via “Hey New Hampshire”, Surprise Us.

I extend to you all my wishes for a Happy Holiday season and a Healthy New Year.

Bob

Ps:

This is the Technorati code required for this blog: 6J876UZJ5FG7

Thinking

I’ve been thinking a lot.  Thank goodness I suppose.  I’ve got a place I can go to for quiet, there to contemplate not only business, but everything going on around me, and in me. 

It is a good way to re-balance your efforts and I’ve been working on it for months.  Kaffe Magnum Opus is now down to 8 significant (in my opinion, which counts since I’m responsible for the business) items to work on soon.  Eight is a lot to work on, so I’ve got them sorted out – coffee perfection, sales model, and internet are the top three.  Ah perfection.  This is hard to achieve, but the value to your customer is the journey.  Keep reaching. 

I’m happy to tell you that we have a terrific coffee person who joined the company on November 1, 2010, coming to KMO from Denver, Colorado.  Jackson Kanampiu spent many years in Kenya running coffee farms, coffee beneficio’s, and he helped develop the Q guidelines for quality coffee.  It is just a pleasure to have him on board and Jackson is already making serious headway.  His first priority is to bring KMO coffee to perfection, while sourcing in a way that will bring down the cost, and the price KMO charges.

2010 was a challenge, as speculators devoured the coffee futures market and drove the “C” over $2 thus driving roasted coffee cost to historic levels,  near $4.00 per pound, before operating expenses.  Colombia did not help with historically high differentials which led all the quality producers to record differentials.  This is historic.  These folks are worse than, well, at least equal to, the bankers and other scoundrels who brought Wall St. and America to the brink, and many families over the brink.  In my opinion these people should be banned from trading.

No bother.  For this is the real world, one in which you must survive no matter the challenge.  Sink or swim.  Stay the course and stay focused.  Your customers benefit, you benefit and your families benefit when you ‘survive’ the tough times.  I hate to use this term for it is outdated, but you must ‘roll with the punches’. 

So see if you can find a nice relaxing place to think.  I’ve had places in my car overlooking a tidal river, a dock on the Hudson River, and now a place in the woods in my back yard.  Today, in the cold, it was invigorating.  And the dogs (we have two) were just as happy to see me, no matter the temperature.  And of course, Cathy, my wife, is my biggest supporter, the most supportive person in my life.  Everything works for her.  So I do too. 

And for you – KMO customers, staff and suppliers.  And the kids and grand-kids.  Both my daughter, Jennifer, and my son, Paul, are successful in their choosen field and both have happy, loving, and supportive families.

Happy Thanksgiving and Merry Christmas and Happy Chanukkah, and, Happy Holidays.  I turned 65 on November 30, 2010, yesterday, and I can assure you that the more birthdays you have the happier they become.   Thanks for all the good wishes.

Here is an excerpt. 

And, we are working on social networking.  And I’ve been working on getting up some new ideas for improving stores in this economy.  So here are the pertinent sites.

www.improveyourprofits.com

http://www.facebook.com/#!/pages/Kaffe-Magnum-Opus-kmocoffeecom/142132272499650

www.improveyourprofits.wordpress.com Blog your challenges and issues or e-mail me: Hey Bob

www.openacoffeestore.com –> this has ideas for opening a store and the ideas and the checklist (http://openacoffeestore.com/new_user_click_here.htm) are good reminders or evaluation tools for existing stores.

Write to me: Hey Bob.

Get yourself a Facebook (www.facebook.com) page (and please Like – click the like button – on our business page and use it for ideas – KMOcoffee page on facebook)

And start tweeting on www.twitter.com.  My user is bobjohnson1945 so please follow it.  I link all of my blog post to twitter and Facebook and yahoo (I’m a novice on yahoo).

My Facebook page: http://www.facebook.com/bobjohnson1945

So …

Order your KmoCoffee.

Timothy Geithner: "Well, I think ..."

