Archive for March 31st, 2009

Mail your warranty card to 1600 Pennsylvania Avenue … Attn: Mr. Obama

March 31, 2009

To me, the most stunning aspect of yesterday’s announcements re: GM and Chrysler wasn’t Rick Waggoner getting canned, or Chrysler being shotgun wed to Fiat (anybody out there own a Fiat ?) … it was Team O’s announcement that the Federal government would now be standing behind the car companies’ warranties.

First, I didn’t know that the Constitution gave a president the unilateral right to declare that my tax dollars will go to keeping somebody else’s shoddy car running for 5 or 10 years. 

More interesting: how exactly is the Federal government going to fulfill the warranty pledge?

Let’s pretend that both Chrysler & GM are headed to the junk heap.  Following them will be their dealers — the guys who currently provide warranty service.  Will they just put a couple of repair bays outside the White House?

More likely, it’ll just be an insurance program that reimburses independent garages who will be licensed to make repairs.  The process for handling the claims ? The reimbursement rates ? The fraud protection ?

And, many warranty repairs require parts.  Where will the parts come from? Answer: probably from China since domestic suppliers will crater soon after GM.

Does anybody in the administration give even a moment’s thought to implementation details?

I guess this program will be good practice for nationalized healthcare.  If they can do it for cars, they should be able to do it for human lives, right?

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This is tough love ?

March 31, 2009

Left leaning pundits were crowing yesterday about President Obama’s “ultimatum to the car companies” and his “tough love approach to the problem”.

Ken’s Take: “If your pulse isn’t revived, I’m going to declare you legally dead” isn’t tough love … it’s just politicizing the obvious.

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Sticking it to the "fly over" states … well, maybe not this year.

March 31, 2009

Excerpted from IBD, “Potholes Ahead En Route To Welfare State”, Barone,  March 27, 2009

Pres. Obama continues to insist that America cannot enjoy real prosperity again without higher taxes on high earners, a government health insurance program, a cap-and-trade program that amounts to a tax on energy and the effective abolition of secret ballots in unionization elections.

Even though there are large Democratic majorities in both houses of Congress, roadblocks have started to appear.

One has been set up by the Senate Budget Committee. Chairman Kent Conrad of North Dakota, who … has apparently decided that cap-and-trade is off the table for this year.

Cap-and-trade would impose higher costs on coal-fired electric power plants. In states where most electricity is produced from coal, this would mean higher utility bills for consumers and industrial users.

So, Democrats from coal states like North Dakota see energy issues differently from Democrats from coal-free states like California.

There are 25 Democratic senators from states that get 60% or more of their electricity from coal (in North Dakota, the figure is 93%). To get 50 Senate votes on a budget with cap and trade, 17 of those Senators have to discard their regional interests and vote for cap and trade..

So you can see why he was ready to ditch cap-and-trade, which, in any case, addresses a problem — climate change — whose purported evil effects are decades away.

Ditching cap-and-trade, however, may set up another roadblock, since the money the government was going to take out of the private-sector economy was slated for Obama’s middle-class tax cut.

This could get interesting.

Full article:
http://www.ibdeditorials.com/IBDArticles.aspx?id=323047032396219* * * * *
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Sticking it to the “fly over” states … well, maybe not this year.

March 31, 2009

Excerpted from IBD, “Potholes Ahead En Route To Welfare State”, Barone,  March 27, 2009

Pres. Obama continues to insist that America cannot enjoy real prosperity again without higher taxes on high earners, a government health insurance program, a cap-and-trade program that amounts to a tax on energy and the effective abolition of secret ballots in unionization elections.

Even though there are large Democratic majorities in both houses of Congress, roadblocks have started to appear.

One has been set up by the Senate Budget Committee. Chairman Kent Conrad of North Dakota, who … has apparently decided that cap-and-trade is off the table for this year.

Cap-and-trade would impose higher costs on coal-fired electric power plants. In states where most electricity is produced from coal, this would mean higher utility bills for consumers and industrial users.

So, Democrats from coal states like North Dakota see energy issues differently from Democrats from coal-free states like California.

There are 25 Democratic senators from states that get 60% or more of their electricity from coal (in North Dakota, the figure is 93%). To get 50 Senate votes on a budget with cap and trade, 17 of those Senators have to discard their regional interests and vote for cap and trade..

So you can see why he was ready to ditch cap-and-trade, which, in any case, addresses a problem — climate change — whose purported evil effects are decades away.

Ditching cap-and-trade, however, may set up another roadblock, since the money the government was going to take out of the private-sector economy was slated for Obama’s middle-class tax cut.

This could get interesting.

