Every year more and more people own smart phones and one of the advantages of smart phones is the use of apps. There are thousands of apps to choose from to seemingly make life simpler for the user.

In the world of information, the wide spread information is both good and bad and according to Stephen Nellis and John Ruwitch of Reuters, since most cellphones have a location tracker, someone in Hong Kong used the location tracker of the police to help the protesters in Hong Kong. The app was widely available and the Chinese Communist Party official newspaper called the app “poisonous”.

The app displays police locations and Apple talked to the Hong Kong Cybersecurity and Technology Crime Bureau to verify the app has been used to target and ambush police, threaten public safety, and criminals have used to victimize residents where they know there is no law enforcement. The app has been discontinued.

Those who do not agree with the Chinese State and Apple’s decision to remove the app felt that the app improved public safety and the claims of threats to public safety had no evidence.

Life is a balancing act and Apple went along with law enforcement and China.

Linking to dividend paying stocks, for every new product there are advantages and disadvantages. Hopefully the advantages outweigh the disadvantages and the market place embraces the new product or service. The disadvantages will affect some people, perhaps not life and death, but there are some disadvantages which is why every company maintains a law firm account, it is the cost of doing business. Ideally, since the companies you invest in have been in business for a long time, the advantages continue to outweigh the disadvantages and the profits and dividends keep you happy.

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

To listen to President Trump defend his telephone call to the President of the Ukraine is wants to fight corruption. In reality there is not one country without corruption, however it is usually not blatant as it was it South Africa. One of the methods the US has to fight corruption is to impose sanctions on individuals to limit their ability to move around money and around the world. In South Africa, the Gupta brothers befriended the son of the President of South Africa and managed to fit in a companies to act as a middle man between the government and the utility company.

In South Africa, the government owns the utility company and everyone pays their utility bills. The Gupta’s put in a company between the government and people paying their bills to pay the Guptas. It offered and did no extra value to the government, but it did enrich the company owned by the Guptas and the son of the former President Jacob Zuma.

The Guptas live in Dubai and want to have the freedom to roam the world, except if they do the South African police will arrest them, so they portray themselves as victims of false accusations.

The US sanctions deny the Gupta’s entry into the US and the family is prohibited from doing business with banks and companies than have US subsidiaries and can have any of their US funds or assets seized.

Linking to dividend paying stocks, politicians often talk about corruption in a foreign land when in reality it exists under their noses. In the case of the US sanctions of the Guptas, time has gone before the US acted for President Zuma left office in February 2018, the Guptas left South Africa and a trial in South Africa has only recently begun. Most followers of the affairs of the Guptas knew about their corruption years before. It is easy for politicians to talk about corruption, it is harder for them to do something about it. In the case of President Trump what sanctions did he impose on corruption in the Ukraine?

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

If you asked most people about a company they knew and respected GE would have come to the forefront very quickly. GE the company that brings things to life. Prior to the 2008 financial meltdown, GE was one of the largest financials services companies in the world, then it fell apart and the massive amounts of profits went away. Since then GE has been struggling to reinvent itself in the manufacturing businesses.

In an article by Alwyn Scott and Ankit Ajmera of Reuters GE was going to freeze pensions for 20,000 salaried workers to take measures to reduce its retirement fund deficit by $8 billion.

CEO Larry Culp is trying to raise cash and pare down $105.8 billion in debt, when he is done GE will focus on power plants, jet engines and windmills, plus related equipment and services.

GE’s pension services are underfunded by $27 billion at the end of 2018. The pension plan is being moved from a defined benefit to a defined contribution such as a 401(k) plan in 2021. The difference is a guaranteed payout to one that moves up and down with the stock and bond market. Both have their advantages but the second one is less expensive for the company.

The company has struggle to boost profits amid a slump in demand for its gas fired turbines as more utilities move to solar and wind power alternatives. GE also faces potential costs of more than $1 billion in its jet engine unit from the grounding of Boeing’s 737 <ax airliner.

GE’s industrial net debt stood at $54.4 billion as of June 30. GE said it was on track to hit its target of less than 2.5 times net debt to earnings before EBITDA by the end of 2020.

Linking to dividend paying stocks, interest rates are at very low numbers which encourages companies to raise money by selling bonds, that can be a very good thing to do. However at some stage, if economy softens too much debt is very bad for investors. There is a balancing act it regards to debt, as a dividend based investor you like less debt than more debt.

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

Think about President Trump, everyday he tweets about a variety of subjects most of it has little consequences to the everyday life of US citizens. Houston Rocket GM Daryl Morey tweeted about Hong Kong and the desire to have more freedom. The Chinese government did not like the tweet and Chinese TV dropped NBA exhibition games.

