New Home Sales Down 50%+

Real Estate

November 2007 - Sales of new single-family homes fell 9% (from October), to12-year low, seasonally-adjusted annual rate of 647,000; down 53.4% from high of 1.39 million in summer 2005 (steepest peak-to-trough decline since 1982), slowest pace since April 1995 (pace of 621,000); since 2006 - new-home sales nationwide down 34.4%, biggest year-to-year decline since early 1991; median sales price of new home dipped to $239,100, down 0.4% from year ago; S&P/Case-Shiller® Home Price Indices in 20 broad metropolitan areas of U.S. (measured since 1987), showed price declines in every market for two months (September, October) for the first time ever.

History's Most Influential Businessmen

Most Influential Business Figures in American History
(of top 100 most influential Americans in history)

5) - Alexander Hamilton,
9) - Thomas Edison,
11) - John D. Rockefeller,
14) - Henry Ford,
20) - Andrew Carnegie,
24) - Alexander Graham Bell,
26) - Walt Disney,
27) - Eli Whitney,
37) - J. P. Morgan,
45) - Samuel F. B. Morse,
54) - Bill Gates,
67) - P. T. Barnum,
72) - Sam Walton,
73) - Cyrus McCormick,
80) - William Randolph Hearst,
94) - George Eastman,
95) - Sam Goldwyn

(Source: December 2006 - The Atlantic Monthly)

Wall Street 2007 - Shanghai, Dubai, Mumbai or Goodbye

October 24, 2007 - Merrill Lynch announced $8.4 billion fourth-quarter loss, most associated with losses in subprime mortgage market; biggest loss in its 93-year history, biggest known loss in Wall Street history; October 30, 2007 - CEO, E. Stanley O'Neal, retired from company. December 24, 2007 - agreed to sell less than 10% stake: 1) $5 billion in new stock (at a discount) to Temasek Holdings (Singapore's sovereign investment company controlled by finance ministry), 2) $1.2 billion (discounted stock) to Davis Selected Advisers (Tucson, AZ); 3) will sell most of Merrill Lynch Capital, commercial finance business, for $1.3 billion to General Electric; January 17, 2008 - reported $9.8 billion fourth-quarter loss (almost matched loss reported for period by Citigroup, company three times Merrill’s size); exceeded analysts’ forecasts, reflected $16.7 billion of write-downs on mortgage-related investments, leveraged loans.

November 5, 2007 - Citicorp reported fourth-quarter write-down of between $8 billion to $11 billion related to subprime mortgages, on top of a $5.9 billion dollar write down announced in October; sold $7.5 billion stake to Abu Dhabi Investment Authority to shore up its capital base; Charles O. Prince III fired as CEO (since October 2003); January 14, 2008 - reported fourth-quarter results - $18.1 billion write-down on subprime mortgage-related exposures (much higher than early November estimate of $8 - $11 billion); disclosed $12.5 billion investment - sold $6.6 billion stakes to foreign investors (including Korean, Kuwaiti governments); $9.83 billion loss for quarter, largest quarterly loss in bank's history; 41% dividend cut planned.

December 10, 2007 - UBS, world’s largest provider of banking services to wealthy, wrote down a further $10 billion in value of its mortgage-backed assets, on top of $3.7 billion charge in October (reported first quarterly loss in 5 years); biggest casualty of American home-mortgage crisis among banks outside United States; sold more than 10% stake to investors from Singapore, Middle East - Government of Singapore Investment Corporation, G.I.C., will invest $9.7 billion, unnamed Middle Eastern investor will inject $1.8 billion into bank; January 30, 2008 - warned it would mark down additional $4 billion in securities, brought total subprime-related residential mortgage write down to about $18 billion, first annual loss since was formed in 1998 merger.

December 18, 2007 - Morgan Stanley posted fourth-quarter loss of $3.6 billion, or $3.61 a share (far surpassed analysts' expectations of $0.39 per share), first-ever quarterly loss in its 72-year history, after taking additional $5.7 billion write-down related to subprime mortgages (value reduced by $9.4 billion, one of largest devaluations on Wall Street); said would sell a $5 billion stake to China Investment Corporation (China's sovereign wealth fund), to shore up its capital = 9.9% stake; chief executive, John J. Mack, took full responsibility, said would forego bonus for 2007.

