After Plant Seizure, G.M. Becomes the Latest to Give Up on Venezuela
Venezuela was once among the most lucrative markets in Latin America for foreign businesses, a country oozing in oil and blessed with an emerging middle class hungry for everything modern, from new cars to snug-fitting disposable diapers.
But the good times are long gone, and on Thursday, General Motors became the latest in a wave of international companies that have shut their doors voluntarily or under duress.
In G.M.’s case, the Venezuelan authorities seized the company’s local vehicle assembly plant. America’s largest automaker said it had been forced to cease operations in Venezuela because of an “illegal judicial seizure of its assets” and would lay off its 2,700 workers there.
The move came amid violent street protests against the government of President Nicolás Maduro and a deepening economic crisis fueled by Venezuela’s heavy foreign debt and the retreat of world oil prices, which have slashed the country’s main source of income.
Subway's 2016 closing of 359 stores marks historic pullback for nation's most ubiquitous eatery
Subway Restaurants closed hundreds of domestic locations last year, marking the biggest retrenchment in the history of a chain that spent decades saturating America with restaurants.
The company lost 359 U.S. locations in 2016, the first time Subway had a net reduction. The store count dropped 1.3 percent to 26,744 from 27,103 in 2015, but Subway remains the nation's most ubiquitous eatery. (McDonald's Corp. is No. 1 by sales.)
The closely held company is coping with a sales slowdown in the U.S., made worse by the emergence of newer fast-casual rivals and the industry's heavy reliance on discounts and promotions. Subway also has lost some of its luster as a healthier-food option. It's been working to restore its status by eliminating antibiotics from its chicken and switching to cage-free eggs.
In another bid to revive growth, Subway is adding delivery services — a strategy that's also been embraced by McDonald's. And it even unveiled a new, more contemporary logo. But so far, the changes haven't helped much: Sales fell 1.7 percent last year to about $11.3 billion. Industrywide, same-store sales continued to slide in the U.S. during March. They dropped 0.6 percent in the fourth straight month of decreases, according to MillerPulse data.
Harley Davidson will shift production, lay off 118 Pennsylvania workers
Motorcycle maker Harley-Davidson Inc (HOG.N) said on Thursday it will lay off 118 workers at its York, Pennsylvania, plant and shift employment to Kansas City, Missouri.
The company said it told employees in November 2015 of plans to shift production of Harley-Davidson Cruisers from the Pennsylvania plant to Kansas City starting in the 2018 model year. Harley-Davidson told employees on Thursday it will cut about 118 positions in York and add 118 positions in its Kansas City plant, spokeswoman Katie Whitmore said.
Harley-Davidson on Tuesday reported a 25.6 percent fall in quarterly profit, hurt by a drop in shipments. The Milwaukee-based company's net income fell to $186.37 million, or $1.05 per share, in the first quarter ended March 26, from $250.49 million, or $1.36 per share, a year earlier.
Demand for Harley's motorcycles in the United States has slowed as its loyal baby boomer demographic ages and rivals such as Indian motorcycle-maker Polaris Industries Inc (PII.N) and Japan's Honda Motor Co Ltd (7267.T) offer competitive discounts.
Moody’s Chief Economist: The economy is in ‘pretty good’ shape
Fewer than 5% of engineers trained in India are cut out for high-skill programming jobs
When considering Indian engineering talent, quantity trumps quality. Indian universities may be churning out the world’s largest engineering population, but the graduates’ skills levels aren’t high. In 2011, India’s National Association of Software and Services Companies estimated that only 25% of India’s IT engineering graduates were employable. Six years on, the talent pool is still in dire straits.
“Only 4.77% candidates can write the correct logic for a program, a minimum requirement for any programming job,” a recent Aspiring Minds study of over 36,000 engineering students in India revealed. The employability assessment company tested students from IT-related streams of study at more than 500 colleges across India on Automata, a machine learning-based assessment of software development skills.
