Monday Sept 17 2012
Video clips are available on the Cengage Textbook Site. YOu will need to use this password
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mowenmanagerial
Professor Elam
Accounting & Investing Info for San Antonio A & M
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Professor Elam
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Professor Elam
Monday Sept 17 2012
A friend sent this and I wanted to share it with you, either turn on your speakers or get the headphones for this one, a large monitor would be a good idea as well.
Click here: Wyman Meinzer's West
Texasthe traiditional idea of writing papers in college will give way to multi media presentations, this is an outsanding example of what might be done.
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Professor Elam
Monday Sept 17 2012
I have enjoyed reading the posts on the Discussion site over the weekend. Some of you doubt that mood is generated within, several of you remarked that indeed the conventional wisdom that we are passively acted upon by the media. Those hints and suggestions determine how we feel. Really? Let's use an hypothesis to test that notion.
Socionomics has it that social mood is endogenously (internally) generated. This determines much of what happens in society. Let's take you back to the post 9/11 market low or the market low of March 2009 or the market low of December 1974 or the market low of October 1987. Pick one, in all cases the mood was uniformly negative and the media was delivering a negative drum beat. If it were true that mood was only influenced by the media, then the mood would continiue indefinitely in one direction. The markets would have gone even lower, if mood changed, perhaps to zero! But that did not happen.
Instead once the sellers were exhausted the mood changed and the markets rallied in every instance. So our alternate hypothesis, that mood must change from within, seems to have credibility. But theories have to work both ways.
What happened at the market tops of August 1987, March 2000 or Fall 2007? Mood was exuberant. The NASD zoomed another 40% in less than six months from late 1999 to early 2000. CNBC went nuts over NASD 5000. If mood were only affected by external events, then the mood should have stayed positive. The Dow Average in that scenario should now be 50,000 or so. But again, that did not happen. The mood changed.
Susan Rice, Jay Carney, Hillary Clinton,and Peggy Noonan all got it wrong again this weekend. A minor video did not cause the riots in the mid East. That was a symptom used to fan already existing anger. Indeed evidence points to a planned attack. And pointing to You Tube videos is hardly an effective foreign policy. World mood turned negative in March 2000, and continues to vacillate right to today. We are approaching another high in the markets. Already we see the manifestation of a change in mood that will bring those markets down.
Needless to say there is much more to socionomics than just this. Mood changes happen in fractals, just like markets. There are always smaller and larger degrees of mood. Short term positive mood exists now evidenced by
bright fall colors, the desire to show off wealth via expensive watches, cars, homes, and the desire to embrace riskier investments
Longer term the seeds of social unrest are on display from Chicago to the Mid East.
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Professor Elam
Weekend Sept 15 2012
We are studying Deming's TQM ideas and later we will study standards in cost managerial class. ISO standards are in independently confirmed rating that a company uses such standards as metrics in its process.
How important is this. Well I noticed Fujifilm takes the rather seriously. Click to see how they proudly list their accomplishment.
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Professor Elam
Thursday Sept 11 2012
Apple released its latest iPhone yesterday. But the race to a larger screen, hey I have five inches yours is only 4.5, wireless re charging, face recognition, have made this a lot tighter race.
One thing I have learned about the computer industry. When they really have nothing else to offer in terms of an upgrade, they change the cabling system. Then your cable won't attach to the newer computer and to the printer, or whatever. and sure enough, Apple has a new cable for iPhone 5.
I'm staying with iPhone 3.
Surprise, Apple did not release a smaller iPad.
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Professor Elam
Wed Sept 12 2012
I frequently mention the upstart success of Lululemon LULU as an example of a hot stock sporting a hihg P/E ratio. Thankfully this company has removed the stigma of having to attend yoga class attired in run of the mill department store togs that scream, Clearance Sale! I know this comes a a big relief to female TAMUSA students……
Now LULU has sued Calvin Klein for marketing a knock off yoga pant that mimics its features. LULU's pant
goes for $98, Calvin is in the game for $19.95, gee accounting classes, what does that do for LULU's gross margin at those different price oints. -
Professor Elam
wednesday Sept 12 2012
This writer suggests that Chicago drop its ties to its failing public school system.
I mentioned in class yesterday that we would probabaly never see another defined benefit plan and the writer suggests they adopt a defined contribution plan.
If this idea catches on it will change the public school landscape. With more parents deciding on home schooling and Districts not being able to afford this, how long before we have a Black Swan Event in public schools.
This reminds me of a similar event in another period of stagnation when Reagan simply fired the striking Airline Controllers. We have not heard from that group since.
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Professor Elam
Tuesday Sept 11 2012
Yesterday no one in a class knew who owned Chrysler, here is the update.
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Professor Elam
Tuesday Sept 11 2012
I recently received an inquriy and exchange from a student which I am going to share with you.
Note the last post focused on using my blog to expand your knowledge horizon.
