Campaign for Liberty

Spent today hearing two speakers I enjoyed. The first was Thomas Woods author of Meltdown. A book explaining the recent economic events. The second speaker was Butler Schaffer who discussed the Great Depression. About 350 people attended.

"Restore the proper meaning of words," advised Confucius

The Obama madness continues. In a democracy the people elect people who are a reflection of themselves. Obama is a reflection of the madness that is the American people. I look at my ancestors and see heroes. I look around today and see cowards.
Obama's tax increase:

Obama's Budget: Almost $1 Trillion in New Taxes Over Next 10 yrs, Starting 2011

President Obama's budget proposes $989 billion in new taxes over the course of the next 10 years, starting fiscal year 2011, most of which are tax increases on individuals.

1) On people making more than $250,000.

$338 billion - Bush tax cuts expire
$179 billlion - eliminate itemized deduction
$118 billion - capital gains tax hike

Total: $636 billion/10 years

2) Businesses:

$17 billion - Reinstate Superfund taxes
$24 billion - tax carried-interest as income
$5 billion - codify "economic substance doctrine"
$61 billion - repeal LIFO
$210 billion - international enforcement, reform deferral, other tax reform
$4 billion - information reporting for rental payments
$5.3 billion - excise tax on Gulf of Mexico oil and gas
$3.4 billion - repeal expensing of tangible drilling costs
$62 million - repeal deduction for tertiary injectants
$49 million - repeal passive loss exception for working interests in oil and natural gas properties
$13 billion - repeal manufacturing tax deduction for oil and natural gas companies
$1 billion - increase to 7 years geological and geophysical amortization period for independent producers
$882 million - eliminate advanced earned income tax credit

Total: $353 billion/10 years

http://blogs.abcnews.com/politicalpunch/2009/02/obamas-budget-a.html

Random Thoughts

I've been thinking about the changing face of radio in this nation. Tommy Mischke was a guy on the radio who was fired because of an FCC violation. If you are unaware the FCC is a neo-Nazi group commissioned by Congress to terrorize the airwaves. MIschke is attempting to use the internet as a new form of media. Citypages.com has given him a web based radio show he will host everyday in the Twin Cities. I am very interested in listening and watching to see what happens. I have been using the internet for listening to music (pandora.com) and podcasting, along with youtube.com.

I want to see if a talk show can make it as a commercial venture online. I hope Tommy succeeds.

What can the Palestinians do to achieve freedom from Israel? I think they need to take a look at Gandhi and Martin Luther King Jr. The idea of non-violent protest and marches. You play into the hands of Israel by using limited violence. Break down the fence surrounding Gaza and walk back to your homes. Do not raise arms against your guards.

Interesting Quote

As Robert Pape of the University of Chicago writes in The National Interest: “America is in unprecedented decline. The self-inflicted wounds of the Iraq war, growing government debt, increasingly negative current-account balances and other internal economic weaknesses have cost the United States real power in today’s world of rapidly spreading knowledge and technology. If present trends continue, we will look back at the Bush administration years as the death knell of American hegemony.”

“America’s relative decline since 2000 of some 30 percent represents a far greater loss of relative power in a shorter time than any power shift among European great powers roughly from the end of the Napoleonic Wars to World War II. It is one of the largest relative declines in modern history. Indeed, in size, it is clearly surpassed by only one other great-power decline, the unprecedented internal collapse of the Soviet Union in 1991.”

From Patrick Buchanan

Thoughts

For many years I was a member of the word of faith movement via a Bible study I belonged too. The man who led our group put huge value on those ministers who happened to be on TV or radio. What I discovered after 17 years was an emptiness that could not be met. I would try the magical formulas out but nothing seem to happen. I was trying to use magical thinking to control the uncontrollable. The guy who led the group would talk about using grace to get what we wanted. But this didn't seem to work either. Grace was seen as power instead of relationship with God. Last year I left that ever shrinking group because I was no longer needed and I might have radical thoughts contrary to the leaders thinking. Living in Minnesota you discover that Minnesotans are passive aggressive so they rip you behind their backs. Leaving has been freeing.

What I have discovered is that relationship is what matters to God. Papa desires a deep relationship with us. I guess I should maybe take the time to read about the love languages and learn how to relate to people. When you belong to a Bible study led by someone screwier then you don't learn about relationships unless it benefits the leader.

Have you ever noticed how messed up church leaders are? Why are they allowed to lead? I understand why the Institutional church is so pitiful. By the way, I learned that this leader bases his relationship in value they are to him as so many people do.

Zephaniah 3:17

The LORD your God is with you,
he is mighty to save.
He will take great delight in you,
he will quiet you with his love,
he will rejoice over you with singing." NIV

The LORD your God is in your midst,
a mighty one who will save;
he will rejoice over you with gladness;
he will quiet you by his love;
he will exult over you with loud singing. ESV

For the Lord your God is living among you.
He is a mighty savior.
He will take delight in you with gladness.
With his love, he will calm all your fears.(a)
He will rejoice over you with joyful songs.” NLT

a. Greek and Syriac versions read He will renew you with his love.

Sirius and XM Radio Broadcasting

1. What are the key elements of XM Radio’s strategy? Is its strategy working well? What do you make of the company’s enormous losses?

