few more items including robotics, quantum computing and artificial intelligence to increase the bill to $252 billion. Gina Raimondo, the Secretary of Commerce said there are a lot of strings attached and a lot of taxpayer protection.

Linking to dividend paying stocks, most of deal with hundreds and thousands and a few million if we are fortunate, large companies often deal in billions. Would the billion benefit change the decision to invest in the US or is it better to deal with partner firms making chips? There are always plus and minus each way, however the fact the government is willing to give the company billions in tax incentives and subsidies means a smaller company would have a hard time competing. There is a reason why they are called moats.

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

A company in business for a long time has built up goodwill along the way and that is worth money. They likely have assets that they do not use very often but could. Some companies own tracts of land that have increased in value as cities change; some have ideas or products that consumers bought years ago. Sales slowed and the company introduced new products, but the old ones were put on the shelf for some time in the future. Once in while, companies will see new trends that are emerging and some of their old products seem to fit the new trends, so maybe just maybe they can become hits in the future.

In an article by Gregory Schmidt of the New York Times News Service, the toymaker Mattel best known for the Barbie doll is reintroducing 3 dormant lines that have not graced toy shelves for decades – Major Matt Mason, Big Jim and Pulsar.

If you do not them, they are action figures and Mattel has a division called Back in Action.

Mattel reported a 19% jump in sales in 2021, and part of the recent success is expansion of legacy brands.

At the moment, if you went down a toy aisle, many of the products are tied to a movie or a TV show or a video game.

Mattel’s strategy for reviving a dormant brand is to engage in hard core fans first, said Richard Dickson, the company’s president and chief operating officer. If the fans take to it, the next step is come up with tie-in content and create a line for children.

Mattel used the formula for Masters of the Universe and now is working on Monster High.

In the toy world, Comic-Con which is held in many cities around the country is an important marketing venue (if you never been to one, you should drop by and see the passion of the fans).

Linking to dividend paying stocks, all companies that celebrate high birthdays have assets somewhere. Once in the while the assets are brought to the marketplace to create even greater assets. For the companies you invest in, do you know what the hidden assets are?

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

Every industry has conferences and manufacturers have trade shows. Although there will be more than one conference to be attended, one conference seems to stand above the other. If you think about consumer electronics it is the trade show in Las Vegas held in January. If you are in the airplane manufacturing business for civilian aircraft the trade show is the Farnborough Airshow. Talks begin weeks in advance but results are announced at the show.

In an article by Tim Hepher and David Shepardson of Reuters, Boeing and Airbus will announce dels with airliners across the globe. Boeing announced deals with Delta Air Lines and Lufthansa worth over $15 billion for 737 Max 10 and 777 X jets.

Easyjet announced 56 Airbus A320neos.

Linking to dividend paying stocks, in every industry there are conferences and at some companies announce purchases. For the companies you own stock, it is good to know when the important conferences are to be held and watch for news from the event. If news is good, then you can hold, if news is not good then you might be looking for alternatives.

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

In every city there is a demand for warehouse space and manufacturing space, often times due to the size required by the company they are looking for inexpensive real estate relative to office space which is more expensive. The companies in the area tend to similar work and clusters of warehousing space bring employment to the area. Inside the warehouses, much of the movement of material and goods was done by hand or using power jacks, but times are changing and the pandemic of COVID met times changed faster than normal.

Technology is improving every year and one of the improvements is the world of robots. Given many of the jobs are repetitious. companies are eager to find a method to use a robot for the most repetition work and they are investing and finding robots to help the business.

In an article by Patrick Sisson of the New York Times News Service, robots are changing the workplace as companies spend billions of dollars on robotics. In the next 5 years, according to the Material Handling Institute adoption of robotics in warehouses is expected to grow 50%. The idea is the robots steered by software and AI can move boxes and products in a seamless environment.

The biggest company in the robotics industry is Amazon which accounted for 38% of the robotics investment in the industry in 2021. The company acquired the robotics company Kiva Systems and has deployed more than 500,000 units. In addition, it set up the Industrial Innovation Fund to invest in firms such as Agility Robotics.

