Sometimes in life it seems everything is going well, then it does not. In the case of one of the top ranked consulting companies McKinsey. The company has been providing strategic directions to organizations around the world ever since the company was formed using the Harvard Business school case method as its basis. The business school at Harvard has the most respected MBA program and some of the people end up in consulting firms. It is often senior management of large organizations need advice and consultants from McKinsey will provide a good product.

In an article by Michael Forsythe and Walt Bogdanich of the New York Times News Service, consulting firms such as McKinsey are now facing internal concerns from employees and former employees who are the clients paying the bills. A consulting firm such as McKinsey can offer a wide range of solutions and paths for companies and those in the oil and gas field tend to generate large profits. McKinsey has consulted with firms such as BP, ExxonMobil, Gazprom and Saudi Aramco which has generated hundreds of millions of dollars in fees. (the same case is made with Boston Consulting Group)

Then the issue of climate change has come up and something is happening to the weather, McKinsey’s work did not focus on the environment but on cutting costs, boosting productivity and increasing profits.

McKinsey has been consulting to the fossil fuel companies for generations and those companies such as Mobil, Shell, Texaco, Standard Oil which became Exxon and a host of domestic and foreign oil, gas and coal companies. The consultants often moved to jobs within the industry.

Now McKinsey is suggesting it will be the largest private sector catalyst for decarbonization.

Linking to dividend paying stocks, sometimes what companies want and desire the need to cut costs, boost productivity and increase profits means that other items are discarded along the way. If a coal company want to be more productive that means it can mine more coal for less money, but that does not necessary help the environment. As times change, other priorities need to come to the forefront and still be able to generate profits to pay dividends.

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

In every market there is hype because you always need someone to buy something. There is hype in consumer marketing to ensure you buy before the good deals are gone and somehow we all know it, but we all look for a good deal. On the stock market there is plenty of hype and for the average investor if you can stay away from it, you will make money because the number one rule in investing is try not to lose money. Having said that when there are high than normal returns, it gets all types of people talking, writing and some actually believing in the hype. For the most part, hype is hype and next week or next month there is something else to be hyped. If you go for something that is hyped, ensure it is money you have that you are willing to lose because for the average person, they will buy and the stock will fall. Once it a while it is possible to buy and sell to the greater fool or believing investor (sometimes there is no difference).

In the case of former President Donald Trump as we all know he was banned from social media, although he still pretends he is President sending notices from the 45th President. In Washington sits the 46th President.

In an article by Krystal Hu and Anirban Sen of Reuters, Donald Trump has decided to have a new social media platform through an app from the SPAC company Digital World Acquisition Corp. The company went public through the SPAC process and has been in talks with Trump Media & Technology Group that would produce an app that has yet to be rolled out even on a trial basis. In other words, there maybe an app for Donald Trump on social media which is the hype.

SPAC shares come out at $10, but people reading or hearing about the app have bid up the shares to close to $200 or the company is valued at over $12 billion, because it involves the former President and ad revenues.

In the story it tells the story of 2 people, one who bought and sold 50% of his holdings then another 25% to hold shares and see. If they go down in value, he has taken his profits. Another person bought and hold because he loves the ex President.

Linking to dividend paying stocks, ideally dividend paying stocks do not rally to moon on hype, they rally because they make profits and can pay dividends. It is slower process but investors earn a return in the form of dividends and over time the capital gain from profitable stocks makes the stock worth holding. If you are going to get along with hype, ensure that it not your entire portfolio, hype is gambling and you need to ensure that when capital gains are made on the market from higher prices, capital gains are locked in and sold to ensure the money goes into your account. Capital gains come from selling, before that they are on paper only. We are human, we want the easy capital gain and once in a while it happens, but understand once the people doing the hype move onto the next time, the stock price will fall to what the revenues dictate the stock should be worth. A company which says it will have an app, but the app is not functioning does not have an revenues.

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

When former President Trump was in office, he often talked about manufacturing in America, but the reality is most of what America buys is made offshore. In recent weeks, we have all read or heard about supply lines conjestion.

In an article by Nathan Vanderklippe in the Globe outlines the issue.

40% of all goods coming by sea come through the Los Angeles area. The ports of LA and Long Beach are working 24/7 to clear a mountain of floating goods estimated to be worth $26 billion.

According to Kevin Mullaney, chief executive of Grayson Co, a retail conultancy, anything that touches land after November 1 will not see the floor for Christmas. (hopefully when you read this the backlog is normal).

Todd Spencer, president of the Owner-Operator Independent Drivers Association, representing over 150,000 truckers says the reality is the demand for imported goods that arrives via ship is greater than our ability to handle or process those loads.

Imports to the US have reached record levels, it was $287 billion in August, the last month for which there is data.

In LA and Long Beach, containers that in 2019 spent 2 and half days on average are now waiting for more than 5.

Containers are now waiting 9 days on a truck after leaving port. The industry believes the standard should be 1 to 3 days.

