Received: from nobody by stodi.digitalkingdom.org with local (Exim 4.91) (envelope-from ) id 1gz1mX-00051B-6b for lojban-newreal@lojban.org; Wed, 27 Feb 2019 08:10:05 -0800 Received: from mail-3-191.rch001.net ([52.124.3.191]:42737 helo=mail-1-191.rch001.net) by stodi.digitalkingdom.org with esmtps (TLSv1.2:ECDHE-RSA-AES256-GCM-SHA384:256) (Exim 4.91) (envelope-from ) id 1gz1mR-00050C-Vk for Lojban@lojban.org; Wed, 27 Feb 2019 08:10:04 -0800 From: "Martin Foner" To: "Lojban@lojban.org" Reply-To: Subject: Keeping Publishers in Business Since 1995 X-BPS1: 7030275 Feedback-ID: 2272909:e3f358ff3e2f409298df36d6dac03a14:marketing:reachmail X-BPS2: 73291 Message-ID: <5f6cfb57-e145-440c-8df5-9e23da14beb2@a.sc02.rmdlvry001.com> List-Unsubscribe: , List-Unsubscribe-Post: List-Unsubscribe=One-Click X-Mailer: RM Mailer (v5.4.949.0) MIME-Version: 1.0 Content-Type: multipart/alternative; boundary="=-LHhmKS471K63wUk7wQ2VJg==" Date: Wed, 27 Feb 2019 10:10:00 -0600 X-Spam-Score: -1.9 (-) X-Spam_score: -1.9 X-Spam_score_int: -18 X-Spam_bar: - This is a multi-part message in MIME format. --=-LHhmKS471K63wUk7wQ2VJg== Content-Type: text/plain; charset=utf-8 Content-Transfer-Encoding: quoted-printable Having trouble viewing this mail? Click here to view it in your browse= r. http://link.rm0004.net/v/R0WNvjfrmE7CU9y63Xc_Yg2 Make sure that you always get our messages: Add martin@ppgcpublishers.= com to your contacts. Click here to unsubscribe or update your email address. http://link.rm0004.net/subscription/?t=3DR0WNvjfrmE7CU9y63Xc_Yg2 Martin Foner's Publishing Newsletter Volume 24, Number 5 Because You're Serious About Publishing Success... OR You're Not Keeping Publishers in Business Since 1995 Hello, Everyone... Survival in business, as in the publishing business, is far more than = increasing revenues and reducing costs. It includes understanding issu= es like recessions, currency, international copyrights, day to day bus= iness operations, politics, and even new tax laws that will impact you= whether income or sales tax. So, with my long personal history as a T= ax CPA specialist and financial advisor, I often have sidebar commenta= ry on these issues as well as publishing concerns. Somewhere later in this newsletter I am going to speak about why Ms. W= arren's "Wealth Tax" is the death knell for family wealth or sell out = wealth, capitalism in the US, if it gets that far; and why AOC made a = fatal business blunder that we should work to avoid when thinking abou= t relocating a business. MORE DETAILED REVENUE ENHANCING IDEAS FOR PUBLISHERS COMPUTING BREAKEVEN Do you remember in the last issue when I asked this: Can you run your company on what is left over? How do you know? Have y= ou run the numbers every month to figure it out...and to determine wha= t you have to do to increase your revenues to the point where you brea= k even? Do you even know what your break even point is? By the title and for t= he entire company each month? If you can't rattle off these numbers, or at least go to an Excel shee= t and read them off from there... you are likely already in trouble. After the last issues, I got many inquiries as to how you figure out "= breakeven". Now all of us should really know this, but since it came u= p more than a few times, maybe a quick lesson would be in order. You d= on't have to admit reading this article if anyone asks you! The subject of computing breakeven could easily take three or four new= sletters, so I am going to do one very simple example. If this makes s= ense, then you are on your way, if not, then I am sure I will hear abo= ut it and work at offering even more detail to explain the subject. Breakeven means your revenues EXACTLY cover your expenses. Thus if you= r business were 100% cash in and cash out, at the end of the month you= would have EXACTLY zero left over. Ok, let us start with cost of sale= s, then expenses, and this will work us backward to the question of wh= at revenues have to be to achieve this position. Let us assume for the moment that your costs of sales, meaning your bo= oks, all cost you $4 each to print, ship, and pay royalties. Likely $2= .50 to print, $.50 to ship, and $1.00 royalties. If you are sending on= esies, then your shipping is through the roof; if you are sending ten = or more per order, then you are getting closer to this per item cost. Now, let us assume your monthly overhead is nominal. Rent, utilities, = office, computer, website, banking, marketing, telephone, everything, = but NOT including a salary for yourself at this point, comes to $4,000= a month. We don't include a salary for you since you don't get one un= til the company is doing better than breakeven. And yes, we could get = into