Walmart recently announced a deal with Symbotic to bring its system of belts, pickers and autonomous vehicles to all of the retailer’s 42 main storing facilties.

Kroger has opened 5 of its 20 planned warehouses outfitted with the Ocado automated system for packing and shipping fresh groceries.

For investors in real estate warehouses, the challenge is old buildings will need 2 or 3 times the power generation of previous generations including the latest wireless and 5G networks or many will need upgrades to suit the demands of robots. At the moment, a human and a robot tend to have similar space requirements, but only one needs a lunch room.

Linking to dividend paying stocks, as robots become common in the workplace they will tend to have a brand name and the brand name will mean recurring revenues for the company. The capital cost for the robot and the operating cost to ensure the warehouse and factory remain operational. With every change there are opportunities, sometimes it is hard to see them but seeing where companies spend their money is a good way to start.

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

Every year a blockbuster movie is released in the hope it will be a blockbuster movie or a movie that makes a lot of money for the film company. One of the blockbusters of the past was a movie called Gladiator staring Russell Crowe directed by Ridley Scott. Having seen the movie more than once, the movie is a good movie.

You Tube has many videos on it and one of them is the opening from the movie. In the movie, Rome which is the center of the universe and ruled by Cesar. There were many good things about Rome for hundreds of years including its building of infrastructure – both to move water and roads or people. The procedures of the Roman Legion was a reason why the Empire was successful.

In the opening of the movie, there is the final battle between the Roman Legions whose General is Russell Crowe and the people of Germania which Rome decided to rule over. Both sides had equally determined people and the leaders of both sides were interesting people. What was the difference? Technology. Rome had more weapons for use in order to preserve the men before they came into contact with one another.

The Romans had catapults which could be used to throw rocks but in this case were used to throw pots of tar set on fire – the idea was to hit a tree and the fire would result to the environment and on people.

The Romans had the use of the long bow arrows, while the Germania army used short arrows. The difference is how far the arrow can travel. The long bow gives an advantage, for the arrows are fired first then people move from their positions.

The Romans had the advantage of a hill, their people would be going down the hill, while their opponents had to strike their swords higher than normal or would be exhausted sooner than the Romans.

The Romans had a cavalry or people on horses, the horses had plating on them and in the movie the General was able to go behind the Germania army to strike them from the rear.

The Romans had other aspects to their battle, but those are the ones that can easily be seen.

Linking to dividend paying stocks, often times these companies have more weapons they can use including regulatory ones in the office buildings. When you invest in profitable company, you expect they have more than one revenue source, for example J&J has 20 billion dollar brands, some of them should be able to perform well if they others have a okay year. There are many examples of profitable companies sources of revenues, once you understand the companies you invest in you will be able to enjoy the summer, watch blockbuster movies and earn dividends along the way.

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

If you go grocery shopping or shopping in many stores, near the cashier is chocolate of one source or another. Few people have chocolate on their lists of things they need at the grocery store, but wants often outweigh needs. For the past few months, high inflation is on the minds of consumers, what are they thinking and actually doing?

In an article by Maytaal Angel and Jessica Dinapoli of Reuters, consumers are cutting back on chocolate due to the cost of living, according to executives at the world’s largest chocolate companies.

In the US, chocolate sales are down 2% to 3% according to Hershey’s VP of Investor Relations Melissa Poole. During the pandemic, chocolate sales increased.

Hershey in certain cases slims down package sizes and keeps the prices similar, known as shrinkflation to retain customers. However it not a tool that is used as often as you think it is because of the time and planning involved.

Daniel Sandler, a principal at IRI showed sales volumes of US store branded or private label chocolate a minor part of the overall market that is cheaper than name-branded chocolate grew by 8% in the past 6 months. Consumers should understand cheaper chocolate has a lower cocoa content.

