San Francisco Soda Tax Passes

Posted on by Scott Hodges
Voters in San Francisco, California have passed a tax on sugary beverages. The goal to target soda in order to stem the rise in obesity and diabetes has been gathering support.
The World Health Organization has recently recommended that governments introduce taxes of this sort in a bid against obesity, diabetes and other diet-related diseases.
Those who oppose these taxes argue that they really hit the lower income populations the hardest. Certainly, the soda companies are fighting the taxes as soda consumption is falling. The San Francisco measure passed with 62% to 38%.
Learn more about these initiatives and others like them around the country.

Amblin Partners & Alibaba Pictures Group Ltd. Joins Forces

Posted on by Scott Hodges

In an interesting move towards partnership, Steven Spieldberg’s Amblin Partners is joining forces with Alibaba Pictures Group Ltd., the film studio section of Alibaba Group Holding Ltd. They plan to co-produce and finance films for both global and Chinese audiences.

In a joint statement, they also said that they plan to collaborate on the marketing, distribution and merchandising of Amblin Partner films in China.

Alibaba Pictures has not, yet, released any films. But if they join with Amblin Partners, which creates films, television and digital content under the Amblin Entertainment, DreamWorks Pictures and Participant Media brands.

Alibaba Pictures has actually invested already in some Hollywood films including “Mission: Impossible- Rogue Nation” and “Star Trek Beyond.”

GlaxoSmithKline Selects New Chief Executive

Posted on by Scott Hodges

GlaxoSmithKline has chosen Emma Walmsley, head of consumer healthcare, as its new chief executive. Both internal and external candidates were considered for the position. Walmsley first joined GlaxoSmithKline in 2010 from L’Oreal and will replace Andrew Witty. As Chairman Philip Hampton said,


“Under Andrew’s leadership, GSK has successfully developed into a company with market-leading positions in pharmaceuticals, vaccines and consumer healthcare.  These provide excellent platforms for sustainable, long-term growth, and we are confident Emma will successfully build on these strengths.”

Boost for Back-to-School Sales

Posted on by Scott Hodges

The back-to-school supply sales this year have been the fastest growing in four years. This is the second most important season for retailers, after the Thanksgiving season, and the back to school period spans from July to September. It includes clothes, shoes, electronics, backpacks and more.

The good weather has also helped to bring shoppers into the stores, rather than just to online superstores like Amazon.  The total back-to-school sales rose 2% in July, as compared to the 1% growth in 2015 and 2014 according to payment technology company First Data.

The prediction is that back-to-school and college spending will get to $75.8 billion this year according to retail association National Retail Federation’s survey each year.

Interestingly, schools have been asking students to save their work on USB drives, and this has boosted the sale for small devices. Best Buy has been tempting students with special coupons for laptops, headphones, small refrigerators and more. J.C. Penny has also done many promotions just as their “Penney Day” which offers many back-to-school staples at discounts on Saturday during the season.
It’s interesting to note that customers are flocking to the less expensive stores, rather than looking for the fancier name brands. As RBC Capital Markets analyst Brian Tunick explained, stores like Old Navy, TJ Maxx and Kohl’s are the top picks for 2016.

AIG Selling Their Mortgage-Guaranty Unit

Posted on by Scott Hodges

The American International Group Inc. (AIG) has said that they will sell their mortgage-guaranty unit to Arch Capital Group Ltd. for approximately $3.4 billion. They believe they will get $2.2 billion in cash, $250 million in Arch Capital’s perpetual preferred stock and $975 million in non-voting common-equivalent preferred stock from selling United Guaranty Corp.
AIG promised shareholders a massive overhaul and they are now following through. They are spinning off the mortgage insurance unit, cutting jobs and selling their broker-dealer network. 

Learn the full details to find out more.

Shake Ups in the Online Gaming World

Posted on by Scott Hodges

Apparently online gaming is the place to be, if this recent acquisition gives a hint about popularity of such activities. A Chinese consortium that includes Shanghai Giant Network Technology Co. Ltd. and Alibaba’s founder Jack Ma have agreed to acquire Caesars Interactive Entertainment Inc.’s online games unit. They are paying $4.4 billion in cash for this acquisition.

China has the world’s largest online gaming market at the moment. They are now looking to expand out of this bubble. Recently, for example, Tencent Holdings Ltd., China’s largest gaming group, agreed to purchase a majority stake in Supercell from SoftBank Group Corp. This deal was worth $8.6 billion. 

Learn more about these deals and the plans that Chinese companies have for expansion.

US Job Growth Turns Up

Posted on by Scott Hodges
US job growth was on a major upturn in June as there was a boost in hiring. The first quarter showed a lull and now the economy looks like it’s heading back up. The Federal Reserve will probably not raise interest rates soon.
Payrolls in the nonfarm sector increased by 287,000 jobs last month. This is the largest gain we’ve seen since last October according to the Labor Department. These signs of strength came, however, before the Brexit vote on June 23, raising fears that these great advances may not continue.
As Millan Mulraine, the deputy chief economist at TD Securities in New York said, “For the Fed, this report is likely to offer some encouragement on the underlying labor market backdrop, though it is unlikely to change the current ‘wait and see’ policy stance as they assess the fallout from the Brexit vote.”

A Major Purchase: Microsoft Corp. and LinkedIn

Posted on by Scott Hodges

Hang on to your hat, because Microsoft Corp. is heading towards buying LinkedIn Corp for $26.2 billion. The combination allows for software like Microsoft Word and PowerPoint to connect with LinkedIn’s 433 million professionals. As Microsoft CEO Satya Nadella said on a conference call with analysts, “LinkedIn and Microsoft really share a mission…There is no better way to realize that mission than to connect the world’s professionals.”

As Forrester analyst Ted Schader said, “It’s a massive growth play for Microsoft.”

LinkedIn makes most of its $3 billion in annual revenue from job hunters and from recruiters who pay a monthly fee in order to post resumes and connect with people.

Gains in Single-Family Home Sales Across the US

Posted on by Scott Hodges

In great news, new US single-family home sales have had their biggest gain in 24 years with the April numbers. As the report from the Commerce Department shows, there is also a surge in new home prices.

As Chris Rupkey, chief economist at MUFG Union Bank in New York said, “Consumers are taking the leap and buying the biggest of big ticket items of their lives and this speaks to confidence. The Federal Reserve can raise rates at their June meeting without fear the economy is going to slow.”

The new home sales went up by 16.6% to an annual rate of 619,000 units. This is the highest level that it’s been since January of 2008 and the percent increase was the most since January of 1992.

The only exception was in the Midwest where new home sales did not increase broadly.

Learn more about these developments and get the full story here.

Merging Communication Companies

Posted on by Scott Hodges
Friday, the US Federal Communications Commission confirmed that they have voted to approve the acquisition of Time Warner Cable Inc. and Bright House Networks by Charter Communication Inc. This would create the second-largest broadband provide and the third-largest video provider. It’s now waiting for approval from regulators in California. That decision is expected at a May 12 hearing.

As Tom Rutledge, the president and chief executive of Charter said on Friday, the transactions will have “significant benefits.”

Friday, the FCC said in a statement that an  “order detailing the commission’s reasoning and the conditions will be issued in the coming days.”

Read the whole article and learn more.