Trade Wars

No country wins in a trade war. Few companies win either.

Even companies like Moog. They make amazing synthesizers like the System 55 pictured above.

They are now asking their customers to write to congress about the negative consequences of tariffs on Moog.

Here is the form letter:

Dear (Congressman or Representative):

I am writing you on behalf of Moog Music, a company of 100 employee-owners, based in Asheville, North Carolina. I am urgently contacting you about the recently announced 25% tariff on Chinese goods.

In case you are not familiar with Moog, they manufacture the world”™s leading analog synthesizers used by artists including but not limited to Michael Jackson,The Beatles, Radiohead, Stevie Wonder and many others.

Roughly half of the circuit boards and associated components for Moog”™s instruments come from China. This tariff would significantly limit their ability to manufacture synthesizers, and could put many of their employee-owners out of a job.

As an employee-owned company with a 60-year legacy in American manufacturing, Moog constantly strives to keep a balance between domestically- and internationally-sourced parts, so that they can continue employing people from their local community in Asheville, North Carolina.

Moog sources circuit boards from US suppliers whenever possible, paying up to 30% over the price of the same circuit boards made overseas. However, whether they buy circuit boards in the US or overseas, the majority of the raw components still come from China. Therefore, Moog will be unable to avoid this substantial cost increase because of the tariffs.

These tariffs will immediately and drastically increase the cost of building Moog instruments, forcing them to lay off American workers and will require Moog to move some, if not all, of their manufacturing overseas.

I do not want to see the end of Moog”™s 60-year legacy in American manufacturing. I do not want their employee-owners left without jobs. I want American workers to continue have the opportunity to support their families and their community.

I implore you to convince the President that these Chinese tariffs cause serious damage to American workers like those at Moog and to rescind them immediately.

Thank you,

(Your Name)


14 days to go before retirement.

Last night my management team held a retirement dinner for me. Such a wonderful evening and such a great team. Incredible food at a beautiful location in the country with dear colleagues and friends. So honoured to have been able to serve with this team.

The gift was a Mont Blanc LeGrand rollerball pen.

For almost 15 years, I carried a Mont Blanc LeGrand with me every single day that I was working. Regardless of location, regardless of business travel, that pen was always with me. I loved the feel, the weight and the quality of such a nice writing instrument.

Then one day I left my pen at the office. I had set it down for some reason, forgot to pick it up and when I returned to the office the next day, it was gone.

I was reluctant to spend the money to buy a new one as it was a very expensive pen and I did life without a Mont Blanc. I know, I know. Such a tough life challenge.

I did miss the LeGrand though and I felt badly about having lost the pen.

My executive assistant knew the story about the lost pen and she helped to decide on this retirement gift with the team.

Such a perfect gift!

I will cherish this pen not because of its feel, weight and quality. I will cherish the pen for the engraving — Best Boss Ever! — and the memories of working with such a fantastic team.

A few more retirement events before I finish in two weeks. And then a new chapter of life begins.

Into Thin Air

Garth Turner really does not like Bitcoin. Or any other cryptocurrency for that matter:

Bitcoin is done. Kaput. So is Ethereum, Tether, Ripple and all the other kiddie cryptos which people have been mining in their bedrooms and selling on unregulated, undisciplined, unsecure, immature and unstable exchanges.

You can read his post here.

I was giving a technology presentation last December. During sound check, the sound person asked me if I was going to say anything about Bitcoin. I told him that I was going to talk a little bit about Blockchain, the technology underneath Bitcoin, but nothing specifically on cryptocurrencies.

“Why do you ask?” I said.

Turns out that he had purchased Bitcoin simply because everyone else was making out like bandits and he wanted in. Unfortunately, as you can see from the chart above, he bought in near the top of the mountain, that initial drop from peak which tempts everyone to dive back into the pool and snap up the coins quickly, while they are still on sale.

Except that Bitcoin wasn’t on sale.

Whether cryptocurrencies will bounce back or not is hard to say. Any type of bubble, whether it is the current nonsense with real estate in Canada, marijuana stocks or Bitcoin, will make a small group of people very, very wealthy. For most, bubbles end badly. With Bitcoin, many people bought with debt, usually credit card debt.

