{"id":42031,"date":"2018-03-05T07:36:06","date_gmt":"2018-03-05T12:36:06","guid":{"rendered":"http:\/\/www.technologyinvestor.com\/?p=42031"},"modified":"2018-03-05T23:43:21","modified_gmt":"2018-03-06T04:43:21","slug":"our-own-worst-enemy-a-trade-war-with-our-friends-erp-is-a-growth-area-yes-but-will-i-invest","status":"publish","type":"post","link":"https:\/\/www.technologyinvestor.com\/?p=42031","title":{"rendered":"Our own worst enemy. A trade war with our friends? ERP is a growth area. Yes. But will I invest?"},"content":{"rendered":"

We are our own worst enemy.<\/p>\n

No one shoots us in the foot as well as we do.<\/p>\n

That was a philosophy I followed when I ran a company. It wasn’t our competition that was hurting us. It was ourselves.<\/p>\n

I fear now.<\/p>\n

The Wall Street Journal<\/em> warns “Tough Talk on Trade Rattles Investors<\/strong>.”<\/p>\n

It headlines:<\/p>\n

Trump administration officials are pushing back against overseas officials opposed to planned steel and aluminum tariffs and U.S. executives who warn the move could undermine a strengthening American economy.<\/p>\n

The Journal<\/em> writes:<\/p>\n

The policy point is that Mr. Trump’s tariffs are trying to revive a world of steel production that no longer exists. He is taxing steel-consuming industries that employ 6.5 million and have the potential to grow more jobs to help a declining industry that employs only 140,000.<\/p>\n

The Journal profiles an Austrian steelmaker\u00a0 in Donawitz that automated\u00a0 its factory and now “needs all of 14 employees to make 500,000 tons of steel wire a year. The same mill in the 1960s would have needed as many as 1,000 workers to produce a similar amount albeit of lesser quality.”<\/p>\n

If we start a trade war to help a declining U.S. industry, we’ll hurt all manner of our own industries (as the Europeans target iconic U.S. companies like Harley Davidson, Jack Daniels).<\/p>\n

And the stockmarket\u00a0 will have an excuse to drop, big time.<\/p>\n

No one wins a trade war.<\/p>\n

I repeat, no one wins a trade war, despite what Mr. Trump believes.<\/p>\n

I’m praying that the Administration comes to its senses before this gets really ugly.<\/p>\n

This is the first time in the Trump Administration that I’ve felt stockmarkets could tumble for a legitimate reason.<\/p>\n

Trade wars are not\u00a0<\/strong>good for stocks.<\/p>\n

I’m not the only person who believes this. Take brilliant investor Carl Icahn.<\/p>\n

CBS Moneywatch<\/a> <\/em><\/strong>reported three days ago:<\/p>\n

Carl Icahn unloaded millions in steel-related stock days before Trump tariff<\/strong><\/p>\n

As the saying goes, timing is everything.<\/p>\n

Investor and former regulatory advisor Carl Icahn dumped $31.1 million of stock in a Wisconsin company that relies heavily on steel to make its products last week, days before President Donald Trump said he’d impose stiff tariffs on steel imports (and hence raise the price of steel).<\/p>\n

The disclosure in a regulatory filing, first reported by ThinkProgress<\/em>, shows Icahn systematically sold off almost 1 million shares of Manitowoc Company (MTW), which makes cranes and other equipment.<\/p>\n

The billionaire investor and longtime confidant of Mr. Trump started selling the stock on Feb. 12. Icahn began selling before Commerce Secretary Wilbur Ross released a report Feb. 16 that called for a 24 percent tariff.<\/p>\n

Mr. Trump’s announcement seven days later that he would inflict a 25 percent tariff on steel imports has sideswiped the market, steel-tied stocks in particular. Manitowoc stock has since lost 12 percent of its value.<\/p>\n

Here’s Manitowoc’s stock over the last year. Mr. Icahn’s timing ability — you got to admit — is pretty awesome.<\/p>\n

\"mtw\"<\/a><\/p>\n

Cramer’s picks<\/strong><\/span><\/p>\n

Where do we get stock ideas from? From our own shopping (think Costco, Square, Apple, etc.)<\/p>\n

And from “gurus.”<\/p>\n

The key with gurus is to do your own research on their picks.<\/p>\n

Cramer is pushing two tech companies, Servicenow (NOW) and Workday (DAY).<\/p>\n

As stocks, both have done extraordinarily well, especially Servicenow (NOW).<\/p>\n

\"ServiceNow\"<\/a>
\nThese two make ERP — Enterprise Resource Planning — software. They sell their software to huge companies that have hundreds of different software systems. The idea is that the ERP will pull all the zillions of systems together and allow any user anywhere in the company to access all the systems and make intelligent decisions based on the company’s\u00a0entire <\/strong>operation rather than bits and pieces of it.<\/p>\n

The German company SAP started ERP in the 1970s and is making money at it, while Servicenow and Workday are not.<\/p>\n

You can boggle your mind by reading more about ERP in places like Wikipedia\u00a0<\/a>\u00a0<\/strong>and Investopedia<\/a>.\u00a0<\/strong><\/p>\n

After spending half the weekend studying ERP, I came away with the conclusion that ERP software is:<\/p>\n

+ Incredibly expensive,<\/p>\n

+ Incredibly difficult to install, and<\/p>\n

+ Incredibly difficult to derive sufficient benefit to pay for its enormous cost.<\/p>\n

