In most towns and cities there is a sweets outlet and it is strange if there is only one place. Most of us like sweets or items which come with sugar in them, what most of us do not know or really want to know is the history of bringing sugar to market. This is why Elizabeth Abbott title is Sugar – A Bittersweet History, Penguin Books, Toronto, 2008.

Yesterday’s column looked at slavery and there is much more than can easily be written if you believe all people should be equal. After slavery was abolished at least officially, however in England the owners were bought out by the government, In Haiti which fought a war with France and won their independence, in order to export its crop the country had to pay a settlement to France which lasted 50 years. People were paid for their labour, and the amounts were on the low side. To keep the amounts on the low side, governments brought in indenture servants. These people had to work for a few years and the idea was they would receive a lump sum award at the end of the 5 years together with their freedom. The people came from India, China and other countries. Only an wide eyed optimist would think the system worked for all. In reality, the same issues we now face regarding minimum wages were being faced with the transformation from slavery to wages. From the Caribbean point of view, after slavery was abolished, it was not long before people realized the soil was not as fertile as it had been. Sugar cane production uses the nutrients in the soil; crop rotation was poorly followed and planting crops which offset the cane uses was rarely done. The only time crop rotation was done, it was done by the natives to the islands before the Europeans takeover, and most of them had died off. In many ways this is the solution to farming in the Caribbean.

For investors this means finding alternative method or other places to grow the cane sugar. Alternatives included beet sugar, other places included the Pacific Ocean islands – Hawaii with its rich volcanic soils; Australia, Florida and a host of other countries. Sugar is well intertwined into our economy and for many of us – our pleasures. Years ago, in England, for those working in the mills, the tea and sugar was their main treat and reason to keep on working. Now days it is more likely a sugar treat for example, chocolate, ice cream, treats from the candy store. Some of which were given to children at Halloween. Shortly it with Christmas holidays and treats will be eaten.

Linking to dividend paying stocks, the names change over the years as the industry consolidates. New inventions which allow the masses to enjoy candy and sugar is an own going process. Similar to all commodities the price of sugar rises and falls, although the size of the candy bars do not seem to get bigger. As an investor, you will look forward to companies with a continuous ability to grow the pie, the other day it was noticed a brand of chocolate bars now has 10 different flavours, and many of the flavours were similar to ice cream flavours. There will always be a demand for sugar and even though it has a very interesting past, the reason for investing is the same as in the past – it generally provides a good return.

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

In most towns and cities there is a sweets outlet and it is strange if there is only one place. Most of us like sweets or items which come with sugar in them, what most of us do not know or really want to know is the history of bringing sugar to market. This is why Elizabeth Abbott title is Sugar – A Bittersweet History, Penguin Books, Toronto, 2008. Similar to most crops in agriculture now most of the large operations are done by machines – specialized harvesters and other tractors and farm equipment. However if you look to the past, the work was done by humans. In sugar and cotton, the answer to meet the demand of Europe was to use slaves.

From an operational point of view, the first sugar were expensive and only something the upper income would use. Much of the sugars used came from honey and bees. Eventually cane sugar was discovered and it grew in climates the Europeans were discovering. In 1492 Columbus sailed the ocean blue, looking for a quicker way to the South Asian islands and their spices. Columbus arrived in the Caribbean and was given gold. He and his crew were quickly struck with gold fever and went on to takeover the gold fields in Mexico. The gold made Spain the richest country in the world and they had money to figure out what to do with the islands. Sugar cane was introduced and soon it was producing to meet the demands of Europe. Every year the demand for sugar grew and Britain and France eventually established colonies they jumped into the sugar trade.

From a purely economic point of view – the slave trade made economic sense. Using England as an example, the ships were built and outfitted in England which caused economic activity, the ships sailed south to Africa to pick up a cargo of people, they sailed across the Atlantic and picked up sugar and other products to bring back to England to be processed. The extra value of commodities is in the processing of the commodity and in England, the manufacturers passed laws against manufacturing facilities on the islands. The cane sugar which had gone through its first level of processing was brought back to England to be processed and distributed throughout the country. This allowed the English to enjoy their tea and sugars. In the above example, the families who owned or financed the ships and their cargos cemented their bonds together through intermarriage. In England, the West India Group ensured a number of their members sat in Parliament to both enhance their operations and to ensure Parliament did not vote against the economic activity.

