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Russ Henke
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Author: |
Russ Henke |
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3/2/2007 6:15 AM |
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Thoughts of interest to COFES and COFES attendees |
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Irrational Exuberence? July |
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By Russ Henke on
8/14/2007 8:07 AM
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This blog entry was written on July 15, 2007:
Over the past few months, weaknesses in the US economy have been reported frequently in the blog entries in this space and of course in the financial press. Yet despite these weaknesses and the ongoing misery of ordinary folks dealing with the housing slump and higher gas & food prices, the nation's stock markets have ignored hedge fund and sub-prime loan problems, and soared to record levels. On Friday July 13, 2007 alone, the Standard & Poor’s 500 index closed above a high set in March 2000 and the Dow Jones industrials blew by 13,900 for the first time in history.
In related news, US retail sales dropped 0.9% in June, and the US Trade DEFICIT widened again in May. The United States’ oil import bill alone increased to $19.0 billion - the largest since September 2006. The US trade deficit with China widened 3.3% in May to $20.0 billion, and the June gap could be even larger. Meanwhile, China posted ...
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Corroboration |
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By Russ Henke on
7/1/2007 3:59 AM
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It’s often surprising to find immediate corroboration of a theme for blog entries that appear in this space. Not two days after the previous June 24 & 25 blog items were published here about “The Rich Getting Richer", Merrill Lynch and the Cap Gemini Group released their annual World Wealth Report. In 2006, the world’s wealthiest saw their combined riches grow by over 11%! Fully 800,000 more people were added in 2006 to the rolls of folks who hold over $1 million in financial assets (not including their primary homes), up from 8.7 million such individuals in 2005. The combined wealth of these fortunate few totals over $37.2 trillion. That's “trillion” with a “t”, and adds up to a fourth of the entire world’s total wealth, about three times the US GNP. Of course, the US leads the pack of such rich people.
But hey, these rich folks are generous. In 2006, ...
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Post Script to June 24 Blog Entry |
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By Russ Henke on
6/25/2007 4:14 AM
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Some readers of yesterday's blog entry may be wondering if they might have missed the chance to ride the first day's price appreciation (over 13% in 8 hours) -- if only they had acted on Thursday June 22, the day before the Blackstone Group's IPO. Not to worry. It would have been difficult, since most Blackstone shares were already snapped up by money managers and big financial institutions.
But, hey, the stock is now publicly traded -- you can take your chances on future Blackstone appreciation -- call your broker! And remember, having watched what the Blackstone Group just did, other "alternative investment funds" may now choose to go public, such as KKR, The Carlyle Group, and more.
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Are the Rich getting Richer? |
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By Russ Henke on
6/24/2007 5:33 PM
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Among all the factors plaguing the vast majority of US citizens, very little space in these blog entries to date has been devoted to the unremitting and enervating trend over the last six-and-a-half years, of the rich-getting-richer, and the poor-getting-poorer in the United States.
With the US government (a) providing unwarranted tax cuts favoring the rich, (b) encouraging rising energy prices by condoning the lack of new oil refineries, (c) stoking international fear, anxiety and doubt, and (d) implementing countless other such policies, the resulting economic conditions have allowed the US wealthy to thrive while US workers’ wages have not even kept up with inflation, despite massive worker productivity gains during the period.
In the last few days, we have witnessed a quintessential example of the “rich-getting-richer” syndrome. Run by billionaires, the private-equity giant Blackstone Group popped up again in the news June 21, 2007 when Re ...
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Cadence in the News June 4 |
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By Russ Henke on
6/5/2007 11:01 AM
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In the June 3 blog entry in this space, Cadence was mentioned as one of the Big 3 EDA vendors. The New York Times reported on June 4, 2007 that Cadence is in talks with at least two buyout firms about a possible sale of the company. Cadence is said to have held talks with Kohlberg Kravis Roberts and the Blackstone Group. But they warned that a deal may not happen because of the “complicated risks in the company's business”. Other private equity firms apparently have looked at Cadence, but passed.
