Carpe Diem

Emerging Markets to the Rescue? Recurring Theme

Emerging Markets Rev Up Toyota Sales–Toyota’s profit for the fourth quarter jumped 7.5% from the previous year as booming sales in China, Africa and South America offset declining US sales and a stronger yen, the Japanese car maker reported yesterday.

Overseas Snack Sales Help PepsiCo Meet Expectations–The snacks business registered double-digit growth in Russia, the Middle East, Turkey and India. The beverage business had double-digit increases in the Middle East, China, Brazil, Argentina, India and Russia. PepsiCo reported a quarterly profit on Thursday that met analysts’ expectations.

Carpe Diem

Why Mint the Penny When It Costs 1.675 Cents?

CBS 60 MINUTESShould the U.S. Mint continue to produce pennies and nickels whose metal content is worth more than their face value? Why mint the penny, when it costs $134 million to make $80 million worth of what most people consider nuisance coins (see chart above of rising copper prices)?

The situation irks Edmund Mony, the director of the U.S. Mint, who would like Congress to find a solution. “You can’t sustain losses on pennies and nickels and expect to be a viable organization that benefits the American people,” says Moy.


Is that really a bureaucrat talking!

Watch “60 Minutes” this Sunday night at 7 p.m. on CBS for the story.
Carpe Diem

1845 vs. 2008: Protectionism Hasn’t Changed

In a classic, satirical anti-protectionism essay by French economist Bastiat, French candlemakers’ in 1845 petitioned against “the ruinous competition of a rival who apparently works under conditions so far superior to our own for the production of light that he is flooding the domestic market with it at an incredibly low price; for the moment he appears, our sales cease, all the consumers turn to him, and a branch of French industry is all at once reduced to complete stagnation. This rival is none other than the sun.”

According to yesterday’s FT Times, The European Candle Institute is currently petitioning the European Union against “a surge in Chinese candle imports that is unfairly damaging our businesses.”

The complaint says that hundreds of jobs have been lost in the past few months, and that Chinese producers are selling below the costs of their EU rivals.

The French candlemakers in 1845, according to Bastiat, wanted to pass a law “requiring the closing of all windows, dormers, skylights, inside and outside shutters, curtains, and blinds — in short, all openings and holes through which the light of the sun can enter houses, to the detriment of the candle industry.”

The European candlemakers today want to impose anti-dumping duties against China in retaliation against “unfair prices.”

Same difference.

HT: Tim Worstall

Carpe Diem

“Euros Accepted” Signs Sighted in NYC

NEW YORK — Some New York City businesses have begun accepting euros as payment for merchandise, as the dollar remains weak against the European currency.

Signs reading “euros accepted” are now being posted in store windows around the city, including liquor stores in the East Village and clothing stores in Midtown.

Foreign tourism to New York City reached record levels last year, as European tourists flock to New York to shop and dine.

Carpe Diem

Rx:1,500 Market-based Retail Health Clinics in 2008

ASSOCIATED PRESSWal-Mart Stores Inc. will open its first in-store medical clinics under its own brand name after leasing space in dozens of stores to outside companies that operate the quick-service health stops.

The world’s largest retailer said Thursday it will open “The Clinic at Wal-Mart” (pictured above) as a joint venture with local hospital systems in Atlanta, Dallas and Little Rock, Ark., starting in April.

Bentonville, Ark.-based Wal-Mart is among several U.S. supermarket and drug store chains that in the past couple of years have begun opening store-based health clinics, which are staffed mostly by nurse practitioners or physician assistants and offer quick service for routine conditions from colds and bladder infections to sunburn.


About 7% of Americans have tried a clinic at least once, and t
hat number is expected to increase dramatically, as chains like Wal-Mart, CVS Corp., Target Corp. and Walgreen Co. partner with mini-clinic providers like RediClinic and MinuteClinic to expand operations. The trade group estimates there will be more than 1,500 by year-end, up from about 800 in November.

From
Wal-Mart’s press release: Today’s announcement is the first step towards opening 400 co-branded convenient clinics by 2010 and further proof of Wal-Mart’s commitment to providing affordable, accessible solutions to America’s healthcare challenges. Wal-Mart expects “The Clinic at Wal-Mart” to become synonymous with quality healthcare at affordable prices, provided by trusted, local providers.
Carpe Diem

Rx: Market Competition. Exhibit A: Inflation Rate for Prescription Drugs at 34-Year Low of 1.4%

Partly due to increasing generic-drug competition (generics were 63% of all prescriptions in 2006 vs. 50% in 2005) and the ongoing, fierce price war among drug retailers (see previous CD posts about $4 prescription drugs at Wal-Mart, Kmart, Publix, and Kroger), the inflation rate for prescription drugs fell to a 34-year low of 1.4% in 2007 (see graph above, click to enlarge), way below the average annual inflation rate of 4.12% for 2007, and way below the 34-year average drug inflation rate of 6.28%.

“The decline in drug prices shows that when things go right in health care — when competitive markets are allowed to function — prices respond favorably for consumers, just as they do in other sectors of the economy. So while politicians and pundits in Washington dream up the next grandiose health care reform, smart consumers know that the most effective health care solutions may be right around the corner at their local retailer.”

Robert Goldberg, Vice-president of the Center for Medicine in the Public Interest

Carpe Diem

Being Alive Today in US, You’ve Won Lottery of Life

A previous CD post documented the significant gains in real income (not counting fringe benefits) over just a single generation (for ALL income groups), based on a sample of individuals who were between the ages of 0 and 18 in 1968 and have been tracked into adulthood.

Another important financial gain over that same generation from the late 1960s to the late 1990s was the significant increase in real net household wealth from about $159,000 per household in 1969 to $452,000 by 1999 (according to data from the Federal Reserve, adjusted for inflation using the CPI). In other words, at the same time that real median household income rose by 29% between the two generations, average real household net worth almost tripled!