Tell It To Al

All these economists promising a return to economic growth this year must not be listening to the FedEx man.

“The operating environment for our first two quarters in fiscal 2010 is expected to be extremely difficult,” FedEx chief financial officer Alan B. Graf Jr. said after posting a wider-than-expected fourth-quarter loss.

Most tellingly, FedEx’s revenue fell 20% to $7.85 billion in the forth quarter. That’s 20% fewer packages than last year’s fourth quarter, when we were also mired in the recession.

It’s long been said, if you want to gauge how the economy is doing, check out FedEx and its larger rival UPS Inc. When they’re not shipping, the economy is tipping.

I don’t want to hear any bankers or Wall Street financiers whining about Obama’s plan for sweeping new regulations of the financial industry.

What did they expect?

Loosely regulated, many of them simply bankrupted themselves.

They divorced themselves from the consequences of their bad lending practices – all to bag their fat fees — and took down the global economy with their insane financial instruments.

And then when it all went bad, it was the government’s job – with trillions in taxpayer money – to bail them out.

Things may get worse before they get better. Banks have not recognized all of their losses. Yet now they’re starting to sing us a song about how regulation is going to be bad for the U.S. economy? That it will stifle innovation?

Maybe they are right. But hasn’t there already been enough “innovation” in the financial industry? These guys created paper products we still don’t understand and found ways to make loans to anybody with a pulse.

There is indeed a risk that the Obama-led charge will go too far – but didn’t our loosely regulated financial system already go too far?

Somebody’s got to protect these bankers from themselves.

Six Flags is bankrupt after an acquisition spree that left it with more than $2.4 billion in debt.

The Looney Tunes characters running through the company’s 20 parks seem to have gotten the best of Washington Redskins owner Daniel Snyder.  Synder waged a proxy battle in 2005, winning control of the company, it’s problems, and all of its debt. He was the man who promised to turn it all around, but a downturn in the economy exposed hinm as just  another Elmer Fudd.

Snyder installed a new CEO, Mark Shapiro, a wunderkind programming executive from ESPN, who had some success turning around operations.

But Snyder and Shapiro were unsuccessful managing the company’s debts – which is, uh-hem, the most important part of a turn-around strategy. Click here to read my column on Six Flags. I also talked about Six Flags with David Asman on Fox Business News.

I can’t believe the IRS wants me to pay taxes on any personal phone calls I receive on my employer-provided cell phone. Yet this has been the law since 1989.

I talked about the relatively unknown cell phone tax and health care reform with Connell McShane and Jenna Lee on web show, Fox Business Live.

They’re in and out faster than the paying customers.

Organized theft rings are increasingly hitting retailers in a souring economy, according to a report from the National Retail Federation. 

I talk about it on Denver’s 9News. (I also discuss the struggles of Krispy Kreme Doughnuts and the laments of a local car dealer losing his franchise.)

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Complaining about the abbrogation of your contract goes no where in bankruptcy court.

Bankruptcy, after all, is the fine art of abbrogating contracts.

That’s why Northglenn Dodge dealer David Fitzgerald says he’s is moving on. After bankrupt Chrysler cancelled his franchise agreement, Fitzgerald is filling his lot with used cars, and changing the name of his business to ngdcars.com.

He even keeps up his sense of humor. In this photo, he stands beside unsold new Dodges wrapped in police tape as a gag.

But breaking up is hard to do. Fitzgerald has sold Chrylers most of his life and says he’ll always be a Dodge man at heart:  “I would bleed Chrysler blue if you cut me.”

Click here to read my column on Fitzgerald.

Maybe GM should change its name. That’s the idea raised in an Associated Press story, suggesting that a brand that once stood for industrial might, is not only tainted, but too often the target of jokes. 

The AP mentions “Groveling Motors,” “General Moneypit,”  and “Government Motors.” But we could go on.

How about Great Maddness, Growing Misery, Gimme Money, Garbage Makers? Or Got Mechanic?

Plenty of adjectives start with G: Geriatric Motors, Gimpy Motors, Garrotted Motors, Gagging Motors, Gangrenenous Motors. 

What would you call GM?

One of the worst things that can happen to a company is a successful initial public stock offering, followed by an accounting scandal and then and economic downturn.

Krispy Kreme Doughnuts Inc. was one of the hottest IPOs of 2000 – amazing considering it was founded in 1937 and wasn’t a dot com. But stock that reached more than $50 a share has languished for years and now trades at $3.50.

Investors loved the doughnuts, but didn’t stop to realize that it’s difficult to support a business that takes up pricey retail space, selling mostly sugar, flour and grease. Still, not recovered from the Internet bust, Krispy Kreme is now struggling through the mortgage bust.

The company recently reported a 53% slide in profits – but at least it’s profitable.  Click here to see my column on Krispy Kreme.

(PHOTO: By Al Lewis)

Former Qwest CEO Joe Nacchio remains in prison as his lawyers file briefs to the U.S. Supreme Court.

(Click here to read Nacchio’s latest brief, filed today.)

Nacchio got nailed for insider trading, and his case has been lingering in the court system for years. The insider information he was alleged to have held was the knowledge that his famous bluster was in fact bluster.

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How about a stress-test do-over?

A Congressional Oversight Panel said the test of whether 19 major banks could survive  a further economic tumult was too easy.

The Federal Reserve Bank’s test involved a worst-case economic scenario, elements of which have already been exceeded. For instance, the test was based on a 2009 unemployment rate average of 8.9% , but in May it hit  9.4%, and it’s likely to hit the double digits before the year is through.

The results of Stress Test Light, disclosed last month, showed 10 of the 19 banks needed tens of billions more in capital. Imagine that.

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