Economically Speaking

“Hostess with the Leastest” – Are unions really to blame?

November 29, 2012, by John Norris

Hostess Brands has made a lot of headlines recently. To the outside observer, it seems as though the unions are forcing the company into liquidation. What is the real story? Are unions really to blame? Hostess’ management is correct when it says the company has to slash sales, marketing, and administrative costs (SG&A) to keep the doors open. After all, the company seems to be in and out of bankruptcy. On the flipside, the bakery...

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Common Cents for October 28th 2012

November 1, 2012, by John Norris

By now, you have probably heard something about the so-called ‘fiscal cliff,’ which we are due to fall off on January 1, 2013. Simply put, taxes are set to increase, and mandatory government spending cuts are due to take hold. Oh, the humanity! Not surprisingly, a lot of people are worried about the economic impact of this fiscal cliff, with some of the more hyperbolic among us forecasting rack & ruin. However, we need to...

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Common Cents for October 12th 2012

, by John Norris

Last night, I watched the Vice Presidential debate until I couldn’t take it any longer. If that was a debate, I don’t know what an argument is. While I understand Joe Biden’s desire to be assertive, and even aggressive, at one point during the proceedings, a scene from “This is Spinal Tap” came to mine: “This one goes to eleven.” Certainly, members of either party will applaud their candidate’s performance, and deride their opponent’s; however,...

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Common Cents for September 28th 2012

, by John Norris

If you read the news enough, you could conclude the world increasingly doesn’t understand the very basic risk/reward paradigm. Essentially, the amount of reward you receive is commensurate with the amount of risk you take. To businesspeople, this makes perfect sense; it is how it should be. That is how you create wealth: you take risk. It helps if you are insanely brilliant and devilishly attractive, but, where the rubber meets the road, the common...

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Common Cents for September 21st 2012

, by John Norris

When is this rally going to end? That is what a lot of investors want to know. After all, the recent spike in stock prices has been a little, shall we say, surprising. If the economy is so weak the Federal Reserve feels the need to dump another couple hundred billion onto the fire, why then are investors so keen to buy equities? In a simpler time, this might not make sense; however, this is...

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Common Cents for September 14th 2012

, by John Norris

Yesterday, the Federal Reserve another round of what it calls ‘quantitative easing.’ This is an academics way of saying: “buying bonds with money the Fed created as though out of thin air.” Obviously, the former sounds a little more sophisticated and mysterious than the latter. Shoot, if Larry the Cable Guy were to describe quantitative easing, he would say something along the lines of: “You see, it’s when these guys buy up all this stuff...

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Sneak a peek…Q & A with John Norris featured in this Sunday’s B’ham News

August 17, 2012, by Shelley deClerk

Does your background as an economist help in your job as director of wealth management at Oakworth Capital Bank? You have to have an idea about where the economy is headed in order to properly invest money. If the economy is headed for recession, you want to load up on government debt and consumer staples. If the economy is poised for growth, corporate bonds and cyclical stocks make more sense. If the economy is doing...

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