December 19, 2007 - Bear Stearns reported a steep fourth-quarter loss, the first ever in its 84-year history; lost about $854 million ($6.90 a share) for fourth quarter, compared to profit of $563 million ($4 a share) for same time last year (analysts had expected loss of $1.82 a share); wrote down $1.9 billion related to holdings in mortgages, mortgage-based securities, up from $1.2 billion anticipated last month; January 8, 2008 - James E. Cayne, CEO and 6% shareholder, retired as an employee of the firm.

Gold - 28-Year High

Commodities

November 7, 2007 - gold price per troy ounce = $845.50 (28-year high)

Business Book of the Year

Financial Times Goldman Sachs Business Book of the Year - 2007

(Lazard LLC), William D. Cohan (2007). The Last Tycoons: The Secret History of Lazard Freres & Co. (New York, NY: Doubleday, 752 p.). Six Years at Lazard Frères, Later Managing Director at JP Morgan Chase. Lazard Freres & Co.--History; Banks and banking--New York (State)--New York--History; Bankers--New York (State)--New York--Biography; Banks and banking--France--History; Bankers--France--Biography. Portrait of Wall Street through tumultuous history of this company - from its origins in 1848 in New Orleans, LA as a dry goods store through its dominant personalities (Andre Mayer, Felix Rohatyn, Michel David-Well, Steve Rattner, Bruce Wasserstein) and controversial 2005 initial public offering. Judges believed the book provided "the most compelling and enjoyable insight into modern business issues," in keeping with the goal of the award.

Cohan was awarded 30,000 pounds. He beat five other titles, including "The Age of Turbulence" by Alan Greenspan, former Chairman of the Federal Reserve Board.

Previous winners include:

Thomas L. Friedman (2005). The World Is Flat: A Brief History of the Twenty-First Century. (New York: NY: Farrar, Straus and Giroux, 496 p.). Three-time Winner of the Pulitzer Prize and Foreign Affairs Columnist (The New York Times). Diffusion of innovations.; Information society.; Globalization--Economic aspects; Globalization--Social aspects.

James Kynge (2006). China Shakes the World: A Titan’s Breakneck Rise and Troubled Future and the Challenge for America. (Boston, MA: Houghton Mifflin, 288 p.). Former Beijing Bureau Chief of the Financial Times. China--Economic conditions--2000- ; China--Foreign economic relations. China's hunger for jobs, raw materials, energy, and food and its export of goods, workers, and investments drastically reshape world trade and politics.

Subprime Mortgage Crisis - Factors

Source: Mortgage Bankers Association; HSH Associates; Federal Housing Finance Board; Loan Performance (First American Co.)
(http://www.sfgate.com/c/pictures/2007/12/07/mn_subpprime.jpg)

Immigration

Economics

A survey by The Center for Immigration Studies (Washington, DC) reported that immigration over the past seven years was the highest for any seven-year period in American history - 10.3 million new immigrants, more than half without legal status. One in eight people living in the United States is an immigrant, total of 37.9 million people - the highest level since the 1920s.

A good read, from the late 'dean' of immigration economics:

Julian L. Simon (1999). The Economic Consequences of Immigration. (Ann Arbor, MI: University of Michigan Press, 434 p. [2nd ed.]). Immigrants--United States; United States--Emigration and immigration--Economic aspects. Examines each significant economic mechanisms by which immigrants affect natives (transfer-and-tax system, production capital, human capital, physical infrastructure, productivity, environmental externalities, unemployment); concludes immigration is, on the whole, beneficial to U.S. natives (similar experience in Canada, Australia) - immigrants displace fewer jobs than they create, are better educated than majority of U.S. workers, are no more a drain on welfare system than general population.

In Search of Excellence - 25th Anniversary

Innovation

Thomas J. Peters and Robert H. Waterman Jr. (1988). In Search of Excellence: Lessons from America's Best-Run Companies. (New York, NY: Warner, 360 p. [orig. pub. 1982]). Management Consultants (McKinsey & Co.). Industrial management--United States.

This is the book which, in my opinion, gave life to the business book genre, titles published by business professionals, journalists, consultants and academics for 'popular' consumption. It was one of the biggest selling and most widely read business books ever published; sold 3 million copies in its first four years; most widely held library book in the United States from 1989 to 2006.

Yet, there is great irony. The book was heavily criticized and its 'Best-Run Companies' were shown to be anything but best-run. How, then, could the book have done so well? Probably because the market business was growing: revenue for published business books, number of MBAs graduating from business schools, number of undergraduates earning business degrees; readers seeking books on business for fun, profit, and instruction.

The book began as a McKinsey project on teams and organizations in business. No publishing efforts had been planned. Then, corporate customers began to pay for the conclusions of the study.

