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WASHINGTON (Reuters) – The United States Postal Service should have more flexibility to raise rates for packages, according to recommendations from a task force set up by President Donald Trump, a move that could hurt profits of Amazon.com Inc (AMZN.O) and other large online retailers. The task force was announced in April to find ways to stem financial losses by the service, an independent agency within the federal government. Its creation followed criticism by Trump that the Postal Office provided too much service to Amazon for too little money.
FILE PHOTO – A view shows U.S. postal service mail boxes at a post office in Encinitas, California in this February 6, 2013, file photo. REUTERS/Mike Blake/Files
The Postal Service lost almost $ 4 billion in fiscal 2018, which ended on Sept. 30, even as package deliveries rose.
It has been losing money for more than a decade, the task force said, partially because the loss of revenue from letters, bills and other ordinary mail in an increasingly digital economy have not been offset by increased revenue from an explosion in deliveries from online shopping.
The president has repeatedly attacked Amazon for treating the Postal Service as its “delivery boy” by paying less than it should for deliveries and contributing to the service’s $ 65 billion loss since the global financial crisis of 2007 to 2009, without presenting evidence.
Amazon’s founder Jeff Bezos also owns the Washington Post, a newspaper whose critical coverage of the president has repeatedly drawn Trump’s ire.
The rates the Postal Service charges Amazon and other bulk customers are not made public.
“None of our findings or recommendations relate to any one company,” a senior administration official said on Tuesday.
Amazon shares closed down 5.8 percent at $ 1,669.94, while eBay (EBAY.O) fell 3.1 percent to $ 29.26, amid a broad stock market selloff on Tuesday.
The Package Coalition, which includes Amazon and other online and catalog shippers, warned against any move to raise prices to deliver their packages.
“The Package Coalition is concerned that, by raising prices and depriving Americans of affordable delivery services, the Postal Task Force’s package delivery recommendations would harm consumers, large and small businesses, and especially rural communities,” the group said in an emailed statement.
Most of the recommendations made by the task force, including possible price hikes, can be implemented by the agency. Changes, such as to frequency of mail delivery, would require legislation.
The task force recommended that the Postal Service have the authority to charge market-based rates for anything that is not deemed an essential service, like delivery of prescription drugs.
BAD NEWS FOR AMAZON
“Although the USPS does have pricing flexibility within its package delivery segment, packages have not been priced with profitability in mind. The USPS should have the authority to charge market-based prices for both mail and package items that are not deemed ‘essential services,’” the task force said in its summary.
That would be bad news for Amazon and other online sellers that ship billions of packages a year to customers.
“If they go to market pricing, there will definitely be a negative impact on Amazon’s business,” said Marc Wulfraat, president of logistics consultancy MWPVL International Inc.
If prices jumped 10 percent, that would increase annual costs for Amazon by at least $ 1 billion, he said.
The task force also recommended that the Postal Service address rising labor costs.
The Postal Service should also restructure $ 43 billion in pre-funding payments that it owes the Postal Service Retiree Health Benefits Fund, the task force said.
Cowen & Co, in a May report, said the Postal Service and Amazon were “co-dependent,” but that Amazon went elsewhere for most packages that needed to arrive quickly.
Cowen estimated that the Postal Service delivered about 59 percent of Amazon’s U.S. packages in 2017, and package delivery could account for 50 percent of postal service revenue by 2023.
The American Postal Workers Union warned against any effort to cut services. “Recommendations would slow down service, reduce delivery days and privatize large portions of the public Postal Service. Most of the report’s recommendations, if implemented, would hurt business and individuals alike,” the union said in a statement.
Reporting by Diane Bartz and Jeffrey Dastin; editing by Bill Berkrot
Too many companies still give feedback in a very old-school way.
When I was working at Google from 2010-2012, every six months we had to do an exhaustive, 360-feedback process. I absolutely dreaded the three full days it took to write reviews on all the people I interacted with. And we had to do that twice a year, every year.
I don’t know if they still do things that way. But I do know that’s not the best way to give feedback. The best feedback isn’t given six months later–it’s given in real-time.
Most companies (and their employees) would be much better off creating a more natural feedback process and eliminating any long, drawn-out procedures they currently have in place.
When incorporating timely feedback, here’s what to keep in mind:
Focus on giving real-time feedback.
No one remembers a specific meeting from four months ago. They don’t remember a conversation from six weeks ago. By the time those individual moments come up in a performance review, they’ve long been forgotten.
But people do remember the conversation they had yesterday. They remember the meeting they held last Monday. That’s why it’s so important to give feedback in real-time. People can actually take your feedback, consider it in light of their actions, and learn from the experience.
