Monthly Archives: August 2012

More Syria Clues

I ran across a number of articles that helped me understand what is going on in Syria and why so many countries are involved.  Here are couple articles that give a good background.

January, 2011 – Assad announces a ‘Four Seas Policy’  (www.upi.com/Business_News/Energy-Resources/2011/01/06/Syrias-Assad-pushes-Four-Seas-Strategy/UPI-98471294335880/).  This is designed to make Syria and Turkey the regional hub for getting mideast energy to Europe and beyond via a network of pipelines.

July 2011 – Syria announces a pipeline deal with Iran and Iraq – a deal that doesn’t include Turkey (rt.com/news/gas-pipeline-iran-syria/).  So does this mean that Syria broke the partnership and decided to compete with Turkey?  Two months later is when the Syrian violence started.

So why are Turkey, Saudi Arabia, and the US supporting the rebels, and Russia and China supporting the Assad Government?  Here are my guesses:

The United States:  Obviously the US is not wild about a conduit for Iran to get its huge gas reserves to market – especially through a country that they have no control over.

Turkey:  they don’t want a competitor in the battle to become the hub of oil and gas transmission to Europe.   I would be interested in knowing what the State Department has offered Turkey to support the rebellion.  Hillary Clinton has met with Turkish diplomats many times of the last several months.

Saudi Arabia:  Not sure here.  Maybe they don’t want competition in the Oil / Gas exporting to Europe.  Probably would have some interest in keeping Iran’s reserves bottled up in Iran.  Probably more to be exposed here..

And why are Russia and China supporting the existing government?   Maybe its just a knee jerk reaction to America’s involvement.  Russia probably has some interest in an efficient conduit of Gas and Oil thru Syria – a country they have very good relations with.  Also,  this article brings up an interesting point – Russia has been a big player in  buying up Iraqi Oil and Gas fields – so a pipeline through Syria would probably be pretty handy.

http://www.platts.com/weblog/oilblog/2012/07/09/petrodollars_ad.html

So I don’t know if  I fully understand why all the global interference in Syria, but I am pretty sure it has something to do with the transporting of energy.

 

 

 

 

 

 

The Paul Ryan Pick

From a purely strategic point of view, I think the Paul Ryan pick makes sense for the Republicans.  If they can get the public to buy in to Paul Ryan being the ‘man with a plan’ and contrast it with the image of a do nothing congress, it might energize swing voters  / Reagan democrats.  He also helps bring the Tea Party back into the game.

Paul Ryan’s big claim to fame is his ‘Path to Prosperity’.  The keystone of this plan is to eliminate Medicare starting in 2022.   Paul Ryan’s plan keeps Medicare unchanged for existing participants – which may encourage anybody over 65 to vote for the plan if they vote based on entitlements.  Maybe the assumption is the under 55  year old demographic will vote based on other issues, and not think about the  on looming benefit cuts that will cost them thousands in years to come.

So if I read it right, the Republicans are going to put the Democrats on the defensive – make the Democrats get the American voters to stand up for their entitlements.  This is something the Democrats have done a poor job of.  It puts the focus of the campaign back on the economy, again putting the democrats on the defensive.  Interestingly, this could add fuel to the fire regarding Romney’s 100 million dollar IRA.  If the political discussion is about entitlements – it seems fair to focus on those who don’t need entitlements because they cheat the system.

I think this is the best strategic move the Republicans can make given all the political liabilities they have.  I still don’t think they have a chance to win the election – but it does define a strategy for them to move forward with.  For those of us who focus on political strategy, this is going to be a very interesting presidential campaign.

 

 

Interesting stuff at Yahoo

I was intrigued when Yahoo (YHOO) named Marissa Mayer CEO a few weeks ago – I think thats a real ‘out of the box’ pick that few companies would do.  It seems most CEO hires are retreads of the same people.  So I got to wondering what Yahoo is up to.  I hadn’t given Yahoo much thought over the last several years, seemed like kind of a dying company with shrinking search share.  But I happened to review their latest earnings announcement to see if I could figure out where they are going.  I pulled this from their ‘Business Highlights’ section of their quarterly report:

 • Fred Amoroso was named chairman of Yahoo!’s board of directors and Daniel S. Loeb, Harry J. Wilson, and Michael J. Wolf joined the Yahoo! board. • Yahoo! and Alibaba Group Holding Limited (“Alibaba”) announced a definitive agreement for a staged and comprehensive value realization plan for Yahoo!’s stake in Alibaba. The first step is the repurchase by Alibaba of up to one-half of Yahoo!’s stake, or approximately 20 percent of Alibaba’s fully-diluted shares.
 • In July 2012, Yahoo! and Facebook announced definitive agreements that launch a new advertising partnership, extend and expand distribution arrangements, and settle all pending patent claims between the companies.
• Yahoo! launched Axis, a new experience that re-imagines how consumers search and browse on the web. Axis offers the only search experience that allows consumers to enter their search, see and interact with visual results, all without ever leaving the page they are on. Axis seamlessly integrates with consumers’ favorite desktop browser and automatically connects the online experiences across multiple devices.
• Yahoo! launched Genome from Yahoo!, an online advertising solution that combines Yahoo! data with interclick’s third party data and advertisers’ first party data along with a premium media footprint to provide marketers with one of the most complete, custom audience solutions in the industry.
• Yahoo! and CNBC announced a strategic content, programming and distribution alliance that will dramatically expand CNBC’s online reach and presence and provide a broadcast platform for Yahoo! Finance’s original content and contributors. CNBC becomes the premier content source for Yahoo! Finance in the U.S. and later this year, the two companies plan to co-create a new slate of co-branded, original videos which will appear on Yahoo! Finance and CNBC.com.
•Yahoo! and Clear Channel announced a cross-platform content distribution and promotion agreement. The multi-faceted relationship involves the distribution and cross-promotion of premium content in addition to a live concert series to the unparalleled combined audience of the Yahoo! Media Network and Clear Channel Media and Entertainment U.S. listeners across 150 markets, plus their websites and the audience of iHeartRadio, Clear Channel’s industry-leading digital radio service.
• Yahoo! and Spotify announced a global content distribution and promotion agreement that will enable Yahoo! to integrate and promote Spotify’s on demand music service on Yahoo!’s Media Network. Yahoo! will also create an app for Spotify’s platform featuring Yahoo! original entertainment content.
 • Yahoo! extended its exclusive online agreement with Eurosport to host and operate the co-branded Yahoo! Eurosport site in key markets. By partnering with the #1 pan-European television sports network, Yahoo! will continue to bring exclusive, high quality sports content online to drive user engagement and provide premium content.
Source:  http://money.msn.com/business-news/article.aspx?symbol=US:YHOO&feed=BW&date=20120717&id=15340975

What jumped out at me was all their media deals they have put together.  Is this where YHOO is going?  To be the hub of all the online media streaming for current content? Seems like an interesting idea though it does have a lot of potential competitors.   Their outgoing CEO was a media guy,  so maybe he was the one that put all these media deals together.  If so, Marissa Mayer probably wont be a big asset in aquiring more media content.  Mayer is a product person, so it seems like their next step is to build a platform designed for media distribution – a skill that Mayer could provide.

Yahoo is currently expected to earn a little over a buck a share next year with an estimated 5 year growth of 12% (vs actual growth of 26% for the last 5 years).  Its selling at $15 a share, so their doesnt seem to be a lot of optimism built into it. Even if Mayer fails to deliver anything more than the previous CEOs at Yahoo over the last few years, it seems like the upside is better than the downside.  In addition, if Yahoo builds a nice content destination, they would be attractive for one of big 4 (Apple, Microsoft, Google, Amazon) as an acquisition target – they are currently starved for content.

Make no mistake – this gamble Yahoo is making could fail.  But put me in the camp of liking the hire of Mayer and being bullish on the stock.