fixed and variable expenses, but to keep it simple, I am simply s= tating an overall monthly number. Let us also assume you have ten books in your line, all retailing for = $20., and wholesaling for $9. each. Now, working backward, if your cost of sales is $4 and your wholesale = revenue is $9, then you are making a $5 profit on each sale. Thus, it = would take 800 units at wholesale to achieve $4,000. Voila! You are at= breakeven. If your sales are roughly 50/50 retail on site and wholesale, your alg= ebraic formula becomes 5X + 16X =3D $4,000, where X is the number of u= nits to breakeven of $4,000. Thus, roughly 191 units of each will get = the job done: $5 profit x 191 units =3D $955=C2=A0 plus $16 profit ($20 less $4 cost= ) x 191 units =3D $3,056 $955 + $3,056 =3D $4,011... $11 over breakeven. And, of course, if you ONLY sell on your site at retail, then 250 unit= s will get you there. Yes, it is a big difference, even in small numbers, between selling re= tail and selling wholesale. This is why you have to have a Strategic P= lan to decide if you are doing one, the other, or both. You have to se= ll OVER three times as many books to breakeven at wholesale. And of co= urse that assumes you are paid timely for them and never run into a Ba= ker & Taylor buy/return buy /return cycle and earn nothing from them. = Watch that carefully. If you want to add some 'salary' or 'draw' for yourself to the equatio= n, you now know how to do that and make the computations. DIVIDING A LARGE LOSING REVENUE BOOK INTO SMALLER AND PROFITABLE PIECE= S, PHYSICAL OR EBOOK Why this isn't obvious to anyone who has been in the industry for more= than about two weeks, is way beyond me, but here goes. Let's assume y= ou have a reference title, or a title with multiple authors on multipl= e subjects, or a title that just seems to cover EVERYTHING about a spe= cific topic. Likely it is 400 pages or more and could be upwards of 60= 0 pages. You are trying and failing to get the $49 to $69 price point = that the book's cost and effort and information requires. You pre-sold. You didn't? We'll talk about that in the next issue. You= marketed; you worked like hell, pushed your authors, and got good rev= iews. Unfortunately, an exhaustive reference work on mid century Briti= sh collector automobiles just isn't cutting it in the marketplace. Now, what is interesting is that the book seems to have about six chap= ters on each of five marques: Rolls-Royce, Bentley, Jaguar, MG, and As= ton Martin. So, isn't it obvious that if you truly believe the subject matter is w= orthy, and the information is worthy, and the pictures are worthy, and= the market is there (you did do your marketing research didn't you, b= efore signing this book?...you didn't... ok one more thing we need to = cover shortly)... then it is worth a shot to chop the big book down in= to five smaller titles, one covering each marque, with about six chapt= ers in each. Instead of 500 pages, you now have five books of roughly 100 pages eac= h. If you feel the need to bulk each of them up, you may, but if you d= on't want to make much more investment, then don't. The $49 book will = now sell in five "pieces" for $14.95 per piece... ($9.95 pre-sale... o= k, we will discuss that too). And of course, the entire volume is stil= l available, since you have plenty in the warehouse, for the $49 price= . Notice how if someone buys all five pieces it has cost them $75? Yes, you will have to reprint, or POD, or whatever, five different boo= ks and covers. BIG DEAL! Do you want to recover your investment or not= ? Of course, again, this assumes you have done your homework and the f= ive books will have some market traction, unlike their parent title. A= nd at $14.95 instead of $49, of course you have a much better shot. As physical books OR eBooks (and you know I am not fond of eBooks but = some of you live and die by them) the deal is pretty much the same unl= ess you are one of those $2.99 for everything eBook sellers. You gotta= get rid of that mentality! In the field of collector automobiles, physical will outsell eBook by = 5 to 1 or 10 to 1... just saying. So I would risk the pre pub work to = do the file splits, five quick covers, and get the darn things into pr= e pub sale ASAP since all the work is already done. Normally, with new= titles, I hold up on pre press until I have a solid response to my ma= rketing and sales efforts (something I have championed for a long time= ... I call it the Bennett Cerf rule), but since I am already done with= pre press, then forward movement is warranted. Again... this program works well with any big book, heavy page count, = expensive, that you can divide easily and market the pieces individual= ly. SO, yes, even if the main title is successful, after a year or two= you are welcome to do the dividing and reintroduce the product into t= he marketplace in pieces. Just remember, some customers will still wan= t the whole thing once they are solicited of the pieces, so make sure = to have some inventory of the large book available. As always, if you have questions, comments, don't understand something= , or have a different take on a subject... my direct email is=C2=A0 mf= oner@nplconsult.com mailto:mfoner@nplconsult.com =C2=A0. Feel free to = contact me, as many have done each issue in the past for 24 years now.