Linking to dividend paying stocks, it is hard for most companies to have a past which laws or morals of today were not broken. It matters what a company does now and in the future or does it represent your values. Often laws change slowly, but there are reasons why law changes slowly – people are benefiting from the existing methods.

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

One of the most interesting and complex things you will look at is yourself. The makeup of all humans rests in the human genome – the complete set of human genes – comes in 23 separate pairs of chromosomes. Knowing they exist, it is possible to do something with them to help people. The human body contains 100 trillion cells. Inside each cell there is a nucleus, inside each nucleus is two complete sets of human genome. One came from the mother, one came from the father. This is why the story is complex.

We know many things, but we do not know how the complex body of ours manages everything so well, slowly we are learning. Once we learn, it maybe possible to do something but because we do not know, the process goes slowly. The chromosomes are categories as life, species, history, fate, environment, intelligence, instinct, conflict, self-interest, disease, stress, personality, self-assembly, pre-history, immortality, sex, memory, death, cures, prevention, politics, eugenics, and free-will. Some of those categories lead scientists to look at them first. For example, the greater the understanding of how disease works and how the human body reacts to defeat diseases means it is possible to inject something to help defeat the diseases which makes us better and live longer.

The book is an interesting read even if you know little or pay attention to the science world.

Linking to dividend producing stocks, the companies we think of in this field is the pharmaceutical companies which bring drugs to the public and after spending millions plus inventing them, can manufacturer at pennies and sell for dollars, which ensure profits in the industry. What we do know is the human body is complex and at times there are complications with drugs (which equals law suits) and this is why the field is so interesting and complicated at the same time.

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

In terms of auto manufacturers, how Toyota arrived and became the number one car seller and has remained in top is a interesting read and is the subject of How Toyota Became # 1 by David Magee, Penguin Portfolio Books, NY, 2007.

If a company has a focus on the long term or a couple of generations from now, it will seemingly not focus on achieving short term results. Toyota is fortunate to be in a position where it can and does loook to the future. One aspect is do not give others reason to doubt the philosophy – keep the executive arrogance to a minimal. Do what regular people do – if they ride the trains, you ride the trains. It helps keep your decision making and remember what you do not know. For example – edgy, niche products attract some and can be very interesting to work on, but they do not attract the majority of car buyers. Toyota looked at the youth market, did not connect. They went back to the drawing board did more research and  set up the Scion brand for the market.

In all facets, the company learn the customer (do research), live the customer (continue to do research to fix) and empathize with the customer to make the experience better. An example of this is truck buyers – there is a popular idea of who truck buyers are, but research shows women drive trucks. They would appreciate features to make it easier which were not in the most popular brands. Toyota geared their trucks towards them and achieved sales, for the same features help the mythical truck driver.

The company has a widespread reputation of a conservative company, however the reality is it spends a great deal of time and money on research and once it makes a decision it is full steam ahead. One example of this is for years, Toyota made their vehicles in Japan and exported to the US, then then decided it was time to be in the US, they did a joint venture to learn and finally built a plant in Kentucky which began to win quality awards. This execution once a decision has been made beats competitors by 30% or more, which is worth billions in extra revenue.

The Toyota Way which is taught at Toyota Institute can be summed up as: a doing person is all that is needed. It does not matter who they are or where they are. We do not need geniuses. We need people  willing to question, questions and question. Once they find out the root cause of a problem, solve it immediately. Then disseminate and share.

Another thing learnt is start meetings with mistakes in order for people to learn. You do not learn from success, mistakes are what shape Toyota. We treasure mistakes says the President of the US Division. However, the idea is to make fewer and fewer mistakes. The thinking is the people hired are the right people, if you only talk about the success no one learns. If you talk about problems everyone can work on them together to solve them.

