A guy walks up to me and asks 'What's Punk?'. So I kick over a garbage can and say 'That's punk!'. So he kicks over a garbage can and says 'That's Punk', and I say 'No that's trendy! <http://thinkexist.com/quotation/a-guy-walks-up-to-me-and-asks-what-s-punk-so-i/348460.html> ”
–Billie Joe Armstrong, Singer, Green Day
Keith is flying back from California this morning, so I’ve been handed the pen on the Early Look. The title Garbage Man has many implications as it relates to investing and careers. For me, it was actually my first job. Yes, this former hockey head and now Macro Analyst started his working career as the Garbage Man back in his home town. I’m not sure I learned a whole lot about investment analysis while digging through the garbage barrels back in Bassano, Alberta, but what I did learn is that as you dig through all that garbage, every once in a while you find a little treasure.
As I sit here drinking my second cup of coffee, listening to Pandora (that’s what the Millennials use to get music these days!), and reviewing the global macro news streaming on to our floor here in New Haven, there are a few little treasures that are emerging.
1. The Chinese central bank is noting this morning that they view gold prices as very high and they will be wary of “bubble” assets. It is interesting that the so called “Communists” see bubbles before He Who Sees No Bubbles (Bernanke) and the purported free marketers at the U.S. Fed do. From a fundamental perspective, this is negative for gold demand in the intermediate term as China is potentially a large buyer of gold to diversify her reserves, though presumably not at bubble prices.
2. In stark contrast to concerns over Dubai’s debt issues, both Latvia (whose GDP declined by 18.4% in Q3) and Senegal are marketing bond offerings this morning, which suggests the market for emerging market debt is strong and open. Additionally, the spread between U.S. treasuries and emerging market debt is at 315 basis points, which is in line with levels before the Dubai restructuring was announced. The implication is obviously that, for now, Dubai appears to be a blip on the radar screen and credit markets continue to open globally even for weak economies like Latvia. Free money and easy credit continues to flow.
3. The less traditional gauge of employment, the Monster.com employment index, which is a monthly gauge of online job demand fell one point sequentially to 119 in November. However, on a year-over-year basis it declined 17%, which is actually the lowest rate of annual decline since September 2008 (so a positive on balance). Interestingly, the occupation that gained the most in terms of “Top Industries Looking for Employees in November” was Transportation and Warehousing. On the margin, this report does look positive and y-o-y compares will look great starting in January. Accelerating year-over-year employment number should also be additive to inflationary pressures, as will emergency level interest rates . . .
Another topic I want to discuss this morning is China, which we refer to as The Client. As many of our faithful readers know, we’ve been all bulled up on China this year and rightfully so given her massive stimulus program, high growth, and low inflation, but I thought it might be interesting to lay out the bear thesis on China. This thesis comes from well known short seller Jim Chanos. A short seller is sort of the Garbage Man of global investing, if you will. He or she is always sniff sniff sniffing for that company, or in this case an economy, that doesn’t quite smell right. With a batting average of 85.1% on shorts since inception, we too know a fair bit about the dark art of shorting.
Chanos’ thesis on China, according to reports, is as follows. First, given the enormous size of the stimulus of China, $900 billion, versus the size of the economy, $4.3 trillion, Chanos and the China bears postulate that the Chinese reported GDP expansion of 8.9% in Q3 is actually less than should be expected. Second, there appears to be some disconnect in official statistics coming out of China. As one example, while the growth in car sales is massive, as we have noted, Chanos and the bears are noting that there is no commensurate increase in gasoline sales. Finally, they theorize that there is massive over capacity being built in many Chinese industries. An example given is in the cement industry, where there is an estimated spare capacity of 340 million tons, which is more than the consumption in U.S, India, and Japan combined.
As of yet, we have not changed our bullish stance on China, but we are concerned about the potential for a H1 2010 slowdown in China. And certainly, any bull should know which garbage pails the bears are pawing around in before they become “trendy”, or worse before their long positions get “punked”.