If a ship goes to another port such as Savannah, Georgia, Houston, New Jersey and New York – all of them have set new records for container movement.

Linking to dividend paying stocks, politicians say something but it is often different in reality. Companies deal in reality and in reality manufacturing is primarily done offshore, retail is handled on shore or on line. Every company has a logistical chain and when it works, all is good. When it does not, one wonders if enough resources were put into the logistics chain. How does your investment in company handle their logistics?

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

It seems that all large companies have decided global warming is a threat to their businesses and want to do something about the issue. Change costs money and resources, but sometimes companies need to change,

In an article by Jonathan Saul of Reuters, Boston Consulting Group estimates that the global shipping industry will need $2.4 trillion in investments to achieve net zero emissions by 2050.

Amazon and IKEA are among commercial users of container shipping that will opt for zero carbon marine fuels by 2040 in a new initiative aimed at speeding up decarbonization in the maritime sector.

90% of world trade is transported by sea, global shipping accounts for nearly 3% of the world’s CO2 emissions and the sector is under going scrutiny to become cleaner.

Linking to dividend paying stocks, companies that make profits have the ability to lead or make changes and still make profits to pay dividends. It is a balancing act but if governments and customers wish it to happen, companies have limited choice by to try. When the next AGM comes along, it is good to know what your company is doing and then it will not be not negatively affected by investment decisions on greener companies.

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

If you think about the space race, the US and the USSR were trying to show the world they were the most advanced societies and the USSR put a satellite into space. The movies show the US military worried the USSR were listening to them. The USSR put the first man into space, but the US went to the moon, a number of times. Since those days, satellites have been used a regular tool by companies and governments. For the big telecommunications companies, you expect them to be using satellites to ensure your cell phone works, where ever you are.

If you think about the phrase they are listening to us, they maybe, but they are definitely watching us. Somewhere some satellite is watching you, although for the most part no one is very interested. What there is more of, is watching whatever the governments of the day are concerned about.

In a recent Wall Street Journal article by Timothy Puko, the European Space Agency has many satellites and some of they track environmental concerns. The European Space Agency released photographs of unreported leaks of methane gas from a Russian pipeline.

On one hand this is good news, one hopes the Russians fix the problem considering the President announced Russia will be carbon neutral by 2060 (or his last term in office). The photographs also tell you someone is watching or has the ability to watch over any landscape in the world.

Linking to dividend paying stocks, some of the best paying dividend stocks are pipelines. As investors you expect very few leaks for that is wasting money that could be going into your pocket. It also means, when there are problems companies have to show how they are fixing the problems and not try to hide the effects. There are fewer secrets so how does the company react to problems is the key. If they do their best to fix and learn, you can hold the stock. If they try to minimize, perhaps it is best to look for alternatives.

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

The stock market is technically reachable for everyone, but for a long time it has an institutional basis. Then something happened – meme stocks.

In an article by the Associated Press, the Securities and Exchange Commission (SEC) released a report on January’s trading in meme stocks. The report noted some of the stock market’s plumbing was creaking, but the basic systems and operations remain sound.

If you go back a number of years, it was relatively difficult to open a brokerage account for small investors because of fees, if you had to pay $25 or more to buy and $25 or more to sell a stock, to make money that stock would either need a large capital gain or you bought it to hold it for a long time. (The writer remembers when some mutual funds were priced ona monthly basis, if you needed to sell you had better hope the month was a good one, now funds are priced on a daily basis) Commissions went down, but still brokerage companies made their revenues on number of times you traded your portfolio. Now some them charge a fee for service of 1 to 2% of your holdings. In the past couple of years some brokerage companies made it very easy to open an account and start trading.

In January, the meme stock of GameStop and a few other companies jumped in value and the newspapers were full of stories of people who were making a lot of money in a short time period. Regular people with some money in the bank rushed to open accounts and buy a meme stock in hopes of gaining a great return. Some did, but many bought at high prices and will never be able to recoup their losses. The meme stocks had a significant rally in June and maybe it will happen again.

The report by the SEC examined how the stock exchanges functioned and what improvements can be made given the increased volume of general public in the stock market.

Linking to dividend paying stocks, as an individual investor it is good that there is a wide variety of access to the stock market, but in reality more money is made by buying a profit making company and holding it for a few years than trading on a daily basis. It is important that both exists for when you wish to sell there is a ready market to sell to. It is good that there are many choices in which to invest and the stock market operations is flexible enough to handle the changes which the industry is constantly inventing.

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

All social media targets people to use their service and some become household names, but when a company is a household name it has to continually renew itself to keep the audience. In the case of teenage market, the service has to be cool and hip and catchy or teens will start to use another service.

In an article by Sheera Frenkel, Ryan Mac and Mike Isaac of the New York Times News Service, Facebook owns Instagram and the majority of its users are teenagers. This is very good for Facebook, but the task for Facebook is to keep teenagers, encourage young teens to use Instagram and then move its older people to its other platforms in order to keep advertising dollars flowing to Facebook company.