Timothy Geithner made me money.  He was on the Charlie Rose show in March of 2009 and mentioned that he thought the government was going to support in some way the Auto Industry.  The market in March 2009 was hovering around 6500.  I thought that night that ‘this is it’, the bottom.  I guessed right.  But it was a guess.

So I bought Ford, GE, GM, GSX (this only 25 shares), and Citi.  A month ago Ford was up 5 times, GE up 2 times, GM gone bust, Citi basically no change (and I expect it to go back to its old yahoo days but they will need new management).  So I sold Ford, GSX and bought Sirius.  Then I bought more Citi and a few days later Ford dropped $2 and I bought it back.  I realize now that I was trading, not investing.  Gambling, not investing. 

I’m still up a fair amount, but very unsure.  This is the first time I’ve invested (really gambling) in stocks.  For the last twenty years all my money went into Kaffe Magnum Opus, and it is the only investment that has positive returns over the twenty year period.  Steady growth, profits after many years of management support and re-investment, and good prospects, although there are challenges in the coffee industry.

So what to do?  I’m reading Ben Stein, yes, that Ben Stein,  “Bulletproof Investing” and it is pretty good, pushing broad investments, not picking stocks, and diversity.  He believes that you will be well off is you get an 5 to 8% annual growth, basically a doubling over 8 to 10 years.  That would be really good for twenty years.  Invest $1 today and in 2030 you have $4 (1 becomes 2 in 10 years, and 2 then becomes 4 in the second 10 year period).  There is a lot more to his strategy, and it is appealing.  The only question: Will I live for 20 years?  I’d be 85.  Maybe. 

So what about real estate?  Commodities (I’m in the commodity business, roasting and selling coffee)?  IPO’s?  I don’t know.  And this is my dilemma.  And then there is Ricky.  Ricky worked with me for a few years while in High School.  After getting a degree in Engineering he now works as a trainer at Best Buy.  He is quite successful and I am happy for his success.  So what does this have to do with making money.  Yesterday he comes to my home to install a bit of electronics and he tells me he realizes that if he is to become a millionaire he must: Pick the Right Stocks and with luck, get rich; pick the right commodities (his friend has farm connections and made some big money); or own a business.  Ricky is about 23 or so.  Wise beyond his years.  Stocks and commodities are pure bets.  But owning your own business is a pretty sure bet if you work really hard, study, and look ahead.  Look around the corner you are approaching.  So …

What to do?  Sell the stocks.  Invest in my business.  It is my livelihood, and I influence directly the actions it takes.  Who knows what it will be worth when I’m 85.  It doesn’t matter too much because it makes me happy.  I worry, sure.  But it makes me happy.

I am a nail biter.  I worry, and even when I worry, I’m happy.  Sometimes a bit jumpy and sometimes a bit biting.  Overall, I’m happy.

If you don’t own a business, I’d suggest you start one.  Or be lucky.  Maybe you can pick the next Microsoft or Google, or for that matter, GM.  GM fifty years ago (1960) was a solid buy.  And my Uncle Mike Buckley made over a million in GM Stock before he died and left it all to charity.  In a funny way he was lucky he died before the management of GM became incompetent.  And let us remember the truth about long-term investing.  GM had a great run for many years, but in the long run?  GM went bust and is now worth nothing.  So much for the long run investor.  I wonder if this is a mortal sin?  Hey Ben, will I go to Hell in a Handbag?

Bob

Lance Stays The Course Despite Two Crashes

Sticking with your plan can sometimes bring surprises out of the blue.  Some are helpful, some cause problems.

Who would expect to see Lance Armstrong on the ground, twice, both crashes caused by other riders. 

In our business the price of coffee spiked this summer.  Not exactly out of the blue, but a surprise none-the-less.  All of us who own and operate and lead our own business must have the courage to just put our heads down and keep going forward.  You and I must be able to absorb disappointments, even when physically hurt, and keep going.  We are the energy that keeps the business healthy.

