Heres Why Trump Went Postal on Amazon

Here’s Why Trump Went Postal on Amazon

The Amazon blame game took another turn on Thursday, when President Donald Trump spun the wheel back around to the U.S. Postal Service. Amazon.com Inc. is a convenient scapegoat for just about any issue. The mail is no different.

Amazon isn’t killing the post office. Since signing a landmark contract in 2013 to expand their business relationship and deliver packages on Sunday, revenue has ticked up; losses are down; and shipping is just about the only growth segment in the mailbag. The Postal Service is saddled by larger issues. Sure, there’s the internet, and nobody is sending postcards anymore, but the big financial dilemma is the agency’s yearly obligation to set aside cash to cover health care costs for future retirees. This accounts for billions in losses.

Give Up?

U.S. Postal Service makes small improvements but is nowhere close to sustainable

Source: U.S. Postal Service

U.S. mail is also required to cover every American, employing carriers who roam neighborhoods six days a week (or seven, if Amazon has a package ready). The Postal Service has said it actually makes money on the Amazon deal. E-commerce revenue provides “essential support to pay for the network and infrastructure that enables us to fulfill our universal service obligation,” David Partenheimer, a spokesman for the Postal Service, wrote in a January op-ed. “All users of the mail benefit.”

The Amazonification of U.S. Mail

Shipping revenue overtook junk mail for the first time last year

Source: U.S. Postal Service

Amazon rebuilt its delivery network around the post several years ago. The company operates “sortation centers” that complement warehouses and organize packages by zip code before sending them to post offices for the final leg of delivery. In Kenosha, Wisconsin, Amazon has a million-square-foot warehouse, connected to a 500,000-square-foot sort center with a covered conveyor belt that resembles an airport skybridge.

Ending the U.S. mail relationship would probably be a bigger setback for Amazon than for the Postal Service. On a dark day in late 2011 when the postmaster general proposed cutting 100,000 staff and shutting thousands of post offices, EBay Inc. shares dropped more than 6 percent. Amazon’s deal came soon after, and radical cuts were avoided—probably not a coincidence.

So the e-commerce giant got the Postal Service off life support, but any benefit beyond that is minimal. Nothing short of a complete overhaul of the mail system, some kind of bankruptcy-style financial restructuring or reneging on those health-care promises would turn the Postal Service into a sustainable business.

Maybe that’s Trump’s goal. Building an antitrust case against Amazon—an idea the President has floated—is a tall order. Amazon’s five-year contract with the Postal Service could be up for renewal this year. Breaking up that relationship would be an easier way for Trump to inflict pain on the #AmazonWashingtonPost, as he calls it.

Fully Charged

And here’s what you need to know in global technology news

A Facebook executive advocated for a grow-at-all-costs mentality in a controversial 2016 memo. BuzzFeed obtained a copy of the staff email from longtime executive Andrew Bosworth, which said deaths or terrorist attacks shouldn’t get in the way of the company’s mission to connect people.

Google is helping shape the future of U.S. wireless networks. The company’s plan to overhaul how valuable airwaves are used for calls and texts is gaining momentum.

Tesla is recalling about 123,000 cars. The voluntary recall affects all Model S sedans built before April 2016, capping the automaker’s worst month-long performance on the stock market since 2010.

Microsoft unveiled its biggest reorganization in years. Devices and software will live together, and Windows is now part of the cloud division. Windows chief Terry Myerson will depart as part of sweeping changes by CEO Satya Nadella.

The man who steadied Twitter wants to sell you a mortgage. As CEO of student-loan refinancer SoFi, Anthony Noto has to upsell the company’s high-earning clientele and fend off Goldman Sachs.

Read more: http://www.bloomberg.com/news/articles/2018-03-30/here-s-why-trump-went-postal-on-amazon

Under Fire and Losing Trust, Facebook Plays the Victim

On Tuesday morning, Facebook employees were quiet even for Facebook employees, buried in the news on their phones as they shuffled to a meeting in one of the largest cafeterias at the company’s headquarters in Menlo Park, Calif. Mark Zuckerberg, their chief executive officer, had always told them Facebook Inc.’s growth was good for the world. Sheryl Sandberg, their chief operating officer, had preached the importance of openness. Neither appeared in the cafeteria on Tuesday. Instead, the company sent a lawyer.

