Continue reading Middle-Income Americans Becoming Frugal Consumers

Middle-Income Americans Becoming Frugal Consumers originally appeared on BloggingStocks on Mon, 03 May 2010 18:00:00 EST. Please see our terms for use of feeds.

Playboy (PLA) tends to be associated with the magazine and sex. Not the hardcore, nasty kind, of course -- Playboy has always been more than a tad distinguished, staying above board while the adult entertainment industry has chosen to compete in ways that my editor would delete if I even attempted.

With Iconix said to be interested in acquiring Playboy, it needs to think about where it can win with the ailing brand. The smart move may be to ditch the magazine and move away from sex -- it can't compete in either of these markets. Then, it needs to figure out how to make the brand relevant to everyone not in the Boomer generation ... or treat Playboy as an investment with a clock on it.

Continue reading Iconix could make Playboy work: Kill the mag, take the sex out of the brand

Iconix could make Playboy work: Kill the mag, take the sex out of the brand originally appeared on BloggingStocks on Sun, 22 Nov 2009 16:40:00 EST. Please see our terms for use of feeds.

Continue reading What will happen if Baby Boomers retire with 401Ks that look like 201Ks?

What will happen if Baby Boomers retire with 401Ks that look like 201Ks? originally appeared on BloggingStocks on Fri, 10 Jul 2009 16:40:00 EST. Please see our terms for use of feeds.

With the chances of finding a job fairly slim, people are certainly thinking about starting -- or even buying -- a business. But, which industry to go into?

It's a tough decision. Yet, there are still opportunities. To get some insight on this, I had a chance to talk to Toon van Beeck, who is the senior analyst with IBISWorld. Let's take a look:

Continue reading Entrepreneur's Journal: What are the growth businesses today?

Entrepreneur's Journal: What are the growth businesses today? originally appeared on BloggingStocks on Sun, 21 Jun 2009 17:30:00 EST. Please see our terms for use of feeds.

Continue reading Social Security will run out of money... in the year 2525

Social Security will run out of money... in the year 2525 originally appeared on BloggingStocks on Wed, 10 Jun 2009 19:00:00 EST. Please see our terms for use of feeds.

Continue reading Will the U.S. economy's focus shift from consumption to production?

Will the U.S. economy's focus shift from consumption to production? originally appeared on BloggingStocks on Wed, 04 Feb 2009 15:15:00 EST. Please see our terms for use of feeds.

Continue reading Where have all the consumers gone?

Where have all the consumers gone? originally appeared on BloggingStocks on Tue, 02 Dec 2008 13:20:00 EST. Please see our terms for use of feeds.

Over the long holiday weekend, I had a chance to do some much needed reading. Given my vocation, sometimes I like to read articles that have little to do with the markets or finance as a way of recharging my batteries.

Of course, even when I partake in this guilty pleasure, there really is no way to truly escape. Somehow every story has a link or relationship to investing that I can utilize in my stock-picking mission.

This weekend, it was an article critical of a Shape magazine cover featuring a bikini-clad Faith Hill that has import for individual investors. In this particular article, the author does a really great job of highlighting the battle of fitness versus self-image.

How exactly did the 41-year-old country singer get that body? Was it photoshopped? How about plastic surgery? Is it really fair to present her in that way without the caveats, if any? The image alone implies that this woman, a busy professional with young children, managed to eat right and exercise in a way that created the image you now see on the magazine -- and that you can achieve yourself.

Wow, what pressure. The problem, of course, is that Photoshop was probably used in this instance, and if not Photoshop, then plastic surgery for certain.

So what does this have to do with investing?

This morning I awoke to the news that Johnson & Johnson (NYSE: JNJ) announced a definitive agreement to purchase Mentor (NYSE: MNT), a leading supplier of medical products for the global aesthetic market -- namely, breast implants.

JNJ is paying $31 per share, or $1.07 billion in cash, for the company. The purchase price is about double what MNT fetched in the open market on Friday.

A premium price of that magnitude in this market environment is hard to believe, but I would not bet against JNJ here. They have their pulse on the market and a copy of Shape magazine on their desk. As the baby-boomer generation ages, plastic surgery looks to be a huge market. Fueled by images like those in Shape magazine, the market is more than worthy of a premium price.

The fact that MNT was valued at the purchase price as recently as June is telling. Yes, the economy is in recession, but the desire to improve self image is alive and well.