This student had passed through the telephone interview stage and was now set to appear in person for a job interview. The company was one of the large refiners in the area. He asked how he should prepare for the interview. Before you scroll down to see my answer, how would you have prepared? Now remember you are no doubt in competition with students from other colleges in the area, Tx State, UTSA, Trinity, St. Mary's etc.
Okay, write down your answer before you scroll down to see my answer.
Here is the exact e mail I sent him.
As a matter of fact yes I do have some suggestions.
Overall I suggest you spend the weekend boning up on the refinery industry.
The major players are TSO, VLO, HFC, CHK, access them on finance.yahoo.com
TSO website
For example if I asked you which is larger, Valero or Tesoro what would you say?
finance.yahoo.com offers great thumbnail sketches on all these companies
The answer is that Tesoro is much much larger, something I did not realize until I looked it up.
I would certainly want to have read the last few letters from the CEO to the shareholders, these are in the front of the annual report, those reports are filed under Investor Relations on the company website.
I would also take a look at the recent stock price charts for VLO, TSO, HFC
I would also google eagle ford shale and do some background reading. If Romney wins, the domestic exploration industry will boom. Which companies have recently moved to town, Weatherford, SLB, HAL. What do those companies do? Okay I only spent a lot of my life around the oil business but you need a crash course this weekend.
Also google refinery accounting, I just did and there are a slew of articles on it, since you will be talking to accountants at a refining company it would be a great idea to be up and current on recent accounting pronouncements about the industry.
How do refiners make money, does it depend on the price of oil or the direction of oil prices?
Trick question, the answer is neither, the refiner makes money on the difference or spread between the price they pay for crude and the price they sell the refined product for, this difference is referred to as the crack spread, due to the name of the refinery cracking process
I would also look up Nustar, they bought a very small refinery here actually around the corner from our Brooks operation.
Here is some background on the Petroleum industry
http://en.wikipedia.org/wiki/Petroleum
And, do you know exactly the location of the interview, not a bad idea to drive over say Sunday Morning when there is little to no traffic and scout out the situation.
Pick out what you are going to wear and set that aside, pressed and shoes shined, if you get a haircut do ti tomorrow
In other words you want to arrive well informed about the industry and TSO specifically.
Remember to look around the room when you meet them for any clues about what your interviewer likes. As Dale Carnegie says, be sure to show a genuine interest in them, that will improve their opinion of you!
Well you got me going, I will not mention your name but I think I would like to post this as a guide for students if that is okay
Dennis Elam
PS, hope you did not have a lot planned other than this for the weekend!
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Professor Elam
Tuesday Sept 11 2012
I was frustrated at the lack of connection between my college classes and the real world of business. When I began trading bonds in 1984, I had to teach myself all about the bond market. UT Austin had not done that in any way. So the first goal was to link real world events with what we study in the classroom.
TAMUSA is basically a commuter campus. Students work and maintain families. There is no student union building or dormitory or tree shaded walks or fraternity or sorority houses where the idea of 'college' as a new expansionary experience used to exist. So, the second goal is to have us all visit in cyber space about what is happening.
Yesterday after class I had several students ask if they were supposed to make a second post. Okay let's require that. The idea however of assigning one post each for Professor Elam and The Market Perspective was to give everyone a push in the right direction. I had hoped that your Intellectual Curiosity would kick in causing you to read more. Hopefully this would result in students making posts with their comments or asking questions in class.
For example, yesterday in class I asked
Who owns Chrysler? I did one guess of Mercedes, but that was two owners back. Since then Mercedes sold to Cerebus, actually paying Cerebus to take it off their hands. Cerebus had it when it went bust and only the prospect of jobs being lost kept the government in the game. Ownership was then handed off to FIAT, now run by a Canadian Chartered Accountant.
AS college graduates you will be competing with other graduates from other colleges. Your diploma is merely a ticket to an interview not a guarantee, as many grads are now discovering.
It is simply not acceptable to not know who owns a former Big Three Auto Maker in this country. It is a remarkable story and one you should be familiar with. I checked and my most recent post was Jan 31 2011 on Chrysler a good while back. But if you are following our links at left or reading the WSJ as I recommended, you would have known.
Okay let's try again. How about another post on the discussion site, this requires you to go back to at least this past spring to spot an event. Another personal goal of yours should be to establish your self as an expert on something. Bruce Howard is a recruiter for a local firm. He regularly visits area colleges and is an Advisory Council Member of TAMUSA. He suggests that students establish their own brand. You can only do this by establishing an expertise in a certain area.
Start now on establishing your brand. Metaphorically speaking, as Mike Phelps swim coach would say,
get in the financial water.
Do I follow my own advice? You bet I do. I maintain a stable of topics so that I can address local professional groups. I have delivered talks enabling these groups to earn Continuing Professional Eduation Credits in their fields.
San Antonio CPA Society
San Antonio Instiutte of internal Auditors
San Antonio Institue of Managment Accountants
San Antonio Society of Women Accountants
and this month, Texas Society of Structural Engineers
Professor Elam 