Full article:
http://www.ibdeditorials.com/IBDArticles.aspx?id=323047032396219* * * * *
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Grape Nuts Breaks the Mold By Targeting Men

March 31, 2009

Excerpted from WSJ, “Grape Nuts Takes Aim at Men” By Suzanne Vranica, Mar 26, 2009

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Seeking to revive a crunchy stalwart, cereal maker Post Foods is launching a new ad campaign for Grape Nuts that is aimed at men.

The cheeky campaign includes a special Web site on MSN with dozens of two-minute videos … which tout the cereal’s quality and offer advice, such as how to ask for a raise in a recession … The site also offers “The Guy’s Manual,” with tips on topics like restoring vintage cars. The campaign’s print ads, which will run in Sports Illustrated, feature men fishing and golfing and include the new slogan “That Takes Grape Nuts” … 

The campaign is a departure for cereal advertising, which has been dominated by wholesome images of mom and the family breakfast table. Even Grape Nuts, which is eaten mainly by men, has run ads targeting women …

While men are increasingly sharing grocery-shopping duties, the task is still handled largely by women, ad experts say. “Men will be entertained” by the ad, “but is it going to influence their purchase if they aren’t the ones doing the shopping?” asks Kristi Faulkner, a principal at Womenkind, a marketing firm.

“When you do something that is different, there is always some uncertainly,” says Steve Van Tassel, Post’s president. He says Post plans to step up its in-store marketing efforts to make sure that whoever does the shopping is aware of Grape Nuts.

Post is trying to stand out in the $6.6 billion ready-to-eat cereal category, where the Grape Nuts brand has been hurt by a host of competitors in the healthy-cereal category … Grape Nuts sales slipped 15% to $54.2 million during the 12 months ended Feb. 22 from a year earlier …  All Bran saw sales rise 30%.

Wall Street and the packaged-goods industry will be watching the campaign closely. Ralcorp’s (Ralston Purina) accquisition of Post, whose brands include Honey Bunches of Oats, Shredded Wheat and Pebbles, raised questions about how a company known for shunning advertising to keep prices low would handle brands that were largely built through marketing.  Ralcorp spent just $97, 837 on ads last year …

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Full Article:
http://online.wsj.com/article/SB123801803460241457.html

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Miller’s New Strategy … Back to the Future

March 31, 2009

Excerpted from WSJ, “Miller Reprises an Old Theme” By David Kesmodel, Mar 20, 2009

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Beer giant MillerCoors, seeking to revive its flagging Miller Lite after a string of marketing missteps, is spending more than $100 million on a new campaign that features redesigned cans and bottles and new ads centered on the brand’s familiar theme: “Tastes Great.”

The campaign … is aimed at grabbing market share from leader Anheuser-Busch InBev and its top-selling Bud Light brand. While the new ads don’t attack Bud Light by name, they are clearly designed to persuade consumers that Miller Lite is the better-tasting brew …

Miller Lite, which introduced Americans to light beer in the 1970s, mostly has posted sales declines in recent years, and its performance has worsened under its new owner, a joint venture of SABMiller and Molson Coors Brewing … One problem is that Miller Lite has bounced from one ad strategy to another in recent years. “The brand has lacked a clear identity for so long … They just haven’t been able to find its voice” …

Now, MillerCoors, borrowing a page from Coors Light, says it will convey a consistent and straightforward message about the Miller Lite brand. That message will be built around taste … In a new twist on the “Tastes Great” theme, MillerCoors is rolling out ads that herald its “triple hops” brewing process, in which hops — the flowers that give beer its distinctive bitterness and aroma — are added to the beer at three different stages. The company says this gives the beer its flavor, “balance” and proper level of foam.

Miller Lite’s new “taste protector” cans will likewise tout the process. The cans have a lining on the inside to keep the beer from touching the aluminum, which can cause a metallic taste. The company also will promote new bottles with different labels as well as a “taste protector cap” designed to preserve the taste of the beer …

Highlighting the brand’s brewing process, however, carries the risk of backfiring with consumers, who are increasingly knowledgeable about beer ingredients. Light lagers like Miller Lite, have a low hops content, especially compared with many of the small-batch “craft” beers that are enjoying the industry’s highest growth rates.

“By overtly marketing their multiaddition hopping process, the consumer would presumably expect Miller Lite to be an overtly hoppy beer; it’s not” … MillerCoors also might find it hard to boost Miler Lite sales at the same time Coors Light sales are growing …

Miller Lite dominated the light-beer wars of the 1980s with its famed “Tastes Great, Less Filling” pitch. Miller Lite is now the No. 2-selling light beer in the U.S. after Bud Light, whose sales volume rose less than 1% last year … Coors Light, the nation’s No. 3 light beer, has been enjoying healthier sales growth than either Bud Light or Miller Lite.

MillerCoors won’t disclose how much it plans to spend on the new ad campaign this year, but Mr. England said it would be “well north of $100 million” …

Edit by SAC

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Full Article:
http://online.wsj.com/article/SB123750883420290503.html

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