Tell It To Al

Now here’s a business plan. Make something cheap. Then sell it even cheaper.

It costs Amazon $209.63 to make its tablet computer, Kindle Fire, according to an analysis by market intelligence firm, IHS iSuppli. It’s selling them for $199. Click here to read the analysis.

IHSiSuppli counts this as a good strategy. “The Kindle Fire, and the content demand it stimulates, will serve to promote sales of the kinds of physical goods that comprise the majority of Amazon’s business,” it’s report says.

But it’s buy low, sell lower. Airlines tried this in the early 2000s, selling tickets below costs to grab market share. Mostly where it landed them was bankruptcy court. Amazon is rich enough to gamble, but pound for pound, the iPad is going to be hard to beat.

I’m fascinated with entrepreneurs who’ve found ways to thrive in these difficult economic times.

Meet Treb Heining, who started making his living blowing up balloons 40 years ago. You’d think he’d be out of gas by now after setting Guinness records for balloon releases and inventing things from balloons that we take for granted today, like the giant balloon arch.  But Heining is hardly winded. He’ now selling balloons shaped like animals that barely hover above the floor, making them appear to walk.

They’re hot sellers, even in the aftermath of a bursting housing bubble, he says. Check them out at myownpetballoon.com. And click here to read my column on MarketWatch.

Watch the latest video at video.foxbusiness.com

The guy who called the Summer Crash of 2011 is now predicting a stock market rally.

Click here to read Pension Partners Chief Market Strategist Michael Gayed’s latest forecast and watch him above explain his buy-and-rotate investment strategy on Fox Business News.

And click here to read the column I wrote on Gayed in August.

Lowering interest rates to effectively zero and playing all kinds of games to hold them there indefinitely may do more harm than good in the long run.

One of the few members of the Federal Reserve Bank who take this view, Thomas Hoenig, is retiring Oct. 1.  Here’s what he says in his parting speech:

“When you encourage consumption by inhibiting your interest rates from rising to their equilibrium level, you will in fact buy problems, and we have in fact bought problems.”

The good news is that while Hoenig expects slower growth for the foreseeable future, he does not expect the economy to “fall off the cliff.”

He is being replaced by Esther George. We’ll see what her views are in the months to come – particularly about this cliff thing.

Click here to read more  on Hoenig’s parting speech. And click here to read the column I wrote about Hoenig in June.

I shot this photo, by the way, while touring the Moots bicycle factory with Hoenig this summmer. Hoenig is also fond of a notion that too many others find quaint: that the United States actually needs to make something.

Hewlett Packard goes through CEOs like printer paper.

It’s only a matter of time before Meg Whitman ends up like the last ones.

In the meantime, there’s always some hope she can do some good at the computer-maker that has so popularly described as “dysfunctional.”

Click here to read my column on MarketWatch.

George Burnett, CEO of Alta Colleges,  the parent company of Westwood College and Redstone College, will resign at the end of the month, but will remain on the board, a spokesman for the privately held company said Monday.

Burnett, a former Qwest executive, has led Alta and Westwood for the past five years, serving at a time when for-profit schools  came under fire for high student default rates and aggressive sales tactics. Westwood’s alleged problems preceded Burnett, but came to the fore in in lawsuits and even a U.S. Senate hearing during his tenure. Burnett did not give a reason for his decision to leave his post.

Dean Gouin will replace Burnett as CEO, effective October 1. Gouin is a 15-year veteran at the company, having filled positions in human resources, financial aid, career development services, and student services before becoming chief operating officer of Westwood College.

“Dean is the right person to lead this company into the future because of his business and operational knowledge, his tenure with us, and his passion for serving our students, faculty and staff,” Burnett said in a statement.

Here are columns I’ve written about Westwood over the years. Burnett has weathered quite a storm, but was willing to sit down and talk about it and make changes at the school.

Ex-Nacchio Cronie Heads To College. Sept. 8, 2006.

A Drive-By Education Doesn’t Come Cheap. May 29, 2009.

An Education In Boiler Room Tactics. Aug. 7 2010.

Westwood College CEO Shaken Up After Senate Hearing. Aug. 10, 2010.

You’re hearing the old  efficiency mantra now more than ever: Do more with less.  Raleigh, N.C. -based Workplace Options calls it “worker intensification,” and Americans are doing a lot more of it these days.

Workplace Options, an employee benefits provider, says 62% of the American workers it surveyed say their employer is   trying to get more work out of each employee, typically with no prospect of any kind of reward. Click here to read the survey.

“In times of economic uncertainty a lot of the burden falls on workers,” said Dean Debnam, chief executive officer of Workplace Options. “Employers are forced to make ends meet with fewer resources and turn to their staff for help.”

Of those surveyed 51% say the increased workload has negatively affected their well-being and 37% said they won’t be able to sustain their current workload in the long run.

Still, it sure beats unemployment.

Imagine touring the Butner Federal Corrections Complex in North Carolina.

Bernie Madoff, the world’s greatest Ponzi schemer, points to a cell across the block and grins like Hannibal Lecter. “See that guy?” he whispers. “He used to work at the Securities and Exchange Commission.”

Last week, the SEC’s Office of Inspector General turned over its investigation of a top former SEC official to the Justice Department for possibly violating criminal conflict-of-interest laws.

David Becker may never be criminally charged, but even the possibility of charges is an outrage unto itself. Becker began mounting his defense in a Congressional hearing on Thursday. He said he discussed his personal financial ties to Madoff with the SEC’s ethic’s office and SEC chief Mary Schapiro. And they gave him the OK to proceed on Madoff matters before the SEC.

“I did precisely what I was supposed to do,” Becker testified. But did Schapiro and the rest of the SEC?

Becker, who was the SEC’s top lawyer, inherited a $2 million Madoff account when his mom died in 2004. His His brother liquidated the account to pay estate taxes, years before the Madoff fraud came to light. But things got sticky for Becker when a trustee sued him for fictitious profits in his mom’s account.

Despite this situation, Becker went right on dealing with Madoff matters before the SEC, influencing such questions as how much investors should receive in compensation from the Securities Investors Protection Corp., and whether Congress should limit clawback lawsuits.

We’ll have to leave it to the Justice Department to decide just how heinous a conflict-of-interest this was. Meantime, Madoff can relish the irony.

Reminds me of a a line from Lecter in the 1991 film, “Silence of the Lambs”: “I have followed with enthusiasm the course of your disgrace and public shaming.”

Click here to read my column in The Sunday Wall Street Journal.

What kind of choices will you make once you are down to your last $1,000?

Find out by playing “Spent,” the online game that gives you a glimpse at what it’s like to be poor.

Click here to play.

The game is the brainchild of Jenny Nicholson, a copywriter for ad agency McKinney in Durham, N.C. She based the game on some of the options she faced growing up up poor.

She wants every member of Congress to play it, too. Click here to see her petition.

Click here to read my column on MarketWatch.