“The IT industry requires maintainable code so that it is less prone to bugs, is readable, reusable and extensible,” the study notes. “Time efficient code runs fast.” Only 1.4% of programmers surveyed could create code that was functionally correct and efficient, meaning it does what it’s supposed to do and in a reliable and speedy manner.
More than two-thirds of the candidates from the top 100 universities in the country were able to write “compilable code,” or that which does not throw errors when compiled into machine-readable code. In the rest of the colleges, only 31% of students were able to write compilable code.
Gas prices are predicted to rise for no good reason
The tradition continues. And it’s costing you money. Every year at this time speculators in the financial markets attempt to push up the price of gasoline — using the excuse that we will soon enter the “peak driving season.”
Ordinarily, peak driving in the US starts Memorial Day weekend — which begins on the afternoon of May 27 this year — and continues until Labor Day.
In normal times, it makes perfect sense for oil and gasoline prices to jump in advance of summer. More people on the roads means greater gasoline consumption, which in turn results in higher prices.
And higher gas prices are already happening — but not because demand is rising or because there’s a shortage of either oil or gasoline. Prices are rising because energy speculators around the world are anticipating that they will jump. That’s going to be the wrong call for the second straight year. According to the US Energy Information Administration, the price of a gallon of gasoline now averages $2.44. That’s around 12 cents a gallon higher than it was just a month ago.
Oakland Creates Country’s First ‘Sanctuary Workplaces’ for Illegal Immigrants
There are hundreds of sanctuary cities nationwide, providing relief from the prospect of deportation to undocumented immigrants who live and work in those places. American colleges and universities have followed suit, becoming part of a major movement nationwide to create “sanctuary campuses.”
And now, Oakland, California, appears to be the first city to champion “sanctuary workplaces” through a city council resolution adopted earlier this week. The measure, championed by immigration rights groups, would prevent employers from working with Immigration and Customs Enforcement to identify employees who are in the country illegally.
“Sanctuary workplaces” are places “where workers are respected and not discriminated against or threatened based on their immigration status,” Oakland City Council member Abel Guillen, who introduced the bill, told local news. “Workers, regardless of their immigration status, have rights,” he added.
Of course, not all employers are happy about the development, because it likely means that they can’t fire or punish employees they discover have violated the law during a self-audit, putting employers at risk of punishment for hiring illegals. It also requires that employers refuse to work with ICE if immigration enforcement shows up at their door.
Fed fines Deutsche Bank $156.6M for multiple trading violations
The Federal Reserve will fine Deutsche Bank $156.6 million for “unsafe” foreign exchange trading practices and for violating a rule banning insured banks from trades with its own capital, the central bank announced Thursday.
The Fed fined the German bank $136.9 million after several Deutsche Bank foreign exchange traders coordinated the sales and purchases of foreign currency with competitors in online chatrooms.
The Fed also fined Deutsche Bank $19.7 million for failing to create adequate controls to prevent “Volcker Rule” violations. That rule, a part of the Dodd-Frank financial reform law, bans government-backed banks from making “proprietary” investments, or trades with the bank’s own money.
“The Board also found that the firm failed to properly undertake certain required analyses concerning its permitted market-making related activities,” said the Fed. “The consent order requires Deutsche Bank to improve its senior management oversight and controls relating to the firm's compliance with Volcker rule requirements.”
Only 4% of Uber drivers remain on the platform a year later
Add to the list of problems at Uber: Driver retention. Only 4 percent of people who sign up to drive for the ride-hailing service are still driving a year later, according to a report in The Information.
The company's accelerating driver drop off rate is partially due to increased competition from companies like Lyft. But the number one complaint among Uber drivers is the pay, according to undisclosed data seen by The Information. Many Uber drivers have complained about unfair compensation for long trips, and not being able to accept tips.
An Uber spokesman told The Information: "We recognize we need to improve our relationship with drivers and their experience using Uber. We're working on a range of improvements across our products, our policies, our customer support and how we communicate."