Like the private equity purchase of MCAD vendor UGS several years ago, (prior to its acquisition by Siemens this year), a deal for Cadence would be one of the biggest moves by private equity firms into technology, a sector they are said to avoid because of its volatility and capital needs. Though both Kohlberg Kravis and Blackstone have invested in technology firms before — most recently, Kohlberg bought the First Data Corporation and Blackstone purc ...
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MCAD & EDA in Q1 2007 |
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By Russ Henke on
6/3/2007 5:32 PM
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On May 27, 2007, I had planned to use this space to
report the financial results of the top three MCAD
vendors and the top three EDA vendors for Q1 2007.
However, comments on Memorial Day remembrances took
precedence.
For the record, in nominal Q1 2007, Autodesk broke
into the rarified atmosphere of eclipsing $500 million
in total revenue for Q1 (at $509,000,000). Dassault
Systemes posted $381,000,000 in revenue, and
Siemens UGS came in at $302,000,000.
An earnings' comparision will have to wait, as neither
Autodesk nor UGS reported earnings this quarter, each
for different reasons.
EDA vendor Cadence reported $385,000,000 in revenue in
Q1, followed by Synopsys at $293,000,000, and Mentor
Graphics at $190,000,000.
& ...
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Dates, Days and Deaths |
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By Russ Henke on
5/27/2007 6:12 AM
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The latest Q1 2007 financial results from the
leading MCAD and EDA vendors are finally out,
and I wanted to discuss them in today's blog
entry.
But Memorial Day 2007 is upon us, just about
1487 days since the infamous declaration of
"Mission Accomplished" in IRAQ. And the
situation there is getting worse, not better.
Over 100 American GI's have been killed in May,
with 5 more days to go. Some 104 soldiers were
killed in April. The last six months have been
the most deadly six months of the war. And
thousands more GI's have been injured, many
incapacitated for life. To say nothing about
the tens of thousands of Iraqis killed and
injured. And further, there is still no end
to the IRAQ war in sight. Millions of Iraqis
have fled the country, more by the day.
And don't forget, the war in Af ...
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Still Looking for Some Good News... |
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By Russ Henke on
5/20/2007 12:32 PM
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Here are some more headlines from May 16 - 20:
Because the US Army is so over-stretched today, more
than 25,000 US National Guard troops are now serving
in Iraq. Nearly 5,000 are also in Afghanistan and 6,000
more are stationed along the Mexican border. Because
of equipment left behind in Iraq and Afghanistan,
domestically-based Guard units have only 40% of
the equipment they need for disaster response.
Nearly 90% of stateside Guard units are rated
less than fully ready (for domestic duty)
because of equipment and training shortfalls.
Scientists working with the US Defense Department
have found evidence that a low-level exposure to
sarin nerve gas — the kind experienced by more
than 100,000 American troops in the Persian Gulf
war of 1991 — could have caused lasting brain
deficits in former service members.
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The Week in Review |
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By Russ Henke on
5/13/2007 7:20 AM
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Again this past week, the economic news contained
some ominous signs for the businesses and people
of the United States.
Here are just a few items:
- The US Trade Deficit surged in March '07,
up 10.4% from the February level. So far
this year, the US trade deficit is running
at an annual rate of $723 billion, just
a tad below the $765 billion deficit set
in 2006, the fifth consecutive year of
record trade deficits.
- And this was reported as good news: "In
a reversal of recent trade trends, the trade
deficit with China improved in March 2007,
growing by (only) $17.2 billion compared with
an increase of $18.4 billion in February."
- Growth of the US economy, as measured by the
GDP, slowed ...
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Happy Cinco de Mayo |
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By Russ Henke on
5/5/2007 10:13 AM
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On April 7, 2007, the blog entry in this space began as follows:
Yesterday, April 6, 2007, the US Labor Department reported that
180,000 new jobs were added to non-farm US payrolls in March.
This figure elevated the average number of new jobs added per
month in Q1 2007 to 151,000. While 151,00 per month may
seem large, and it is compared to the dismal record over the
last six years, 151,000 per month does not even keep pace
with the need for new jobs generated by normal US population
growth.
Yesterday, May 4, 2007, the Labor department revised these numbers, having
overstated the February and March job gains by some 26,000. This correction
lowers the Q1 average per month to an even weaker 142,000.
But the cha ...
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