The authors: 1) identified 43 companies between 1961-1980 which, in their opinion, constituted a blueprint for success, based on several criteria: asset growth, equity growth, return on total capital, return on equity, return on sales, market/book value [where was realized returns to shareholders?]; 2) distilled the results into eight common themes which, they argued, were responsible for the success of the chosen 43 corporations:

1. A bias for action, active decision making - 'getting on with it'.
2. Close to the customer - learning from the people served by the business.
3. Autonomy and entrepreneurship - fostering innovation and nurturing 'champions'.
4. Productivity through people- treating rank and file employees as a source of quality.
5. Hands-on, value-driven - management philosophy that guides everyday practice - management showing its commitment.
6. Stick to the knitting - stay with the business that you know.
7. Simple form, lean staff - some of the best companies have minimal HQ staff.
8. Simultaneous loose-tight properties - autonomy in shop-floor activities plus centralised values.

BUT...Excellent companies these were not.

A) Daniel T. Carroll was the first to weigh in with a stinging rebuke of the book and its conclusions. He was former president of Booz Allen Hamilton’s Management Consulting Division, former chief operating officer and president of Gould, Inc., former chief executive officer of Hoover Universal (later merged with Johnson Controls), both Fortune 500 companies; founder of The Carroll Group, Inc., a management consulting firm.

He published his conclusions in "A Disappointing Search for Excellence," Harvard Business Review, November-December 1983, pp. 78-88. He criticized the lack of deep research, heavy reliance on anecdotes and secondary sources, and superficial conclusions. He seemed to be proved right as a number of the supposedly excellent companies did poorly with a year of the book's being published. The 'lessons' suggested in the book were highly suspect.

B) Business Week (November 5, 1984) published an article, titled, "Oops. Who’s excellent now?". It observed that, of the 43 'excellent' companies in the Peters/Waterman book, one-third were in financial difficulties within five years, particularly in the high technology sector.

C) Michelle Clayman (Oxford BA, Stanford MBA), founder and managing partner of New Amsterdam Partners, an institutional money management firm ($6 billion under management), published a startling contrast in the Financial Analysts Journal (May-June, 1987). titled “In Search of Excellence: The Investor’s Viewpoint.” The author studied 5-year performance (1981-1985) of Peters/Waterman companies vs. "unexcellent companies" (in search of disaster companies) - 39 companies from the S&P 500 which ranked in bottom third of all Peters/Waterman criteria from 1976-1980: asset growth (21.78% vs. 5.93%, equity growth (18.43% vs. 3.76%), return on total capital (16.04% vs. 4.88%, return on equity (19.05% vs. 7.09%, return on sales (8.62% vs. 2.49%). Classic growth vs. value choice.

Her results showed that Peters/Waterman companies largely tracked the S&P 500 market index (market returns) while her 'disaster' companies generated returns in excess of the market returns of 12%. She concluded that so-called 'good companies' don't always make good investments. It would seem that the future cash-generating ability of the 'excellent' companies may have already been factored into the prices of their shares. No so for the 'disaster' companies.

Peters and Waterman focused on innovation (product or process) without regard to: 1) execution of that innovation into real, sustainable, competitive advantage(s) or 2) translation of that innovation into realized returns for shareholders. They focused on financial criteria, not economic results.

I consider that unacceptable. Innovation without 'economic value added', especially in the form of increases in profitability and realized returns to shareholders seems an empty exercise, sort of like 'profitless prosperity' (rising sales without rising profit). Profitability is the key to value - if innovation cannot or does not contribute to increases in a company's future cash-generating ability, then the exercise should be questioned as a waste of time and resources.

Black Friday, Cyber Monday

Retail

1) ShopperTrak RCT Corp. (Chicago, IL) tracks sales at over 50,000 retail outlets; reported that combined sales for Friday (November 23) and Saturday (November 24) grew 7.2% to $16.4 billion.

2) National Retail Federation (NRF) reported that more than 147 million consumers shopped over Black Friday weekend, a 4.8% growth from last year.

3) comScore, Inc. (Reston, VA), a leader in measuring the digital world, reported Cyber Monday online spending grew to $733 million, a 21-percent increase over 2006 and an 84-percent jump from the average daily online spending totals during the preceding four weeks.

