Dr. Eschker and his dedicated group have published their Economic Index for September. They found that in September Hospitality, Lumber, Employment , and manufacturing orders were up, while Home Sales, Retail, unemployment claims, building permits and “help wanted” advertising were down.
AIR- Redding gets a grant. Redding has been awarded a $450,000 grant from the Dept of Transportation in the form of a revenue guarantee to help SkyWest defray the cost of replacing their current turboprop (Embraer Brasilia) service with Canadair Regional Jets, according to the Redding Searchlight Record. The grant requires a $50K match and does NOT guarantee that jets will return to Redding but is a necessary first step in that direction. SkyWest recently pulled out of Modesto and is discontinuing service to Chico in December.
RAIL-HSR is on the way. The California High-Speed Rail Authority took the first step toward actually buying trains, opening bids for a billion-dollar contract to build trains and maintenance facilities. Siemens, which has a location in Sacramento, will be among the bidders, and interest from Chinese and Japanese manufacturers is expected to be strong. The specs are that the trains must be able to deliver passengers from San Francisco to Los Angeles in three hours. If Siemens prevails, the economic benefits to the Sacramento area would be substantial.
MORE RAIL- The Economist reminds us that HSR is nothing new, in fact it’s been around for 50 years, just kinda slow in coming to California. Fifty years ago this week the Osaka-Tokyo line commenced operations and has “since whisked 5.6 billion passengers across the country without a single serious accident. Punctuality? The average delay is less than a minute.” Japan’s HSR, at 200 mph, is actually pokey compared with China’s Shanghai maglev (430 kph) or the maglev being developed to update the Tokyo-Osaka run to a speedy 500 kph, about an hour’s time. This will cost $47B, but the Japanese have a government that is willing to invest in infrastructure.
STILL MORE RAIL- Closer to home, a three-judge panel of the 1st District Appellate court found that the North Coast Railroad Authority and its partner the Northwestern Pacific Railroad can expand freight service without further environmental review. Specifically, the panel found that freight rail traffic is interstate commence and not subject to the California Environmental Quality Act. The envronmental groups that brought the suit, Friends of the Eel River and Californians for Alternatives to Toxics, had not announced at press time whether they would appeal. The NCRA’s next step is to raise $5M to rehabilitate the tracks between Windsor and Cloverdale and to recruit customers for the freight service between Napa and Windsor which currently runs twice a week.
Do you love dogs? Sure.
Do you love OPD (Other Peoples’ Dogs)? Uh, not so much.
Well, as of January 1, California restaurants with patio spaces will be allowed to serve dogs right along with their owners, assuming the owners are human. This “change” will probably affect Humboldt less than more urban regions because plenty of local eateries are already allowing dogs. The rules are that the patios must have separate entrances so that the doggies don’t enter the restaurant itself and they continue to be banned from food preparation areas. The new rule does NOT mandate that dogs must be allowed on patios; that’s up to the proprietors. Nor does it change any of the rules on bona fide service animals.
I’m a dog owner who does not envision taking my dog to a restaurant in this lifetime. For one thing, she’d eat everything in sight. For another, she’d never be able to share space with one of those cute fuzzy little dogs that look and sound exactly like her squeak-toys. The other question is, do I want to share a table with someone else’s dog? When MY dog drools on the table, it’s cute. When YOUR dog does it, it’s disgusting.
I’m all in favor of consumer choice, so when I pass by a patio cafe where chows are chowing down in favor of a human-only environment, that’s a valid choice. I wonder how the majority of Humboldt diners will react to their new dining companions.
Here are some factoids with which to tickle your brain.
TOURISM- As the HSU survey in our last post pointed out, tourism stats are down in Humboldt County. However, our friends in Redding are feeling the same pain, according to the Searchlight -Record, no link available. Isn’t it puzzling or are tourists staying away because of the drought and fires?
CHINA- University of California officials have made no less than 20- that’s TWENTY- trips to China so far this year to woo Chinese students with their lucrative out-of-state tuition payments. Oh, yeah, they’re smart too. And haven’t fried their brains on drugs.
APPLE- now has 2500 workers in their Elk Grove location which started as a distribution center but is now hiring folks who wouldn’t know what a forklift looks like. 89 current vacancies, including one for “Mandarin Team Manager”.
100 OBJECTS- The State of South Carolina, which has imho the slickest tourism of any state, is sponsoring a promotion of “100 Objects” in Orangeburg County ranging from battlegrounds, old schools, gravestones, gardens etc. It’s sort of like “101 Things To Do on the North Coast” combined with a historical scavenger hunt. Any community could adopt this promotion except we’d have to lose the bland word “objects”. “Prizes?” “Treasures?” OK, I can see why they settled for “objects”. Still a good gimmick for a promotion.
SHERLOCK HOLMES- the stories by A Conan Doyle have fallen into public domain. Those of you who always thought you had a future writing screenplays, have at it.
OBAMA- one of his biggest financial supporters is the CEO of COSTCO.
