Samsung Manipulates Galaxy Tab Sales

Investors beware!

WSJ reports that Samsung's actual galaxy tab sales are smaller than the numbers on its balance sheet:

In early December, Samsung announced it had sold 1 million, declaring that sales were going “faster than expected.” Then, in early January, Samsung announced sales of 2 million.

But during the company’s quarterly earnings call on Friday, a Samsung executive revealed those figures don’t represent actual sales to consumers. Instead, they are the number of Galaxy Tab devices that Samsung has shipped to wireless companies and retailers around the world since product’s formal introduction in late September.

I believe what Samsung used were a couple of old trick in the accounting book -- channel stuffing and possibly consigned goods. Samsung executive, Lee Young-hee used the terms “sell-in” to reflect Samsung’s sales to distributors and “sell-out” to reflect the distributors’ sales to consumers. Of course, "sell-in" would be high because distributors are the middlemen passing on the products to consumers. Thus, the important number to take notice is "sell-out." In that aspect, Lee Young-hee said "sell-out wasn't as fast as we expected." 

Starbucks to roll out Supersized Coffee

How bad is American's addiction to coffee? It must be very high because Starbucks announced they are rolling out trenta size drinks. For those that are not familiar with Starbucks' lingo, one trenta size drink is equivalent to 31 oz. fluid. This is more liquid than a human's stomach can hold!



(Source: National Post)


Experts also say that switching to a trenta drink can add 200 extra calories a day, which results in an average of 2 pound weight gain per month. According to Sarah of Truth In Slimming, while American consumers are freaking out about Starbucks' new size, Dunkin Donuts have been serving a 32-ounce coffee for years. McDonald's also serve up 32 oz. sweet tea for $1. 


Who buys these oversized drinks? Are these corporations releasing the products based on current American dieting trends? 

Tiger Mother and Baby Cubs

One mother has beame an Internet sensation with her recent memoir -- Battle Hymn of the Tiger Mother. The author Amy Chua is a Yale law professor and a self-proclaimed "tiger mother."

What exactly is a "tiger mother?" Wall Street Journal's excerpt from the book gave us an idea of what Ms. Chua's guidelines are:

1. Never let your child attend a sleepover. 
2. Never let your child watch TV or play computer games.
3. Receiving any grade less than an A is not okay.
4. Your child has to be the No. 1 student in every subject except gym and drama.
5. Your child must play the piano or violin.
6. Call your child "garbage" as a motivation tool. 

Amy Chua points out three key differences between Chinese and Western parenting style: 1) Western parents focus too much on a child's self-esteem, 2) Chinese parents believe their children are indebted to them, and lastly, 3) Chinese parents believe that they always make the best decisions for their children despite what they want. (To dissipate any talk of racism, Ms. Chua uses the term Chinese loosely to include any parenting style that resembles hers.

The WSJ article titled "Why Chinese Mothers Are Superior" has accumulated over 7478 responses and has been featured numerous times on other blogs. Andrea Johnson of Minot Daily News criticized Amy Chua's parenting skills as "child abuse" that will most likely leave emotional scars and years of therapy sessions for her daughters.

David Brooks of the New York Times calls Amy Chua a wimp:

"(Amy) is protecting them from the most intellectually demanding activities because she doesn’t understand what’s cognitively difficult and what isn’t. Practicing a piece of music for four hours requires focused attention, but it is nowhere near as cognitively demanding as a sleepover with 14-year-old girls. Managing status rivalries, negotiating group dynamics, understanding social norms, navigating the distinction between self and group — these and other social tests impose cognitive demands that blow away any intense tutoring session or a class at Yale. "

Adrienne Mong from Behind The Wall questions if there is "love" in the Tiger Mom approach:

"But try growing up in a society like America where people hug even when they just say hello, and you start noticing the fact that your parents never hug or kiss you. Try growing up in a society which places a high value on positive reinforcement and you might start wondering why it is that your parents only ever notice your faults and your inability to be the best student in your entire class."

In a recent face-off between Larry Summer, ex-Harvard president, and Amy Chua, Larry argues that the tiger moms hinder creativity, which is an "even more valuable asset that educators and parents should emphasize." Larry theorizes that tech moguls like Bill Gates and Mark Zuckerberg probably would not have been born if their mothers were the traditional tiger moms. After all, what kind of strict mothers would let their kids drop out of college?