XM'x strategy is "building awareness and demand among potential subscribers and in the advertising community" by appealing to to a broad market with "innovative and diverse programming, nationwide coverage, many commercial-free music channels and digital sound quality." XM is using sports promotions by signing numerous contracts with Major League Baseball, the PGA and others to help market the service. XM has formed partnerships with General Motors and Honda with XM Radio being optional in many makes of cars.

Overall, XM has been successful in adding subscribers to its service. Subscribers has increased to 7.63 million by the end of 2006.The problem with XM's strategy is that XM is mostly commercial free service thus subscriber fees make up the vast majority of revenue. Unlike HBO which can market its shows (DVD and on-demand) after the initial airing XM does not have any way to improve the revenue stream.

The majority of losses are caused by two areas; the first is marketing costs associated with convincing people that radio is worth paying for. Spending over 50% of subscriber revenue just to bring in more subscribers makes the current model ineffective. The second area is interest expense on a growing mountain of long term debt.

2. What are the key elements of Sirius Satellite Radio’s strategy? Is its strategy working well? What do you make of the company’s enormous losses?

Sirius has a three prong approach to its marketing strategy. The first is enhancing and refining programming. Sirius has added programming of such variety as Howard Stern with 2 channels and $100 million annual budget. Channels dedicated to music superstars such as The Who or creating a Metropolitan Opera channel. The second is introducing radios with new features and functions such as producing a satellite portable radio with WiFi. The third feature is expanding distribution of Sirius radios through automakers and retail outlets.

By the end of 2006 Sirius had achieved the 6 million subscriber mark with a per subscriber acquisition cost of $108. The company has brought on subscribers but like XM the revenue stream is limited to subscriber fees. Sirius needs to invent ways to increase revenue beyond the subscriber, whether by using advertising on its Internet radio service or finding the ability to remarket radio content.

The company is suffering enormous losses due to two areas. The high costs associated with acquiring new subscribers which amount to more expenses than total revenue and the use of equity to compensate employees. Like XM the battle is to convince people that radio is worth paying for. With all the alternatives (podcasting, MP3, live streaming, free internet radio, etc) presently available to occupy peoples time a reason needs to be created for people to want to pay for radio.

3. What are the pros and cons of the proposed merger between XM Radio and Sirius?

I realize the companies have merger and needed a suitor to survive. I wrote this for a class is school. Schools are always behind the times by too many years.

The companies feel that competition for satellite radio exist within many areas including the iPod, Internet radio and free radio thus to survive the companies are stressing the merger would allow for the development of greater content and programming choices for consumers and the ability to better introduce lower cost and easier to use satellite receivers. Sirius CEO Mel Karmazin has stated that a possibility would be that a merger might lead to lower monthly subscription fees. Another reason for the merger maybe the survival of the industry, with both companies losing huge amounts of money maybe a combined company could survive and prosper.

The cons are that with the merger there would only be one satellite radio company thus creating a monopoly. Plus the original satellite licenses granted XM and Sirius by the Federal Communications Commission prohibited one company from owning both licenses.

Benjamin Constant (1767-1830)

“Individuals must enjoy a boundless freedom in the use of their property and the exercise of their labor, as long as in disposing of their property or exercising their labor they do not harm others who have the same rights.”

A Thought

Have you ever noticed:

The bigger the pickup truck or the sportier the sports car the slower they drive.

Bottled Water

1. What are the strategy-shaping business and economic characteristics of the bottled water industry? What is the industry like?

The bottled water industry is made up of three large players, Coca Cola, Nestle and Pepsi. In recent years the move has been to consolidation within the bottled water industry as Coke, Pepsi and Nestle's have all acquired smaller regional brands. As the market for bottled water has plateaued a move to flavor enhanced water and vitamin water has occurred with Pepsi coming out with products such as Propel, etc. In a recent article on Brandweek.com "Has the Bottled Water Well Finally Run Dry?" Kenneth Hein discusses the downturn in the bottled water industry by Coke and Pepsi.Hein talks about several reasons for the downturn including the economy, why pay for something you can get free, the concern over PET bottles leeching toxins into the liquid and the increase of sales of store labels (i.e. Target- Archer Farms).

To combat some of this decline Pepsi has aligned Aquafina with a sponsorship Major League Baseball And a bright spot with sales of enhanced water increasing by 18,4% in the first half of 2008. Nestle's has moved more into the Home/Office delivery of bottled water.

2. How is the bottled water industry changing? What are the underlying drivers of change and how might those driving forces individually or collectively change competition in the industry?

The move in the industry has been toward consolidation as the big three purchase the smaller regional the flavor and enhanced water brands. Also, customers are purchasing more store labels are the economy slows. The move away from PET bottles by consumers along with the store labels entering the market is cause for concern. The two factors that have effected sales of the large companies have been the increase in the sales of store labels and the economic downturn. Plus the advances in home filtration systems have caused people to move in that direction and away from the use of bottles.

3. What recommendations would you make to Coca-Cola to improve its competitiveness in the global bottled water industry? to PepsiCo? to Nestlé?

Each of these companies should develop alternatives for PET bottles as more Westerns become environmentally conscious. Coke needs to expand the market for vitamin and flaver water to be competitive against Pepsi's success in the market. Coke should go after sporting event sponsorship that will bring in name recognition for Dasani products.
Nestle should continue to use packaging innovation to separate itself from competitors. Styles that will catch the eye of children and adults. Pepsi has an advantage with the Gatorade brand name to develop alternative water drinks. Use that name recogonition to advance new products such as the sports drink market.