Last week, there were celebrations in Egypt as the construction involving the Suez Canal was finished. It was a $ 8.5 billion project and involved both new canals and widening of existing canals and the project was completed within 1 year. If you look at a map of the Mediterranean Sea -to the north is Europe; to the south is Africa and in the lower western corner is Egypt and a seemingly shortcut to the Red Sea which connects you to the Indian Ocean and China. The movement of goods over the sea is still the least expensive method and having a shortcut which cuts the time to go around Africa is a big deal for shippers. Egypt is hoping and expecting with the expansion more ships will pass through and each time they pass through the canal is a toll road – Egypt receives fees. If shipping increases by 30% per year and is constant the fees Egypt is looking at could rise to $13 billion from today’s $5 billion. If the shippers come through the Canal, the investment was worth it.

Linking to dividend paying stocks, as long as the trip is concentrated safe, shippers will send their ships through the canal for it is both less expensive and less dangerous than sending their ships around Africa. In simple terms, Africa is a barrier to entry and the only game in town or monopoly is the Suez Canal. From a shippers point of view they hope there is peace in the area. There are natural barriers for entry which allow companies to maintain an advantage, however there are always alternatives even if the alternatives are slower for the moment. The question to ask is how does the alternatives become more competitive and when that happens – there will be a migration to other sources until the market sorts itself out.

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

On September 2011, one of the people I was working with was on the phone to Cantor in the World Trade Center, shortly after the phone went silent and the image of America changed. Before it was possible to examine whether America was a source of good in the world or had plenty of shady sides. Now that time was passed, it is evident that in many countries around the world America has its shady side, when it comes to protecting America’s interests. In our economy as a company grows it becomes vertically integrated and buys assets in other countries to diversify its holdings and sell its products around the world. If it sufficient size, there is the ability to influence the governments of the day to ensure its holdings are essentially left alone or not touched by government regulations. If a country wishes to nationalize without compensation then the company’s executives turn to government agencies such as the CIA to see what can be done. The CIA has a history of overturning “bad” governments to “good” governments which protect and allow assets to produce wealth to be sent to the US. In the book, Rogue Nation by Peter Scowen published by McClelland and Steward, Montreal, 2003 some of the worst cases are documented. The cases include countries in Central and South America, countries in the Middle East and Asia. Some were done to protect the corporate assets from communism; some were done to show others what America was willing and could do; and some were done because they could. Very few action were done to protect the average person in the country.

Linking to dividend paying stocks, one hopes the ethics and vitality in the home market is brought forth to the external markets. The world can use many of the products and services available to North Americans, but how far should the government go to protect those assets? It is an age old question, but one that never has a great answer. Be proud of the company diversifying its markets at high margins; but do not be surprised the world does not always look favourably at your home country.

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

In the modern age we often think of queens or princesses similar to the late Princess Diana of England. She was a relatively naïve, young lady from the right family who eventually grew into her position after producing heirs to the English throne. A very different woman was Josephine Bonaparte. In the book Ambition and Desire – the Dangerous Life of Josephine Bonaparte written by Kate Williams published by Random House, NY, 2013. The end prize was being married to Napoleon who went from a small town roots to one of the greatest generals in France to becoming Emperor of the empire to his downfall, but that is a different story. Josephine was born in the French Island of Martinique where the family estate grew sugar cane and employed many slaves. When she married she moved to France but she was essentially the same naïve young lady from the islands. After having children and a separation – she moved into a convent  which catered to separated wealthy ladies where she learnt the rules of court, how to use her figure and who to target to achieve her ambition of money and power. She learned well becoming the mistress of the French leader after the revolution and settling with Napoleon.

Linking to dividend paying stocks, similar to people, there are many layers to dividend paying stocks. There is the image of a well run profitable company, it could be because of the long-held monopoly – as long as it holds strong then all else is good; there is the dividend which comes from the ability of the company to make profits; there is the reputation of the company as well as the years of being in business. All help shape the users of the goods and services of the company.

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

If your stocks and income have risen to the degree you are very rich, one aspect you have to be concerned about is thieves. Ideally you are insured, but when it comes to expensive art and jewels, the con artists will be in the area. They are going to the usual places where the rich gather to steal assets. In the book Heist Society by Ally Carter published by Disney Hyperion Books, NY, 2010 some young people steal paintings for a seemingly good cause. The paintings were originally stolen by the Nazis ended up in private collections and in this case were stolen and needed to be stolen again to give to their rightful owners. The art of stealing from a museum with high security makes interesting reading.

Linking to dividend paying stocks, the ability to steal means the ability to look through plans of the museum; and use the strategy of humans dealing with the security measures to accomplish the “stealing” of the paintings. Along the way the readers learn about the emotions of the people involved. It is possible that teenagers could do this, but generally the skills needed including the use of technology and teamwork takes years of practice. The book still is an interesting read. The learning point is to do anything well, advance planning or doing your homework has to be done well and since you are dealing with people, many possible considerations need to go right.

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

The summer offers greater opportunity to drive around the location where you live and learn the stories of how and why you came to be there. If you go back in history, people originally settled by the water for both water and food. In time the place either grew or people moved to other places which evolved into cities. Once the cities came, people wanted more space and if they had come to the eastern part of the US, they thought of going west. The west offered many opportunities and people shipped their goods to the east to be sold. As time goes on, the search for a less expensive and relatively faster way to ship goods and people came and the first choice was canals. In a book called Bridges, Canals & Tunnels – the Engineering Conquest of America by David Jacobs and Anthony Neville published by American Heritage Publishing, NY, 1968 the authors describe the challenges of doing what we all consider to be normal. The first canal built was the Erie Canal – from New York City take the Hudson River north to Albany (the state Capital) and turn west to end up in Buffalo.  While the line on the map is relatively straight the terrain is not. Similar to canals at the time, everyone thought it was a great idea, but it was expensive, there were many political challenges, however once in operation the cost to build the canal was earned back with 10 years. With those results, the rest of the US looked to build canals to generate income – most did not succeed, perhaps there are canals where you are going this summer many of them are now used for more leisurely or tourist purposes.  It was interesting with the building of the Erie Canal the cost of the sending goods from Philadelphia to Columbus, Ohio overland was twice as expensive and took 10 days longer than sending the goods from Philly to New York through the Erie Canal to Buffalo and then onto Columbus.

The invention of the steam engine lead to the great railway building age and once again prices fell and length of time to ship the goods fell. The challenge of the engineers was the lands around the Appalachian Mountain range is not flat and many bridges needed to be built. The design of the bridge which fit the needs to be relatively inexpensive, pleasing to look at and very functional was a given that the engineers overcame. After the bridges, because trains have to have a relatively flat base, the great train tunnels were built – it was technically easier to go through the mountains than around them and new processes were developed. After the private automobile became affordable the demand for roads, highways, interchanges kept the engineers busy.

Linking to dividend paying stocks, with the 3 transportation routes, those that could build the first ones were the companies which would have a monopoly and could increase prices to make healthy profits. The government’s role was to ensure bonds could be sold, but there was limited competition which would allow the bondholders to be repaid. The barriers to entry meant new competition was desired after the first company increased prices too much and sometimes it was cheaper to go through a different city to get better prices. There were alternatives and dividend paying companies must watch monitor closely the alternatives.

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

There is an expression, what does that taste like? chicken and everyone seems to know what chicken tastes like. Why is that and why did the chicken of all animals be found in all countries of the world? The book Why Did the Chicken Cross the World? by Andrew Lawler published by Atria Books, NY, 2014 tries to answer the question and the chicken turns out to be an interesting bird. The next time the reader goes to the Fall Fair, looking at the chickens will be more than a quick in and out. The chicken has its roots in South East Asia and is known as the Red Jungle Fowl. The characteristics of the chicken soon made in valuable and revered throughout the world. If you are sick – eating chicken soup is good for you, all around the world everyone knows this and it works. The rest of the chicken is used for other aliments too. In addition, because the chicken scratches the ground looking to eat bugs, it is desired around the world. The male is the rooster and it crows in the morning as the sunrises – it sees the light before the other animals this makes the rooster needed for religious ceremonies around the world. The chicken also lays eggs at a faster rate than other birds which makes it a food source and very desirous for health research. It turns out the chicken is more valuable than at first glance. The book tells many different stories about people around the world for centuries and their relationship to the chicken.

