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    Published on: November 12, 2010

    Here’s a bit of financial news that’ll open your eyes...or at least raise your eyebrows...

    Bloomberg reports that in fewer than three years, Groupon Inc. - a coupon site that offers short term deals - has achieved a market valuation that some people estimate to be close to $3 billion.

    According to the story, “ Unlike many new companies that dot San Francisco and its environs, Groupon’s success stems less from a breakthrough technology -- say, algorithms that improve Web search -- than from a straightforward use of e-mail, a communication tool that’s falling out of favor as Web surfers use social networks ...  Groupon sends a daily e-mail to registered users in a given market, offering steep discounts on products and services, ranging from cupcakes to yoga classes, dinner cruises to dental exams. Groupon keeps a 50 percent cut of every deal sold, while the company benefits from a rise in new customers. Deals, known as groupons, activate when a certain number is sold, encouraging users to recommend offers to friends.”

    Groupon currently serves more than 300 markets, and is estimated to have annual sales of about $500 million.

    This could be a short-term fad, it could be a recession-era phenomenon that could go away when and if prosperity returns, it could be part of just another bubble that inevitably will pop.

    But it might not be. Walmart already has been reported as emulating Groupon ... which could put this approach to discounting on an even faster track. Inevitably, there will be others.

    Whether a short-term marketing gimmick or a sustainable business model, Groupon’s approach is definitely an Eye-Opener.

    - Kevin Coupe
    KC's View:

    Published on: November 12, 2010

    CNN has an interesting story about a Kansas State University professor, Mark Haub, who decided to conduct an experiment for a class he was teaching in human nutrition.

    During a two-month period, Haub limited himself to less than 1,800 calories a day, as opposed to the 2,600 calories usually consumed by a man of Haub’s age and size, following “a basic principle of weight loss: He consumed significantly fewer calories than he burned.”

    At the end of the two months, Haub lost 27 pounds. His body mass went from 28.8 to 24.9. His bad cholesterol went down, his good cholesterol went up. And he reduced his triglycerides level by 39 percent.

    Here’s the rub. During the two months, Haub’s diet largely consisted of Twinkies, doughnuts, Hostess and Little Debbie snacks, Doritos chips, sugary cereals and Oreos. (CNN notes that while “two-thirds of his total intake came from junk food,” Haub “also took a multivitamin pill and drank a protein shake daily. And he ate vegetables, typically a can of green beans or three to four celery stalks.”)

    The premise that Haub wanted to test was that “in weight loss, pure calorie counting is what matters most -- not the nutritional value of the food.”

    "That's where the head scratching comes," Haub tells CNN. "What does that mean? Does that mean I'm healthier? Or does it mean how we define health from a biology standpoint, that we're missing something? ... I'm not geared to say this is a good thing to do. I'm stuck in the middle. I guess that's the frustrating part. I can't give a concrete answer. There's not enough information to do that."

    Here’s some more head-scratching information: “To curb calories, he avoided meat, whole grains and fruits. Once he started adding meat into the diet four weeks ago, his cholesterol level increased.”

    Haub continues to feel ambivalent about the experiment’s results:
    "I wish I could say the outcomes are unhealthy. I wish I could say it's healthy. I'm not confident enough in doing that. That frustrates a lot of people. One side says it's irresponsible. It is unhealthy, but the data doesn't say that."
    KC's View:
    This is an intriguing story, because while it confirms one bit of conventional wisdom - portion and calorie reduction lead to weight loss - it also throws into question the whole nature of health. While the short term data would suggest that Haub is healthier, there are a lot of long-term implications that need to be considered.

    This story will continue, because Haub will keep running tests and compiling data. And we’ll all be interested in seeing where the road leads.

    Published on: November 12, 2010

    Amazon.com faced an uproar this week when it was revealed that it was selling a book that promoted pedophilia and looked to establish a code of conduct for pedophiles.

    The online bookseller’s first response to criticism was to say that it does not engage in censorship and would sell even titles that it finds to be objectionable; but then, Amazon relented and pulled the $4.95 book from its site.

    Ironically, the contretemps gave the book a sales boost - it actually reached number 96 on Amazon’s list of top 100 best sellers.
    KC's View:
    When I first heard about this controversy, I was going to check out the book on Amazon to see what all the talk was about...but then I decided not to, fearing what just going to that page would do to my Amazon profile. (I’ve been using Amazon to send Depends and other, similar products to a relative who is in a nursing home, and I’m constantly surprised by the “if you bought this you might be interested in this” suggestions. The last thing I need is it getting into Amazon’s computer system that I’ve been checking out books about aberrant sexual behavior.)

    Now, about Amazon’s decision making process in this case...

    I think the default setting in any bookstore is - and probably should be - in favor of a free and unfettered press.  But they probably should have moved faster to stop the sale of a book that promotes pedophilia, just as (I assume) they would not sell a book teaching people how to make a bomb.  (I'm guessing that there may not have been any discussion of this book by actual, real people until it was already online...and then they went to the default position.  Not selling books that advocate illegal behavior strikes me as an appropriate place to draw the line, and hardly qualifies as censorship.