In an article by Chris Gallagher and Se Young Lee of Reuters provides context – The Chinese market is one of the largest consumer markets in the world and for the past 20 years, the NBA has working to ensure people in China watch NBA games and buy merchandise. The Houston Rockets was the team which Yao Ming played and starred and is a national hero in China. The NBA broadcast rights for was sold for a 10 figure sum or $1.5 billion and online partner Tencent counted more than 500 million viewers for streamed games. If Houston were to relocate to Shanghai, it would be a profitable team.

Daryl Morey apologized for the tweet, however the Chinese government was not letting up , Chinese smartphone maker Vivo, a key sponsor for the exhibition games in China announced it was suspending all ties with NBA underscoring the strength of the backlash in the country.

Linking to dividend paying stocks, all companies employ people and everyone has opinions, most people working for a company are not the spokesperson of the company but they have opinions. In many countries around the world, people are allowed to voice their opinions, however in China some opinions are not allowed to be voiced. This is a very difficult aspect to manage, because of consistency and where leaders of countries draw the line. If you cross the line, be aware of consequences. Most institutional investors and corporate executives do not want to cross the lines.

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

When an investor is successful over a long period of time, money flocks to the fund, because we all believe the people behind the fund can repeat their success again. One of the most successful investor has been Masayoshi Son and SoftBank Group Corp. Anyone who has taken an Uber, sent a Slack message or worked at We Work has put money into SoftBank.

In an article by Peter Eavis and Michael J De La Merced of the New York Times News Service examined the latest going of Mr. Son. SoftBank made a large investment in Alibaba Group Holding in China and earned over $100 billion. Mr. Son is looking to build a new fund called a Vision Fund to invest in artificial intelligence, robotics and other advanced technologies.

The issue is WeWork was going to do a IPO in the area of a valuation of $47 billion, the market has examined WeWork and suggest it is worth $15 billion at best. If the IPO goes forth at $15 billion, SoftBank would need to take a $2 billion writedown rather than a $30 billion profit. Quite a change, which is the reason why the founder of WeWork has stepped down.

SoftBank is the largest cellphone companies in Japan. and owns Sprint in the US which was purchased for $21.6 billion. Sprint and T Mobile recently received approval to merge. Mr. Son wants to take on Verizon Communications and AT&T, it is a huge uphill battle.

Analysts say one of the biggest problems for SoftBank Group is that its enormous investments in startups have pushed up valuations for young companies that no other investors are willing to pay. WeWork is the the prime example, how does the company make a profit? and if there is a downturn in the economy will people pay premium rates for office space or will office rates fall?

Linking to dividend paying stocks, the great thing about these stocks is you can easily determine how they make a profit. Then you can go through various scenarios if they will continue to make a profit to pay the dividend. The reason why although every business can be complex, bring it to the simplest reasons. If those reasons can, you can look for alternatives.

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

A month or so ago, drones knocked out 5% of the production of oil in Saudi Arabia. At one time that would have produced dramatic results of a downturn in the world’s economy. Now days, while important the world’s oil traders and the economy absorb it and went on. One of the reasons is the energy supply has changed over the past few years and more power is coming from solar and wind. Fossil fuels both oil and gas are still extremely important but the world’s energy has turned a corner.

In addition, cars are changing and have changed. The latest example is the 2020 Porsche Taycan.

In an article by Norris McDonald of the Toronto Star, he drove the Taycan, but first he learned about the vehicle. He went to Atlanta, Georgia to attend a technical briefing and the car will leave no CO2 imprint. Equally important the acceleration of the Taycan goes from 0 to 100 in 3.0 seconds and has a top speed of 270 miles a hour.

A few weeks later Mr. McDonald was in Germany to test the vehicle – he was with a professional race car driver on the German Autobahn where there is no speed limit and the car went up to 265 mph and had to slow down because of someone doing 225 mph. The car can reach these speeds because of adjustable air intakes and variable rear suspension.

Porsche has reduced the CO2 emission per vehicle by 75% and it its working towards 100% through the Porsche Production 4.0. Smart means flexible and connected production, lean means responsible and efficient use of resources, and green means sustainability and environmental protection. Porsche’s plan is by 2025 half of the vehicles will be electrified – either plug-in hybirds and fully electric vehicles. By 2030 all electric.

The cost of the car is around $200,000 and will be in showrooms in 2020.

Linking to dividend paying stocks, most innovations happen at the most expensive level and then filter down. The technology to allow a Porsche to go 270 mph means some the average commuter car will not necessarily go that fast but will easily means the needs of the family driving the vehicle. That becomes the game changer which means some rental cars will be electric and then the choice at all showrooms will be electric.

Fortunately for the grid system, it is very hard to knock out 5% of the world’s power at one time, however it should mean utility companies will always pay a dividend.