In many of those stories, women have a lead role – food, medicine, collecting the eggs. It was not until the 1950’s when a committee called the Chicken of Tomorrow decided to breed the chicken to look more like a turkey in the sense of broader and thicker breast and meatier thighs and drumsticks. The crossing of California Cornish males and New Hampshire females gave this bird the correct amount of European and Asian genes made the chicken about 4 pounds or twice the size of the average bird. With advances in science, nutrition, breeding it was soon able to grow a bird in half the normal time which allowed prices to fall. The falling prices plus advertising and linkages to the post world lifestyle and soon more people were choosing to eat chicken. At this time the chicken producers John Tyson Farms, Frank Perdue and others entered and changed the chicken business.

One of the hot new movies this month is expected to be Mission Impossible staring Tom Cruise, this is a franchise which keeps delivering box office revenues for the movie companies. In my part of the county, while the weather is wonderful it is also hot which drives people to air conditioning facilities including movie theaters. The summer is traditionally one where more people go to the theater and if you have checked out the prices at the popcorn stand you will determine if your rather invest in the studio or the company showing the movies. It is likely the better choice of the company, multimillion dollar blockbusters help the company stock more. Every week the top movies are released and some of them have been Marvel franchise which is owned by Disney.

Linking to dividend paying stocks, enjoy the movie and watch the credits how is the distributor? who is the director? are they great and hot? are they consistent? If they you may more money in the months to come.

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

In our lives, we hear many speeches or parts of them, hopefully the best parts of them for there is only a limited time on the news hour. Sometimes the speeches are delivered by managers or executives or outsiders. The problem is most are not classic or telling you anything. Often times speeches are given which do not seem to project the sincerity or honesty of the speaker, the speech was scheduled but it is not to offend or jeopardize a person’s position in the company or political party. There are methods which the speeches could be better and the book Classic Speeches edited by Richard Crisscup published by The Citadel Press, NY, 1965 can help. The book is an anthology of speeches that have been monumental, both in their impact on their times and in their influence on history. One good thing about this anthology is there are speeches by a wide variety of speakers – hopefully some you would disagree with.

The aspect of reading classic speeches is to review the ones that resonate with you and ask yourself why? In this case, classic speeches do not have to be long, but they have to an opening, body and conclusion. The speech must reflect the sincerity and passion of the individual and it has to offer some sort of hope. Hope for the listener something will be better in the future.

Linking to dividend paying stocks, the words the President says about the company are taken seriously and when he/she says the wrong thing, stocks changed hands. As dividend holders we want to hear the company has another successful year to stay profitable and pay the dividend (that is a good speech in itself); afterwards we want to hear hope for the future. Why will the company continue to be profitable? Shareholders reports are rarely classic speeches in the vein the Classic Speeches book categories them, but we can hope.

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

The book called The Race – The Uncensored Story of How America Beat Russia to the Moon by James Schefter, Doubleday, NY, 1999. In the book is President Kennedy’s one sentence from a speech where he was honest, blunt, with a youthful and idealistic heart which changed everything about space, He said,  “I believe this nation should commit itself to achieving the goal, before this decade is out; of landing a man on the moon and returning him safely to Earth.”

At the time, both Russia and the US had put a man in space but not very far into space. The rockets which sent the first people into space would have to be redesigned; the first capsules were for one person – the journey to the moon takes 3 people. There was no method to disengage from the main rocket while one person continues to orbit the moon; the other 2 to land on the moon and then take samples. The vehicle would have to take off and connect back to the main rocket and come home safely. There was still many unknowns and many aspects of the journey to be created. This was a time when millions of people regularly watched the lift offs of the rockets and their short journeys.

The genius of the manned spaceflight team only became obvious later. They understood that the advanced work took time and must be done right. The goals were set were superhuman and dedication flowed from the top to the bottom of the chain. The hallmarks of the team were brilliance, innovation, passion and sacrifice. The only clock that counted was the countdown clock.

Linking to dividend paying stocks, the space program had a great many unknowns but it was fortunate to be led by the right people for its time. One can imagine it was one thing to see the rockets go up successfully, but budgets and political considerations needed to be managed, all by people who were brilliant at science to those who were not. However the driving force was President Kennedy’s remark about going to the moon, landing, and coming back safely. Each were huge challenges and would lead to many problem solving exercises. The point is the people did it, does your company which you have invested in have a goal which at present is a dream? could it? then you would know what to look forward to.

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