Good luck out there today,
Daryl G. Jones
XLK – SPDR Technology — We bought back our position in Tech on 11/20. Rebecca Runkle has an innovation story in Mobility and Team Macro has an M&A story in our Q4 Theme, the “Banker Bonanza”. We’re bullish on XLK on TREND (3 Months or more).
GLD – SPDR Gold — We bought back our long standing bullish position on gold on a down day on 9/14 with the threat of US centric stagflation heightening.
CYB – WisdomTree Dreyfus Chinese Yuan — The Yuan is a managed floating currency that trades inside a 0.5% band around the official PBOC mark versus a FX basket. Not quite pegged, not truly floating; the speculative interest in the Yuan/USD forward market has increased dramatically in recent years. We trade the ETN CYB to take exposure to this managed currency in a managed economy hoping to manage our risk as the stimulus led recovery in China dominates global trade.
TIP – iShares TIPS — The iShares etf, TIP, which is 90% invested in the inflation protected sector of the US Treasury Market currently offers a compelling yield. We believe that future inflation expectations are currently mispriced and that TIPS are a efficient way to own yield on an inflation protected basis, especially in the context of our re-flation thesis.
EWJ – iShares Japan — While a sweeping victory for the Democratic Party of Japan has ended over 50 years of rule by the LDP bringing some hope to voters; the new leadership appears, if anything, to have a less developed recovery plan than their predecessors. We view Japan as something of a Ponzi Economy -with a population maintaining very high savings rate whose nest eggs allow the government to borrow at ultra low interest levels in order to execute stimulus programs designed to encourage people to save less. This cycle of internal public debt accumulation (now hovering at close to 200% of GDP) is anchored to a vicious demographic curve that leaves the Japanese economy in the long-term position of a man treading water with a bowling ball in his hands.
XLI – SPDR Industrials — We shorted Industrials again on 11/9 on the up move as the US market made a lower-high. This is the best way for us to be short the hope of a V-shaped recovery.
EWU – iShares UK — Despite areas of improvement, broader fundamentals remain shaky in the UK: government debt continues to expand, leadership in critical positions lacks, and the country’s leverage to the banking sector remains glaringly negative. Q3 saw its GDP contract by -0.3%. Further bank stimulus and the BOE’s increase in its bond purchasing program suggest that this will not end well.
XLY – SPDR Consumer Discretionary — We shorted Howard Penney’s view on Consumer Discretionary stocks on 10/30 and 12/2.
SHY – iShares 1-3 Year Treasury Bonds — If you pull up a three year chart of 2-Year Treasuries you'll see the massive macro Trend of interest rates starting to move in the opposite direction. We call this chart the "Queen Mary" and its new-found positive slope means that America's cost of capital will start to go up, implying that access to capital will tighten. Yields are going to continue to make higher-highs and higher lows until consensus gets realistic.
A guy walks up to me and asks 'What's Punk?'. So I kick over a garbage can and say 'That's punk!'. So he kicks over a garbage can and says 'That's Punk', and I say 'No that's trendy! <http://thinkexist.com/quotation/a-guy-walks-up-to-me-and-asks-what-s-punk-so-i/348460.html> ”
MCD is scheduled to report November same-store sales numbers before the market opens on Tuesday. It is important to remember that headline numbers will look worse than underlying trends as November 2009 had one less Saturday than November 2008. In October 2009, the calendar shift/trading day adjustment, which included one extra Saturday relative to October 2008, boosted reported same-store sales growth by 1.0% to 1.7%, varying by area of the world. I would expect about this same magnitude of negative impact on reported results in November.
Taking that into consideration, I wanted to provide comparable sales ranges for each geographic segment as a benchmark of what I think would be GOOD, NEUTRAL, or BAD results based largely on 2-year average trends.
U.S. (facing +4.5% comparison from last year, calendar shift helped result by 0.0% to 2.8%):
GOOD: Any positive number would signal that October’s negative result was only a 1-month blip. Considering the negative 1% to 1.7% impact on reported results, I don’t think investors are expecting positive comparable sales growth as this would point to a sequential improvement in 2-year average underlying trends. For reference, a reported +0.5% would imply that underlying growth is closer to +1.5%, which would signal that 2-year average trends had improved nearly 100 bps from October levels.