If you sit down with someone at their one-year review, and they’re completely surprised at the dialogue you’re having, that’s an issue. The whole point of a yearly check-in is that there should be no surprise. It should be a conversation where both parties feel like they’re on the same page.
If that’s not happening, there’s something wrong with the way you’re communicating.
Involve both people in the process.
For feedback to be useful, both people have to be engaged. You need input from the person getting the feedback, as well as the person giving it.
Sometimes people will have no idea they did something that bothered you, and it may take them some time to process what you’re saying. But other times, they might affirm what you’re saying as soon as you give your feedback.
“I know. I totally messed that up. I realized I was talking too fast as soon as the meeting ended.”
They recognize it, they’re already thinking it through, and they’re taking ownership. That’s a good opportunity to let the person who’s getting the feedback come up with the solution and implement it on their own.
The more someone can respond to what you’re saying, the more helpful it is to them. It also may be the case that the person receiving feedback may need to process it and come back to you later on. And either of those outcomes is fine.
Always add context.
You should never tell someone, “Good job in that meeting!”
It’s a nice thing to say, sure. But it gives them no specific information on what they did well.
Instead, you should give them something they can use. “I thought you led that meeting really well. The addendum was very clear. You kept everyone on track, and you followed up at the end. I can tell everyone knows what they need to do next. Keep doing that.”
The same principle applies to negative feedback. You can’t just say you didn’t like something. You have to tell them exactly what you believe went wrong.
Without any context, people have no idea how to fix what they did–or how to keep doing a good job.
Make sure it’s timely.
There’s a difference between immediate feedback and timely feedback. Yes, you want feedback to happen in real-time. You don’t want to bring it up two months from now.
But sometimes you need space to ensure what you’re saying is as helpful as possible.
I used to be much more in the moment when I gave feedback. I’d pull someone aside right after a meeting to tell them what I thought about their performance. But over time, I’ve found it’s often better for everyone if I wait and fully process my thoughts. Sometimes, I’ll even delay my feedback until the next week.
I don’t wait so long that they have no idea what I’m talking about. Just long enough that I have time to think over what I’m going to tell them–and figure out the most effective way to say it.
The whole point of giving feedback is that it helps you develop relationships. Think of the best relationships you’ve had at any job. They were probably relationships where you were close enough to tell each other the truth.
When I was an investment banking analyst, I became really close with one of my associates. And I could rely on her to tell me when I did something wrong and how I could improve. I didn’t feel like she was chastising me. I felt like she had my back. She was watching out for me by letting me know when I wasn’t doing something as well as I could.
If someone takes the time to give you helpful feedback, that means they care about your growth.
If you want your team to grow, it’s essential for your company to develop a good process for giving feedback. If it’s done well, it builds trust, strengthens bonds, and helps people become their best.
Positive Acceleration Momentum Stocks
This week I have selected 8 breakout stocks from the following sectors: 2 healthcare, 4 basic materials, 1 technology and 1 services. Detailed charts for each stock are at the end of the article.
The new selections of positive momentum stocks for this week include:
- Baytex Energy Corp. (BTE) – Basic Materials / Independent Oil & Gas
- Cogentix Medical, Inc. (CGNT) – Healthcare / Medical Appliances & Equipment
- Forum Energy Technologies, Inc. (FET) – Basic Materials / Oil & Gas Equipment & Services
- Noble Corporation (NE) – Basic Materials / Oil & Gas Equipment & Services
- Four additional long positions are available to subscribers.
- Four negative acceleration momentum stocks available to subscribers.
- Live daily chart tracking and momentum updates for subscribers are available along with detailed portfolio performance of individual stocks.
Thumbnail images of the Positive Momentum Portfolio Week 49
Welcome to the Momentum Breakout Selection list for Week 49. This article provides the complete list of Breakout Stocks for subscribers only. The full performance results for all the different portfolios are linked in the 2017 YTD performance results with important descriptions of the different portfolio methodologies. A brief summary of the selection methodology for these momentum stocks can be found in my primer article on quick pick momentum accelerators.