This is a brilliant deal for JNJ. The company enters a strong market with great demographics at a time of economic weakness. Taking advantage of a strong balance sheet and rich cash flow, JNJ is a winner in this economy.

Self-image issues aside, I like this deal.

Jamie Dlugosch is a contributor to InvestorPlace.com.

Bet on T&A with J&J (JNJ) originally appeared on BloggingStocks on Mon, 01 Dec 2008 15:40:00 EST. Please see our terms for use of feeds.

This post is one in a series on prominent company nicknames. See all 25, and share your thoughts and memories about the Peacock Network below in the comments.

Perhaps more visually recognizable than any other television symbol today, NBC's colorful peacock logo and nickname encompass far more depth and history than simply having been a tool of recognition for NBC Television, subsidiary of General Electric Co. (NYSE: GE). Beyond simply identifying network programs in the age when NBC and CBS began applying the color palette to broadcast television, NBC's peacock was charged with the awesome task of informing and convincing the parents of the baby boomer generation that color television had arrived, it was good, and they wanted it. The peacock was assigned the monumental task of engaging the public. Indeed, it has performed that job to perfection.

I grew up fully addicted to television, and NBC's peacock long heralded the appearance of many of my favorite shows. Bonanza, NBC's first serious success in color broadcast television, was a weekly treat for me, as it was for millions of other enchanted TV viewers. Accordingly, by the time color television promotion had begun to move consumers to purchase the new color television sets, which sold for approximately $1,000 initially, the NBC peacock, which had begun its glorious life as a simple static image, learned how to fan its tail feathers in a motion indicative of the sweeping changes the television age would come to initiate.

Until man orbited the earth, television was perhaps the single greatest technological achievement since Henry Ford had put automobiles into mass production. Since the coming of color television in 1956, the NBC peacock has been a television communications fixture, and NBC television is respectfully referred to as "The Peacock Network" by people and publications throughout the industry. It can be said that very few other company logos have stood as representative for changes that have affected so many people, so very deeply, for such a long time.

Company nicknames: NBC's peacock stands for much more than just 'living color' originally appeared on BloggingStocks on Tue, 12 Aug 2008 18:10:00 EST. Please see our terms for use of feeds.

Continue reading Housing sector slump seen decreasing some Baby Boomers' nest eggs

Housing sector slump seen decreasing some Baby Boomers' nest eggs originally appeared on BloggingStocks on Thu, 26 Jun 2008 12:44:00 EST. Please see our terms for use of feeds.

No doubt, small businesses are a powerful force in the U.S. economy in terms of job creation and innovation. And, according to a recent study from the Kauffman Foundation, it looks like things are still going strong, despite the slowing economy. For example, every month, about 500,000 new businesses are started (of course, there are certainly a good number that fail as well).

So, what are some of the key trends? Well, interestingly enough, there is quite a bit of growth from immigrants. In fact, they are more likely to start businesses than native-born Americans.

Something else: men are twice as likely to start a business then women. Actually, I think this is unfortunate because diversity certainly allows for stronger growth.

However, looking at the next decade or so, I suspect we'll see much more entrepreneurial activity. Why? It's when the Baby Boomers will reach their prime years for new business formation. They will have the wisdom and resources to take a flier. What's more, a new business may actually became an interesting way for Baby Boomers to essentially change the definition of "retirement" -- that is, leaving the rat race and doing what they really want.

Tom Taulli is the author of various books, including The Complete M&A Handbook (www.mergerbook.com) and is also a principal in Averiware, which provides an ERP system to small and mid-size businesses.

Small business still powering originally appeared on BloggingStocks on Sun, 27 Apr 2008 16:40:00 EST. Please see our terms for use of feeds.

Continue reading The economics of Social Security, Medicare, and you

The economics of Social Security, Medicare, and you originally appeared on BloggingStocks on Thu, 27 Mar 2008 12:20:00 EST. Please see our terms for use of feeds.

Stung by the housing market correction, stagnant wage growth in certain job segments, above-average debt levels, and a slowing economy, Americans are saving more and using credit less -- a shift that some analysts argue is a cultural inflection point of sorts, with huge implications for the economy.

Economist Steve Affinito told BloggingStocks Tuesday that while The Times' interpretative report did not "cite a large enough sample size to meet my fancy," it nonetheless provided data points that support what macroeconomic indicators are saying about consumer choices.

"We know that the savings rate has increased in the last six months, and retail sales are sluggish, at best. Take these and combine them with much tighter credit terms for home equity loans and other credit and what you get is a pull back in purchases, particularly purchases on credit," Affinito said.

Continue reading Are U.S. consumers moving away from buying on credit?

Are U.S. consumers moving away from buying on credit? originally appeared on BloggingStocks on Tue, 05 Feb 2008 17:00:00 EST. Please see our terms for use of feeds.

With treasury yields well below 4%, and even decent corporate paper not yielding much better, the question I keep hearing from my elderly clients who live off of their investment income is where are they going to get the income needed to meet their expenses. Thrown into the mix that, in four years million and millions of baby boomers are set to retire, so they will also need to start adjusting their portfolios to be more income oriented. I anticipate that we will see continued demand for high-rated bonds and, as such, I can't imagine that we will see yields back above 6% on good corporates.

What to do? The answer to that question is more involved than this space permits, but take a look at preferred stock to help supplement income. My buddy, Zack Miller had a nice post about this a while back. The problem with preferred stocks is that it's hard to get information on each issue and the terms of the issue. Also, liquidity can be an issue. That's why I like the POWERSHARES ETF TRUST (AMEX: PGF). The ETF is well diversified as it holds about 28 issues. More important is that it is yielding a shade under 7%. With preferreds having been slammed over the last few months, there may be some opportunity for some capital gains as well.

Living off fixed income? Check out preferred stocks.

Aaron Katsman is the lead Portfolio Manager and Managing Director of America Israel Investment Associates, LC. and Senior Editor of IsraelNewsletter.com. DISCLOSURE: Writer has a position and is long PGF. He has no positions in any stock mentioned as of 1/27/08

The search for income for retirees originally appeared on BloggingStocks on Sun, 27 Jan 2008 08:40:00 EST. Please see our terms for use of feeds.

Demographic, education trends are in Hologic's (HOLX) favor originally appeared on BloggingStocks on Fri, 04 Jan 2008 16:30:00 EST. Please see our terms for use of feeds.

Now is definitely not the time to think about retail sector investments. Soaring oil and gasoline prices, uncertainty regarding the size of the subprime mortgage default problem, and concerns about a slowing U.S. economy don't exactly flash the "SPEND" signal for consumers this holiday season.

Even so, Nordstrom Inc. (NYSE: JWN) may buck the trend, or perform well despite the headwinds, to use a Wall Street phrase.

The case for buying Nordstrom rests on the company's increasing market share, solid balance sheet and cash flow, all driven by the Nordstrom brand. Over the last decade, Nordstrom has established itself at the leading upscale department store. Most retailers would love to have Nordstrom's combination of brand reputation, Baby Boomer appeal, and consistent shopping experience across store departments.

Continue reading Nordstrom: A retail play for the bold investor

Nordstrom: A retail play for the bold investor originally appeared on BloggingStocks on Mon, 12 Nov 2007 14:04:00 EST. Please see our terms for use of feeds.

USA Today reports that at age 62, America's first baby boomer opted into Social Security today. The question for America is whether the 80 million people born between 1946 and 1964 will bankrupt Social Security by the time all of them are receiving their payments.

The caseload for so-called entitlements -- Social Security and Medicare -- is going to explode in the next 23 years. By 2030, Social Security's caseload will be 84 million people, up from 50 million today. Medicare will go from 44 million beneficiaries to 79 million. That will leave about two workers paying payroll taxes for every retiree. The tab is estimated at $50 trillion in future obligations over the next 75 years. Social Security will rise from 4% to 6% of the GDP, and Medicare will go from 3% to 11%.

The options are not good. Fixing Social Security solely with higher taxes or cuts in spending would mean a 16% increase in the payroll tax or a 13% cut in benefits. Medicare's needs would be far greater: a 122% payroll tax hike or a 51% reduction in spending, just for hospital care. Unfortunately, the longer we wait to fix the problem, the more it will cost.

However, if history is any guide, we'll wait until a crisis before we find the will to act. And that crisis will fall on the shoulders of the baby boomers' children and grandchildren -- not much of a legacy.

Peter Cohan is president of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter.

Will baby boomers bankrupt social security? originally appeared on BloggingStocks on Mon, 15 Oct 2007 15:11:00 EST. Please see our terms for use of feeds.