All the above need a management structure and hiring basis to allow it to strive and work for the betterment of the company in both good and lean times. In many organizations to implement the Toyota system means empower of teams and decisions do not go down the food chain with no questions asked.

Linking to dividend paying stocks, in all likelihood some or many of the measures can be seen in many companies as value has to be seen to be given and received. There are and will be different methods to manage companies as long as they make profits, there will be few who disagree. Once they do not make profits, then change is on the table. As an investor, hopefully you are considering the long term to receive dividends as well as capital gains. Generally long term means going through the economic cycles and being profitable at both ends, because of monopoly or monopoly like pricing or more properly creating great value for the customer.

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

If you live in North America the automobile has influenced your life, the shape of the cities, the design, the movement, something about the autos has influenced you. When you look around the cars – there are many models and manufacturers and at one time the big three GM. Ford and Chrysler sold the most number of vehicles. Now there are a fewer manufacturers including Toyota. How it arrived and became the number one car seller and has remained in top is a interesting read and is the subject of How Toyota Became # 1 by David Magee, Penguin Portfolio Books, NY, 2007. The reason why books such as this one are important is as companies grow systems develop for very good reasons, but the systems develop tend to lessen the great innovation and energy which the founders saw as the problems with the competition. In other words the larger the company develops the more it looks like the old competition it thought was not doing the job of providing value to the customer.How does Toyota not become like its competitors?

The Toyota company was founded by the Toyoda family who first experience success in the textile industry and made the transition to automobiles. Many of the lessons, Mr. Toyoda learnt in textiles were transposed to automobiles. The biggest lesson is the strive for continuous improvement. The improvement is done through people suggesting a better way and being rewarded with cash, as well as studying and adjusting to see the most efficient and effective method. There is a story about how clean the shop floors of a Toyota factory are – it is because Toyota has and continues to work on it. Most of the parts come in recyclable, returnable packages or if suppliers want to supply Toyota they and Toyota come up with solutions to packaging. In addition, if there are empty containers they are stacked up to go back to receiving, where the package is sorted into bins which can be recycled. The net result is little waste, plant cleanliness is sustainable and Toyota saves money on garbage pickup. The other auto companies are no where near where Toyota is.

Continuous improvement applies to all parts of the business including the time it takes to do manufacturing. People think there is a better or easier way, this can include what it some steps were eliminated and it made sense to do the change. For example, the workers were taking 8 steps to do one part, a better way was to send the materials to do the same thing in 4 steps. One of the principles is thus if a process or an activity does not add value, get rid of it. This principle goes throughout the company from the cafeteria to the factory floor to corporate office.

Another principle is to speak up immediately when problems are recognized and ask why 5 times to get to the root cause. The process does not ensure there are no mistakes that get through, but it does ensure is people are trying to solve problems or do no harm.The reasons for the 5 whys it ensures the company is trying to solve the problem from not happening again, not a quick fix solution. Once the root cause is discovered the problem can be fixed.

Customers like pleasant surprises or getting more than expected from the advertisement. When the company is delivering the value, customers will tell everyone. A great example is the Lexus division. Those who drive or test drive the Lexus will like it as the car is built to be the best vehicle in its class. Within two years of launching the vehicle the Lexus was the largest luxury brand.

Linking to dividend paying stocks, the reason to examine good companies is to determine why are they consistently good. If it is their people, but people change; is it their culture, but culture can change. Toyota stresses the entire package not just one or two or three of their principles. It helps when the company has the backing of the family and other companies have Wall Street pressures on them, but that is a reality. In part 2  the column will look at more reasons.

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

Noise is a constant it is around us and sometimes the noise is something we like and we want it loud, others times the noise is something we do not want and we want it quiet. An interesting book which looks at the subject is the book Noise – A Human History of Sound and Listening by David Henry, HarperCollins, NY, 2013. The book is based on the radio program which ran on the BBC in England.

