This morning, I was struck by this story at the top of the WSJ‘s front page: “Buffett Hits Kraft on Cadbury.”
And I thought, this investor merely makes a remark about a business deal, and it tops the WSJ (not only that, but it’s the third most-read story on the Web site today)? What gives? How come when I issue pointed remarks on the business world — such as my profound doubts about Starbucks damaging its business model by pushing instant coffee — I don’t even get a mention in the Journal?
As it happens, it’s very easy to answer that question: I’m the guy who bought McClatchy at $39.00. Enough said. By ignoring me, my friends at the Journal are being kind.
I was painfully reminded of that this morning by my old friend Burl Burlingame. You know Burl — the star of “Killer Subs of Pearl Harbor” (which makes me terribly envious; I wish I had a cool-sounding credit like that to go into MY obit). Anyway, he passed this bit of news on to me:
Newspaper Stock Prices End the Year Up, By A Lot
Posted by Rick Edmonds at 2:41 PM on Jan. 4, 2010
After four years of cascading losses, the stocks of publicly-traded newspaper companies all posted substantial gains in 2009.In fact, a bold investor who bought McClatchy, E.W. Scripps, Lee, A.H. Belo or Journal Communications at their low points early in the year could have realized a 10 times gain by cashing out at the end of 2009.
Burl’s implied point was, “Hey Brad, look at how they profited from firing you and Robert and the rest.” To which I say, Gee, thanks, Burl. Shaka da kine, bruddah.
But don’t expect me to be impressed at the new stock price. A ten-fold increase means it went from 35 cents to $3.54.
So let me know when it gets to 10 times that. I’d still be losing money, but at least I could get some of what I invested back (the staggering sum of $1,300, another reason why the Journal doesn’t put me in the same league with Buffett).
An excellent authorized biography of Warren Buffett: “The Snowball”
http://www.amazon.com/Snowball-Warren-Buffett-Business-Life/dp/0553384619/ref=sr_1_1?ie=UTF8&s=books&qid=1262796220&sr=8-1
It’s long (800+ pages) but it really gives great insight into the mind of one of America’s greatest capitalists.
Gannett used to pay its employees overtime in Gannett stock. Many were wiped out last year.
The story does note that advertising will still be down this year.
My implied point, absolutely.
My overt point — often newspapers fire the talent that make them a unique product.
The situation that the newspaper industry finds itself in reminds me of something Yossarian did in Catch-22. Remember when he snuck up to the intelligence tent to move the bomb line up over Bologna? Clevinger accused him of confusing cause and effect — of thinking that moving the bomb line over Bologna would cause it to be captured and therefore no longer be a valid target, rather than the other way around…
Newspaper companies have now become that way about the stock price. They’re ditching everything that gives them value in order to raise the stock price, because they have come to value the stock price (the bomb line) more than ACTUAL value (capturing Bologna). And Wall Street — well, I have very little respect for Wall Street’s measurements of value.
Or maybe I’m crazy (after all, Clevinger turned out to be wrong, didn’t he — at least momentarily?). In which case Doc Daneeka should sign something saying I don’t have to fly any more…
More to think about:
http://www.observer.com/2010/media/tablets-above
BTW, my wife’s workload was doubled yesterday. A month ago the paper laid off the night editor, and they’ve discovered they can’t operate without that position. But the original guy has gotten work elsewhere. So Mary has been informed that she has to do his work in addition to her regular duties. We’ll see how long that lasts.
I’m sorry to hear about your wife’s problem. That is, as sorry as I can be for people who still have JOBS at newspapers… which, as it turns out, is quite a bit.
I really, really do feel sorry for my friends still working at newspapers, and am glad I’m not among them. At least I’m cranking away at figuring out what to do next. They are not. They are clinging to their jobs as long as they can, while their effectiveness (and the extent to which their efforts are worthwhile) diminish daily, and noticeably. They really should be working on what they’re going to do after newspapers, but they don’t have the time or the energy.
And from everything I can see — both inferred from the content and based on things I hear from the inside — it really has to be miserable. Especially if you once loved it, as I did.
I don’t have a steady job, and I need to get one, but at least I’m free of that quicksand…
As for the Tablet. I’ve been hearing about The Tablet for almost 20 years — nearly as long as we heard about pagination, before it was finally implemented. I’ve always thought it was an exciting concept. But I don’t know now. Seems to me that continuing to refine content for phones and PDAs would be smarter. The public is expecting their handhelds to do more and more; it’s not looking for another device to lug around.
@ Burl–my brother bailed out on the Phila. Inquirer after they slashed the sports editorial staff to close to nothing–but hey, he got to be the top dog!–and still expected an error free sports section. He’s working for Vanguard now–not nearly as happy, but he did skip being slashed in the next round of cuts–it’s a union paper and he was the next in line seniority-wise. It’s taken him a couple of years to get used to the fact that neither Plan A or Plan B are a choice that results in working a reasonable workload at a stable, high-quality newspaper.
We are on vacation this week and so far, I read Brad’s link to Joe Wilson’s piece, and one other link from The State’s e-newsletter. I have not missed my printed copy…and I am a big newspaper fan–it’s just as you say–they have lost much of their unique, high-quality content!
Have you read Kim Stanley Robinson’s “Mars” series? The characters all have interactive tools they call “slates” that basically sound like big iPhones. He wrote this decades ago.
I myself am actively working on a post-newspaper “escape” plan. I would not have considered something like that some time ago.
Mary’s additional duties: Mixed blessing. They told her she was one of the few employees left with the skill set to actually get the product out. She’s needed, and that’s good. But read between the lines of what they said. At some point, the cuts will be so deep, and the expertise so thin, that the product can no longer be manufactured.