GDP, PCE & Jobs, generating cash, Tupperware, and Veteran's Day
Looking Back – two out of three ain’t bad.
Well, the GDP, PCE and Jobs numbers came out last week.
The Gross Domestic Product for the third quarter came in at 2.8%, below the expected 3.1% and the Q2 number of 3.0%. But still good.
It showed that the economy was doing pretty well in spite of higher interest rates.
The Personal Consumption Expenditures index came in at 2.1%, meeting expectations and a little less than the previous month’s 2.2%. That’s good. Right where the Fed wants it to be. But…
The core index – the PCE less prices for food and fuel – continues to stay stubbornly higher than plan. It’s at 2.7%, right where it was last month.
This bears watching.
The employment report (versus the unemployment report) came in with expectations of 110,000 new jobs after the previous month’s 223,000 new jobs. Drum roll…..
12,000 new jobs. Hmmm. Not good.
Many people were quick to point out that if it wasn’t for two hurricanes and the Boeing machinists strike’s impact on manufacturing, it would be fine.
All that means is that the people who submit their estimates couldn’t be bothered to factor that in.
GDP – Good. PCE – Good. Jobs – Bad.
Final Score: Good – 2, Bad – 1.
Oh, but consumer confidence hit its highest level in 9 months at 108.7, and confidence is always good.
Selling Assets
One way to generate cash flow is to sell your product and collect on the invoice.
If sales aren’t working and you need cash, then another option is selling your assets.
That’s what Spirit Airlines and Boeing are looking to do.
Spirit Airlines is cutting jobs and looking to sell 23 planes.
There will be $80,000,000 in cost cuts (translation: employee workforce reduction).
The sale of the jets will generate about $519,000,000; after they pay off the debt, they will net $225,000,000.
Shares of Spirit were up 25% to $3.01.
It’s really not a good sign when a cup of coffee costs more than a share of your stock. It was $39/share in March 2021.
Boeing is looking to sell stuff, too. Like its NASA and space operations.
That would include its Starliner space capsule and the operations supporting the international space station.
If I were them, I’d get the two astronauts back from the space station first.
And cutting 17,000 jobs.
It has not had an annual profit since 2018. Wow.
Boeing is looking to raise $19,000,000,000 in equity to cover its cash burn.
At least it’s not debt.
Wow.
Tupperware
This brand was ubiquitous in the food storage industry. It was to food storage what Kleenex was to facial tissues.
“Which Tupperware do you want me to put the meatloaf in?”
Many people to this day call any plastic food storage container “Tupperware”.
Because “food storage container” is way too wordy. At any rate…
They have been saved in bankruptcy and will be purchased by its creditors instead of being liquidated. Who cares? The employees, I’m sure, but the company has been so far out of the market in the last few years that the name really doesn’t carry the value it once did.
Is this headline news? Not really; I just thought it was worth mentioning.
Next Monday is Veterans Day – November 11
On the 11th hour of the 11th day of the 11th month in 1918, World War I ended with the signing of the Armistice. In 1938, November 11 became a national holiday known as Armistice Day. In 1954, Congress formally changed the name to Veterans Day.
Click here to access the U.S. Department of Veteran’s Affairs page for Veteran’s Day.
For those of you who have served in the Armed Forces of the United States of America, thank you.
As the Department of Veterans Affairs notes, Veterans Day does not have an apostrophe because it is not a day that ‘belongs’ to veterans, it is a day for honoring all veterans. I encourage you to read up about it or watch a documentary on The War to End All Wars.
“They Shall Not Grow Old” by Peter Jackson is very well done – 5 Stars from me.
Today, poll your employees to find out which are veterans. Then, have an office lunch on Friday to show them the respect they have earned.
That’s kind of a trick question. You should already know which of your employees are veterans. If you don’t, find out.
Speaking of polling, after you vote tomorrow, find a veteran and thank them for allowing you the opportunity to do so.
There are 24 days until Thanksgiving, 51 days until Christmas, and 57 days left in the year. It's time to close those deals, or you might have to start thinking about selling assets. Don’t be Spirit or Boeing.
Hit your numbers.