Someone bought Bitcoin at $19,870 USD on a credit card.

They cannot be having a good day today.

Here are some predictions about the future value of Bitcoin. A couple of these predictions claim $1 million or more for Bitcoin.

A gold rush.

At least until the bubble bursts.

Big Payday for Intel’s CEO

You might recall a little incident with Intel, Meltdown and Spectre. Almost all Intel processors since 1995 were impacted.

On the cover of Intel’s Code of Conduct, we find this note from Intel’s CEO, Brian Krzanich:

Intel has consistently been recognized as one of the world”™s leading corporate citizens and most ethical companies. I would like to thank you for your contribution in role modeling Intel values and maintaining our reputation as a company that is well respected, trusted, and admired.

As we embrace new challenges and increase our presence in rapidly changing markets, one thing that must never change is our unflagging commitment to our values and the highest ethical standards. These core values and standards are the foundation of the unique Intel culture that differentiates us, builds our brand, and inspires our customers and suppliers.

Our Code of Conduct is and will always be our steady compass. The Code sets the expectations for integrity and ethics that I expect all employees to follow. Read it, discuss it, and commit to upholding it. If you have any questions or concerns please contact your manager, your Business Group lawyer, your Ethics and Compliance Business Champion, any member of Intel Ethics & Legal Compliance, or the Intel Ethics & Compliance Reporting Portal (

I look forward to your continued commitment to live our values in the workplace each and every day.

Brian Krzanich
Chief Executive Officer

Now the code of conduct did not stop Brian from selling all of the Intel stock he could after Intel learned of this security issue. Part of his unflagging commitment to Intel’s values and their highest ethical standards allowed him to profit before public disclosure.

Brian was also carrying on a “consensual” relationship with an Intel employee, against Intel company policy.

I guess someone decided to hold him to account.

He resigned today.

But don’t feel sad for him.

Looking at Intel’s latest 14a filing, which you can download here, Brian has a big payday coming.

His walk away compensation is estimated at $38 million dollars.

Not bad for a former CEO with a demonstrable track record of modeling Intel values and profiting in a timely fashion on the sale of Intel stock.

I Get Mail

I will miss email encounters like this one after I retire.

You would be surprised at how difficult it is to answer questions honestly, simply and with absolute clarity but somehow, with decades of experience answering hundreds of thousands of emails just like this one, I think I finally found a way.

Gmail has a new AI auto responder.

The AI wanted me to answer this way:

Yes, I am. I would love to chat. You’re looking at him!

I think Google has some work to do with their AI auto responder.

I Get Mail

On a quiet day, I receive 30 to 40 unsolicited vendor emails in my corporate inbox. Google conveniently puts many of them into my spam folder. I check the spam folder every so often, just in case, and often find interesting chains of emails.

This one I call the Ode to Dilip.

From: Dilip
Sent: Thursday, April 12, 2018
Subject: Meeting request

Dear Richard,

Hope you”™re having a great day!

My name is Dilip and I am with one of the leading providers of analytics services.

Our customer-centric approach, deep domain expertise, and a strong focus on operational excellence, combined with innovative analytics solutions, enable us to help our clients differentiate in the market.

We offer data analytics services which empower companies to monetize data from across the organization, eliminating data and application boundaries and silos, to make the right information available to the right users at the right time. This helps fully leverage the power of analytics to drive competitive advantage and business benefits.Please let me know your convenient time to schedule a meeting to discuss further.

Look forward to your reply. Have a great day!


Almost all unsolicited vendor emails follow this same pitch. Generic corporate bingo phrases like “empower companies to monetize data from across the organization” and “make the right information available to the right users at the right time” generally reduce a vendor’s credibility almost immediately.

Five days pass. Dilip tries again.

From: Dilip
Sent: Tuesday, April 17, 2018
Subject: RE: Follow upDear Richard,

I am writing this to follow up on my earlier email. I”™d like to set up a call to discuss any quires you might have, Please let me know if you are still interested, and if so, which day works for you.

I look forward to hearing back from you. Have a great day!