The company is considering things like better targeting financial bonuses to certain drivers and allowing tipping, which could allow drivers to earn more, according to The Information. Lyft, its main competitor, already gives riders the option to leave a tip.
$30,000 robot will make you a salad
Sally doesn't clean, chop or toss vegetables. The new salad robot making its debut in San Francisco this month is more like a salad vending machine: Press a few buttons on a touchscreen and it drops neat portions of refrigerated ingredients into a bowl.
But Sally the Salad Robot could be the latest step in automating some of the more repetitive parts of food preparation. Its creators hope food robots can help with one of Silicon Valley's biggest restaurant problems: a shortage of kitchen workers.
Sally is the first product from Chowbotics, a Redwood City startup developing robots for the food-service industry. CEO and Founder Deepak Sekar spent two years creating Sally with help from Apple (AAPL, Tech30)Fellow Rich Page.
"I've always thought cooking was 20% creative work and 80% formulaic work like chopping," said Sekar. He also worked with ex-Google (GOOG) chef Charlie Ayers, an early Google employee who has gone on to open his own restaurant in Palo Alto, Calafia Café, and work on food startups.
Fastest growing expense in federal budget is interest expense
A Quarter of Millennials Who Live at Home Don’t Work — or Study
A life of leisure, free of bosses and bills, sure sounds like the dream — and it turns out millions of millennials are living it. But don't congratulate them yet. They're doing it under their parents' roof and not necessarily by choice.
About a third of 18- to 34-year-olds in the U.S. live at home, the Census Bureau reported on Wednesday. That includes college dormitories. Among 25- to 34-year-olds living at home, one in four is neither enrolled in school nor working. That's 2.2 million people, a small percentage of the nation's more than 70 million millennials but a striking figure nonetheless.
More 18- to-34-year-olds live with a parent than with a spouse, according to the report, The Changing Economics and Demographics of Young Adulthood: 1975–2016. That's a major shift from the 1970s, when young people were more than twice as likely to live with a spouse. Young adults today are also likelier to be enrolled in college or graduate school than their counterparts in the '70s.
Most of those who live at home but neither work nor study have a high school diploma or less, and about a fifth have a child. Half are white, and the majority are male. About a quarter have a disability.
Sears has been quietly closing more stores than it said it would
Sears Holdings announced in January that it would shut down 150 stores this year, with most locations closing by April. Now the company is closing even more stores.
Sears, which owns both Sears and Kmart stores, has been notifying local media of the additional closures over the last several weeks.
Most of the stores on the new list will start liquidation sales in April and close in July. Sears didn't immediately respond to a request for comment on how many more closures will occur this year.
Sears chief financial officer, Jason Hollar, suggested in March that the company would be closing stores in addition to the 150 already announced this year. In a prerecorded conference call, Hollar said the company was looking for ways to generate "liquidity" — in other words, cash — and he specifically highlighted the company's real estate.
Should RadioShack Executives Get $1.4 Million In Bonuses? No, Say Creditors
When a company has filed for bankruptcy and is closing stores, should the leaders who helped it to get there be rewarded with bonuses? That question has come up in the proceedings for RadioShack’s second bankruptcy in just over two years, and the company’s creditors and court-appointed trustee have responded with a resounding “nope.”
If that sounds familiar, it’s because the original iteration of RadioShack set aside $3 million to give bonuses to executives and key employees the last time it filed for bankruptcy, back in 2015.
The committee of unsecured creditors didn’t necessarily object to the bonus plan, but to its structure, arguing that the plan requires only one thing: that the company keep to its budget to run its remaining business during the bankruptcy proceedings. This doesn’t require any particular effort on the executives’ part, since the budget has already been approved. The employees will not receive the payments if they resign.