The market is Instagram has 1.3 billion users, TikTok has 1 billion users and Snapchat has 500 million users. For Facebook a marketing survey showed people who had left Instagram went to YouTube and TicTok before going to Snapchat.

During the pandemic the average person increased their time on social media to 3 to 4 hours a day compare to 1 to 2 hours a day. Adults typically spend 30 to 45 minutes.

Teens are an important segment to cater to because they spot and see trends and can spend more time on the site to be able to see more advertisements.

Linking to dividend paying stocks, the market is very competitive and every industry does similar things to try to attract and retain customers. When the large companies have sufficient size where 2 or 3 companies have 75% of the market, investors tend to be happy because they will attract and retain the bulk of the customers. The companies will fight for market share but investors, particularly dividend investors want consistency of recurring revenues to equal profits to translate to dividends.

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

If you are a dividend buyer of stocks, part of your holdings likely includes an utility or two because they produce regular profits, are regulated by people who tend to raise prices which allows the utility to make profits to pay dividends. This is a good thing for the investor.

Many years ago, there was an inherent policy that growth is good and any business which produces jobs and taxes for the community is a good thing. That idea is likely changing with more people saying growth is good, but at the right balance.

In the world of finance, bitcoins have come to mainstream and various financial institutions accept them and make products for people to buy, if desired. The bitcoin is made or kept value in servers, think about the big tech companies of Google and Facebook among many companies they have buildings that have servers to run their systems. If you wish you can buy Real Estate Investment Trusts (REIT) that the tech companies use or it is normal business activity.

According to an article by Michael Hill of the Associated Press, to have large scale bitcoin mining, the companies need inexpensive power to run the hug power gobbling computer arrays that create and transact cryptocurrency. The companies involved solution is to buy their own power plants. This has environmentalists alamed.

An example is the Greenidge Generation runs a gas plant near the shores of Seneca Lake in the Finger Lakes region on New York state (if you fly over them, the lakes look like fingers) to produce 44 megawatts of electricity to run 15,300 computer servers, any additional energy produced goes in the state grid system. The megawatts needed for the servers could power 35,000 average homes.

Environmentalists see a threat, the fossil fuel plant will add to the greenhouse gases and they are asking the state regulator to deny renewal of the plant’s air quality permit and put the brakes on similar products.

Bitcoin mines unlock bitcoins by solving complex, unique puzzles. As the value of bitcoin goes up, the puzzles become increasingly more difficult, and it requires more computer power to solve them. Greenidge said it mined 729 bitcoins over 3 months and each bitcoin was valued at $59,000. The mining company says it has brought 45 high paying jobs and made a significant contribution to the area in taxes and capital improvements.

Greenidge said it in compliance with its permits as it has bought carbon offsets.

Linking to dividend paying stocks, we all need electricity to continue our normal life and how that electricity is generated is a concern for many. The easiest ways are water, sun and wind, but some sort of fossil fuel will be needed into the distance future. Environmentalists sometimes see the world as black and white, utilities see the world needing a product and regulators often sided with the utilities. In the near future, that could alter or make the decision process longer, however utility companies have time on their side.

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

In general, growth is good at least stable growth is good for the banks. As long as you are personally ok in your work life, one of the methods to see how the economy is doing is looking at the big banks. The big banks besides offering a multiple of services for you, also offer multiple services for corporations and governments. If the parts of the bank are doing well, then the economy must be doing ok. The banks like reasonably stable growth which allows people to take out loans and pay them back, the higher the payback ratio, the lower loan losses have to be and the higher the profit for the bank.

In mid October, the banks reported on their 3rd quarter and all did very well, producing greater profits for shareholders.

In an article by Anirban Sen and Elizabeth Dilts Marshall of Reuters, the biggest US bank is JPMorgan Chase and because the economy was growing in a stable fashion and loan losses provisions were lowered, the bank’s profit was 24% higher than the same period last year. The bank’s average loans, deposits were higher (money flowing into the economy), credit card spending was higher (an indication of consumer expectations).

The highlight of the bank was its Corporate and Investment Bank division where advisory fees almost tripled due to strong performance in Mergers and Acquisition (M&A) and equity underwriting, thanks to new issues on the stock market.

Overall, JPMorgan’s profit rose to $11.7 billion or $3.74 a share compare to $9.4 billion or $2.94 a share a year ago. Analysts were expecting $3.00 a share profit. The difference was the reserve was lowered by $2.1 billion.

Revenue rose to $30.4 billion just above the $29.8 billion analysts were expecting.

Linking to dividend paying stocks, the big banks are a staple in dividend stock portfolios because they make profits on a consistent basis. In JPMorgan’s case a bad quarter would have been $9 billion, a good quarter $10 billion and and a great quarter $11.7 billion profit. It is hard not to own the shares either directly or indirectly through index funds. As long as the economy grows to allow for people and companies to pay back loans, the banks are a long term hold.

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