Top 30 Wealthiest Businessman in History

(in today's dollars):

1) John D. Rockefeller ($192 billion);
2) Cornelius Vanderbilt ($143 billion);
3) John Jacob Astor ($116 billion);
4) Stephen Girard ($83 billion) - banking;
5) Bill Gates ($82 billion);
6) Andrew Carnegie ($75 billion);
7) A. T. Stewart ($70 billion) - department store;
8) Frederick Weyerhaeuser ($68 billion);
9) Jay Gould ($67 billion) - financier;
10) Stephen Van Rensselaer ($64 billion) - land;
11) Marshall Field ($61 billion);
12) Henry Ford ($54 billion);
13) Sam Walton ($53 billion);
14) Andrew W. Mellon $48 billion) - banking;
15) Richard B. Mellon ($48 billion) - banking ;
16) Warren E. Buffett ($46 billion);
17) James G. Fair ($45 billion) - silver mining;
18) William Weightman ($44 billion) - malaria drug;
19) Moses Taylor ($44 billion) - Citibank;
20) Russell Sage ($43 billion) - financier;
21) John I. Blair ($43 billion) - railroads;
22) Edward Henry Harriman ($39 billion) - railroads;
23) Henry Huttleston Rogers ($39 billion) - Standard Oil;
24) J. P. Morgan ($38 billion);
25) Oliver S. Payne ($37 billion) - Standard Oil;
26) Henry Frick ($36 billion) - coke/steel;
27) George Pullman ($34 billion) - railroad sleeping cars;
28) Collis Porter Huntington ($33 billion) - Central Pacific Railroad;
29) Peter A. B. Widener ($32 billion) - streetcar tracks;
30) James C. Flood ($31 billion) - silver mining.

(source: "The Wealthy 100: From Benjamin Franklin to Bill Gates-A Ranking of the Richest Americans, Past and Present" by Michael Klepper and Robert Gunther (New York, NY: Carol Pub. Group, 1996)

Entrepreneur's Quiz

Entrepreneurship

The only ingredient that is both necessary and sufficient for starting a business is:

a. Money
b. Customers
c. An idea or product
d. Motivation and hard work

(source: www.ceoclubs.org)

And the Answer is?

Beaujolais Nouveau

Beverages

Beaujolais Nouveau released at 12:01 AM on third Thursday of November.

September 12, 1937 - L'appellation d'origine contrôl Beaujolais created (Beaujolais AOC); French certification under auspices Agriculture Institut National des Appellations d'Origine (INAO), branch of French Ministry of Agriculture, created July 30, 1935, to manage administration of process for wines; rules stated Beaujolais only officially sold after December 15 in year of harvest; November 13, 1951 - rules relaxed, Union Interprofessionnelle des Vins du Beaujolais (UIVB) formally set November 15 as release date for Beaujolais Nouveau; Vintner Georges DuBoeuf introduced Beaujolais Nouveau (made from Gamay Noir à Jus Blanc grape in Beaujolais region of France, authorized for immediate sale after fermentation); 1985 - date changed to third Thursday in November to take best advantage of marketing over following weekend.

(Les Vins Georges DuBoeuf) , Rudolph Chelminski (2007). I’ll Drink to That: Beaujolais and the French Peasant Who Made It the World’s Most Popular Wine. (New York, NY: Gotham Books, 320 p.). Dubœuf, Georges; Beaujolais (Wine)--France--History; Vintners--France--Beaujolais; Wine and wine making--France--Beaujolais--History; Beaujolais (France)--History. Cinderella tale behind success o Beaujolais Nouveau: story of wine, history of region, tale of peasant wine grower who became richest, most famous individual wine dealer in France.

Quote of the Week

Wall Street Journal (November 7, 2007)

Norman Peltz, , owner of Arby's (# 13 restaurant chain in the U.S.) through Triarc Companies, Inc. (holding company) and owner of 5.3% of Wendy's International Inc. (#3 restaurant chain in the U.S.), 3.5% of Cadbury Schweppes, 4.3% of Heinz and, reportedly, 3% of Kraft Foods (#2 food company by sales), through Trian Fund Management LP (hedge fund), said, "I found out early on that business is just common sense,". "It's about getting sales up and expenses down."

1962 - dropped out of Wharton School (University of Pennsylvania) at 20; 1967 - helped his father acquire food distribution businesses in Boston, Philadelphia and Baltimore; 1978 - sold the business; 1993 - acquired distressed conglomerate, sold everything but Arby's and Royal Crown Cola, renamed business Triarc Cos.; 1997 - acquired Snapple for $300 million from Quaker Oats Co., added fresh marketing, new beverage products, revived Snapple brand; 2000 - sold to Cadbury, with several other brands, for $1.45 billion. November 2005 - launched hedge fund to to target large, underperforming companies with good cash flow; work with, or apply pressure to, executives to improve operating results (Wendy's, Heinz, Kraft).