Despite the vilification of Amy Chua, there are support for Chua's disciplinary methods. as As Alfidi of Alfidi Capital Group points out, "Ms. Chua raised her kids to be winners in lfe (sic). Tiger mothers know that old fashioned concepts like discipline, achievement, focus, standards, delayed gratification, and self-mastery never go out of style."


Even Sophia Chua-Rubenfeld, the elder daughter of Amy Chua, defends her mother in a letter to the New York Post. The one thing that her Tiger Mom has taught her was that to live a meaning life is "about knowing that you’ve pushed yourself, body and mind, to the limits of your own potential."

Now, I'm sure most of you have formed your own opinion by this point. Let me add my two cents. Personally, I believe parents have the biggest influence on a child's life. Due to the lax attitude of American parents, American children is facing poor quality public education systems. Oscar-nominated documentary Waiting for Superman brought lots of media attention to this delicate quandary. We point fingers at the incompetency of the government, the villainous teacher unions, and the poorly trained teachers. However, why does no one question the fundamental parenting skills? I'm not saying you should whip your child and send them to military school. But maybe, just maybe, it's time to stop buying your kids video games and pick up a book instead?!

Apple Inc.

Recent news of Steve Jobs' medical leaves opened up new questions regarding Apple's future. Techies and bankers are both concerned about imminent future of one of world's most innovative company of this decade.

Let me gave everyone a brief background. Apple was founded by Steve Jobs and Steve Wozniak in 1976. Initially, they ran a small operation out of the Jobs' garage in Los Altos, California and revolutionized the Personal Computer industry with its easy-to-use computer Apple II. Although Apple pioneered in the PC industry, it was difficult for them to sustain a competitive advantage with its differentiation niche strategy. By charging their consumers at a premium price, Apple offered high quality Macintosh computers with guaranteed reliability and simplicity. While Apple seems to have a bright future ahead of itself, it lost a majority of the PC market shares to Microsoft, Dell, and HP. It didn't help that their top management team made a few wrong maneuvers during the Sculley-Spindler-Amelio years. Apple fell to its lowest trough in 1997 with a loss of $1.6 billion and barely managed to hold its ground with a 3% worldwide market share.

Thankfully, someone at Apple made a smart decision to hire Steve Jobs back. Unlike his predecessors, Jobs was a "tech visionary." I personally believe that Jobs got the golden touch. By focusing heavily on Research & Development and restructuring efforts, Jobs revived Apple in 1998 with a $309 million profit during the fiscal year. His commitment to R&D helped the creation of the "digital hub" strategy. Due to the stagnant nature of the computer industry, Jobs pushed the boundaries of digital technology when he introduced the iPod. Since the iPod, Jobs has redefined the digital world with a string of iGadgets: iTouch, iPhone, and the latest iPad. In 2009, the majority of Apple's net sales came from non-Macintosh series. The iPhone series became 30% of Apple's total revenue. Not only do the financial report figures illustrate Steve Jobs' success, but the ubiquitous presence of Apple products also confirms this theory.

(Interesting side note: Ever since I bought an iPhone, I've became more aware of Apple's products on the silver screen. For those that are curious about this phenomenon, this Product Placement News article claimed that Apple does not pay for the exposures.)

While I applaud Mr. Jobs's maverick attitude and trendsetting accomplishments, I can't help but wonder what would become of Apple sans Jobs. In a press release to Apple employees, Jobs announced a medical leave with an indefinite return date.

Dun dun dun. Here comes the million dollar question! How will Apple fare under a different management? Is Apple going to prevail or is history doomed to repeat itself?

FYI: To give everyone a quick heads up, some are betting against Apple already. One daring prediction against Steve Jobs is that he will not be returning to Apple as he has already achieved everything he wanted. Others are concerned about his health.

A shot of Steve Jobs setting the record straight regarding his "premature death", circa 2008. 

Update:
Netgear's global chairman and CEO Patrick Lo spoke about Steve Jobs in a recent interview with the Sydney Morning Herald. Lo said, "Once Steve Jobs goes away, which is probably not far away, then Apple will have to make a strategic decision on whether to open up the platform."

Does the future of Apple rely solely on Steve Jobs? I want to leave y'all with a quote by Mr. Jobs, "Innovation distinguishes between a leader and a follower."

Jump Start

Welcome,
After much consideration and careful planning, I've finally decided on a theme for my blog. Finance! The bottom line!

Believe it or not, I like to read the Wall Street Journal and follow the corporate news whenever I can. Hopefully, I can share some insights with my undergraduate Accounting degree. Let's see how much classroom knowledge can really be applied in the real world!

Ready or not, here I go!