The context: Reports in the  and thethe previous weekend that Cambridge Analytica, the political consulting firm that advised President Trump’s electoral campaign on digital advertising, had effectively stolen personal information from at least 50 million Americans. The data had come from Facebook, which had allowed an outside developer to take it before that developer shared it with Cambridge Analytica.

Facebook tried to get ahead of the story, announcing in a blog post that it was suspending the right-leaning consultancy and that it no longer allowed this kind of data sharing. Its users—a cohort that includes 2 billion or so people—weren’t ready to forgive. The phrase #DeleteFacebook flooded social media. (Among the outraged was WhatsApp co-founder Brian Acton, who in 2014 sold Facebook his messaging app for $19 billion.) Regulators in the U.S. and Europe announced they were opening inquiries. The company’s stock fell almost 9 percent from March 19-20, erasing about $50 billion of value.

QuicktakeFacebook and Cambridge Analytica

In most moments of crisis for the company, Zuckerberg or Sandberg have typically played damage-controller-in-chief. This time, the employees got all of 30 minutes with Paul Grewal, the deputy general counsel. the news reports were true—a blame-deflecting phrase that struck some as odd—Grewal told them, Facebook had been lied to. Cambridge Analytica should have deleted the outside developer’s data, but it didn’t. Reporters were calling this a breach, but it wasn’t, because users freely signed away their own data and that of their friends. The rules were clear, and Facebook followed them.

One employee asked the same question twice: Even if Facebook played by its own rules, and the developer followed policies at the time, did the company ever consider the ethics of what it was doing with user data? Grewal didn’t answer directly.

A Facebook spokesman declined to comment for this story, referring to a January post by Zuckerberg stating the CEO’s aim to get the company on a “better trajectory.” On Wednesday afternoon, Zuckerberg published a post promising to audit and restrict developer access to user data. “We have a responsibility to protect your data, and if we can't then we don't deserve to serve you,” he wrote. “I've been working to understand exactly what happened and how to make sure this doesn't happen again.”

Read more: Silicon Valley Has Failed to Protect Our Data. Here’s How to Fix It

Of course, Facebook has weathered complaints about violating user privacy since its earliest days without radically altering its practices. The first revolt came in 2006, when users protested that the service’s news feed was making public information that the users had intended to keep private. The news feed is now the company’s core service. In 2009, Facebook began making users’ posts, which had previously been private, public by default. That incident triggered anger, confusion, an investigation by the U.S. Federal Trade Commission, and, ultimately, a consent decree. In 2014, the company disclosed that it had tried to manipulate users’ emotions as part of an internal psychology experiment.

As bad as each of these may have seemed, Facebook users have generally been unfazed. They’ve used the service in ever-greater numbers for greater amounts of time, in effect trading privacy for product. They were willing to give more and more data to Facebook in exchange for the ability to connect with old high school friends, see pictures of their grandkids, read only the news that they agree with. The concept was dubbed Zuckerberg’s Law in 2008, when the CEO argued at a conference that each year people would share twice as much information about themselves as they had the year before. Notions of privacy were eroding, Zuckerberg said in 2010. “That social norm,” he added, “is just something that has evolved over time.”

For a while, the only thing Facebook needed to do to keep growing was to remove barriers to downloading and using the product. By 2014, it had reached almost half the world’s internet-connected population, and Zuckerberg realized the only way to expand further was to add people to the internet. While Facebook invested in internet subsidy programs in developing countries, it also went on an acquisition binge, buying up popular social software makers such as Instagram and WhatsApp.

These moves led to annual revenue growth of about 50 percent, with most of the increase coming from mobile ads, and converted the company’s Wall Street doubters. Last year, even as Facebook was forced to acknowledge that it had played a role in the Russian disinformation campaign during the election of Trump, investors pushed its stock price up 53 percent.