OLIVES- due to the drought, this year’s olive crop is going to be down 45% from last year. Martini drinkers might want to stock up bigtime.
OYSTERS- Rumor has it that a major Marin County oyster producer will start operations in Humboldt Bay.
That’s all, folks, for this week. Stay safe and far away from the fires.
The Humboldt Economic Index. produced by Dr. Erick Eschker and his team at the Economics Department of HSU, does not show a pretty picture this month. The leading indicators are, shall we say, mixed.
Lumber is up, but Hospitality, Retail and Home Sales were down in July, as were building permits and help-wanted advertising. On the positive side, manufacturing orders are up slightly and UI claims are down. The national jobless rate declined to 6.1 percent in June while the unemployment rate was 7.2, virtually the same as the State as a whole.
Here’s what you’ve been waiting for: gas prices. “Both California and the Northern California region have seen 8% decreases in their average gas prices this month, while Eureka’s average price stayed at $4.25 in June.” Enjoy the report, and our continued thanks to the HSU team.
PART ONE: Imagine there were a company that offered on-line shopping, business-to-business sales, online payments, wholesale trade and cloud computing- in other words a combination of eBay and Amazon that is actually bigger than eBay and Amazon combined. Welcome to Alibaba.
Started by a schoolteacher named Jack Ma on his kitchen table in Hangzhou in 1999, the company, now based in Hong Kong, is about to launch what may be the biggest initial public offering in history, one which could easily surpass Facebook’s fumbled IPO of $16B in 2012. Why will be the biggest beneficiary? Yahoo, which owns 24% of Alibaba and will probably use the infusion of cash from the IPO to continue its buying spree of smaller tech companies. To give you an idea of the scale, Alibaba processes $248B in retail sales yearly. Here’s a description from the Mercury News:
‘”Nearly 8% of all Chinese online shopping goes through Alibaba sites; on Singles Day last year, a popular holiday in China for online shopping, the site processed $5.8B in in purchases. By comparison, eBay’s total sales on its online marketplace for all of 2013 were $6.8B.”
Alibaba is also moving into mobile commerce in a big way, investing in American companies like Mountain View -based Tango Me and in Lyft, the San Francisco -based ride sharing app, while attempting to consolidate its position amidst its nearest rivals, Baidu and TenCant, which is already rolling out its own IPO. (Google and eBay have departed the China market). Alibaba’s IPO was scheduled for August 8 (eighth day, eighth month- the Chinese like “8”s) but may be delayed due to last-minute glitches involving SEC approval of some of their subs which are based in the Cayman Islands. Ma, who is worth over $8B, has stepped down as CEO but remains as Chair of the 21.000 employee firm and is devoting his time to a charitable trust.
It’s a global economy for sure, and becoming more so every day. Wonder how long it will be before we start seeing Singles’ Day promotions? That ‘s too good an idea to skip.
PART TWO: The Analects of Jack. The early history of Alibaba is set forth in a documentary and a book (Alibaba, by Liu and Avery, 2009) which describes how at one time in the early days, Ma was literally kidnapped and held hostage in a Malibu mansion at gunpoint until he talked his captor into going into business with him). Ma only got into college on his third entrance exam but his English major has definitely been put to good use in the following phrases which were compiled by American City Business Journals from various interviews and an appearance on Charley Rose that I’m sorry I missed. Here’s a sampling.
Why he likes small businesses and tries to help them through Alibaba: “I’ve seen people make a fortune by catching shrimps, but I’ve never seen anyone make a fortune by catching sharks and whales. It’s like Forrest Gump.”
On putting customers first: “It’s customers No, 1, employees, two, and shareholders, three. It’s the customer who pay us the money, it’s the employees who drive the vision, and it’s the shareholders who when the financial crisis comes, these people ran away. My customers and my people stayed.”
On technology: “I know nothing about technology. I use the computer to browse the Internet and receive email. That’s it.”
On developing a business: “If you want to be a great company, think about what social problem you could solve.”
On money and Alibaba’s large cash reserves: “When you try to solve problems with money, that is when your real problems start. A company’s assets are like a country’s armed forces.You cannot use it lightly, but if you ever need to mobilize it, you must win.”
A new law just signed by Governor Brown (AB 2486) and effective immediately allows wine and cider tasting at Farmers’ Markets under the following conditions:
-The wineries (or cideries) must grow ALL the fruit in their product
-Only one winery can hold tastings on a given day
-Each Farmers’ Market can determine whether to hold testings
-The tasting area must be cordoned off
-Samples are limited to 3 ounces of wine or cider per adult customer.
The bill, which was authored by Assemblyman Mark Levine, D-San Rafael, passed both houses UNANIMOUSLY.
The delightfully named Portia Bramble of the North Coast Growers’ Association reported that Winnett Vineyards from Willow Creek would be a likely participant at the Arcata Farmers’ Market, at least by next season. This is one story which does not seem to have a downside.
Don’t read this if you’re looking for good news for airline passengers. A friend of the blog compiled the following links which show that no matter how bad it gets, there’s always room for worse.
