April Randomness

For all your random needs

Posted in Uncategorized | 36 Comments

SNAP fraud in the furniture city

Two women have been arrested after the Food Stamp police discovered the women were buying the food for their restaurant using 21 food stamp (SNAP) cards that were not in their names. The card numbers and PIN numbers were written down in a notebook.

http://myfox8.com/2017/04/19/high-point-restaurant-owners-plead-guilty-to-fraud-face-up-to-5-years-in-prison/

The news story has this curious sentence:

“The court may also order restitution to victims of the offense.”

Who might they be referring to?

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“Going concern” warning expected for IheartMedia

Marketwatch Story

In the accounting business, one of the obligations of auditors is to evaluate whether the business has the resources and income to sustain itself as a business in the future. When the auditor feels the obligation to issue a going concern warning, things are in bad shape.

This warning may be less that anything has changed at iHeart Media (formerly Clear Channel), but rather the standards have changed. In 2014, the Financial Accounting Standards Board (FASB), the non-governmental organization (NGO) that sets the standards upon which audits are based, added a requirement that companies include a going concern statement in quarterly reports. This change was to make US standards more consistent with international norms.

FASB rule change

Sears was the first big company to issue a quarterly going concern warning

Explanation

The fundamental principle of accounting is that a business is a going concern and will continue to operate in the future. If not, the assets of the company in a forced liquidation are likely worth a lot less.

In the case of iheart, the vast majority of the assets are “intangible”, meaning they have no physical presence – real estate, buildings, furniture, transmitters, vehicles, etc. What iheart owns is permission from the FCC to operate radio stations and the resulting income streams. $4 billion in assets is “goodwill”, which is essentially that Clear Channel overpaid during the bidding war in the late 1990s with the idea that the existing business relationships with advertisers will drive future income even in the absence of a tangible asset like a long term contract.

In the event of a forced sale, there is no other radio company that has the resources or legal ability to absorb 800 radio stations. The FCC has been expressing interest in relaxing the rule to permit foreign owners to own US radio stations.

Iheart also owns most of Clear Channel Outdoors, the billboard company, which does have substantial physical assets – but the parent has loaded up CCOH with debt and transferred the proceeds to the parent to avoid being crushed by the $20 billion in long term debt still outstanding from the 2009 transaction that made Clear Channel into a private company. CCOH has $5 billion in long term debt, resulting in a negative owner’s equity of close to a negative $1 billion. Close to $2 billion of their assets are intangible and close to another $billion is IOUs owed by iHeart

Clear Channel Outdoors 10-K annual statement

“Owners” of iheartmedia common stock have a negative owners equity of almost $11 billion, close to -$100 per share, of which 2/3 is held by the two private equity firms that put together the original deal. As of Friday, IHRT stock closed at $2.75 a share, and IHRT had a loss per share of more than $3 a share. I have no idea what people think they are buying.

Iheartmedia 10-K

In December, the so-called “board of directors” (controlled by the two PE firms) authorized 400 million shares a new non-voting class D common stock and 250 million shares of “blank check” preferred stock, without any limitations (interest rate, convertibility, priority over other owners, etc). Since an IPO seems unlikely, the logical reason one might do that is preparation for a debt for equity swap as part of a financial reorganization. Without the $1.8 billion in interest expense, the Preferred stock equity might be worth something. But the people owning the current class A common stock are along for the ride – the board of directors is not there to protect them.

Posted in IHeart Media | 1 Comment

Taffy Nivert

One of the perks of Amazon Prime is Amazon Music, an on demand music service that allows you to download and play music from a smallish library (around two million tracks). Now that I can hear music better, time to give it a listen.

While listening to “Country Roads” performed by John Denver, I was curious about the background vocals. It turns out this song is a bit odd. If you have ever driven through West Virginia and listen to local radio, you would think Country Roads was the National Anthem of West Virginia.

The unfinished song was being written by Bill and Taffy Danoff, who lived in Maryland and had never been to West Virginia – neither had John Denver (Henry John Deutschendorf Jr.). Bill Danoff was inspired by listening to WWVA in Wheeling West Virginia, and hoped Johnny Cash would record the song.

The rest is history

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PIT

One of the news accounts about the conclusion of the guy from Cleveland who killed a random old man live on Facebook mentioned a police officer had disabled the vehicle with a successful PIT maneuver, something I was not familiar with, probably because I don’t watch TV.

Assuming one or two of you are not familiar, here is what it means. When police are in a high speed pursuit, they pull up along side of the vehicle they are pursuing in the blind spot. The police car taps the rear driver side quarter panel, which sends the car into a spin. When done correctly, the police car doesn’t strike the car, and only has cosmetic damage. The target vehicle becomes inoperative. If you’re short on time, you can skip the first six minutes.

I’m not sure where this idea came from, but it might have been Richard Petty.

Posted in Uncategorized | 6 Comments

Russia sending military to North Korea border

https://www.thesun.co.uk/news/3370028/russia-putin-north-korea-war-troops-border/

Yes, Russia does have a (small) border with North Korea. Russia controls the Pacific coast to a bit south of Vladivostok, the terminus of the Trans Siberian railway, and home of russia’s Pacific fleet.