From the theatres of part 1 the next chapter is about persuasion. When US President Barack Obama spoke in Chicago’s Grant Park it was a great speech. It showed Obama’s eloquence was one of his key election weapons. It persuaded his supporters to feel hopeful and his opponents to feel generous. It encouraged them all to believe in the things he did. It was partly what he said, and partly a manner how he said it – of cadence as well as content. The art of persuasion is about changing minds, it is about the audience’s skills. It is the listener who has to interpret the words and perhaps detect the falsehoods or manipulations designed to get their vote. Many years ago, in Roman times the master was one of the world’s greatest orators: Marcus Tullius Cicero.

Cicero showed that in ancient Rome good oratory before the voting public was the supreme political skill: you had no hope of gaining public office if you could not speak well. The public is just as cynical as today as there is a fine line between being persuaded and being cajoled and misdirected. The tricks of the trade include:using rhetoric to join two ideas together; ideas are unfurled in threes; drawing attention to a subject by circling it rather than discussing it directly. Use repetition of ideas as well as the end of the sentence for the audience to grasp easily the direction you want them to do. The voice will use different tones and reflections and using the audience’s reaction to enhance the speech for they will have to do something.

From the speaker to the noises of the city to the noises of the sporting arenas – some noise is welcomed. Think about the 12th Man in Seattle – the crowd noise. In other venues such as a concert hall or golf games, that is too much noise .During the football  games it is welcomed and encouraged. In the Middle Ages the best way to communicate was by the bell. The sounds of the bell because people tended to live close meant either church services or a call to action if danger was nearby. In the Industrial Age the bell was topped by the factory whistle. There are other sounds the book discusses such as the noise of war and music.

Linking to dividend paying stocks, when the company makes a profit and pays a dividend there are sounds to be heard from Wall Street to Main Street as the payments are delivered to the shareholders. Part of being a good President of a company is to give the annual report to the shareholders and all listeners wish to hear a good speaker. There are methods to deliver a good speech, however continually delivering increasing dividend payments to shareholders for many have many listening to your words.

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

Noise is a constant, it is around us and sometimes the noise is something we like and we want it loud, others times the noise is something we do not want and we want it quiet. An interesting book which looks at the subject is the book Noise – A Human History of Sound and Listening by David Henry, HarperCollins, NY, 2013. The book is based on the radio program which ran on the BBC in England. To start at the beginning during prehistoric times – the noise was largely from nature. Every animal makes a sound, people tended to live in caves and they resonate. Where they resonate more is where the art is to be found. Nobody is certain if the artists knew the principles of the sound and where the art is but the theory works where art and caves are to be found.

The desire to talk and listen to people is the reason for the world to keep using mobile phones, long before the invention, people in Ghana were communicating with drums. They would send out the equivalent of a Morse Code to talk to others for both safety and normal conversation. Once the tones of the drum are learnt, the drums can send out multiple messages.

If you been to a forest and spent a little time, you will quickly learn the sounds of the forest. If you been there for a longer time, you can develop where you are by sounds you hear. There is a distinctive sound based on the geology, climate and wildlife. Added to the sounds is the wind which changes as the wind increases and decreases.

From nature we move to people and story telling. One of the methods we learn our values and principles is through story telling. Whether it be a story teller in school or the library or at home to going to the market and listening to storytelling at coffee houses. An interesting story is the one about the ancient theatre at Epidaurus in southern Greece. The setting is beautifully symmetrical gently sloping auditorium which could seat 14,000. The open air building cuts out the risk of interfering reverberation. This means voices from the stage roll up to the audience and high frequency sounds of the actors are amplified as they go. The juicy part of the story is the plays depended on the listening of the audience, and the actors had to be very good to keep the audience engaged. If they were not, the audiences would become restless and be disruptive. Audience participation was as much as part of the performance as the actors on the stage.

Linking to dividend paying stocks, in many of the examples noise is seen as background but in reality it is integral part of the landscape. For example, we look at the hills and trees changing but with the trees is a whole host of things happening and noises being made. For a company to continue to pay a dividend it has to be getting the little things right, as well as the big ones. It takes the understanding the noise of the consumer to offer feedback and to continuously improve the business. A book such as Noise offers us the ability to think about a section of life and how it can play a bigger part in our everyday life.