Always Get Equity - 2

New York Times December 3, 2000

INVESTING: DIARY; 'Buy and Forget' Pays Off Big
By Julie Flaherty

Know that nice feeling you get when you find a forgotten $20 bill in the pocket of an old coat? Last week, a Massachusetts man had that feeling -- 200,000 times over.

The man, a 62-year-old salesman who wants to keep his identity under wraps, recently found that some stock he thought he had sold long ago had been quietly gaining value for 13 years. A week ago, it was worth about $4 million.


The investor said he bought 3,000 shares of EMC, the data storage company, on a tip from his cousin in 1987, but soon sold 2,000 of them to pay for his children's college tuition. He forgot about the remaining 1,000 until the state's Abandoned Property Division, noticing the inactivity, contacted him last month.

Sure enough, after spending three days in his cellar with a kerosene lamp, he found the still-sealed envelope with the stock certificates. The shares, for which he paid about $15.75 each, have split several times, making him the owner of 48,000 shares whose latest 52-week high was $104.94 ($5 037 120).

No sooner did he claim his property at the statehouse last Wednesday, though, than he saw EMC's share price slip along with the rest of the Nasdaq. ''I lost $600,000 in two days,'' he told The Boston Herald. ''But I can't find anyone to give me any sympathy.''

Always Get Equity

New York Times (November 11, 2007)

SAN FRANCISCO, Nov. 11 - Bonnie Brown was fresh from a nasty divorce in 1999, living with her sister and uncertain of her future. On a lark, she answered an ad for an in-house masseuse at Google, then a Silicon Valley start-up with 40 employees. She was offered the part-time job, which started out at $450 a week but included a pile of Google stock options that she figured might never be worth a penny.

After five years of kneading engineers’ backs, Ms. Brown retired, cashing in most of her stock options, which were worth millions of dollars. To her delight, the shares she held onto have continued to balloon in value.

When Ms. Brown left Google, the stock price had merely doubled from its initial offering price of $85. So Ms. Brown is glad she ignored the advice of her financial advisers and held onto a cache of stock.

“I’m happy I saved enough stock for a rainy day, and lately it’s been pouring,” said Ms. Brown, 52, who now lives in a 3,000-square-foot house in Nevada, gets her own massages at least once a week and has a private Pilates instructor. She has traveled the world to oversee a charitable foundation she started with her Google wealth and has written a book, still unpublished, “Giigle: How I Got Lucky Massaging Google.”

As the stock continues to defy gravity, Ms. Brown, whose foundation has its assets in Google stock, can be more generous with her charity. “It seems that every time I give some away, it just keeps filling up again,” she said. “It’s like an overflowing pot.”

When Google’s stock topped $700 a share last week (all-time high of $747.24 on November 6)
before dropping back to $664 on Friday, outside shareholders were not the only ones smiling. According to documents filed on Wednesday with the Securities and Exchange Commission, Google employees and former employees are holding options they can cash in worth about $2.1 billion. In addition, current employees are sitting on stock and unvested options, or options they cannot immediately cash in, that together have a value of about $4.1 billion.

Although no one keeps an official count of Google millionaires, it is estimated that 1,000 people each have more than $5 million worth of Google shares from stock grants and stock options.

The rise in Google’s stock is affecting the deepest reaches of the company. The number of options granted to new employees at Google usually depends on the position and the salary level at which the employee is hired, and the value is usually based on the price of the stock at the start of employment.

The average options grant for a new Google employee - or “Noogler” - who started in November 2006 was 685 shares at a price of roughly $475 a share. They also would have received, on average, 230 shares of stock outright that will vest over a number of years.

Computers

October 22, 2007 - Apple Computer reported better-than-expected fourth quarter earnings (profit rose 67 percent year over year to $1.01 per share on revenue of $6.22 billion), stock rose to all time high just above $189 per share, market value reached $161 billion = most valuable computer maker, 4th most valuable technology company: Microsoft ($329 billion), Google ($211 billion), Cisco Systems ($195 billion).

Business Services

November 7, 2007 - Visa agreed to pay $2.1 billion to American Express to settle damages related to a 2004 antitrust lawsuit; claimed that Visa and MasterCard barred member banks from offering their customers credit cards which could be used on rival payment networks, in violation of antitrust law; believed to be largest amount ever paid to resolve antitrust violation.