“As such, the [bonus plan] is really a disguised retention plan for the Debtors’ most senior management,” the creditors’ attorneys argue [PDF]. In a bankruptcy, it can be legitimate to award bonuses or key employee incentive payments (KEIP) to important executives and employees. The 2005 revision of the U.S. bankruptcy code spells out that these incentive payments have to actually be tied to something that the employee is responsible for, and can’t be a reward for simply sticking around through a reorganization or liquidation.
The Official New Word That Will Forever Replace The Term Retirement
A dear friend of mine truly despises the term retirement. He’s 60 years old but thinks, acts, and feels like he is 40. During a recent conversation, he emphatically said, “Do you know what retirement means? To withdraw from life. I’m not withdrawing from life – I can work circles around you and most people younger than me… plus I have years of knowledge and experience to rely on.”
He literally has a physical reaction to the term retirement and he is not alone. Time and time again, I hear people talk about the need for a new word and I’ve heard everything from rewirement, encore life /career, third age /stage, retirementhood, and the list goes on.
It’s interesting because people have all along been searching for the wrong type of replacement. What baby boomers need and what has been sitting right in front of them for years is a simple upgrade to the term retirement that relieves them from the idea of feeling old, incapable, out-of-touch, or withdrawn. Simply put, the official new word that replaces the old and outdated concept of retirement is actually Retirements. This represents a functional shift that changes everything.
First, it makes the decision to retire from something much easier. Right now, the decision to retire is one of the most stressful things people put themselves through. They rack their brains, run all the numbers, and waste a lot of time and energy trying to prepare for everything that might come up. They worry if they will have enough money, what they will do with their time, how they will make an impact, how they will spend all day with their spouse, and so on.
A Cashless Economy at a Cracking Pace: How the EU Commission Short-Circuits Central Banks
The European Union Commission knows that the best way to push a reform through is for nobody to notice, by breaking it down into a thousand little adjustments and not packaging it into one major change. Its intention to ban cash from the Eurozone is therefore going at a slow and steady pace, after restricting large amounts of border-crossing cash transfers.
The Deutsche Bundesbank has responded to the EU Commission's move by promoting its International Cash conference “War on cash: Is there a future for cash?” Although the conference is yet to come, its mere existence shows that suppressing currency from our economies is not an obvious should-do for the Bundesbank. If it were, they would quietly go along with the EU's slow choke on cash. The Bundesbank, like many other market participants, has its doubts on the bold move.
Indeed, the perfectly secure nature of digital currency is not convincing to all as a blockade against crime and corruption. The Nigerian Central Bank, which is precisely tackling such matters, “warns against digital currencies. The central bank of Nigeria (CBN) warned banks against dealing with non-bank entities acting as virtual, laundering activities, tax evasion or to finance terrorist networks. Moreover, the central bank reminded, already warned off digital currencies earlier this month. Banks must ensure that such companies perform extensive anti-money laundering and counter the finance.”
Central banks have long figured out that, although crime rings and corruption networks do use cash, they are just as able to use digital currency, using front companies and rattles, to maintain their lucrative and illegal operations.
U.S. Considers Lifting Oil Sanctions On Iran
While acknowledging that Iran has so far complied with the nuclear deal it agreed to, U.S. Secretary of State Rex Tillerson said on Tuesday that the Islamic Republic continues to sponsor terrorism, and an interagency review will evaluate whether continuing to lift sanctions would be in U.S. national security interests
“Iran remains a leading state sponsor of terror, through many platforms and methods. President Donald J. Trump has directed a National Security Council-led interagency review of the Joint Comprehensive Plan of Action that will evaluate whether suspension of sanctions related to Iran pursuant to the JCPOA is vital to the national security interests of the United States,” Secretary of State Rex Tillerson said in a letter addressed to the Speaker of the House of Representatives, Paul Ryan.
The Secretary of State did not specify how long the review would take, but noted that “when the interagency review is completed, the administration looks forward to working with Congress on this issue.”
Since some of the international sanctions on Iran were lifted in January 2016, the Islamic Republic has vowed to regain the share of the oil market it had lost, and to reach pre-sanction output levels of around 4 million bpd.