“If I am still interested”? Dilip does not give up however.

Three days pass. Dilip strikes again.

From: Dilip
Sent: Friday, April 20, 2018
Subject: Can I block 15 minutes on your calendar.

Dear Richard,Hope you”™re having a great day!

The reason for my persistence is that I”™m confident in our ability and strongly believe our analytics services could really help you to drive competitive advantage and business benefits.

I would like to arrange a quick call with you to discuss possible collaboration. How about next Wednesday 3:00 pm for you? If this Date/time doesn”™t suites you let me your convenient time to schedule a call.

Looking forward to hearing from you soon.


I see this tactic used frequently as well. A specific date and time is requested. I wonder how many people respond positively to this tactic? Given that all of his emails are going to spam, he may not be aware that I am reading his entire email chain in one sitting.

Nonetheless, he tries again. Before the Wednesday. Four days later.

From: Dilip
Sent: Tuesday, April 24, 2018
Subject: Awaiting for your reply.

Dear Richard,

I am writing to follow up on my earlier email. I haven”™t heard from you for a while. If you are still interested, Please let me know your convenient time to schedule a call. I”™ve been keeping space open in my schedule, but if you”™ve decided to go in another direction that”™s no problem. Just let me know.

Thank you,


“I haven’t heard from you for a while.” Actually, you have never heard from me.

“If you are still interested…” Actually, I was never interested.

Dilip soldiers on.

From: Dilip
Sent: Friday, May 4, 2018
Subject: Trying to connect

Dear Richard,

Since I have not heard back from you, I have to assume you are not interested in our product at the moment. If you are still interested, Please let me know your convenient time to schedule a call.

I”™m looking forward to your reply. Have a great day!


Yes Dilip, you had to assume that I was not interested although you were unaware that Google had placed all of your emails into Spam.

When I retire in a few weeks, all of those unsolicited vendor emails will bounce back undelivered.

I might miss a few of them. Like the ones from Dilip.

Sometimes I Just Hate Retailers

I suspect retailers might have a pessimistic sense about their future in the digital age. And, every so often, I understand why.

Many retailers are just awful.

A recent experience at the local Jump Plus store here in Kingston reminded me why I am increasingly going online to shop.

Two weeks ago I went to the Jump Plus shop to order a replacement for my aging iMac. As I live downtown, I wanted to support the local retailer.

The customer service was neutral. I knew the exact specification I wanted for the new machine and the transaction was pretty basic: please order this machine.

I was told that it would take them 5 to 7 business days for a custom order iMac to be delivered to their store. And that was fine with me.

They had my name, address, email address and telephone number on file as I have purchased from them many times before.

I asked them specifically if they required a deposit for the order. I was told no.

All fine.

I decided to call them to check on the status of the order as we were now 10 business days since the order was placed. The person who answered the call asked me who placed the order for me. Odd. You couldn’t find the order?

After trying to describe the salesperson who helped me, another person came on the line, the salesperson who had allegedly placed the order.

I quickly recounted the order that I had placed with her and the machine configuration.

“Did you get my email?” she asked.

This gets old pretty quickly.

“No.” I replied.

I receive several hundred emails a day. I archive them. I might have missed this one, although I doubt it. So I searched for any email from Jump Plus over the past two weeks.


“Well,” she continued, “we can’t order the unit because it is a custom build and we require a deposit. That is store policy.”

I pointed out the obvious to her. I had asked if a deposit was required when I placed the order two weeks ago and she told me no. The order specifically highlighted that it was a custom build when it was placed. If it was store policy, why wasn’t a deposit requested when it was placed? Why didn’t you follow up immediately with the request for a deposit if it was required for the order? You had both my email address and my phone number on file.

“Well, you will have to come in and place the deposit and then we can process the order.”

I really do not like people who are deceptive.

She could have responded with: “Oh I am so sorry. I was not able to get your order into our system without a deposit. And, with everything going on, I neglected to contact you to come into the shop to make the deposit. To make up for this, we’ll give you [whatever, a slight discount, a gift card to a coffee shop] for your trouble. You’ve been a long-time customer and we really appreciate your business.”