Mergers & Acquisitions

Biggest of All Time (as of 2005)

1. Vodafone AirTouch acquired Mannesmann (November 14, 1999) for $179.86 billion
2. America Online acquired Time Warner (January 10, 2000) for $164.75 billion
3. Pfizer acquired Warner-Lambert (November 4, 1999) for $89.17 billion
4. Exxon acquired Mobil (December 1, 1998) for $78.95 billion
5. Glaxo Wellcome acquired SmithKline Beecham (January 17, 2000) for $75.96 billion
6. Royal Dutch Petroleum acquired Shell Transport & Trading (Oct. 28, 2004) for $74.35 bill.
7. Travelers Group acquired Citicorp (April 6, 1998) for $72.56 billion
8. SBC Communications acquired Ameritech (May 11, 1998) for $62.59 billion
9. NationsBank acquired BankAmerica (April 13, 1998) for $61.63 billion
10. Vodafone Group acquired AirTouch Communications (Jan. 18, 1999) for $60.29 billion

New Most Valuable Company in the World

Wall Street - Trading History

November 5, 2007 - PetroChina, subsidiary of China's state-owned China National Petroleum, first half 2007 revenues less than one-third of Exxon Mobil, debuted on Shanghai Stock Exchange (13% of available float), tripled in price, became most valuable company in corporate history with a market capitalization in excess of $1 trillion.

Creator of Budweiser (not Anheuser-Busch)

Beverage Industry

1876 - Charles W. ("Carl") Conrad, St. Louis wine merchant, contracted with Anheuser-Busch to brew "Budweiser" with imported (Saazer) hops and (Bohemian) barley, mash prepared by infusion (Budweis is name of small Bohemian city; introduced because of its Germanic sound, potential appeal to American and German migrants); 1870s - first U.S. brewery to adopt pasteurization; 1872 - first use of A&E eagle on packaging; July 16, 1878 - Charles W. ("Carl") Conrad registered "Budweiser" trademark (canceled October 21, 2005); April 29, 1879 - company renamed Anheuser-Busch Brewing Association; January 16, 1883 - C. Conrad & Co., bottler and distributor for Budweiser®, declared bankruptcy during "Panic of 1883"; April 24, 1883 - Anheuser-Busch acquired rights to bottle and sell Budweiser; March 2, 1886 - C. Conrad & Co. (Mainz, Germany) registered "Budweiser" trademark first used in January 1876 (lager bier only genuine as decreed by the courts original as decreed by the courts); 1891 - Anheuser-Busch Brewing Association acquired brand/trademark, ownership of 'Budweiser' name; July 23, 1907 - Anheuser-Busch Brewing Association registered "Budweiser" trademark first used in January 1876 (beer); January 15, 1918 - registered "Michelob" trademark first used April 15, 1896 (draft-beer); August 26, 1958 - registered "Bud" trademark first used in June 1939 (beer).

Most Valuable Companies in the World

Wall Street - Trading History

Bloomberg Financial Markets reported that China now leads world in number of publicly-traded companies with market values in excess of $200 billion (8), U. S. (7), Western Europe (4), Russia (1).

October 17, 2007: 1) ExxonMobil ($525 billion; 2) Petrochina ($429 billion), 3) General Electric ($418 billion), 4) China Mobile ($37billion), 5) Industrial and Commercial Bank of China ($336 billon), 6) Microsoft ($285 billion), 7) Royal Dutch Shell ($271 billion), 8) China Petroleum ($269 billion), 9) Gazprom ($266 billion), 10) AT & T ($255 billion), 11) NP ($242 billion), 12) China Life ($242 billion), 13) HSBC ($227 billion), 14) Citigroup ($223 billion), 15) Bank of America ($223 billion), 16) Procter & Gamble ($221 billion), 17) China Construction ($220 billion), 18) China Shenhua Energy ($216 billion), 19) Bank of China ($209 billion), 20) Electricite de France ($203 billion).

1999 - Technology and communications companies topped the list .

1989 - Japan had 14 of top 20 companies (especially banks).

General Electric, Exxon, AT & T on all lists.

Excellence in Manufacturing

Manufacturing:

(http://www.shingoprize.org/Images/shigeo_shingo/shigeo_shingo.jpg)

1988 - Utah State University recognized Dr. Shigeo Shingo, one of world’s leading experts in improving manufacturing processes (helped create, write about many aspects of revolutionary manufacturing practices comprising Toyota Production System) for his lifetime accomplishments with an Honorary Doctorate in Business; developed Shingo Prize for Operational Excellence to promote awareness of lean manufacturing concepts, recognize companies in United States, Canada, Mexico that achieve world-class manufacturing status; regarded as premier manufacturing award recognition program for North America; intended as "Nobel prize" in business, grounded in lean enterprise management leading to world-class and globally competitive business; criteria (practices, techniques that might achieve
world-class level of quality, cost, delivery, business results) organized into 5 sections: 1) Leadership Culture and Infrastructure; 2) Manufacturing Strategies and System Integration; 3) Non-Manufacturing Support Functions; 4) Quality, Cost and Delivery; 5) Customer Satisfaction and Profitability.

