All posts by James Cannon

About James Cannon

James Cannon is an experienced hedge fund analyst. He has served on the advisory boards for various different Fortune 500 companies as well as serving as an adjunct professor of finance. James Cannon has written for a variety of Financial Magazines both on and off line. Contact James at james[at]businessdistrict.com

Schools of Higher Learning Report Record Gifts from Donors

Education
Harvard University. Photo courtesy of
John Phelan

Setting a record for the ninth year in a row, United States colleges raised a whopping $47 billion during the 12 months beginning in June 2017. It appears that the long-lived stock market expansion played a role in the positive results.


The wealthiest school in the country had the best year. Harvard University raised an astounding $1.4 billion, said a study released in February 2019 by the Council for the Advancement and Support of Education.


Schools can thank the 14% growth of the S&P 500, which most likely helped many donors reach a bit deeper into their pockets. Three school surpassed the one-billion-dollar mark in money raised from June 2017 until June 2018. Seven schools were presented with single donations of at least $100 million, the highest number ever receiving such large gifts from one donor.


The second and third largest donations were made to Stanford University for $1.1 billion and Columbia University, which received $1 billion in gifts. Fourth and fifth runners-up were University of California at Los Angeles (UCLA) which garnered $787 million and UC San Francisco with a nice $730 million.


The survey was taken by 927 schools. The survey relied on estimates for schools that did not respond to the survey.

Polar Vortex Costs US $1 Billion

News,
The Polar Vortex . Courtesy
NASA Goddard Space Flight Center from Greenbelt, MD, USA

The last week in January 2019 sent the US Midwest into a deep freeze that cost lives and about $1 billion.


At least one dozen people were reported killed by below zero temperatures which in some place reached record lows from Minnesota, Illinois to the northeastern USA. Thousands of planes were grounded or delayed, other forms of transportation, such as trains, were disrupted, and schools sere shuttered in Wisconsin and Minnesota. There were also several power and water outages reported.


Supply chains were disrupted as rail and barge transportation was halted or slowed. Retail shops and restaurants also suffered losses as most people sheltered indoors.


The $1 billion estimated price tag is still considerably less than the damage caused by the polar vortex of 2014, which came to about $5 billion.


Not everyone lost during the freeze. Stores selling winter items did a brisk business along with online sales and drive-through restaurants.


Chicago reported a bone-chilling minus-30 degrees Celsius, and Minneapolis recorded minus-32. Wind-chills factors made some places feel like minus-70 degrees.

A Tale of Two Massachusetts Bank Mergers: North Easton Savings Bank and Avidia Bank

Companies, Investments, ,

Two banks in Massachusetts—North Easton Savings Bank and Mutual Bank—have recently announced that they will be merging in early 2019.

The two banks both maintain 9 locations in different Massachusetts communities. This merger will allow the banks to combine their resources and expand their services. The banks have announced their commitment towards maintaining a culture of growth and success and have dedicated a website, www.meetyourbetterbank.com, to support clients.

Bank mergers can be complicated and often affect thousands of clients as well as employees.

This was the case when another two Massachusetts banks—Westborough Bank and Hudson Savings Bank—merged in 2007. When their merger was announced in November 2006, the deal seemed straightforward. Hudson parent company Assabet Valley Bancorp would pay $35 per share for Westborough Financial Services Inc. (the mutual holding company for The Westborough Bank), for a total of $20.6 million. The deal eventually went through, and the two banks merged to become Avidia Bank.

But, surprisingly, this deal involved intense negotiations, and did not go to the highest bidder. An offer of $38.50 per share from an unidentified individual was rejected by the bank’s shareholders. Another offer, of $40 per share by Marc Bistricer’s Murchinson, was also turned down.

As these Massachusetts banks demonstrate, bank mergers are complex deals that carry implications for bank personnel, investors, and customers.

Diamond Giant Alrosa Names Female Head

Mining, News, ,
Rare twinned diamond crystal. Photo courtesy Robert M. Lavinsky

The world’s leading producer by output of diamonds, Alrosa, appointed Rebecca Foerster to lead its USA division.

The move comes the reopening of its offices in New York last year, together with expanding sales in the US. The company chose an experienced female executive to lead its American operations; Foerster is former Vice President of Strategic planning and marketing at Leo Schachter Diamonds, a position she held for four years.

She has previous experience as Vice President at the US Representative office of Rio Tinto; executive roles at Frederick Goldman Inc, Revlon, Unilever, and Benckiser.

“The United States is the world’s largest market for diamond jewelry consumption. For this reason, special requirements are placed on the person who will represent Alrosa’s interests there. Foerster has a wealth of experience in companies that represent almost all parts of the diamond pipeline, from diamond mining to diamond jewelry sales. She knows the specifics of the diamond business and is well aware of American market needs,” said Deputy CEO of Alrosa, Yury Okoemov.

In 2016 Alrosa closed its New York office for “organizational reasons.” Since the office reopened in 2018 business has been expanding at a pace to the extent that from the two rough diamond auctions held last year in New York the company will have four such events in 2019. Alrosa, which mines diamonds, plans to also offer polished diamonds to the US market this coming year.

Japan Tagging on Tourist Tax to All Departing Persons

Japan
Japan

As of January 7, 2019, all those leaving Japan will be required to cough up an additional 1,000 yen (US$9). The money will be collected to improve tourism infrastructure in the country.


The levy, known as the International Tourist Tax, will be obligatory and all nationalities, regardless of the reason they are leaving the Japan. Tourists, businessmen, and any other traveler, as long as he or she is beyond 2 years old, will have the surcharge added to the price of their plane ticket.


Japanese authorities expect to raise about 50 billion yen. With the new money they plan to improve tourism infrastructure, including making the immigration process at the airport smoother, and encouraging visitors to go beyond the usual Tokyo and Kyoto stops during their stays in Japan.


The Asian democracy has been stepping up its marketing to the international tourist sector as a new source for its economic growth. In 2018 it is estimated that about 30 million foreigners visited Japan, the most ever. Many of the growth in tourism comes from Asian visitors, especially those arriving from China, South Korea and Taiwan. Japan is hoping that the coming Olympics will get the number of visitors to Japan up to 40 million by the year 2020.