If you think about the Great Wall of China, it is one of the world’s great construction projects however it was built with by humans with little machinery, they had tools but not machinery. How was it done? the emperor at the time brought in recruits from the lands he conquered or slave labor. For many years, people could and can do many things, but add a machine and the whole economy advances as machines enabled more to be done. If you think about farming, prior to the tractors made by John Deere, farms were generally 100 acres or less. After the tractor and other farming machinery the farms get much bigger to feed the world.

In 2022, companies across North America spent $2 billion for almost 40,000 robots to help them with record demand and shortage of bodies. There is wonderful You Tube video about how robots help build the Ford 150 truck and robots in the auto plant have been there for decades. Now robots are doing more work in companies to meet the demands of consumers.

In an article by Timothy Aeppel, the Association for Advancing Automation or A3, is the industry group for robots, reported the share of robots going to non-auto companies grew further in 2021. Some of the fastest growth in orders came from the metals, food and consumer goods category.

The number one driver for automation is the labor storage in manufacturing, said Joe Campbell, a senior manager in applications development at Universal Robots, a unit of Masschusetts based Teradyne which specializes in co-bots.

A field which has resisted robots is the construction business, but Universal sold a robot to a company that uses them to install drywall.

Linking to dividend paying stocks, business are in the business of finding solutions. Customers pay for the solution and they typically give little thought how the process works as long as the end result makes them happy. The process works till it does not, robots help companies maintain production cycles and the robots are beginning to do the more flexible jobs many thought you needed people to do. As long as people have access to income, companies will be doing more with robots and investors will like it. In your company investments, how do they use robots?

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

Alphabet is one of the largest tech companies and if you own an index fund whether it is tech related or index of the market it is likely there and that is good. Alphabet’s is a very profitable stock and when you look at its divisions, there are 7 divisions that are billion dollar divisions. People use Google search as they shopped on line and advertisers followed shoppers with larger budgets.

In an article by Paresh Dave and Nivedita Balu of Reuters, Google beat expectations with sales jumping 32% to $75.3 billion in the 4th quarter for a third straight quarterly sales record.

Consumers used Google’s search for apparel and hobbyist items, while retail, finance, entertainment and travel advertisers raised marketing budgets said Google’s chief business officer Phillip Schindler.

Analysts said, Google generates more revenue from internet ads than any other company. It seems the growth will continue to move upwards.

Shares of Alphabet rose after the company announced it will be splitting 20 for 1 share on July 1.

For the full year, Alphabet’s sales rose 41% to $258 billion.

You Tube’s revenues increased, Google Cloud increased quarterly revenue by 45% to $5.5 billion.

Alphabet’s quarterly profit was $20.6 billion or $30.69 a share.

Linking to dividend paying stocks, a company similar to P &G with its numerous divisions of over $1 billion allows dividends to be increased for decades. Alphabet will be one of those companies as it continues to be a very profitable company. It is company to buy and hold and buying before the split is a good thing to do.

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

Branding exercises are some of the most aspects to any company, for all companies the owners look at what the brand means to them and hopefully the rest of the world. Branding can be the greatest element of a company or it can not seem to work or need a reboot. If you are a NFL football fan, the Washington Football Team changed their nickname from Redskins to Commanders. Perhaps it will work during the season.

In an article from Reuters, Daimler AG is changing their name to Mercedes Benz Group AG to unlock shareholder value. The car maker was originally called Daimler Benz, changed its name to Mercedes and then changed to Daimler now back to Mercedes Benz.

CEO Ola Kaellenius said they have reach chance to raise the multiple.

Linking to dividend paying stocks, branding is a very important exercise and over the years everyone has seen it work and not work, even with the best paid consultants. Most people including me have worked for companies who rebranded and then went back to the old brand. It is an art, not a science, however when it works it works very well. Hopefully the companies you invest in have great brands and are not changing them anytime soon.

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

At one time, it was relatively easy for mining companies to go into any country around the world to extract minerals. In the name of economic development and some benefits flowing to the host government, mining companies operated and the rest of the developed world benefited from the mining companies.

In an article by Clara Demina of Reuters, perhaps the scenario is changing a bit. Rio Tinto is one of the largest mining companies in the world based in Britain and Australia (where it is largest iron ore miner), as goes the economy of China goes the fortunes of Rio Tinto.

Rio Tinto was expecting to invest $2.4 billion in a mine in Serbia to extract lithium which is needed for battery production of EV vehicles. The country’s leaders cancelled the project. One can easily imagine a $2.4 billion project in Serbia would be good for their economy. It should be noted there is an election looming, perhaps after the election the government will review their decision.