Worse, installing it is likely to detract a firm from the basics of running its business — designing and introducing new products that will sell and dealing with customers to sell them the most — the best for their needs, given their preferences, etc.<\/p>\n

Moreover, overlaying a huge new IT system over existing smaller friendlier systems may completely detract from getting the full benefits of the existing systems — each of which were installed for a reason.<\/p>\n

Given all this, I came to the conclusion that CRM — customer relationship management — software would pay off much faster and is a much better investment — for me as an investor and for its customers.<\/p>\n

Chart SAP, NOW and WDAY against Salesforce (CRM), you can clearly see the historical results.<\/p>\n

\"CRMTenYears\"<\/a><\/p>\n

Hence, I’m glad CRM is in my recommended portfolio — the one in the right hand column on my web site<\/a> — and WDAY and NOW are not.<\/p>\n

What I’ve learned about hearing aids<\/strong><\/span><\/p>\n

+ Don’t procrastinate. If your family says you need them, you do. If your favorite word is “What?” you definitely need them. It’s not nice to put your family and friends through a deaf you.<\/p>\n

+ All hearing aids amplify<\/strong> sounds and voices. Some will filter out some ambient noise — like in a restaurant. But it’s not 100%. Their basic job is to amplify. The more expensive ones purport to amplify sounds from one direction — the people you want to hear. Mine does, a little.<\/p>\n

+ Hearing aids that work with a Bluetooth app on your iPhone or Android smartphone are 1000% better.\u00a0 With the app, you can adjust volume, boost frequencies you’re missing and pick certain patterns — restaurant, outside, “all around”, etc. You can even define your own pattern.<\/p>\n

+ $3,000 hearing aids are not the total solution. Even with them in my ears, I prefer to watch TV with my $70 Sennheiser headphones.<\/p>\n

\"SennheiserRS120\"<\/a><\/p>\n

Click here.<\/a>\u00a0<\/strong>The sound is far richer. It’s\u00a0in stereo and I can hear the dialog far better. I can wear the headphones over my hearing aids.<\/p>\n

+ My hearing aids don’t have a microphone. I can hear cell phone calls, but I have to speak to my iPhone’s mike. A better choice is these $27 Soundpeats Bluetooth earbuds.<\/p>\n

\"SoundPeats\"<\/a><\/p>\n

They have a microphone. You can be on the phone, walk around, take notes, without holding your phone. That’s really useful. Click here.<\/a>\u00a0<\/strong><\/p>\n

+ On a plane, the only devices to get are the Bose\u00a0QuietComfort 20 noise cancelling ear buds. They magically kill the engines’ sounds and let you sleep. That box just behind the plug contains the magic noise cancelling electronics.<\/p>\n

\"BoseEarbuds\"<\/a><\/p>\n

Frequent flyers swear by them. I wouldn’t get on a plane without them. They cost $249. You can use them for speaking and listening on cell phone calls. You can use them for watching YouTube on your laptop. Far better than your laptop’s crummy speakers. Click here.\u00a0<\/a>\u00a0<\/strong><\/p>\n

+\u00a0The key to being happy with hearing aids is a patient lady. This is Menessa Garcia of Costco La Quinta, California. She sold me my ReSound Forte hearing aids.<\/p>\n

\"MenessaGarcia\"<\/a><\/p>\n

She spent a total of three hours with me — testing my hearing, teaching me how to insert my hearing aids, teaching me how to use the app, etc. You need someone like her. Nice, helpful lady.<\/p>\n

+\u00a0Sometimes you simply don’t want your hearing aids in. For example, playing tennis. The sound of the ball is too loud. It’s also not good to sleep, swim or shower with them.<\/p>\n

+ I paid $2,700 for my hearing aids. I suspect I would have paid $6,000 had I gone to a local corner store audiologist who are big on marketing and light on service. But I have no real idea. I can’t Google ReSound Forte hearing aids and get competitive pricing information. Hearing aids may be the only product in the world where total obfuscation reigns. Me thinks deliberately.<\/p>\n

But for me, there are solutions. See above. And I’m happy.<\/p>\n

Stuff to carry when you travel<\/strong><\/span><\/p>\n

+ Black electrician tape. Use it to cover light sources — microwave, alarm clock, TV.<\/p>\n

+ Safety pins. Use them to pin the drapes together to further reduce light.<\/p>\n

+ Ear plugs. To kill ambient noise. And the Bose noise cancelling ear buds — see above.<\/p>\n

+ Melatonin. For getting to sleep when you’re in another time zone.<\/p>\n

The Jehovah’s Witness and the weather<\/strong><\/span><\/p>\n

Saturday morning the weather was too bad to play golf.<\/p>\n

Suddenly there was a knock on the door.<\/p>\n

A young, well dressed man stood there. He said “Hello sir, I’m a Jehovah’s Witness.”<\/p>\n

I said, “Come in and sit down.”<\/p>\n

I offered him a cup of coffee and asked, “What do you want to talk about?”<\/p>\n

He said, “Don’t know. Nobody’s ever let me in before.”<\/p>\n

\"HarryNewton\"<\/a>
\nHarry Newton, who had fun researching and writing today’s blog. Writing still remains the best way of teaching oneself something.<\/p>\n

I worry about Mr. Trump’s trade war and its effects on the stockmarket. We’ll see this week.<\/p>\n