At the start of the year, chocolate makers were expecting a 2.5% growth, but now are forecasting a 1% growth rate or flat or people will still buy chocolate.

Linking to dividend paying stocks, in many mature industries companies are not expecting growth but a continual movement of the deck chairs or they need to do all the good things to fight to maintain their existing market share. If they do, they stay profitable and do it all next year. Understanding growth rates in your investment companies is a good thing to know.

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

For the past 20 plus years, China has been the manufacturing capital of the world, if you go in Walmart which is the world’s largest retailer, most of the stuff is made in China. To do that billions of dollars have been spent to ensure the cost to manufacture, transport and ship to a store remains less than doing somewhere in the US. The transportation is by containers and the shipyards pick up the container, place in on a ship, transport across the seas and shipyards take it off to be placed on a railbed to go to a truck to go to the local distribution area and sent to a store. (if you enjoy watching logistical videos, there are many on the shipyards of China). It seems logical to keep an eye on volume of containers shipped from China.

In an article by Ellen Zhang and Ryan Woo of Reuters, according to official customs data, outbound shipments rose 17.9% in June, compared with a 16% rise in May, but analysts were only expecting 12%.

According to Julian Evans-Pritchard, senior China economist at Capital Economics, although total container throughput at Chinese ports was little changed, the recent weakness in domestic shipping demand has allowed more port capacity for foreign trade.

Daily container throughput in ports in Shanghai are recovered to 95% of year earlier levels according to official data. Exports of computers, steel products and autos contributed to the robust growth.

At the ports, commodity imports have declined, because Chinese officials have locked down areas of the country because of COVID under a zero COVID strategy.

China posted a trade surplus of $97.94 billion in June, surpassing analysts expectation of $75.70 billion.

Linking to dividend paying stocks, it is hard to find a company in the world which does not do some aspect of business with China. For decades China and the development of the country has been a stabilizing force in the world of commerce. Most of us depend on some aspect of Chinese economy and that can be very good. All countries have official statistics and economists to interpret them. Keeping an eye on them can be a good thing for your investments.

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

If you watch TV, every half hour show was designed to for 24 minutes of content and 6 minutes of advertising in between the show. Companies paid advertising companies to place their ads when the most viewers would see them and hopefully some would be buyers of the product. If you did not like the commercials, the movies seeing another revenue source embedded the products in the movie. What drink does the main character drink? did the company pay to have them drink that product? and the list can and does go on and on. Hopefully, the character and the product placements made sense and you did not really pay attention to it.

As technology evolves people want choice and along came streaming sources which allows the consumer to watch whatever programs they want to, when they want to. The idea of binge watching an entire season of shows is available. People loved streaming companies until the growth of new subscribers slowed and the companies wanted more growth, what to do? The solution offer streaming subscriptions at a lower price, but with advertisements within the shows.

In an article from Reuters, Netflix has picked Microsoft as a partner to run its placement of ads. Why Microsoft, Chief Operating Officer Greg Peters of Netflix said Microsoft has good privacy protection as well as Microsoft has the ability to be innovative.

Recently Microsoft completed acquisition of Xandr Inc which is an online advertising platform formerly owned by AT&T. Xandr allows advertisers to buy ad space across thousands of websites and target audiences. Microsoft sold $10 billion in ads last year across its Bing search engine and LinkedIn social network.

Netflix joins other companies offering ads and no ads streaming services including Hulu, Peacock, HBO Max and Disney+.

In related Netflix news, the company reported it lost 1 million subscribers, the stock went up because the expectations were the company was going to lose 2 million subscribers. Netflix beat expectations.

Linking to dividend paying stocks, when you examine the underlying abilities of the company to make money, in this case you see entertainment driving advertising revenues. You may love the entertainment which is great, but in reality it is an advertising vehicle. Understanding the premise allows to understand how and if the company is making profits. How is the company doing in bringing advertising? do advertisers pay premium prices? and the list of questions can go on. The answers allows you as an investor to decide to hold or seek alternatives.

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