NEUTRAL: -1% to flat would imply underlying growth of approximately flat to +1%, excluding the timing/calendar shift, and 2-year average trends that are about even with to slightly better than October. Like last month, this range of results, though neutral from an investor sentiment perspective as it relates to expectations, is not a favorable sign for current trends. Before October, MCD had not reported a decline in U.S. same-store sales growth since March 2008 so two consecutive months of declines would not be good.
BAD: below -1% would not be that surprising as it assumes 2-year average underlying trends that are similar to what we saw in October. Although I would typically consider maintaining 2-year average trends as a neutral result, I think a reported number below 1% (even if does not reflect true underlying trends) will hurt investor sentiment. MCD has not reported a monthly comparable sales decline of greater than 1% since March 2003.
Europe (facing +7.8% comparison from last year, calendar shift helped result by 0.0% to 2.8%):
According to a Reuters article, MCD’s Europe Chief Financial Officer Jerome Tafani said, “The trend in sales we have seen up until October is not going to change in the coming months.” Based on his comments, we would not expect to see a BAD result.
GOOD: +6.0% or better would imply that MCD is maintaining its strong 2-year average underlying trends from October, which accelerated sequentially from September.
NEUTRAL: +3% to +6.0% would point to 2-year average underlying trends that have slowed somewhat from October but are still even with to slightly improved from September levels. September 2-year average trends were up 6.0% so these are still good numbers, but I think MCD’s strength in Europe has trained investors to need 2-year average trends in the 7%-plus range to get really excited.
BAD: below +3% would imply a significant sequential slowdown in 2-year average underlying trends from October and a slight deceleration from September. A +2% or lower would be viewed as really BAD as it would signal a return in 2-year average underlying trends to the low reported June levels.
APMEA (facing a difficult +13.2% comparison from last year, calendar shift helped result by 0.0% to 2.8%):
GOOD: +1.0% or better would signal that MCD maintained its 2-year underlying average trends from October. Being that MCD’s APMEA trends accelerated rather significantly in October after having slowed somewhat for the four preceding months, I think just maintaining those 2-year average trends in the 7%-plus range will encourage investors that October was not just a one month uptick.
NEUTRAL: -1% to +1% would point to 2-year average underlying trends that are consistent with to slightly worse than what we saw in October. Although I don’t think investors are accustomed to negative results out of this geographic segment, the tough YOY comparison and the reported negative timing shift must be considered as a reported -1% number still implies 2-year average underlying trends in the 6%-plus range.
BAD: any number below -1% would imply that 2-year average trends have slowed somewhat from October which might lead investors to believe that October’s significant improvement is not sustainable.
The total percentage of successful long and short trading signals since the inception of Real-Time Alerts in August of 2008.
LONG SIGNALS 80.33%
SHORT SIGNALS 78.51%
The good news - manufacturing in the U.S. expanded in November for a fourth consecutive month. It appears to be a given that growth is here to stay!
The not so good news - the rate of growth is slowing. The Institute for Supply Management’s manufacturing index fell to 53.6, lower than forecast 55.0 and from October’s three-year high of 55.7.
On this news stocks rallied yesterday and are extending gains into early trading today.
Yes the “Broken buck” is helping to spur demand from abroad, but the overall impact is inflationary. Look no further than the comments from the field.
(1) Apparel, Leather & Allied Products – “Becoming concerned about the value of the U.S. dollar!"
(2) Food, Beverage & Tobacco Products - "Low value of the dollar driving commodity costs higher."
(3) Fabricated Metal Products - "Demand from automotive manufacturers remains strong and building."
(4) Electrical Equipment, Appliances & Components – “Capital construction seems to be picking up, and we are seeing more jobs that are bid out."
(5) Primary Metals - "Steady increase in business." The XLB was the best performing sector yesterday and again today!