Rio Tinto found the lithium in jadarite which is only found in Serbia’s Jadar Valley and Rio Tinto has spent $450 million figuring out how to extract the lithium and become Europe’s biggest lithium mine producing 58,000 tonnes of refined battery grade lithium carbonate a year, enough to power 1 million electric vehicles.

Rio Tinto being a global miner has other options such as an mine in Argentina which it paid $825 million to buy. Rio Tinto is working through the court system to build one of the world’s largest copper mines in Arizona.

Linking to dividend paying stocks, at one time the phrase economic development was one of the world’s most important phrases and many projects were done to increase economic development. Now days, both sides of every issue has similar information and able to use public relations in similar fashion, some battles will be won, some will be lost. Ideally, the company you invest in has potential investments to do which will lead to good profits to pay dividends.

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

If you a smart phone it will either be an android (google owns the insides) or apple. If you own an apple then the apps will be tailored to the apple insides. Apple’s value went over $3 trillion, although the tech selloff in January means the worth is slightly below $3 trillion.

In an article by Danielle Kaye and Paresh Dave of Reuters, Apple reported its 4th quarter results and as an investor, you would like the results.

Often we talk about the holiday season we refer to the US holiday season, but a company such as Apple which sells phones around the world, people look to China. According to research firm Counterpoint Research, Apple’s smartphone market share in China reached 23% where it was the top selling vendor for the first time in 6 years. The iPhone 13 led to worldwide phone sales revenue of $71.6 billion a 9% increase from 2020.

Apple’s services business which covers paid apps, Apple TV, Apple Music, Apple Fitness, saw revenue rise 24% to $19.5 billion. The company has 785 million paying subscribers across its platforms an increase from 620 million a year ago.

For Microsoft, Amazon and Google cloud services are a major revenue generator, not so much Apple.

iPad sales were down 14% to $7.25 billion; sales for Macs rose 25% to $10.9 billion.

Overall, revenues rose 11% to $123.9 billion with profit of $34.6 billion or $2.10 a share.

Linking to dividend paying stocks, if you think about Apple, you tend to think about the iPhone, but they have 3 distinct revenue sources the iPhone, Macs and Services. The Services component is growing because Apple’s infrastructure is in house and when a great app comes out, the Apple equivalent is soon added. People do not have to miss out and are happy owning Apple products which means they will be repeat customers or upgrading their phones on a consistent basis.

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

If you have flown on a plane or gone by the airport to watch planes fly from the airport, you eventually determine the airlines were using 2 manufacturers of planes – Boeing and Airbus. The world of commercial aircraft is a duopoly and that allows investors in Boeing to be very confident airlines will buy their planes. In the last 3 years, Boeing has had a problem with their planes – first it was the Max 737, although that problem has been fixed and planes are coming off the assembly line and being sold. The other plane is the 787 which has some structural repairs and face further regulatory inspections.

In the world of airplanes, similar to many other manufacturing industry, the government has regulatory agencies to determine if the plane is safe and once given approval, the public accepts and happily goes flying. Generally things have to be very serious before the regulatory bodies say no, however in the last couple years saying no is heard loud and clear.

In an article by Uday Sampath Kumar and Eric M Johnson of Reuters, Boeing announced its 4th quarter results in late January and stated it incurred $4.5 billion charges on the 787 program. To become positive cash flow Boeing plans to increase production of the 737 and 777.

Reports suggest the 787 program will be stalled for months as US regulators review repairs and inspections over structural flaws in the jets. Often after the US regulatory agency has approved other countries will rely on their work and approvals will be easier to come by.

David Calhoun, the CEO of Boeing, noted the company is working to build stability and predictability going forward. Production with remain at 5 jets a month and soon will be able to sell to Chinese airlines.

The issue with the 787 is Boeing switched to carbon composite structures that make the jet lighter and cheaper to fly for the airlines, however there are tiny gaps barely visible to the naked eye which have resulted. Boeing is using ultrasound devices and tools to find the gaps.

The good news for shareholders is the 737 Max is producing 26 planes a month up from 19 and they are selling. Boeing is trying to reach 31 planes a month.

Linking to dividend paying stocks, all manufacturing companies produced goods but a flaw or bad manufacturing which makes the company redo means cash flow will take time in the months to fix. Regulatory bodies do not operate under the same pressures and time frames as public companies, they take time to do their thing. As members of the public, that is what you expect and desire – the regulatory agencies to take their time and when they say it is safe, the public can use the product. If one of your companies has a issue in their manufacturing process, a good strategy is to move to another alternative company and if desired buy it when it has solved the issue and sales return.

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

For the past 2 years, more people have bought things on line that ever before and carriers such as Amazon need to deliver the goods to homes and businesses. To deliver the packages, vans are needed and it used to be the Postal Service took most of the vans but private companies are in the business of packages. All the companies use vans to deliver packaged goods.