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

Everyone in the world has done some event planning, as soon as you get more than two people together you are event planning. Most of the world does plan million dollar events, but something less. Often one of the biggest events is a wedding, but birthday parties or neighbourhood parties all go through the same checklist. The book event planning by Judy Allen, John Wiley and Sons, Toronto, 2000 is a great guide as the price of the event rises. For most of us, except for the Wedding or Anniversary party, we do a lot of stuff in our heads because the budget is relatively low. For example in the coming week is Halloween – you may go out for trick or treating or stay home and have the kids come over. It is not a great decision to do it at the last moment, otherwise you will be running around for all the little things you forgot. The book event planning features gala events and conferences but the same process goes for any size event.

The reason the purpose of the event is paramount is who is the targeted audience. If you watch the movie or read the book The Great Gatsby – the target audience for all the parties was a lady who live across the bay – Daisy. Why are you choosing the guest list? The event will determine what you hope to do. Questions include who needs to be there? The higher the profile of quest, the higher the need to go “first class”. Do you want media to be there? who is free or complementary?

At every event food and beverage needs to be offered. What kind of food and how it is presented is as varied as food. Many years ago, the author used to go to a lunch meeting and the main course was roast beef, the audience has changed and now roast beef is rarely on the menu. Food preferences for people change over time, but food is needed.

Other considerations consider entertainment. Plan it carefully knowing who your audience is. What kind of event it is and the age range. Make it appropriate and fun for the audience. Use good judgement. When you have entertainers they need to set up.

Photographer – do you wish a official photographer? people will take pictures with their cell phones.

In terms of themes and programs as long as they complement the purpose, use your creative spark to enhance the event. If you have tables, the guests need to see over the centrepiece. The décor can be anything you wish – there are amazing number of things to be rented.

The wrap up is most important because you have both learned things for next time as well as have a go to list for suppliers. It gets easier each time you do it. Send thank you notes. Remember each event is filled with people and with that there will be magic in the details and magic of memorable events to come.

The book appendix has many check lists for you which can be modified depending on the size and scope of the event. The list helps your attention to detail.

Linking to dividend paying stocks, with the planning of the event, the success is the purpose of the event being fulfilled. With dividend paying stocks, the success is the continuing payment of the dividend to your account. With the money, you can reinvest, live off it or make new investments, the choice is yours. In addition as time goes by the value of the holding tends to rise. Profitable stocks will trade at higher multiples than non profitable stocks, which means you have two methods to fulfill the purpose.

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

If you ever read the books or seen the shows about Sherlock Holmes, you were likely amazed and how he solved the case. In a book called Mastermind – How to Think Like Sherlock Holmes by Maria Konnikova, published by Penguin Group, NY, 2013 there are methods to be learned. Most of us are more interested in one subject or another and when asked about it can offer many insights. For example an experience home inspector will be able to look at your home and try to see into the framework of the house, however the same person may not be able to do the same for an automobile.

The Holmes method has 5 points:

1. Know Yourself  – and Your Environment   

Prior to making specific deductions, pause and reflect to and look at the bigger picture which allows you to put the details into context.

2. Observe – Carefully and Thoughtfully

Asking your yourself about the context and what is there? what should be there and is not? Try to examine the clues from different perspectives to see other clues. Give your self some time or patience to come up with ideas.

3. Imagine – Remembering to Claim the Space You May Not Think You Need

Imagination and creativity is used to think and pause about various options which can be rejected to move on.

4. Deduce – Only from What You’ve Observed, and Nothing More

We are people and we have biases and desire specific results, but are the clues really telling you that? try not to bring your biases into the conclusion.

5. Learn – From Your Failures Just as You Do from Your Successes

Practice, Practice, Practice and you will begin to make fewer mistakes, but learn from your mistakes.

Linking to dividend paying stocks, in choosing which investment to make you will need to continue to narrow your process and the method helps you narrow the choices. This blog believes by focusing on dividend paying companies, you will lose less money because those companies are profitable and although the stock market goes up and down in the long run profitable companies do better. Along the way, it is very good to receive income or a dividend.

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