Award Recipients (1989 - 2007)

Links Update

Links, as shown, do not 'link'.

Here are working URLs:

Wall Street - Trading History: www.businesshistorybooks.com/History1.htm

Capitalists: www.businesshistorybooks.com/Capitalists.htm

Mining: www.businesshistorybooks.com/Mining1.htm

Tobacco: www.businesshistorybooks.com/Tobacco.htm

Business History Books: www.businesshistorybooks.com

Highest Returns Since Crash of '87

Wall Street - Trading History

20-year winners (October 19, 1987 - October 18, 2007)

Twenty stocks in the S&P 1,500 index that have delivered the highest total return since the 1987 stock market crash.

Company	20-year total return*	Business
International Game Technology	35,080%	Casino gaming systems
UnitedHealth Group	32,984	Health maintenance organization
Jack Henry & Assoc.	22,811	Computer systems for financial institutions
NBTY	20,451	Nutritional supplements (Nature's Bounty)
WMS Industries	19,060	Gaming, lottery machines
Kansas City Southern	17,201	Railroad
Fastenal	17,199	Distributes industrial supplies
Oracle	13,290	Business software
Weatherford Intl.	12,923	Oil field services
Micros Systems	12,876	Computer systems for hospitality
Jefferies Group	12,846	Investment banking
Best Buy	12,283	Electronics retailer
Eaton Vance	12,202	Mutual funds
Harley Davidson	12,055	Motorcycles
Sierra Health Services	11,770	Managed health care
Expeditors International	11,454	Transportation logistics
Microsoft	11,447	Software
Amgen	11,424	Biotechnology
Clear Channel Communications	11,219	Broadcasting

*Includes share-price appreciation plus dividends from Oct. 19, 1987, through Wednesday. Returns are adjusted for splits and spin-offs. Source: FactSet Research Systems, SF Chronicle research

Business History Uncovered - Daily

Daily discoveries in business history


Capitalists -
(Rupert), W.P. Esterhuyse ; [translated by E.P. Hees] (1986). Anton Rupert: Advocate of Hope. (Cape Town, SA: Tafelberg. Rupert, Anton; Industrialists--South Africa--Biography; Social ethics.

(Rupert), Ebbe Dommisse with the cooperation of Willie Esterhuyse (2005). Anton Rupert A Biography. (Cape Town, SA: Tafelberg, 463 p.). Rupert, Anton; Industrialists--South Africa--Biography. South Africa's most successful entrepreneur.

Mining:
February 1887 - Cecil Rhodes and Charles Rudd formed Gold Fields of South Africa Ltd. to hold properties acquired on Transvaal, Witwatersrand gold fields; 1892 - renamed The Gold Fields of South Africa; became second largest gold producing group after Anglo American; 1989 - acquired by Hanson plc.

May 13, 1909 - London and Rhodesian Mining Company Limited incorporated (Lonrho plc); 1961 - Roland "Tiny" Rowland joined company; sales (over 34 years) increased 787-fold, profits rose 1,365 times; January 1993 - Dieter Bock, German financier, became largest shareholder; shared chief executive's position with Rowland; October 1993 - forced to step down as Chairman; November 3, 1994 - Rowland ousted from chief executive position; January 1997 - Anglo American Corporation of South Africa Ltd., South Africa's largest company, acquired 26% controlling interest in Lonrho; changed focus to mining (platinum, gold, coal) in Africa; 1997 - Bock gone; 1999 - renamed Lonmin plc to symbolize return to mining roots.

Tobacco:
1941 - Anton Rupert (South Africa) established Voorbrand Tobacco Company; renamed Rembrandt Tobacco Corporation; 1948 - manufactured first cigarettes; 1954 - acquired controlling interest in Rothmans of Pall Mall; 1972 - overseas tobacco interests consolidated into Rothmans; 1988 - Rembrandt Group restructured international activities, formed Swiss holding company, Compagnie Financier Richemont (CFR); held 33 percent of Rothmans International plc; 1993 - separated tobacco, luxury goods operations into Rothmans International BV/PLC, Vendôme Luxury Group SA/PLC; 1995 - consolidated tobacco interests into Rothmans International (world's 4th-largest cigarette manufacturer); operated as wholly-owned subsidiary of Richemont; June 1999 - Rothmans International merged with British American Tobacco (BAT), world's 2nd-largest cigarette producer.

