Wednesday, September 23, 2009

A couple of things: is this a precurser to Dividends? and where is Inflattion if costs are lower?

NEW YORK -- General Mills Inc.'s fiscal first-quarter earnings soared 51% as the company's profit margins widened in tandem with moderating commodity prices and as sales rose of household staples like Hamburger Helper, Multigrain Cheerios and Pillsbury cookie dough.

The results handily topped expectations and the processed-food giant again raised its fiscal-year earnings view, this time by 20 cents to $4.40 to $4.45 a share.

Lower commodity prices have begun to aid the large food makers, who were hit badly last year as their raw material costs surged. Despite the declines in raw material costs, most of these companies have largely been able to avoid the large scale price rollbacks some investors had feared. That is beginning to help their profit margins. ConAgra, maker of Hunt's sauces and Healthy Choice meals, this week also raised its fiscal year earnings forecast. Companies like General Mills have also cut costs aggressively.

General Mills also has introduced products to help drive its U.S. retail segment growth, such as Progresso High Fiber soups. Its Betty Crocker brand entered the profitable gluten-free niche with mixes for cookies, brownies and cakes.

For the quarter ended Aug. 30, the company reported a profit of $420.6 million, or $1.25 a share, up from $278.5 million, or 79 cents, a year earlier.

Excluding items, such as hedging gains and losses, earnings were up at $1.28 from 96 cents. The company earlier this month indicated results likely would top its internal projections but didn't give details.

Revenue edged up 0.6% to $3.52 billion, with currency fluctuations hurting sales results by 2 percentage points. Volume was flat, reflecting the loss of 2 percentage points from divested product lines.

Analysts polled by Thomson Reuters most recently were looking for earnings of $1.03 on revenue of $3.49 billion.

Gross margin jumped to 41.5% from 34.1% amid lower costs for grain and other commodities.

At its U.S. retail business, sales rose 5.8%, with volume up 2%. Profit rose 21%. In its international division, sales dropped 4.1% on the weaker dollar as earnings fell 13%.

The bakery and food-service unit remains under pressure amid restaurant industry weakness, with sales down 16% on divestitures and falling flour prices. However, segment profit more than doubled amid lower commodities prices and cost cuts.

Write to Anjali Cordeiro at and Tess Stynes at

Sunday, September 20, 2009

An article that discuses the effect of sun spots on Global warming! Do we know conclusively what has created global warming?,0,4360136.story
Global warming and the sun
Jonah Goldberg
September 4, 2009

On the last day of August, scientists spotted a teeny-weeny sunspot, breaking a 51-day streak of blemish-free days for the sun. If it had gone just a bit longer, it would have broken a 96-year record of 53 days without any of the magnetic disruptions that cause solar flares. That record was nearly broken last year as well.

Wait, it gets even more exciting.

During what scientists call the Maunder Minimum -- a period of solar inactivity from 1645 to 1715 -- the world experienced the worst of the cold streak dubbed the Little Ice Age. At Christmastime, Londoners ice-skated on the Thames, and New Yorkers (then New Amsterdamers) sometimes walked over the Hudson from Manhattan to Staten Island.

Of course, it could have been a coincidence. The Little Ice Age began before the onset of the Maunder Minimum. Many scientists think volcanic activity was a more likely culprit. Or perhaps the big chill was, in the words of scientist Alan Cutler, writing in The Washington Post in 1997, a "one-two punch from a dimmer sun and a dustier atmosphere."

Well, we just might find out. A new study in the American Geophysical Union's journal Eos suggests that we may be heading into another quiet phase similar to the Maunder Minimum. Meanwhile, the journal Science reports that a study led by the National Center for Atmospheric Research has finally figured out why increased sunspots have a dramatic effect on the weather, increasing temperatures more than the increase in solar energy should explain. Apparently, sunspots heat the stratosphere, which in turn amplifies the warming of the climate.

Scientists have known for centuries that sunspots affected the climate; they just never understood how. Now, allegedly, the mystery has been solved.

Last month, in another study, also released in Science, Oregon State University researchers claimed to settle the debate over what caused and ended the last Ice Age. Increased solar radiation coming from slight changes in the Earth's rotation, not greenhouse gas levels, were to blame.

What is the significance of all this? To say I have no idea is quite an understatement, but it will have to do.

Nonetheless, what I find interesting is the eagerness of the authors and the media to make it clear that this doesn't have any significance for the debate over climate change. "For those wondering how the [NCAR] study bears on global warming, Gerald Meehl, lead author on the study, says that it doesn't -- at least not directly," writes Moises Velasquez-Manoff of The Christian Science Monitor. "Global warming is a long-term trend, Dr. Meehl says. . . . This study attempts to explain the processes behind a periodic occurrence."

This overlooks the fact that solar cycles are permanent "periodic occurrences," a.k.a. a very long-term trend. Yet Meehl insists the only significance for the debate is that his study proves climate modeling is steadily improving.

I applaud Meehl's reluctance to go beyond where the science takes him. For all I know, he's right. But such humility and skepticism seem to manifest themselves only when the data point to something other than the mainstream narrative about global warming. For instance, when we have terribly hot weather, or bad hurricanes, the media see portentous proof of climate change. When we don't, it's a moment to teach the masses how weather and climate are very different things.

No, I'm not denying that man-made pollution and other activity have played a role in planetary warming since the Industrial Revolution. But we live in a moment when we are lectured and harangued that if we use the wrong toilet paper or eat the wrong cereal, we are frying the planet. But the sun? Well, that's a distraction. Don't forget your reusable shopping bags, but pay no attention to that burning ball of gas in the sky -- it's just the only thing that prevents the planet from being a lifeless ball of ice engulfed in darkness. Never mind that sunspot activity doubled during the 20th Century, when the bulk of global warming has taken place.

What does it say that the modeling that guaranteed disastrous increases in global temperatures never predicted the halt in planetary warming since the late 1990s? What does it say that the modelers have only just discovered how sunspots make the Earth warmer?

I don't know what it tells you, but it tells me that maybe we should study a bit more before we spend billions to "solve" a problem we don't understand so well.

Tribune Media Services Jonah Goldberg is an editor at National Review Online.

Copyright © 2009, Chicago Tribune

Interesting listening to what informed people said about the US economy a few years ago and how they got howled down!

Enjoy watching this!