    Did they screw up?  Yes.  Should they have tighter review processes?  Yes.  Should they learn from this?  Yes.  Will they learn from this?  I fervently hope so.

    Published on: November 12, 2010

    The Tampa Tribune reports that certain reusable shopping bags obtained at Publix and Winn-Dixie contain lead levels.

    According to the ABC story on the same subject, “the newspaper's website reported that some bags had enough lead they could be considered hazardous waste if residents disposed of them in household trash.

    “The lead appears to be in a form that's not easily extracted or ‘leached’ out, so there is less concern the lead would easily rub off on food when the bags are new, the paper found. But over time, lab experts note, the bags wear down and paint can flake off, and eventually reusable bags could accumulate in landfills, presenting another ecological issue.”

    The story notes that “Publix officials stress their bags comply with current federal laws regarding lead content. The newspaper reported Thursday that Publix is asking suppliers to find ways to make bags with less lead.

    “In an e-mail to the Associated Press on Thursday, Winn Dixie said that it is confident that the reusable bags are safe to use and reuse as intended.”
    KC's View:
    Maybe it is just me, but these responses seem just a little underwhelming. As a customer who uses canvas bags almost exclusively, I think I might be a little worried by this...and the responses seem less than reassuring.

    Published on: November 12, 2010

    Bloomberg reports that the Cleveland Research Co. is projecting that “Wal-Mart Stores Inc. may fail to turn its sales around by the holiday season as planned since the discount retailer has yet to lure customers back from rival outlets.” The analysis suggests that store traffic has continued to decline at Walmart, and that the retailer has cancelled some promotions in order to protect profit margins.

    Walmart is not commenting on the report.
    KC's View:

    Published on: November 12, 2010

    Safeway announced this week that “its stores raised $16.1 million in October to combat breast cancer, the most common form of cancer for women. Funds donated at checkout by Safeway customers throughout North America support three areas of focus: research, treatment and early detection.”

    During the last decade, Safeway and its various banners reportedly have raised more than $94 million for breast cancer research and prevention.

    “We are grateful and humbled by the extraordinary outpouring of support for a cause that impacts so many women and families,” said Larree Renda, Safeway Executive Vice President and Chair of The Safeway Foundation. “Even in a difficult economic climate, our customers recognize the importance of continuing the search for more effective treatments and an ultimate cure for breast cancer.”
    KC's View:

    Published on: November 12, 2010

    Bloomberg reports that Starbucks plans to open 500 new stores in the next 12 months, with 400 of them outside the US. The company says that it expects China to be its growth market within two years.

    The expansion plan marks a shift for the company, which seems to believe that the global economy is recovering.

    • The Los Angeles Times reports that faced with a number of legislative defeats - ranging from required calorie counts on menus statewide to a ban on toys in Happy Meals in San Francisco, to a moratorium on fast food restaurants in the poor South Los Angeles area - California’s restaurant industry “is gearing up to fight back, emphasizing the role fast-food businesses have played in providing jobs and entrepreneurial opportunities.”

    • It was announced last night that Newsweek is merging with The Daily Beast, the online magazine run by the redoubtable Tina Brown.

    According to the New York Times, “A Newsweek-Daily Beast partnership joins three outsize personalities: Sidney Harman, the 92-year-old stereo mogul who recently bought Newsweek for $1; Barry Diller, the media magnate who finances The Daily Beast and a host of other Web properties; and Ms. Brown, whose various stints as a high-flying — and high-spending — editor over three decades have always drawn intense curiosity from the media business.

    “One person who was involved in the deal said both publications would retain their separate identities.”
    KC's View:
    The two entities may have “separate identities,” but Newsweek almost certainly is going to take on Tina Brown’s unique persona ... and will be better for it.

    Published on: November 12, 2010

    • Dino De Laurentiis, the movie producer responsible for more than 500 films ranging from La Strada to Serpico, Three Days of the Condor to Death Wish, Barbarella to Mandingo, died Wednesday. He was 91.
    KC's View:

    Published on: November 12, 2010

    ...will return.
    KC's View:

    Published on: November 12, 2010

    Thursday Night Football has resumed in the NFL...with the Atlanta Falcons defeating the Baltimore Ravens 26-21.
    KC's View:

    Published on: November 12, 2010

    Nice story today in the Chicago Sun Times about how Brenda Barnes, the former CEO of Sara Lee who stepped down after suffering a stroke, has recovered to the point where she will be atop the Willis Tower this weekend to greet the more than 1,000 participants in the SkyRise Chicago event, which raises money for the Rehabilitation Institute of Chicago.

    The event has people climbing the 2,109 steps to the top of the Tower. Among them will be 38 people who are Barnes’ family and friends, running as “Team Brenda.”
    Barnes reportedly spent five weeks at the Institute in her recovery.