This past Week 48 saw substantial volatility in the S&P 500 with the highest two consecutive weekly gains totaling 2.44% since May 28th. Consistent with the 63 years of historical S&P 500 returns charted below, November also saw the S&P 500 gain 2.81%, the largest monthly gain this year since 3.72% in February. I continue to maintain several market hedges in VIX as I have detailed on the message board. During the 260 point intraday decline in the Dow this week the VIX JAN calls saw gains of more than 44%. This significant
increase in volatility could be an early signal of a pending market top. Again, historically the S&P 500 tends to perform extremely well in December.Total cumulative long portfolio returns by week of the past 5 weeks (t-5) are listed below through the end of Week 48 to illustrate rolling returns of prior top performers through Friday:
|Breakout Forecast||Long Portfolio Returns past 5 weeks / Top Performers|
|Week 47 (t-1)||+5.56% (EXPR) +31.52%, (NGVC) +25.60%, (SPWH) +11.54%|
|Week 46 (t-2)||+1.64% (SORL) +24.87%, (PIRS) +11.38%, (AUTO) +8.20%|
|Week 45 (t-3)||+7.30% (DNR) +44.70%, (IOVA) +12.82%, (SLCA) +11.43%|
|Week 44 (t-4)||+8.90% (MRNS) +21.37%, (WLL) +11.08%, (ARAY) +8.25%|
|Week 43 (t-5)||+15.18% (CPRX) +59.42%, (VRAY) +47.76%, (BBG) +31.72%|
As I continue my study, the typical optimum momentum holding duration from this analysis appears to be one to three weeks, but as the rolling 5 week table above illustrates, some of these stocks can carry positive momentum for many weeks and some may return to the selection list in the current week.
The breakout frequency of 5% and 10% gainers per week continues to outpace the broad market by 4-5 times higher rates of occurrence in the same population of stocks (non-OTC, non-ETF). As the chart below indicates through Week 46, the average number of breakouts above 10% in a trading week is 26% of the breakout portfolio compared to 3.42% in the comparable population of stocks in the US market exchanges. This is a frequency greater than 7 times the expected breakout rate of the greater market population.
All past selections of individual returns are available on my list of articles by Breakout Forecast Week. This includes daily and weekly returns for all stocks selected since the beginning of 2017. These stock selections are intended to provide the highest probability of greater than 10% gains within the first week (5 trading days) by focusing on accelerating momentum characteristics detailed in my primer article linked above.
End of week results for Week 48:
Charts of Week 49 Selections are as follows:
Positive Acceleration Momentum Stocks
Baytex Energy Corp. (BTE) – Basic Materials / Independent Oil & Gas
Noble Corporation (NE) – Basic Materials / Oil & Gas Equipment & Services
Value Portfolio Results through week 48
The following are the weekly updates for each of value portfolios generated every month and tracked in addition to the weekly breakout selections. The Forensic Analysis Value Stock selection portfolio returns are listed below. The latest December selections of the Forensic Portfolios are available here.
|Forensic Selections with Adverse Scores||Returns YTD||Number of Periods|
|July (-) Forensic Portfolio 1||68.11%||5 months|
|Aug (-) Forensic Portfolio 2||39.05%||4 months|
|Sep (-) Forensic Portfolio 3||23.47%||3 months|
|Oct (-) Forensic Portfolio 4||-1.59%||2 months|
|Nov (-) Forensic Portfolio 5||4.80%||1 month|
|Forensic Selections with Positive Scores||Returns YTD||Number of Periods|
|July (+) Forensic Portfolio 1||15.50%||5 months|
|Aug (+) Forensic Portfolio 2||11.89%||4 months|
|Sep (+) Forensic Portfolio 3||3.06%||3 months|
|Oct (+) Forensic Portfolio 4||-4.40%||2 months|
|Nov (+) Forensic Portfolio 5||-6.66%||1 month|
The Piotroski value model is well documented in 17 years of financial literature to outperform other value selection models. This is part of an ongoing study to test the selection performance through multiple portfolios over one year. Further detail and charts of each of the Piotroski Portfolios are available here.
|Piotroski Enhanced Value||Returns YTD||Number of Periods|
|August Portfolio||9.41%||4 months|
|September Portfolio||10.10%||3 months|
|October Portfolio||4.92%||2 months|
|November Portfolio||2.10%||1 month|
As always, I hope you capture the most beneficial returns of this small sample of the weekly breakout selections and have a profitable week of trading! Thank you for reading my articles. If you want free future updates, just click the “Follow“ button at the top of the page.
If you enjoy receiving my Breakout Forecast updates each week, please also consider receiving the complete eight long selections and four short selections every week with a subscription today! Subscribers also receive the full updates with more detail well in advance of this article prior to the market open every week.
JD Henning, PhD, CFE
Disclosure: I am/we are long DNR NGVC EXPR SPWH MRNS.
I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Editor’s Note: This article covers one or more stocks trading at less than $ 1 per share and/or with less than a $ 100 million market cap. Please be aware of the risks associated with these stocks.
The Ig Nobel awards ceremony is a marvelous spectacle encrusted with tradition . But if you really want to know how the winners did their work and why, you need to go to the Ig informal lectures, held at MIT the Saturday after the awards.