1. You’ve noticed the carriers imposing more and more fees along with the regular airline fares? Try 1200% in the past seven years, like from $2.4 B in fees in 2007 to $31.5 B in 2013. More carriers are counted in the later figures but the fees are all coming from the same source: you. 60% of these fees are from the sale of frequent flyer points, 25% for baggage fees, the rest from such services as early boarding and extra-leg-room seating fees. Here, courtesy of Yahoo Finance is a full accounting.
2. I’m sure you’ve heard by now that TSA is also raising its fees. The current fee is $2.50 for non stop and $5 for a connecting flight. The new rate is $5.60 per flight with any connecting longer than four hours counting as a separate flight. That may not sound like much but it adds up, especially when you miss your connection due to delays leaving ACV and end up with a ten-hour layover at O’Hare. Here is an account from USA Today.
3. The impact of the war in Ukraine and its spinoffs will be enormous and it is probably too early to assess. The route changes resulting from the war are coming at a time when fuel prices are at an all-time high. When the carriers are squeezed, guess who they’ll pass the increase onto? The Hindu Business Line newsletter carried an analysis but the link is no longer available. Time moves quickly in the Middle East.
LOCAL UPDATE: The Airport Advisory committee did not have its meeting as scheduled yesterday for lack of a quorum but Emily Jacobs reported that there was “some” interest in serving ACV demonstrated by other carriers at the confab in Edmonton. Someone reported that Santa Rosa is improving its runways in anticipation of DIRECT FLIGHTS TO HAWAII. Wouldn’t that be great? Yes, it would.
A Silicon Valley one-percenter is proposing to split the state six ways. Guess which part will end up with all the money? It ain’t us.
Meanwhile, on September 18th, a referendum in Scotland will determine whether Scotland remains part of the United Kingdom or goes independent. The similarities between the Scottish situation and the putative State of Jefferson are interesting to compare.
MONEY: Scotland is a rich country due to the North Sea oil reserves. They can leave the Brits behind and still survive economically. (Scotland can already afford to educate its university students for FREE.) A State of Jefferson on the other hand will end up as the Appalachia of the West. Other than tourism and weed, which will be selling for pennies after legalization, what do we have? Oysters. Good oysters, but still…Every candidate for office in Humboldt County in the last twenty years has run on a platform of bringing jobs to the county. Where are those jobs? I must have missed something.
HISTORY: The Scots were an independent people until 300 years ago with their own culture and language. ( To this day the average American has about as much chance of understanding a Scot speaking what is now is considered the Scottish dialect as he would have understanding someone from Newfoundland.) 300 years ago there were no “white” people in “Jefferson”. The State of Jefferson would have the highest proportion of Native Americans of any area in the State. Separating from California would not enhance their economic situation one bit. If it would, tell me how. Yes, they would carry more clout locally because everyone else will be broker. But will their situation really improve? Will anyones?
POLITICS: The Scots have long been more “socialist” than the rest of the UK. Within recent memory they were still sending a Communist or two to Parliament every year, usually from Glasgow. The factories and tenements of Glasgow were the inspirations for Karl Marx’s Capital. Glasgow is the only place where I ever had a cabbie return a tip because good Marxists don’t believe in tipping. The Scot’s desire to be free of “imperialist state” of the UK has deep roots and may well carry the day. Politics in “Jefferson” is more chaotic. With a 20% participation in the recent elections, it seems clear that most Jeffersonians (is that what they call themselves?) are not participating in politics because they’re hopeless or too stoned. This paves the way for the Tea Party or other fringe groups to fill the vacuum. Not a pretty sight.
Anyway, September 18th should be interesting. If the Scots opt for independence will they be part of NATO? Will they adopt the Euro? What will happen to the North Sea oil, in which the Norwegians also have an interest? It’s been a long time since our states changed boundaries. In November, will the divide-and conquer strategy of the SV plutocrats win out over the welfare of the rest of us? Stay tuned. And for God’s sake register to vote.
This is my third post about “The Caribbean Picnic”, on Henderson where the GoGo Bistro used to be. I finally made it in there yesterday. It’s a PUERTO RICAN restaurant with CUBAN food also. The two main offerings are Cuban sandwiches (ham, pork, usually pickles) and a Puerto Rican sampler, both $9. I’ve eaten a lot of Cuban sandwiches, having family in Florida, and this was not only better than average, it’s HUGE, easily two meals for the average person. They also have a selection of pretzels, not the little brittle kind but serious big puffy ones. The staff is welcoming and helpful and I will definitely be back. Any of you who visit this place, please share your opinions with us.
On another note, Marcelli’s Pizzaria (their spelling) had a soft opening a few days ago and folks were streaming in for lunch at what used to be Big Louie’s. They don’t have a website yet but they’re open 7 days and the menu looks a lot like the old BL one. You can call them at 497-6374 for eat-in, takeout, delivery or take’n’bake. So much to be grateful for! Please share your reviews with us. Bon appetit.