But the big blue app, as employees call Facebook’s namesake service, hasn’t changed much in years. The company has tweaked its algorithm, at times favoring or punishing clickbait-style news and viral videos, but most people use the service the same way they did two or three years ago. And some people are simply over it. In North America, Facebook’s daily user counts fell for the first time in the fourth quarter, and time spent on the site declined by 50 million hours a day. Facebook claimed that this was by design: Zuckerberg was focusing on helping users achieve “time well-spent,” with the news feed de-emphasizing viral flotsam.

The company positioned its new algorithmic initiative as a reaction to a study co-authored by one of its employees, arguing that while Facebook could be bad for users' mental health if they used it passively, more active use was actually good for you. The study could be viewed as a rare show of corporate transparency or a novel way to goose engagement.

Some of the moves, however, look even more desperate. Now, when people stop going on Facebook as often as usual, the company sends them frequent emails and text messages to encourage them to re-engage. It’s also getting more aggressive about suggesting what users should post.  According to some employees, the focus on time well-spent just means the company will point to metrics such as comments and personal updates as signs of growth, rather than genuinely improving the user experience.

In the long run, Facebook wants to make its product even more immersive and personal than it is now. It wants people to buy video chatting and personal assistant devices for their homes, and plans to announce those products this spring, say people familiar with the matter. It wants users to dive into Facebook-developed virtual worlds. It wants them to use Facebook Messenger to communicate with businesses, and to store their credit-card data on the app so they can use it to make payments to friends.

Employees have begun to worry that the company won’t be able to achieve its biggest goals if users decide that Facebook isn’t trustworthy enough to hold their data. At the meeting on Tuesday, the mood was especially grim. One employee told a reporter that the only time he’d felt as uncomfortable at work, or as responsible for the world’s problems, was the day Donald Trump won the presidency.

BOTTOM LINE – As its share price tanks and regulators circle, Facebook is struggling to answer basic questions about its next moves, even from its own employees.

Read more: http://www.bloomberg.com/news/articles/2018-03-21/under-fire-and-losing-trust-facebook-plays-the-victim

A Manager of $42 Billion Fears Bubble in World’s Biggest Stocks

The world’s biggest companies could be hiding the biggest risks.

That’s because companies such as Amazon.com Inc. and Alibaba Group Holding Ltd are overvalued, according to Robert Naess, who manages about $42 billion in stocks at Nordea Bank AB, Scandinavia’s largest bank.

“I’m a bit worried about the valuation of these very popular companies,” Naess, portfolio manager, said in an interview in Oslo on Friday. “The big stocks have become more expensive. There’s danger of a bubble in them.”

Naess and his partner, Claus Vorm, quantitatively analyze thousands of companies, investing in those with the most stable earnings and avoiding expensive stocks, a strategy which has delivered a 10 percent return for the Global Stable Equity Fund this year. It has returned 12 percent on average in the past five years, beating 75 percent of its peers.

They prefer “boring” stocks, unlike the global behemoth technology companies that have led the global stock rally. Tech stocks sold off at the end of November, with the single worst day on record for the so-called FANG stocks. One of those stocks, Amazon, which has risen 55 percent this year, has a price-to-earnings ratio of 275 for 2017, compared with 18.2 on average for MSCI World Index.

“Long-term, 5-10 years, stocks that are expensively priced, such as Amazon, Tencent and Alibaba, will give a low return,” Naess, who also shuns Facebook, Inc., said. “I’m pretty certain that in the next 10 years the return on those will be lower than the market.”

The fund holds Apple Inc. and Alphabet Inc., which are “reasonably priced”. It has also bought a stake in Merck & Co., Inc. and increased in Amgen Inc., CVS Health Corporation and Walgreens Boots Alliance, Inc.

Naess sees about 12 percent upside for the global developed stock market in the next 12 months provided companies continue to deliver expected earnings growth.

“2018 looks OK,” he said. “Normally, I think the earnings estimates are too high. But I believe earnings estimate could be too low next year given earnings are so good this year.”

    Read more: http://www.bloomberg.com/news/articles/2017-12-11/a-manager-of-42-billion-fears-bubble-in-world-s-biggest-stocks