The border between the countries is a river, which is crossed by a railroad bridge. Because North Korea uses standard gauge tracks to be compatible with China, the Russian gauge trains cannot be used without a change of gauge.

So far this looks like a defensive deployment to prevent a flood of refugees in the event of an active military confrontation between the US and North Korea.

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The road to serfdom

When Hugo Chavez took over the oil business in Venezuela in 1998, government looters took the computers containing the geological data and production plans to sell the PCs. Since then, the oild fields have rapidly depleted due to mismanagement of the oil fields.

Following in his footsteps, Nicholäs Maduro’s government has seized GM’s car factory in Venezuela

http://www.detroitnews.com/story/business/autos/general-motors/2017/04/20/general-motors-venezuela/100685866/

The plant made three Chevrolet models – and is being looted. GM has given up. It took a $400 million loss last year due to the worthless currency.

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O’Reilly out at Fox?

http://nymag.com/daily/intelligencer/2017/04/sources-fox-news-has-decided-bill-oreilly-has-to-go.html

That would be pretty foolish. O’Reilly could do enormous damage to the News Corp empire with his knowledge from the inside.

Bill O’Reilly has a face for radio, if he ever decides to return.

Posted in Talk Radio | 6 Comments

Fake News 101

The Countess and I were reviewing today’s news events when I spotted this story from the Los Angeles Times

Carrier strike group wasn’t headed to Korean peninsula despite Trump administration claims

The premise of their opinion is that President Trump is lying about sending an aircraft carrier task group to North Korea, or the US Navy is unclear on what it is doing.

They never actually cite anyone who says the carrier task group was headed to Korea. The closest they came to evidence was this statement attributed to President Trump:

“We are sending an armada, very powerful,” to the waters off the Korean peninsula, President Trump told Fox Business News on April 12.

We both reacted to this line – there is a quote from Trump followed by a paraphrase or an assumption, with the entire sentence attributed to Trump.

What did President Trump actually say?

http://www.foxbusiness.com/politics/2017/04/12/trump-on-north-korea-threats-are-sending-armada.html

“We are sending an armada, very powerful. We have submarines, very powerful, far more powerful than the aircraft carrier,” Trump told the FOX Business Network’s Maria Bartiromo. “We have the best military people on Earth. And I will say this: he is doing the wrong thing.”

So the President was saying the opposite of the implication put forth by the LA Times. Aircraft carriers have little to offer in this scenario since we have B52 bombers on station in South Korea. B2 bombers would be the weapon of choice.

In 2009, China let it be known they have a ballistic missile designed to sink an aircraft carrier by flying at Mach 10 up to 2000 km (1,200 miles) and attack vertically, going straight down. It is a weapon for which the US Navy may have no effective defense. An improved model called the DF 26 has a longer range and the ability to detonate a nuclear warhead on the carrier, guided by satellite targeting. It is very hard to hide an aircraft carrier from an adversary who has satellites.

With advances in pilotless planes and cruise missiles, an aircraft carrier is of limited use when friendly airbases nearby (primarily Japan) are available.

Posted in Uncategorized | 4 Comments

Amazon randomness

Amazon had an aha! moment somewhere during the evolution to what it is today, which this video explains quite well. It runs contrary to conventional thinking about warehouse organization, because Amazon uses computers and barcodes extensively.

When Amazon receives a product from a supplier, they break the case apart and store each item randomly all throughout the warehouse, which means when a person orders more than one item, the walking time to gather the items goes down. Even if it is a newer warehouse where robots are doing the moving, it still saves time. Not having fixed locations for certain merchandise means the space adapts to what people are currently ordering.

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How I saved $200 using YouTube

So when Countess was here, much to my dismay I learned the power window on the passenger door(s) of my 2001 model car would not operate. I, as the master of my domain, could lower and raise the windows, but the mere passengers could not.

Since passenger comfort is my #1 priority, this needed to be fixed by the time the countess returns to the castle.

The car has a lockout switch for some inane reason that allows the driver to prevent the kids from playing with the windows. The switch is highly susceptible to corrosion and then it behaves as if the lock is ON all the time.

So with a basic understanding, I called a local repair shop and here was their advice

On a good day, the car is probably worth $1,500, but has less than 55,000 miles (17 year old car), so spending that much was at least worth considering options, so YouTube to the rescue

In no time, I have this video showing what a simple repair it is. Another amateur video shows the guy doing the same repair without even the screwdriver and using a part from a junk yard.

So the company who made the video will ship the part for $55 including shipping. Another company had the part for $45, and the brick and mortar companies that advertise on radio offer the part from $90 to $140

So I took the risk. The part arrived in 2 days via USPS. The window is fixed.

Here is what the old part looks like

The packaging says it was made in Taiwan, so I may well have voided my pre-Obama GM warranty.

Posted in Uncategorized | 3 Comments