Maybe it is just a coincidence but the ISM numbers look just like consumer confidence - making lower highs! For the second day in a row the low beta SAFETY trade (XLU) is outperforming the other higher beta sectors!
Just another coincidence?
Last Wednesday our immediate term TRADE target for Gold was $1190, so we sold some. Then Gold corrected, and we bought back what we sold on Dubai Friday (gold was down, a lot).
This morning we entered the game with a 7% Gold position in the Asset Allocation Model, and I cut that in half as Gold tested our refreshed immediate term TRADE target of $1224. Unlike most sell-side strategists, we like to be on the right-side. Managing risk dynamically; changing our price targets proactively. As prices change, we do.
Some call this trading. It is – but when “long term investors” hit buy/sell buttons, that’s called trading too. What I have learned (the hard way) in this business is that it pays to manage the risk associated with price appreciation in long term TAIL positions. My daily challenge remains to improve this process, using math, as opposed to emotion. I continue to learn a great deal from chaos theory on this score. I continue to learn a lot about myself.
For now, the math says gold is in an immediate term TRADE bubble (TRADE = 3 weeks or less).
I’m not fighting it. I’m not selling all of it. I’m just selling some of it.
My risk management lines are in the chart below. I’ll be a buyer again of what I just sold on a pullback to my immediate term TRADE line of $1170/oz.
It’s ok to be long bubbles. Just be aware when you are in one (yes, Peter Schiff, that means you).
Keith R. McCullough
Chief Executive Officer
RETAIL FIRST LOOK
December 2, 2009
TODAY’S CALL OUT
The flow of e-commerce data continues with more traffic, search, and sales stats flowing out of Black Friday and CyberMonday. If you can step away from all the media hype, take a minute to look at Dockers new branding campaign. Khakis may be coming back…
- With all the speculation, traffic metrics, and surveys surrounding the post-Thanksgiving shopping period, we got a glimpse into actual results from Guess and Staples. Guess noted that Black Friday sales increased by mid to high single digits in its retail stores, with a margin performance that was comparable to last year. Staples characterized its Black Friday as “good” and on track with its aggressive plans. Management also went on to note that the pace of business in the afternoon, after the early morning doorbusters, was strong. Finally, it was noted that Black Friday has never been a good predictor of the ultimate success of the entire holiday period. With that said, all eyes will be on this Thursday’s sales reports despite their limited significance to the next 6 weeks of holiday shopping!
- GSI Commerce reported that the same store sales of its 500 e-commerce clients increased by 17% over the Friday to Sunday period. They also noted that CyberMonday sales were record breaking although the final figures were not fully available. Even more impressive was the growth in online searches related to “Black Friday” and “printable coupons”. Google reported that searches for “printable coupons” were up 50% year over year, suggesting there has been a surge in the use of the Internet to search for the best deals offline. Consumers are conducting extensive product and pricing research before heading to the mall and are also increasingly planning their trips according to key-item availability and pricing.
- Dockers released a new branding campaign, aimed at re-launching the khaki brand and reinvigorating sales which have been on the decline for 5 years. According to research conducted in advance of the new marketing push, men are replacing khakis at about half the rate that they replace their denim. The overall khaki category declined by 12% this year, which is in line with prior year declines. Dockers VP of marketing also went on to note that there are some signs that the category may be in the early stages of a turnaround as evidenced by fashion denim brands entering the category, increased sightings of khaki’s worn in key influential markets in northern Europe, and the return to a more formal work-place uniform (i.e not denim) as males attempt to gain employment. If true, we suspect it won’t be long before we see a khaki overload as all men’s brands attempt to capitalize on the trend.