    Did you read the story this week about how Tony Hayward, the deposed CEO of BP, told the Guardian in the UK that if he had a degree in acting from "RADA rather than a degree in geology I may have done better" in handling the fallout from the Gulf of Mexico oil disaster.

    (RADA is the Royal Academy of Dramatic Arts, just FYI...)

    Clearly, Hayward doesn’t get it, never got it, and will never get it.

    And the big thing he doesn’t get is when to keep his mouth shut.

    Because words matter. And he continues to choose the wrong ones.




    Fast Company had an interesting piece this week about the full-body scanners being installed in many US airports, which are seen as a preferred alternative to full body searches that could be required in a time of heightened security concerns.

    Not everybody prefers them, though. As the magazine reports, “a new lawsuit by watchdog group Electronic Privacy Information Center (EPIC) claims the body scanners are easily hackable, store nude pictures for unknown periods of time, and don't even catch terrorists.”

    On this one, I’m with James Carville, who gave his opinion on this issue on Tony Kornheiser’s radio show. (I can’t repeat it here, but you can Google it.)




    Like a lot of Americans, I tuned into “Conan” on Monday night, curious about Conan O’Brian’s first late night talk show on TBS. While I found it amusing, there was nothing so special about it that I’d ever want to tune in again.

    I’ve found, as I get older, that I dislike so-called “talk shows” in which the discussion is attenuated, lasting just a few minutes and focused on hyping this movie or that book. From “Conan” to Leno to even the “Today Show,” I just find the conversation to be too insubstantial to satisfy me. I’d much rather watch “Charley Rose” or “Morning Joe,” where they actually give the guests time to talk, where ideas actually get explored. “The Daily Show” is often better than most other late night shows, mostly because Jon Stewart brings on guests who nobody else is interviewing, talking about subjects that are getting precious little air in the mainstream media. (And, when the discussion gets interesting, Stewart puts longer versions online, to satisfy those of us who aren’t happy with the TV chats.)

    Maybe this is just me.




    An MNB user, believing that my cultural education was simply too limited, sent me a Justin Bieber CD this week, suggesting that I listen to it and broaden my mind. For which I thank you.

    I originally brought it with me on a long road trip, figuring I’d listen to it in the car. But I changed my mind; I figured if somehow I got in an accident or had a heart attack at the wheel, it would be mortifying if the police found a Bieber CD playing in my car. So I brought it home and listened to it there, when nobody else was around.

    Glad I did. Because if I had listened to it in the car, I probably would have been overwhelmed by an irresistible impulse to drive my Miata into a bridge abutment.

    This is not to say that I don’t understand why a certain demographic might find him appealing. But I cannot even imagine ever listening to this CD ever again.

    I’m sticking with Jimmy Buffett...the Beatles...Bob Dylan...Bob Marley...the Dixie Chicks...Taylor Swift...Train...Levon Helm...Jerry Jeff Walker...Kenny Chesney...and whole bunch of other folks who I could listen to over and over and over again.




    One of my favorite essayists is Nora Ephron, and I’m looking forward to her new book, “I Remember Nothing: And Other Reflections.”

    I did read an excerpt this week that included what immediately became one of my favorite lines of the year. She defined her religion as “Get Over It.”

    Which is a really good line.




    My wine of the week: a wonderful 2008 La Maialina Chianti, which was perfect with spicy chicken. (And thanks to the wonderful wine folks at Dorothy Lane Markets for offering the taste.)

    I also liked a 2008 The Negociant Albarino from California, which is a pretty good approximation of Spanish Albarinos.



    That’s it for this week. Have a great weekend, and I’ll see you Monday.

    Slainte!
    KC's View:

    Published on: November 12, 2010

    Here’s a bit of financial news that’ll open your eyes...or at least raise your eyebrows...

    Bloomberg reports that in fewer than three years, Groupon Inc. - a coupon site that offers short term deals - has achieved a market valuation that some people estimate to be close to $3 billion.

    According to the story, “ Unlike many new companies that dot San Francisco and its environs, Groupon’s success stems less from a breakthrough technology -- say, algorithms that improve Web search -- than from a straightforward use of e-mail, a communication tool that’s falling out of favor as Web surfers use social networks ...  Groupon sends a daily e-mail to registered users in a given market, offering steep discounts on products and services, ranging from cupcakes to yoga classes, dinner cruises to dental exams. Groupon keeps a 50 percent cut of every deal sold, while the company benefits from a rise in new customers. Deals, known as groupons, activate when a certain number is sold, encouraging users to recommend offers to friends.”

    Groupon currently serves more than 300 markets, and is estimated to have annual sales of about $500 million.

    This could be a short-term fad, it could be a recession-era phenomenon that could go away when and if prosperity returns, it could be part of just another bubble that inevitably will pop.

    But it might not be. Walmart already has been reported as emulating Groupon ... which could put this approach to discounting on an even faster track. Inevitably, there will be others.

    Whether a short-term marketing gimmick or a sustainable business model, Groupon’s approach is definitely an Eye-Opener.

    - Kevin Coupe
    KC's View: