Reprographics 101

from MARKETWIRE, 05/10/2011

(the following two paragraphs were only the beginning of this particular article)

Parsons is pleased to announce that Kevin J. Thibault has joined the firm as Vice President and Market Development Manager for state transportation programs in the United States. In this role, he will be responsible for developing Parsons’ relationships in strategic markets as well as other multimodal transportation initiatives.

Mr. Thibault has more than 25 years of professional engineering experience in the public and private sectors. Prior to joining Parsons, he was the executive director for the Florida Rail Enterprise, a unit within the Florida Department of Transportation (FDOT) responsible for implementing the state’s high-speed rail program. He also served as the assistant secretary for engineering and operations for the FDOT where he served as the agency’s chief operating officer for more than 7,100 employees with an annual budget in excess of $6 billion. He also served as the interim executive director and production director of Florida’s Turnpike Enterprise, the state’s largest toll entity.

Joel’s comments:

Rant of the day….

Surprise, surprise; yet another former government-sector transportation executive has joined the ranks of a large private-sector transportation engineering firm. If you were to examine the employee roster at virtually any large engineering firm in the state of Florida, you’ll likely find a former head of a “district” DOT office, or a former “deputy director” of the state DOT, or a former “secretary” of the state DOT. It is highly likely that this same fact holds true in other states in the U.S. It is also not surprising that private-sector lobbyists, who represent “engineering firms” in the state, are very active in lobbying the state “house” and the state “senate.”

Which brings me to one of the things that makes absolutely no sense to me (and that drives me crazy), as a taxpayer, especially when you consider the fact that Florida government is strapped for funds. In the State of Florida, engineering firms do not have to, nor do they, compete based on “price.” They only have to compete based on “qualifications” and on “their overall understanding of the scope of a project and their approach to meeting the requirements of a project.” In other words, it (being selected or not selected to perform engineering services on a state DOT project) mostly “boils down to” …. “who you know.”

If the Florida legislature wasn’t so-damn-deeply in the pockets of engineering firm lobbyists, Florida’s taxpayers would save a lot of money. Florida’s taxpayers would save hundreds of millions of dollars if the rules were changed to force engineering firms to compete on the basis of price. The same thing very likely applies to many other states.

An article, this morning (May 17, 2011) on Fox Business News, attributable to Reuters, says this….

Housing starts and permits for future home construction fell in April as an overhang of homes on the market discourages builders from taking on new projects, pointing to prolonged weakness in the housing sector.

The Commerce Department said on Tuesday housing starts dropped 10.6% to a seasonally adjusted annual rate of 523,000 units. March’s starts were revised up to a 585,000-unit pace from the previously reported rate of 549,000 units.

Economists polled by Reuters had forecast housing starts rising to a 568,000-unit rate. Compared to April last year, residential construction was down 23.9%, the largest decline since October 2009.

Residential construction is being crowded out by an oversupply of used homes on the market, in particular, foreclosed properties, which sell well below their value.

Home builders’ sentiment was flat in May, the National Association of Home Builders said on Monday.

Though builders expected a modest improvement in sales during spring, they anticipated market conditions to weaken in the next six months.

Groundbreaking last month was depressed by a 24.1% tumble in volatile multi-family homes, where starts for buildings with five or more units dropped 28.3%. Single-family home construction fell 5.1%.

New building permits dropped 4.0% to a 551,000-unit pace last month. April’s permits were revised down to a 574,000-unit pace and economists had expected overall building permits in April to remain unchanged at the previously reported 585, 000-unit pace.

Permits were held down last month by an 8.8% drop in the multi-family segment. Permits to build single-family homes slipped 1.8%.

New home completions rose 4.1% to 554,000 units in April.

Here’s the beginning of an article I just found on the web-site mentioned in the next line…..

By Bob Sullivan (on redtape.msnbc.msn.com, on 5.17.11)

One moment of weakness — a single click on a bogus e-mail link or website — has cost many U.S. companies nearly $1 million apiece, the FBI said. And it has transported them into a world of international intrigue worthy of a spy novel, connecting them to a crime ring linked to six Chinese port cities near the Russian border.

In a sternly worded warning that included a remarkable level of detail for an FBI press release, the agency is warning U.S. businesses and banks to be wary of wire transfers headed to Chinese cities of Raohe, Fuyuan, Jixi City, Xunke, Tongjiang and Dongning.

It’s unclear if the stolen funds remained in China or were transported elsewhere, and U.S. security firms are currently debating the significance of the notice. But the high-dollar value of the thefts, combined with their high-profile destination — any government cybercrime warning that involves China raises eyebrows – has attracted unusual attention in the banking community.

Transactions headed to those Chinese cities should be “heavily scrutinized, especially for clients that have no prior transaction history with companies in the Heilongjiang province,” the FBI said.

You can access the complete article at this link:

http://redtape.msnbc.msn.com/_news/2011/05/17/6655775-an-online-bank-scam-worthy-of-a-spy-novel

Joel’s comments:

Have you ever had anyone steal money from your company?

One interesting “scam” that happened to NGI, back around the early part of 1997, was a scam that went something like this (this is to the ‘best of’ my recollection, and it’s been several years since it happened)…..

Our customers’ checks were going directly to a bank-provided outsource service that opened the mail, recorded what was paid and then deposited the funds into our bank account. The only problem was that some of the checks never made it into “our” bank account. They ended up being deposited into a different “NGI” account. Some brazen person registered a new company, using Florida’s easy-to-use “Sunbiz.org” filing service – using a company name similar to our company’s name – and, then, using that paperwork, opened a checking account at another bank – and then, diverted some of our customers’ checks into that bank account. It took a while to realize that we had a problem. Our A/R people, growing concerned that some of our larger customers were not paying as promptly as they used to pay, called those customers, only to be told that “hey, we already sent you a check…. and that was over a month ago, ….. and, hey, wait a minute, that check has cleared our bank account.” That’s when we discovered the scam that someone had set up a new company and was stealing our customers’ checks and depositing them into a bank account other than ours. Pain in the ass.

The paragraph that follows was pulled from a much longer article that appeared, on May 6, 2011, on AGC’s web-site, under construction economics….

Most domestic banks reported no change in their standards for approving CRE [commercial real estate] loans; however, a few large banks and foreign banks reportedly eased such standards somewhat,” the Federal Reserve reported on Monday in summarizing its latest quarterly survey of senior loan officers at 55 U.S. banks and 22 U.S. branches and agencies of foreign banks. “About 35% of domestic banks reported having seen increased demand for CRE loans—the strongest reading since the mid-1990s. The banks that indicated an increase in demand were almost all large domestic banks. Other domestic and foreign banks reported little change in demand for CRE loans on net.” The Wall Street Journal reported on Wednesday, “J.P. Morgan Chase & Co. has about $5 billion in [CRE] loans in the pipeline, about $1 billion of which is new construction. That is a threefold increase from its pipeline 12 to 18 months ago, bank officials say, a turnaround from recent years when the bank all but stopped originating commercial real-estate loans.” The article also cites Wells Fargo & Co. and Deutsche Bank AG as having increased CRE loans, but “banks shedding such assets include [Bank of America Corp.], Huntington Bancshares Inc., KeyCorp and SunTrust Banks Inc.”

Better to be an optimist than a pessimist! Norman Vincent Peale long-ago pointed out the “power of positive thinking”.

Here’s the beginning of a post on the ZweigWhite’s blog:

FAYETTEVILLE, Ark. (May 3, 2011) –New evidence points to a brightening mood among the leaders of design firms, with bonuses, raises and incentives now poised to make a comeback.

A majority of A/E/P principals are optimistic that business will pick up this year, according to ZweigWhite’s 2011 Principals, Partners & Owners Survey. Eleven percent of the respondents stated that business will be much better in 2011, and 57 percent said they believe it will be somewhat better. Only 16 percent believe the business environment will be somewhat worse, and no respondents said they felt things would be much worse this year. Seven percent expressed no opinion.

You can access the complete post at this Internet address:

http://blog.zweigwhite.com/news/pay-going-up-as-optimism-rises-in-design-world/

In a post on my blog on March 25^th, 2011, I pointed out that “Equities research analysts at Robert W. Baird & Co. upgraded shares of American Reprographics Company (NYSE: ARC) to an “Outperform” rating in a research note released to investors today.”

On March 25, 2011, ARC’s stock closed at $ 9.98.

Subsequent to that date, ARC’s stock drifted higher, and, on April 1, 2011, ARC’s stock closed at $10.37.

Subsequent to that, ARC’s stock has gone up and down, and, today, May 16, 2011, ARC’s stock closed at $8.56.

I guess RW Baird’s outperform rating hasn’t yet had much of an upside effect on the price of ARC’s stock. Maybe that’ll happen at some point. As that saying goes, “we’ll see.”

ARC’s largest institutional shareholder (other than T Rowe Price) is “Stadium Capital Management.” I don’t knowhow much SCM’s “average cost per share” was for the ARC shares it owns, but, oh my, these guys have placed a big bet on ARC stock. I would imagine that the guys at SCM know the reprographics (and technology) business “inside and out” (i.e., a lot better than most do), for they’ve placed a big bet on their investment in ARC shares. I hope their bet pays off for them. They are probably long-term bettors.

SCM owns 4,627,245 shares of ARC stock. (at least that was the number reported as of December 31, 2010, per MSN.com.)

At the close of the market on March 25, 2011, SCM’s ARC shares were worth approximately $46.2 million.

At the close of the market on April 1, SCM’s ARC shares were worth $48.0 million.

And, at the close of the market today, May 16, 2011, SCM’s ARC shares were worth $39.6 million.

A quick check on MarketWatch.com and on MSN.com reveals that analysts are estimating that ARC’s EPS for 2012 will be in the range of $.28 – $.32 per share.

And, a quick check on BusinessWeek (owned by Bloomberg) reveals that analysts are estimating that ARC’s revenues will rise to $467 million for C/Y 2012.

If both of those estimates turn out to be close to reality, then, hopefully, SCM’s big bet will pay off handsomely.

Wow, the market was quite funky today; up, down, up, down.

Found an interesting “note” on the Internet today by Nicholas Santiago. He titled his “note”, “Schizophrenic Market”. Here’s what he said…..

If you are an intra-day stock trader you will have noticed that the major stock market indexes have traded all over the map. The Dow Jones Industrial Average has traded over 300 points from its intra-day peaks and troughs. The driving force behind every stock market move is the U.S. Dollar Index(DXY). When the DXY declines the major stock indexes rally and trade higher. The opposite is true when the DXY trades higher the major stock indexes deflate and trade lower. This inverse relationship between the stock market and the U.S. Dollar Index is as tightly correlated as I have ever seen.

Options expiration is on May 20, 2011, therefore, that means that the entire trading week should be very volatile. Often during this week, many of the leading and popular stocks will trade rather erratic. The reason for this type of activity is due to the institutional games that will played by the major financial firms. You see the institutions have enough capital on hand to push the market anyway they see fit. The object by the institutions is to try and shake out the small retail options traders out of their positions. For example, if enough retail options traders bought call options on a stock like Netflix Inc.(NASDAQ:NFLX), or Apple Inc.(NASDAQ:AAPL), the stocks will generally sell off during the week so that the retail options trader closes his call position for a loss on the premiums paid.

These games take place every month during the week into options expiration. Therefore, until the institutions take care of business it would be prudent to expect more volatility throughout the trading week.

Sorry, this is a political rant.

Below “my comments”, I’ve posted a copy of an op-ed editorial that appeared yesterday in the NY Times.

This op-ed editorial, which I urge everyone to read, talks about the “debt ceiling” issue the U.S. government will soon be facing.

My comments:

Although I consider myself to be a mixture of liberal and conservative viewpoints – I lean liberal on some issues and lean conservative on others – I’m not, by any stretch of the imagination, a “radical.” As to the op-ed editorial that appears below, I 100% agree with Mr. Krugman.

Radical conservatives apparently have little, if no, concern that failing to raise the debt ceiling will cause problems for U.S. citizens. I, too, urge President Obama not to cave in and cater to the demands of the radical conservatives in the House of Representatives.

Quite frankly, I’m looking forward to seeing what actually happens when the debt ceiling isn’t raised. I don’t think the U.S. has had this happen before, so, if anything, if it does happen it will prove to a unique and interesting adventure, whatever ends up happening …. that’ll be kind of exciting, if you ask me, and, at my age, I need some excitement!

But, part of the reason I’m hoping this will happen is that….. I’m guessing that, if the debt ceiling isn’t raised, interest rates will jack up quickly, and maybe then I’ll be able to earn some “real” interest on the cash I’ve got in the bank. And, if the stock market takes a quick nose-dive, then maybe I’ll be able to buy a bunch of dividend-paying stocks at better yields than has been the case the past 18 months. In short, perhaps a good dose of “fiasco” will give my income a nice bump.

So, I say to Congressman Boehner (and to all of his Tea Party constituents), “go ahead, make my day!”

But if it happens (in other words, if the debt ceiling is not raised by the time it has to be raised) and if, as a result, interest rates do jack-up and stock prices crash, I’m going to feel very sorry for those who feel the repercussions. When interest rates jack-up, developers will stall projects. The A/E/C industry is still a “basket case” and that won’t help its “recovery”, at all. AIA “project inquiries” will take a hit, the AIA ABI Index will take a hit, interest rate hikes on home mortgages will exacerbate an already (very) ugly housing market. Recovery in the A/E/C market, which we all were hoping to see take hold in 2011, will likely be pushed further off into the future.

I don’t like seeing America held hostage by a small group of people with a radical conservative agenda, but, since I’m personally not going to pay a price for their stupidity and ignorance, I guess I should say, like Alfred E,. Neuman would have put it, “What, Me Worry?”

OP-ED COLUMNIST

America Held Hostage

By PAUL KRUGMAN

Published: May 15, 2011

Six months ago President Obama faced a hostage situation. Republicans threatened to block an extension of middle-class tax cuts unless Mr. Obama gave in and extended tax cuts for the rich too. And the president essentially folded, giving the G.O.P. everything it wanted.

Now, predictably, the hostage-takers are back: blackmail worked well last December, so why not try it again? This time House Republicans say they will refuse to raise the debt ceiling — a step that could inflict major economic damage — unless Mr. Obama agrees to large spending cuts, even as they rule out any tax increase whatsoever. And the question becomes what, if anything, will get the president to say no.

The debt ceiling itself is a strange feature of U.S. law: since Congress must vote to authorize spending and choose tax rates, why have a second vote on whether to allow the borrowing that these spending and taxation policies imply? In practice, however, legislators have historically been willing to raise the debt ceiling as necessary, so this quirk in our system hasn’t mattered very much — until now.

What has changed? The answer is the radicalization of the Republican Party. Normally, a party controlling neither the White House nor the Senate would acknowledge that it isn’t in a position to impose its agenda on the nation. But the modern G.O.P. doesn’t believe in following normal rules.

So what will happen if the ceiling isn’t raised? It has become fashionable on the right to assert that it would be no big deal. On Saturday the editorial page of The Wall Street Journal ridiculed those worried about the consequences of hitting the ceiling as the “Armageddon lobby.”

It’s hard to know whether the “what, us worry?” types believe what they’re saying, or whether they’re just staking out a bargaining position. But in any case, they’re almost surely wrong: seriously bad consequences will follow if the debt ceiling isn’t raised.

For if we hit the debt ceiling, the government will be forced to stop paying roughly a third of its bills, because that’s the share of spending currently financed by borrowing. So will it stop sending out Social Security checks? Will it stop paying doctors and hospitals that treat Medicare patients? Will it stop paying the contractors supplying fuel and munitions to our military? Or will it stop paying interest on the debt?

Don’t say “none of the above.” As I’ve written before, the federal government is basically an insurance company with an army, so I’ve just described all the major components of federal spending. At least one, and probably several, of these components will face payment stoppages if federal borrowing is cut off.

And what would such payment stops do to the economy? Nothing good. Consumer spending would probably crash, as nervous seniors started wondering how to pay for rent and food. Businesses that depend on government purchases would slash payrolls and cancel investments.

Furthermore, markets might well panic, especially if interest payments are missed. And the consequences of undermining faith in U.S. debt might be especially severe because that debt plays a crucial role in many financial transactions.

So hitting the debt ceiling would be a very bad thing. Unfortunately, it may be unavoidable.

Why? Because this is a hostage situation. If the president and his allies operate on the principle that failure to raise the debt ceiling is an unthinkable outcome, to be avoided at all cost, then they have ceded all power to those willing to bring that outcome about. In effect, they will have ripped up the Constitution and given control over America’s government to a party that only controls one house of Congress, but claims to be willing to bring down the economy unless it gets what it wants.

Now, there are good reasons to believe that the G.O.P. isn’t nearly as willing to burn the house down as it claims. Business interests have made it clear that they’re horrified at the prospect of hitting the debt ceiling. Even the virulently anti-Obama U.S. Chamber of Commerce has urged Congress to raise the ceiling “as expeditiously as possible.” And a confrontation over spending would only highlight the fact that Republicans won big last year largely by promising to protect Medicare, then promptly voted to dismantle the program.

But the president can’t call the extortionists’ bluff unless he’s willing to confront them, and accept the associated risks.

According to Harry Reid, the Senate majority leader, Mr. Obama has told Democrats not to draw any “line in the sand” in debt negotiations. Well, count me among those who find this strategy completely baffling. At some point — and sooner rather than later — the president has to draw a line. Otherwise, he might as well move out of the White House, and hand the keys over to the Tea Party.

This afternoon, I visited the web-site of one of our former company’s competitors in Florida, just to see if there’s anything new on this competitor’s web-site.

Although I did not find much new, I did see these three lines, highlighted on this reprographer’s home-page:

* Free Pick-Up and Delivery

* Local Area Only

* $10.00 minimum order

My question to reprographers who do still offer “free” pick-up and delivery –

Do you routinely review customer accounts to make sure that customers, who do take advantage of your “free” pick-up and delivery offer, are generating sufficient business to offset the costs your company incurs to operate pick-up and delivery services?

If you have a small to medium size account – let’s say it’s a subcontractor who is located 5 miles from your production center – whose “average order” is $15.00 – and who places one order each day – are you making a profit on that account? Or, are you, literally, “spinning your wheels” for no gain (no profit?)

With the cost of car insurance increasing year over year, the cost of repairs continuing to increase, and the cost of gas at around $4.00 per gallon –and drivers don’t typically work for free – it “ain’t cheap” to provide pick-up and delivery services.

I can still recall when we offered “free” pick-up and delivery back in the early 1970’s. But, back then, gas prices were less than $1.00 per gallon, car insurance rates were somewhat reasonable and driver-pay-rates were in the $3 – $4 (or less) per hour range, ….. and our average selling price “per sq ft” (for diazo bluelines) was around $.07 per sq ft.

What might have made sense years ago, even 10 years ago, may not make any sense at all today.

May 10, 2011 05:28pm EST (Article by Tony Hoffman) (Article found on pcmag.com)

Lenovo has announced the RJ600N, a Memjet-based office printer intended for sale in China. Memjet is a high-speed color printing technology being marketed by a company of the same name. The RJ600N has a wicked-fast claimed color printing speed: up to 60 pages per minute, and a low claimed cost per printed page. Lenovo is the first company in the world to release a Memjet printer to the office market.

The RJ600N is the first fruit of a partnership between Memjet and Lenovo that was made public at CES in January. Lenovo, China’s largest PC manufacturer, also holds approximately an 18 percent share of the Chinese laser printer market. The RJ600n is Lenovo China’s first digital color printer. Its claimed cost per page was quoted to be 0.1-0.15 Yuan ($0.02) for monochrome printing and 0.3-0.5 Yuan ($0.06) per sheet for color. The claimed color cost per page is particularly low.

Memjet-based printers owe their speed to their extra-wide print heads, 8.77 inches (222.8 mm) across, which span the width of a page. Each print head contains more than 70,000 ink nozzles, 17 times that of traditional print heads. This design allows Memjet-powered printers to deliver more than 700 million drops of ink per second onto a page.

Lenovo isn’t the only partner that Memjet has taken on. At CES, the company also announced alliances with KPowerscience to bring fanfold (continuous paper with holes on the edges) printers based on its technology to Taiwan, Korea, and China, and WeP Peripherals to bring 60-ppm color printers to India. More recently, Memjet announced partnerships with Medion AG and Lomond to bring printers based on its technology to Germany and Russia, respectively.

Joel’s comments:

Okay, so after several years of hearing about Memjet technology, a “Memjet-technology-based” small-format printer is now on the market, ….. albeit in China!

Unfortunately, the announcement of Lenovo’s launch of this printer did not mention the “purchase price” of this printer. If someone is able to find that information, please let me know, so I can “update” this post to include that information.

This printer is probably priced at less than $1,000.00 USD, and, in saying that, I’m basing that guestimate on remarks MemJet made, quite some time ago, that a small-format printer, using MemJet technology, would likely sell for around $600.00 USD. Anyway, at some point we’ll find out the price that Lenovo is selling this printer for.

Nowadays, manufacturers (such as K/M, Canon and Ricoh) and dealers who offer high-speed color-capable small-format printers are reportedly charging around $.05 per color-click for “service and toner”. But, one would have to spend $30,000 or more for such a system.

Inasmuch as I have yet to see a “color print” off of a Lenovo printer, I have no idea how the quality of a color print from a Lenovo MemJet printer compares to the quality of color prints produced by K/M, Canon or Ricoh high-speed, small-format color printers. However, if the quality of color prints produced by the Lenovo printer are comparable, then the Lenovo printer, once it is out there in numbers, will likely erode (seriously erode) sales of the more expensive toner-based (and even some high-speed ink-jet based) color printers.

I still haven’t found any news about a “large-format” MemJet printer coming to market.

Found on CNN Money, this morning…..

Here are just a few of the comments made in an article titled, “Industries the Jobs Recovery Forgot”

Think of them as the industries the recovery has left behind.

* Construction

* Finance and insurance

* Media

For workers in these areas, the job prospects aren’t much better today than they were at the start of the Great Recession.

Employment levels hit four-year lows in April in more than a dozen sectors tracked by the Labor Department. Another 10 hit lows in the first three months of the year and have shown little gain since, according to an exclusive CNNMoney analysis.

The problems persist even while nearly three out of four other business sectors have been adding jobs over the last six months.

For job seekers with these fields on their résumés, talk of a hiring rebound rings awfully hollow. And economists warn not to expect any quick turnaround in some of these industries.

Construction is the biggest hole in the job market. Job losses started there well before the start of the recession in December 2007, but since then, the construction industry shed a staggering 2 million jobs, or 27% of its the pre-recession jobs.

“Construction is just starting to turn, but it’s not going to come back fast,” said Mark Zandi, chief economist of Moody’s Analytics. “And it’s not getting back to the levels we saw during the boom anytime in the foreseeable future.”

The finance and insurance sector also has yet to recover from the damage wrought by the collapse of the housing bubble.