In an article by Karen Weise and Neal E Boudette of the New York Times News Service, Amazon has an instiable appetite for electric vans thanks to a ballooning logistics operation and a pledge that half of its deliveries will be carbon neutral by 2030.

The reality is Amazon has signed many contracts which is good, the bad news is there are few deliveries, but there are promises to be met. Rivian Automotive has a contract for 100,000 vehicles, Dodge Ram has orders for thousands, Daimler (think Mercedes) has an order for 1,800 Sprinter vans. In India, Amazon has formed a partnership with Mahindra & Mahindra for 10,000 electric 3 wheel vehicles by 2025.

At the moment Amazon has 175,000 vans according to Ross Rachey, who oversees Amazon’s global fleet.

According to data from MWPVL, a logistics consultancy, Amazon now delivers 50% of its orders globally and has 6 times as many delivery depots now than in 2017, with at least 50% more new facilities set to open in 2022.

Delivery vans are well suited to electric propulsion because they usually travel 100 miles or under in a day which means they do not need the large battery packs. The trucks can be charged overnight, due to the fewer parts in electric vehicles the maintenance budget is less.

Mr. Rachey said Amazon is building the largest EV fleet and charging network in the world.

Linking to dividend paying stocks, companies such as Amazon have the ability with the help of van building companies to lower their cost of fossil fuels and stay very competitive in the marketplace. Fossil fuel or crude oil prices are expected to be in the $100 barrel of oil which is expensive for the economy and a company, how does it lower costs – goes electric and stays competitive. It is sometimes easier for a profitable company to change because of costs.

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

In the commodity business, if you own the commodity you love to hear there is a short squeeze because short squeezes means higher prices. That scenario is playing itself on the London Metal Exchange (LME) for nickel. Prices have increased to over $24,000 a tone for the first time since 2011.

The squeeze is going on physical delivery.

In an article of Andy Home of Reuters, the nickel market is in a tight squeeze which eventually leads to higher prices for the uses of nickel. There are 2 markets for nickel – stainless steel and battery for electric cars. (One would suspect that people are working on alternatives to nickel, but we are not there yet).

According to a report from Goldman Sachs, the most significant degree of tightening surprise in balances across the base metals in 2021. The bank was forecasting a surplus of supply of 49,000 tonnes last year, but now estimates a deficit of 159,000 tonnes.

JPMorgan analysts project nickel usage in batteries to grow by 50% year in year in 2022, taking over from stainless steels as the biggest driver of demand growth.

In terms of supply, a new mine in Indonesia will help. What would not help is the issue of Ukraine and potential sanctions if Russia crosses the border. Russia is a major producer of nickel, aluminium and palladium.

The last time the market was in a short squeeze was in 2007 when the price of nickel went to $50,000 a tonne.

Linking to dividend paying stocks, if you own stocks when there is a short squeeze it is wonderful because prices rise. Trying to play the squeeze can be expensive because in markets, with high prices company look for alternatives to bring the price down. For those who remember high steel prices meant automobile companies starting using more aluminum in the manufacture of vehicles. If you own the stock and the price rises, ensure you take profits and look at alternatives. Eventually the price will fall and you can buy back into the stock at a lower price.

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

When you think about Wall Street or the stock market, it has many companies all trying fighting for the investors dollars. On Wall Street there are people with many theories of why a company should do well for the next few years and beyond. At some points, it is seemingly easier to see for example during the first part of COVID when governments around the world shut down the economy for health reasons. What did this mean, it meant people who often commuted a distance and time to work, were at home longer. What did they do? Some of it was entertainment or streaming services such as Netflix. The longer the stay at home, the more people turned to Netflix. The company was a growth stock and it was relatively easy to understand how and why they were growing.

In an article by Lisa Richwine of Reuters, even though Netflix has some of the most watched shows which allows it to have greater subscriptions and bring in advertising dollars, some people changed to not being at home all the time. The growth component of Netflix is changing, there will be other reasons to own Netflix. The company had projected 5.9 million new viewers, the actual was 2.5 million and the stock went down 20% erasing the gains from 2020.

You may still like Netflix and watched the shows, but you need to understand Wall Street has a herd mentality of what it likes and does not like. For the past few years it has been growth as number one element to the business strategy; now it is looking for profitable companies and in a few years may love value companies. Wall Street does and will change.

Linking to dividend paying companies, if you tend to buy profitable companies (and can pay a dividend) they tend to trade at higher multiples because they can profits or higher EPS multiple. Wall Street can change but eventually the street will like profitable companies over growth companies because the number one rule is still try not to lose money.

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