The news is reporting that Lance tweeted his intention to continue in the race and help his team-mates.  Good for him.  While winning is out of the question this year, he could still win some stages. 

So let us leaders learn the easy way.  Watch another person handle adversity and thrive.

May your summer be happy, and your Gazpacho cold.

Bob

It is a good follow on to my thoughts about inflation in the US.

Bob

To keep it short and to the point.  Managing your business in times like these is not easy but you must keep pace with price increases.  I was born in 1945 and so have experience with several periods of rapid inflation.  You may not remember or know, but the prime rate was over 20% in the seventies.  Nixon, Ford and Carter were Presidents.  Ford wore buttons with the initials WIP - Whip Inflation Now.  Nixon slapped price controls on the American Economy.   The inflation was caused by the huge increase in Government spending for The Great Society and other stuff, and the Vietnam War.

Today we have the Iraq and Afghanistan Wars and Government gone wild.  This is not a political statement for either Democrats or Republicans.  Both share in the economic carnage caused by incredible increases in the debt load.  Bush increased it by 3 Trillion and more and Obama at least that much, some inherited, but none-the-less, on his watch.

My concern is that interest rates are as low as they can go with nowhere to go but …. up.  Inflation may lead the way, or it may follow rates up, but I think we are in for many increases in prices.

So keep watch and keep moving your own price.  You have to maintain margins.

Bob Johnson

You know that the banks received 1.5 Trillion dollars is support payments.  It will probably double by the time the currently undervalued assets are purchased by the Treasury, courtesy of taxes paid by you and I and loans from the Chinese.

GM is looking for around $20 Billion.   Give it to them.   No brand can outlive the decline in value of its name due to bankruptcy.  There is talk of taking the most valuable ‘good assets’  of GM and selling them to a new company, Good GM, and letting the Bad GM’s $70 Billion in so called bad assets be sold off – liquidated – they say.

I am truly angry over the inequities now coming from my favorite president of all time, who I supported wholeheartedly, and do support.   Why, for a pittance in today’s money ($20 Billion), let a perfectly good manufacturing company go down the tubes  while supporting pompous, feckless bankers to the tune of $1.5 to $3.0 Trillion?  Here I”ll say it: “What the #$%^&*(@#$”.

Our local bank, Sun National, got $89 Million in subsidies.  What??  The money given to banks is pervasive.  Surely Sun National Bank did not threaten the economy.

Surely we Americans are appropriately angry about the misuse of our money.   In days gone by the few bankers who created default credit sways might be tar and feathered in Boston or New York Harbor, satisfying our call for revenge and punishment.  Not today, they just change banks and stay in there mini-mansions.  Polls say 70% and more of us oppose support of GM.  Why?  The banks will still get away.  Letting GM go, and creating a hole in the car market is like hitting ourselves over the head with a lead filled bat.  Nuts.

So what is the reason or reasonableness of tar and feathering our car companies.   This act, letting GM go into bankruptcy, will surely benefit its competitors.  What competitors?  Toyota, Nissan, Hyundai and the new Indian and Chinese cars headed this way.   More American Jobs go overseas. 

Certainly these fellows in the white house did not require the banks to come up with a survival plan.  Rather, those who govern, first the Bushites, panicked and handed out near a Trillion Dollars.  Now with plenty of time to think it through, the Obamerites will give another $1.5 Trillion to the financial industry, and not a drop for the car companies.   What in the world are they thinking - worse - what in the world are they doing?

Who cares about a miserly $20 Billion anyway?  The battle over GM is just a smoke screen protecting the fleeing bankers.  These men and women (although I know of no women identified as rascals) are the modern Merchants of Venice, The Pirate Princes of Wall Street.  First they take our money, then plead guilty, then point guns at our head and take trillions more.

Only in America.

It it was not so sad, I’d laugh. 

Bob