January 2016

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A little bit of gratitude goes a long way

As I was driving to work yesterday morning, I noticed a big FedEx truck trying to merge into my lane on the freeway. As expected, most drivers were barreling ahead, not giving the FedEx driver an inch to work with. I thought, I’m not in such a huge rush, why not let the guy in?
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Is your company profitable enough?

How profitable is your company? Do you know the amount in dollars? Do you know it as a percentage of revenue? If you know how profitable your company is, is it profitable enough? Can it be more profitable? Realistically, how profitable can it become? These last three questions are loaded. Ask heavily-invested people, and you’ll
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The tenuous connection between the stock market and the economy

There was a Bloomberg article published Tuesday titled “JPMorgan Cuts S&P 500 Forecast, Citing ‘Earnings Recession’ Risk”. Here’s an excerpt from the article: “There is increasing risk that elevated volatility starts incurring enough technical damage to market psychology,” a team led by Lakos-Bujas wrote in a note to clients on Tuesday. That could spill over
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What is an "earnings beat"? On expectations and stock prices

Have you heard of an “earnings beat”? That’s where a public company reports earnings that exceed the expectations of analysts. That’s where the “beat” comes in, in the sense that actual earnings beat expected earnings. As an example, take this article about McDonald’s: Global same-store sales surged 5 percent in the fourth quarter, the Oak
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Emotion explains some of our crappy predictions

I took my son to the store on Sunday, partly because we needed things, and partly to get him out of the house. He had a bit of cabin fever. A quick trip to the store means he can be a maniac somewhere besides our house. I took the freeway on the way home. As
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Here’s an excerpt from an article from CNBC titled “Market hoping for earnings season boost”: Earnings are expected to show the worst decline since the financial crisis, yet analysts are holding out hope that the bar is low, earnings will beat and that will help pull the market out of its worst new year slump
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Right versus wrong, science versus business

When you think of the difference between science and business, what do you think of? Rigid versus flexible? Exact versus inexact? Empirical versus heuristic? Maybe you think of something else. The point is, you get down to something along the lines of science having a “right” answer, while business doesn’t. That’s kind of true, but
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The fruit stand as a metaphorical business model

Business can be complicated. When you think about large companies with international operations across tons of product lines, you find a lot of complexity. It helps to simplify things. When I’m in that situation, I turn to the fruit stand. Almost all businesses can be described as a fruit stand, as long as you give
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Now is not always the best time to investigate a failure

I was at a fast food restaurant late Saturday night. It was one of those restaurants where you place your order in one line, and then pay for it another line. I ordered a meal. I expected a drink to come with it. But no one gave me a drink. When I asked what was
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Rise above the politics of an apology

You probably heard about the U.S. boat that mistakenly entered Iranian waters this week. Iran captured the boat, held the US Navy personnel overnight, then released them all the next day. Part of the coverage was an article from The Wall Street Journal titled “U.S. Denies Apologizing to Iran Before Release of Sailors”. What? The
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