PPR raises 806 mln euros in CFAO IPO - French retail and luxury goods group PPR raised 806 million euros ($1.22 billion) after pricing the equity offering for its Africa-focused unit CFAO at 26 euros per share on Wednesday, said sources familiar with the matter. Some 31 million shares were sold in the CFAO initial public offering, which is Europe's fourth largest this year. It was priced towards the lower end of the indicative price range of 24.80 to 29.0 euros per share. The CFAO offering was oversubscribed a week after the deal was launched on Nov. 17. CFAO shares are due to start trading on Euronext Paris on Thursday. <forbes.com/>
Yoox Sets IPO Price - The price per share of Internet fashion retailer Yoox Group has been set at 4.30 euros, or $6.46 at current exchange, which values the company at 216 million euros, or $324.5 million. This price positions Yoox shares in the high-end range of the fork indicated for the IPO of between 3.60 euros, or $5.37, and 4.50 euros, or $6.71. Shares will start trading Thursday on the Milan Stock Exchange STAR segment for small companies. The Bologna, Italy-based firm, which runs e-commerce sites for brands including Emporio Armani, Diesel, Dolce & Gabbana, Jil Sander, Valentino and Roberto Cavalli, launched its IPO on Nov. 16, expecting to raise as much as 126 million euros, or $187.9 million at current exchange, through the sale of 24.3 million shares. <wwd.com>
Penney's Sets Rollout of Mango Line - In a move that chief executive officer Myron E. “Mike” Ullman 3rd called a “game changer” along the lines of the addition of beauty store Sephora to its mix, the Plano, Tex.-based company said Tuesday it has made a deal with Spanish fast-fashion retailer Mango to sell the MNG by Mango brand exclusively in the U.S. department store market. Billed as the largest rollout of any fast-fashion concept, the line of casual and career sportswear and accessories will launch in up to 75 J.C. Penney stores and on its Web site for fall 2010 and expand to 600 stores by fall 2011. Mango has more than 1,300 stores in 94 countries, but only 12 freestanding units in the U.S. The deal will immediately allow the Barcelona-based retailer to blanket the U.S. with its core collection — vaulting over the likes of H&M, Zara and Topshop — while giving Penney’s the ability to quickly provide European runway-inspired product to its customers. <wwd.com>
Payless Shoes Opening First Stores in the Philippines - Collective Brands Inc., the Kansas owner of several footwear chains, will bring its first Payless ShoeSource stores to the Philippines next year. The retailer will open in as many as seven locations in the country within the next 12 months, Chief Executive Officer Matthew Rubel said today during a telephone interview. Collective Brands is working with a franchise partner, Stores Specialists Inc., based in the Philippines. The move marks the next stage of international growth for Collective Brands, which will also expand the number of stores it operates in the Middle East and open in Russia next year, Rubel said. Shoes are a category on which consumers in emerging markets tend to spend as their incomes increase, and Filipino consumers already have “high footwear consumption,” he said. <bloomberg.com>
Liz Claiborne appoints new head of Lucky Brand - David DeMattei, Williams Sonoma exec, new head of Lucky. Tom Fitzgerald who served since June departing company. Apparel maker Liz Claiborne (LIZ.N) on Tuesday appointed David DeMattei as chief executive of Lucky Brand Jeans, starting Jan 4.The company gave no reason for the departure of Tom Fitzgerald, who has served as CEO since June. DeMattei, who will report to Liz Claiborne CEO William McComb, most recently served as a group president of brands at home furnishings retailer Williams Sonoma Inc. He previously served in top executive roles at Coach Inc (COH.N), J Crew Group Inc (JCG.N) and Gap Inc (GPS.N). Lucky Brand is one of the handful of apparel brands that Liz Claiborne retained in a major overhaul of its business in which it shed underperforming wholesale units to focus on faster-growing brands with retail potential. <reuters.com>
Cyber Monday Sales Surge - According to Coremetrics Inc., a web analytics firm, sales were up 13.7% on Cyber Monday over year-ago levels. The average dollar amount consumers spent per online order rose 38.2% from Cyber Monday 2008 ($180.03 versus $130.24), led by apparel retailers. Consumers bought nearly 10% more items per order on Cyber Monday 2009 compared to Black Friday 2009 and nearly 30% more compared to Cyber Monday 2008. Consumer shopping hit its peak from 9-10 a.m. PST, but maintained stronger momentum throughout the day than on Cyber Monday 2008. On Black Friday, only sales grew 24.1% compared to Black Friday 2009. Consumers spent more per online order ($180.03 versus $170.19 for an increase of 5.8 percent) compared to Black Friday 2009. <sportsonesource.com>
Most Major Retailers Plan Flat Holiday Ad Spending - More than half (55%) of retailers say that their 2009 advertising budget is flat this holiday season, up from 43% in 2008, according to a study conducted by BDO Seidman, LLP. Only 19% of retailers have increased their advertising budgets this year, while one-quarter (26%) of retailers cite budget reductions. Of the retailers who do not expect a turnaround until the third quarter of 2010 or later, 50% say their holiday marketing and advertising budget in 2009 is lower. The retailers who expect the turnaround to happen sooner, (second quarter of 2010 or earlier) 62% plan to keep those budgets about the same. When it comes to advertising expenditures, a strong majority (64%) of the retailers will spend most of their holiday advertising and marketing budgets on print advertising, which is up from 57% in 2008. Interestingly, more than half (51%) of retailers are including social media in their marketing strategy this year – a severe increase from only 4% in 2007. <sportsonesource.com>
Mitsukoshi Cuts 1,500 Jobs Through Retirement Scheme - Isetan Mitsukoshi Holdings Ltd.’s payroll is set to shrink. Japan’s largest department store retailer said Tuesday that about 1,500 Mitsukoshi workers have applied for its early retirement program. Those employees represent just over 22 percent of Mitsukoshi’s full-time workforce. They are expected to retire by Jan. 31. Mitsukoshi was looking to reduce its workforce after closing a number of stores including one in Tokyo’s Ikebukuro neighborhood. As reported, Japanese consumers have been cutting back on shopping as their country’s economic problems persist. Luxury goods companies and department store operators have suffered the most in the current climate as consumers find stylish bargains at low-priced chains like Uniqlo and Hennes & Mauritz. <wwd.com>
Cotton Exporters Lean on U.S. Over Subsidies - Trade ministers from poor West African nations Burkina Faso, Mali, Benin and Chad said Tuesday that a recent increase in subsidies to U.S. farmers threatened to bury their cotton industry. Ahmadou Abdoulaye Diallo, Mali’s minister of trade, said the U.S. was subsidizing 20,000 cotton farmers for about $3 billion a year or an estimated $150,000 per cotton farmer. He said Mali has three million cotton farmers and Africa has more than 20 million who are pressuring their governments for an accord to eliminate all subsidies, which he said create unfair trade. Diallo and ministers from the other nations “did not exclude the possibility” they might follow Brazil and launch a legal case against the U.S. policy in the World Trade Organization. But he also told WWD, “If there was no acceptable deal on cotton, there would be no deal on Doha [trade talks] — we would execute our veto.” <wwd.com>
Target Links With Liberty of London - Target is partnering with Liberty of London, the luxury brand known for its bold florals and exuberant prints, to launch one of the largest collections it’s ever undertaken with an outside brand. The line will encompass fashion, home and other categories. Liberty of London for Target will bow on March 14 in Target stores nationwide and on target.com. The fashion segment will feature apparel and accessories for women, men and children. Target did not reveal details or prices for the collection other than to say it will be “well priced.” Liberty’s Web site features signature print shirts in abstract and floral fabrics priced at 75 pounds, or $125 at current exchange, and 85 pounds, or $141. The British retailer offers dresses and skirts in Liberty prints in collaboration with designers such as Theory and APC. Target did not discuss specifics of the home collection. However, products could be similar to the pillows, cosmetics bags, lamp shades and notebooks in iconic prints found on the Liberty site. <wwd.com>
Lacroix Shrinks to Licensing Operation - High fashion received another blow Tuesday as the commercial court here approved a plan to convert troubled couture house Christian Lacroix to a licensing operation. A judge read the decision to a packed courtroom, setting the stage for Florida’s family run Falic Group, majority owner of the 22-year-old firm, to cut Lacroix’s workforce by 100 to about a dozen employees, putting an end to its high-fashion and retail operations. Potential suitors — including an Ajman sheikh and French turnaround firm Bernard Krief Consulting — failed to provide financial guarantees for their relaunch plans by court-imposed deadlines. Italy’s Borletti Group, parent of Printemps and La Rinascente department stores, withdrew from the process in September. <wwd.com>
LVMH, Standard Chartered to Expand Sincere Watch - LVMH Moet Hennessy Louis Vuitton SA’s L Capital Asia LLC and Standard Chartered Private Equity Ltd. plan to bolster Sincere Watch Ltd. after taking control of the Singapore-based retailer of luxury timepieces. L Capital, Standard Chartered and Tay Liam Wee, the company’s chairman and managing director, now own “close to” 80 percent of Sincere Watch, with a group of banks holding the rest, according to a statement handed out in Singapore today. LVMH plans to back Sincere when negotiating for retail space and share its database of high net-worth customers. “We are seeing signs of improvement in luxury spending as the global economy recovers,” said Tay, whose family founded the company. “With the backing of two of the strongest global icons, we will be able to sharpen our competitive edge and accelerate our growth plans.” <bloomberg.com>
Poised to Grow, Kellwood Eyes Deals - After a stormy 2009 of its own, Kellwood Co. is looking forward to 2010 and hoping to ink a deal for at least one acquisition to add to its portfolio of brands. The company in recent weeks has been working with two investment banks to identify possible acquisition targets. There are two offers on the table and two letters of intent signed, according to Michael W. Kramer, Kellwood’s president and chief executive officer. While he declined to provide details about the targeted brands, Kramer is hoping at least one deal could materialize within the next two months. The firm remains on the prowl for even more acquisitions throughout next year and beyond. <wwd.com>
Selective Beauty Sues Claiborne - Selective Beauty, a onetime distributor of Juicy Couture and Usher fragrances in Europe, has sued Liz Claiborne Inc. for $20.2 million, alleging that Claiborne’s licensing of its fragrance brand portfolio to Elizabeth Arden contributed to the beauty distributor’s bankruptcy. In a lawsuit filed in U.S. District Court in Manhattan on Nov. 24, the French firm said that, starting with a partnership for Juicy Couture in February 2007, it helped build both brands in its markets at its own expense. The company alleges the sudden loss of the Claiborne business in June 2008 contributed to its financial woes earlier this year. Nick Rubino, senior vice president and chief legal officer of Claiborne, said, “We believe the allegations are without merit and we plan to conduct a vigorous defense.” A spokesman for Arden declined comment. <wwd.com>
Some major e-retail sites experienced problems during the holiday weekend - While the majority of e-retailers performed well during the holiday weekend, retailers such as Hewlett-Packard Co., Kohl’s Corp. and Staples Inc. experienced major problems and slow page-loading times that may have led fickle consumers to shop elsewhere, says Matt Poepsel, vice president of performance strategies at Gomez, which monitors web site performance. The issues led the site to record overall availability of 83.59% for the weekend, well below the 97.60% average for the top 50 retailers, according to Gomez Inc.’s Retail Benchmark. The firm measures web and mobile web performance and experience. Moreover, the site’s average response time was 7.79 seconds for the weekend, more than three times slower than the top 50 retailer average of 2.25 seconds. <internetretailer.com>
Europe Producer Prices Fall for 10th Straight Month - European producer prices declined for a 10th month in October as companies continued to cut costs even after the economy emerged from the recession. Factory-gate prices in the euro region dropped 6.7 percent from a year earlier after falling a revised 7.6 percent in September, the European Union’s statistics office in Luxembourg said today. Economists had projected a decrease of 6.8 percent, the median of 18 forecasts in a Bloomberg News survey showed. From the prior month, October producer prices rose 0.2 percent. European companies may struggle to increase prices as rising unemployment prompts consumers to cut back spending and a stronger euro makes exports less competitive abroad. <bloomberg.com>
Risk Managed Long Term Investing for Pros
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