Business History Books

The Internet's largest site devoted to business and management history:


http://www.businesshistorybooks.com/


More than 15 years - Collection of books and films on business history: industries, companies, executives, products/services, economics, scandals and business fiction. Essential books on management history: investing, financing and operating decisions. The result: largest multimedia collection of business history and management literacy available anywhere. Entries are organized by subject, company, year and author.

History of Business History

Economic History to Business History

I. Economic History - Shift from Political Economy to Economics

1871-1874 - Marginalist Revolution gave birth to Neoclassical economics - "natural value" of a good is determined only by its subjective scarcity, i.e. the degree to which people's desire for that good exceeds its availability (in contrast to Marixism and socialism) (http://cepa.newschool.edu/het/essays/margrev/margrevcont.htm):

W. Stanley Jevons, The Theory of Political Economy, (New York: Macmillan, [1871]
Carl Menger, Principles of Economics, (trans. and ed., J. Dingwall and B.F. Hoselitz),
(New York: Free Press, [1871]
Léon Walras, Elements of Pure Economics: or The Theory of Social Wealth, ( Éléments d’économie politique pure; ou, Théorie de la Richesse Sociale; trans., W. Jaffé), (Chicago: Irwin, [1874]
Other significant contributors to the neoclassical school: Vilfredo Pareto, Manual of Political Economy (New York: Kelley)


Jevons (left) initiated change in concept of 'political economy' from realm of political science (theology, philosophy, law) to formal science of 'economics' (similar in precision with mathematics and physical sciences; stressed importance of deductive method in mathematics as basis technique for economic science - basis of neoclassical theory); central figure linking political economy with social policy; proposed theory of utility (connection between value in exchange and final [or marginal] utility) - way to measure utility contained in objects - measurement of 'commodity utility through human physical sensations' (decreases over time).

1871 - Harvard University appointed Charles Francis Dunbar as first full-time professor of economics in United States; emphasized class discussions relating public policy issues to broad economic principles.

1883 - Dunbar introduced first course in Economic History (at Harvard): "The Economic History of Europe and America Since 1763" (review of money, taxes, tariffs to illustrate principles of John Stuart Mills).
1885 - Small group interested in economics organized the American Economic Association (AEA) at a meeting in Saratoga, New York; February 3, 1923 - incorporated in Washington, DC; Richard T. Ely, actively involved in founding of Association, was first secretary; membership consisted mainly of college and university teachers of economics.


II. Professional Independence of Economics

1890 - Alfred Marshall (Professor of Economics, Cambridge University, 1885-1908) published "Principles of Economics" (London: Macmillan); effectively changed name of discipline to Economics from Political Economy; leading force in professionalization of economics, its establishment as independent academic discipline.






November 1890 - British Economic Association established; arose amidst skirmishes in late 1880s between economists at Oxford and Cambridge Universities over who would be first to launch a professional journal; prevalent lack of professional self confidence; executive committee reluctant to hold annual conferences with papers and discussions as did AEA; 1902 - won Royal Charter, changed name to Royal Economic Society.
1890s - University of Chicago, Columbia University, Harvard University, Johns Hopkins University, University of Wisconsin established highly regarded economics departments.

1892 - William J. Ashley appointed to Chair in Economic History at Harvard (first in United States); first generation of American economic historians.


III. Birth of Business History

1925 - Wallace B. Donham, dean of Harvard' University's Graduate School of Business Administration (1919 to 1942), gathered the editor of the Boston Globe, the Federal Reserve agent attached to the Boston Federal Reserve Bank, and two or three others, formed a Business History Society. Membership composed of librarians, historians, businessmen, immediately began to educate companies and repositories to historical value of business operating records, acquired records for Baker Library at HBS. The fee for membership was $100 a year, the Society regularly issued a Bulletin containing news of its activities. Donham credited with founding of Business History as distinct, academic pursuit; invited Norman S.B. Gras and Henrietta Larson to come to HBS to found and teach a new discipline, business history, and hired Arthur Cole to head the new business library.

June 1926 - Bulletin of the Business Historical Society first published; 1954 - became Business History Review, one of the seminal sources for information on business history

1927 - Norman S. B. Gras took the position of American Chair of Business History at Harvard University