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

Most people reading this will remember or know about the invasion of Iraq looking for WMDs or Weapons of Mass Destruction. Before the invasion, a case was made Iraq had WMDs and were prepared to use them on either Israel, Europe or the US. Based on evidence which was presented at the United Nations, the people of Iraq must be stopped. It turned out it was a made up fact because no WMDs were found.

In WW II, the allies had a similar concern, nuclear weapons. The story of the search is in the book The Bastard Brigade by Sam Kean published by Little, Brown and Company, NY, 2019. The title refers to the Brigade or Army Unit that was not attached to anyone other but had the highest authority to do what was necessary to track down both the components needed to make nuclear weapons and the scientists. The book is written in the fashion of a novel and is very interesting to read.

Prior to WW II, the goal of everyone working in the nuclear environment was the pursuit of knowledge to help understand and try to harness the power of the nuclear energy. During WW II, then and only then the nationality and religion of the scientists became important. Prior to WW II, sharing of information was both fundamental and critical. The sharing of information allowed other scientists to learn and then try for the next step. Most next steps took years to advance. A career might be moving the bar very slowly forward.

In the book, both the Allies and Nazis were terrified the other side would use nuclear weapons, the Nazis threatened but it turned out they were behind the Allies and the Allies used nuclear in Japan to end WW II. The book is from the Allies perspective and targeted the raw materials needed to make nuclear weapons.

Some of the most daring raids came to stop the production of heavy water in the Vermork power plant in Norway and the bombing of Peenemunde. The Allies were always amazed at the ability of the Nazis to build and in large manufacturing facilities.

In the end the book is about people, people are similar to other people, people with egos; people who make over sized contributions to the war effort and people who believed the Nazis had to be stopped before they had the nuclear option.

Linking to dividend paying stocks, whatever the industry you invest in the community tends to be relatively small which means it is relatively easy for you to continually learn and understand the industry. In the nuclear industry, it is a handful of people; in other industries concentrating on both newspapers and industry magazines will give you profiles of those who are the leaders in the industry. You will like some, admire some and invest in some for as long as the company is run reasonably well, you are investing in people to do the things they say they will.

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

There is nothing Wall Street likes better than the ability to measure something. Economists talk in concepts, on Wall Street they like measurable numbers. Either the company is making money or it is not. In the first Tuesday of every month, the Institute for Supply Management (ISM) releases its purchasing managers index (PMI). In an article by Stephen Culp of Reuters noted the manufacturing sector accounts for 12% of the economy. Service and retailing account for most of the rest, however the manufacturing index helps drive the other sectors. In August the PMI was down to 47.8 from an an expect number of 50.1.

This was the second time the index was down which means exporters are closer to recession than booming. The biggest reason for the downturn is President Trump’s tariffs on Chinese imports. The problem is compounded by the increase in the dollar which means for the next few months companies will be more inclined to wait or scale back until they can read the tea leaves of the consumer.

During the first quarter of 2018, when tariffs came on Chinese goods, the negative currency impact was $40 million a year. That number has balloned to $23.4 billion.

The companies most affected included GE which recieves 65% of its income from outside the US; Computer Chip makers such as Micron Technology; Qualcomm’s overseas customers contributed 97.4% and Nike receives 62.5% of their revenues offshore.

Manufacturing is in the early stages of a recession.

Linking to dividend paying stocks, the economy similar to all industries has some bell weather or canary in the mine stocks which gives you indications of how the overall economy is doing. Hopefully, politicians know which indicators they are and pay attention as they go up and down and take appropriate actions. While investors do segment rotation or pay particular attention to those companies which are most affected. In every downturn, there are opportunities to either accumulate a good stock at a low price or move to growing sectors.

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

For the President of the US, impeachment proceedings have begun, and one aspect it shows is who is President matters. The President tends to go over the line on multiple occasions and not remember the rules or laws. The closest example in the banking is Wells Fargo. A former CEO wanted every customer have 12 products and if you think about the number of products you have with your bank, it is likely less. In order to meet this 12 standard, fake accounts and products were set up for millions of customers. The bank CEO was fired.

In an article by Imani Moise of Reuters, for the years 2016 to 2018, Wells Fargo was the only bank among the top 4 not to have growth in loans or deposits. Think about that statement, according to President Trump the US economy has been the best performing in the world and one of the top 4 banks in size does not have growth in loans or taking in deposits. The existing CEO Allen Parker will return to being the general counsel while Charles Scharf will take his place. Mr. Scharf is the former CEO of New York Mellon and Visa Inc.

The expectation is Mr. Scharf will benefit from Mr. Parker’s work in changing the culture at the bank. The new CEO is expected to change the reputation and bring more business to the bank and the shares to move forward.

Linking to dividend paying stocks, the bank has been paying a dividend for the past number of years but the stock price has remain constant. Whenever there is a scandal with one of your investments, unless you love the shares, reduce your holdings and find alternatives as the change in culture happens. You can always buy back in a couple of years if you want to own the shares.

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