Yesterday I posted Chasing Value: Harley-Davidson (HOG) looking on down the road and actually bought a few shares. Late in the day I received a comment from one of our frequent readers whose opinions I have grown to respect, although he can be a little harsh at times. This reader raised some interesting points I thought worth some consideration. He wrote:

• "I don't like the stock. I see it as a luxury item for aging Baby Boomers. The ones who always wanted one, (or who) already own one. The younger generations aren't interested. I also think you're making a classic mistake when you speculate by saying "if it returns to its former level within the next few years."

He is correct that there is no assurance a stock will return to past glory. It is entirely possible that a company may fade away, just like Levi Strauss did when competitors stormed its castle from all sides with cheaper products, fancier products, variations on a theme and jeans made by other strong brands that extended their product lines into Levi's historic stronghold.

Similar things are happening now to Harley-Davidson (NYSE: HOG) as Honda Motors, Yamaha, Kowasaki and Suzuki take on "style and look" of the classic American "HOG" ride. They do it cheaper, with less effort and even borrow American icons like eagles and flags to promote their machines. They also offer a smoother ride in many cases, as Harley clings to the past and continues producing motorcycles with what it calls "edgy" (read "rough") rides. It is also true that younger motorcycle enthusiasts do not appreciate the Harley mystique in the same way as Baby Boomers have.

Continue reading Chasing Value: Will Harley-Davidson (HOG) fade like Levi Strauss?

Chasing Value: Will Harley-Davidson (HOG) fade like Levi Strauss? originally appeared on BloggingStocks on Fri, 21 Sep 2007 16:35:00 EST. Please see our terms for use of feeds.

Last week I reported on a new study suggesting that around a third of baby boomers don't have enough in savings to maintain their current standard of living in retirement. While I certainly think people need to save more money, I wasn't panicking yet. I wrote that, "Rather than seeking Florida retirement communities and golf courses, the senior citizens of the future may work longer, often on projects that have a social element. Remember, this is the group of people that brought us Woodstock and the Vietnam War protests -- I don't see them sitting by the beach."

MarketWatch's Marshall Loeb has a good piece on this very same issue. He starts with a nice quote from Jack Welch: "People don't want to sit on the beach just because they've hit 70. They're too vibrant. They want action: 70 is the new 55."

Loeb writes that "The appeal of early retirement is fading, and more and more folks are willing -- even eager -- to work beyond some mythic date. A record 24.6 million Americans age 55 and above are on the job."

Age discrimination is on the decline and so are "mandatory retirement ages" for certain companies and occupations.

This is great news for everyone: Older workers have a lot to teach younger workers, and working, at least part-time, late into life will likely slow mental deterioration (just like playing bridge does).

So let's not weep too much for the baby boomers. Many may not have enough to retire at 65, but that could work out just fine for them -- and society at large.

They don't wanna retire ... they just wanna work at their jobs all day originally appeared on BloggingStocks on Sun, 05 Aug 2007 13:10:00 EST. Please see our terms for use of feeds.

Here's a shocker: baby boomers don't have enough money for retirement. An Associated Press piece reports that "Nearly one-third of baby boomers ages 51 to 61 are at risk of not having enough in savings to finance a comfortable retirement, according to a study being released Tuesday by the Center for Retirement Research at Boston College."

This piece seems like the most believable of the recent studies on this topic that have come out. One actually suggested that people were saving too much, which reminded me of an old newspaper clipping I saw on the 'Headlines' segment of Jay Leno's Tonight Show: "Newspapers look for ways to deliver mail more slowly." I don't really see how anyone can argue that Americans are saving too much money. Pick up a copy of Maxed Out if you need convincing. Why would people who are saving too much money have so much debt?

The saving grace here may be that baby boomers are likely to retire in a way that is dramatically different from the way their parents did. Rather than seeking Florida retirement communities and golf courses, the senior citizens of the future may work longer, often on projects that have a social element -- Remember, this is the group of people that brought us Woodstock and the Vietnam War protests: I don't see them sitting by the beach.

My hunch is that medical advances will allow older people to be more active longer, and that we won't end up with too much of a retirement crisis.

Baby Boomers need more money for retirement originally appeared on BloggingStocks on Tue, 31 Jul 2007 06:30:00 EST. Please see our terms for use of feeds.