Instead she made up stories about “emails” and “store policies” when she either forgot to place the order as requested or her manager told her that she should have requested the deposit at the time the order was placed and she just never followed up.

I ordered the unit from Apple direct and it will be to my door in 3 business days.

So much easier.

Thank You For Your Business

From a recent Ontario Securities Commission settlement with 1832 Asset Management L.P. (Scotiabank, Dynamic Funds):

2. Investment fund managers (“IFMs”) are prohibited from making a payment of money or providing a non-monetary benefit to a participating dealer or dealing representatives (“DRs”) of a participating dealer in connection with the distribution of securities, except in certain permitted circumstances under Parts 3 and 5 of National Instrument 81-105 Mutual Fund Sales Practices (“NI 81-105”).

3. The Companion Policy to NI 81-105 provides that NI 81-105 was adopted in order to discourage sales practices and compensation arrangements that could be perceived as inducing 2 participating dealers and their representatives to sell mutual fund securities on the basis of incentives they were receiving rather than on the basis of what was suitable for and in the best interests of their clients. The purpose of NI 81-105 is to provide a minimum standard of conduct to ensure that investor interests remain uppermost in the actions of mutual fund industry participants when they are distributing mutual fund securities and that conflicts of interest arising from sales practices and compensation arrangements are minimized.

This was how Scotiabank’s asset management division thanked some of their financial advisors — Dealing Representatives (DRs) — for their business:

6. In particular, 1832 engaged in excessive spending on promotional activities on DRs including in relation to:

(a) one-time events such as concerts and sports events, including play-off events. In many instances, the cost of these events to 1832 exceeded $700 per DR per event and, in more limited instances, the cost exceeded $1,000 per DR per event;

(b) multiple promotional activities within the same quarter in breach of 1832”™s guidelines, including taking a DR to back-to-back Blue Jays baseball (“Jays”) play-off games at a cost to 1832 of $1,340 for the DR and, in a one month period, taking a DR to two Toronto Maple Leafs hockey (“Leafs”) games and a Rihanna concert at a cost to 1832 of $1,111 for the DR; and

(c) on occasion, annual promotional activities, including spending more than $3,500 on one DR in 2015.

7. 1832 also provided promotional items and gifts (collectively “Items”) to DRs that were not of minimal value (and were therefore excessive) and/or were not promotional in nature including by:

(a) approving Items included in 1832”™s warehouse store (the “Warehouse”) that were distributed to DRs, including a Bose wireless music system ($200), an executive briefcase ($190) and a golf GPS ($150);

(b) providing, with the approval of management, gifts of tickets to major events to DRs without requiring that an 1832 employee attend the event, including tickets to Jays games ($245) and to concerts such as Justin Bieber ($253);

(c) providing more than 2,000 gift cards to DRs, including approximately 150 gift cards costing more than $50 each to DRs, all of which gift cards constituted monetary benefits that were not permitted under NI 81-105; and

(d) providing Apple iPad minis and keyboards with a combined cost of approximately $325 each to 215 DRs who attended a mutual fund conference sponsored by 1832 in 2015 (the “2015 Conference”) and with a combined cost of approximately $375 each, to 210 DRs who attended a mutual fund conference sponsored by 1832 in 2016 (the “2016 Conference”) as well as Maui Jim sunglasses ($111) to those 210 DRs and, where applicable, the DR”™s guest.

8. In addition, 1832 provided excessive non-monetary benefits to DRs on food, drinks and entertainment at the 2015 and 2016 Conferences including:

(a) spending over $1,000 per DR on the final day of the 2015 Conference on food, drinks and a celebrity speaker; and

(b) spending over $850 per DR on the final day of the 2016 Conference on food, drinks and a celebrity speaker.

From today’s Globe and Mail:

The Bank of Nova Scotia”™s asset management division, 1832 Asset Management L.P., is the second investment fund manager to be fined this month for excessive spending in its mutual fund sales practices.

The fund manager has agreed to pay an $800,000 administrative penalty and $150,000 in investigation costs as regulators voice concerns surrounding their mutual fund sales practices.

Good to see the OSC at work in this area.