= Keep it clean, spare me the bashing, I am here to advise and help, no= t jam my ideas down your collective throats. Above all, my recent goal= over the last twenty five years or so is to work hard to keep the pub= lishing industry relevant. I intend to continue. And yes, if you feel you have questions or wish to discuss your own si= tuation with me, in terms of Strategic Planning, improving your revenu= es, profitability, growth, Exit Strategy, or whatever... I am happy to= do so, and beyond, would be happy to be your publishing consultant, f= or a few hours, a day, or long term, and with my 40+ successful years = in publishing, guide you to achieving your own Strategic Goals in publ= ishing. Simply email me at=C2=A0 mfoner@nplconsult.com mailto:mfoner@n= plconsult.com =C2=A0. I have been located in sunny Southern California= now for the last seven years. If you are close by, we can arrange to = meet. COMMENTARY - WARREN I think it is very interesting that I did have a few people call me cr= azy from my last Commentary... at least people are reading it. That is= most certainly your business to decide. My job is to bring these issu= es to your attention. Speaking of... Ms Elizabeth Warren is running for President. She is fl= oating the idea of a Wealth Tax. If she decides to pursue this piece o= f communist insanity, we should collectively float her out of the race= ASAP. Why does it matter to us as publishers? Well, for the few of us who wi= ll ever get to sell out with some personal wealth, it could be an issu= e. But this one is for the greater good of business everywhere and the= continuation of the capitalist system in the United States. Failing t= his, we WILL see business and commercial destruction of unbelievable p= roportions if this concept becomes law. Briefly, she wants to tax, ANNUALLY, 2% of anyone's wealth (everything= they own at retail value, cars, paintings, gold, houses, stock, busin= esses, everything) who has wealth valued at $50 Million or more. Doesn= 't apply? Not today. But if this gets in, like every other tax scheme,= the number will keep coming down and eventually hit $10 Million just = about the time 10-15 years from now when you just might sell your comp= any for $4 or 5 Million and have a house or two and some savings and B= INGO... you're next! Here, in a paragraph, is why it is so both communist and dangerous to = our society. Let's assume your company is worth $50 Million and you ho= ld stock and all your worth is in that stock. You get wealth taxed 2% = or $1 Million. You have to sell $1 Million of your stock to pay the ta= x. But likely that stock has a basis of zero if you were the founder. = And that means you will pay an ADDITIONAL TAX of $200,000 just to be a= ble to pay the wealth tax. This pattern continues and in 20 years, HAL= F of your worth is gone! And to whom and for what? It is more than enough to pay income tax in your income. A wealth tax = is nothing more than the government coming to your home, as they will = to make an assessment of your real worth and taking your property at t= he point of a gun. Ms. Warren's overall objective is to destroy wealth wherever she sees = it and redistribute it to everyone else. That is the definition of Com= munism. She is free to call herself a Democratic Socialist, but unfort= unately, if she pursues this, she becomes Little Putin and should be d= ismissed as quickly as humanly possible. COMMENTARY - AOC It is most unfortunate that Alexandria Ocasio-Cortez can't seem to sto= p her mouth before her brain gets into gear. I do believe she has a fu= ture in politics, but her background as a barista is showing. And righ= t now, is showing heavily whether the media is ragging on her or not. = And they should be. She has made a fatal mistake in logic and we, as business people shoul= d take note not of what she did wrong, but of the lesson of not moving= into places where we might not be welcome. No, we aren't Amazon, and = most of us aren't going to get any tax incentives to move our business= es, but even if not, if we need to move, it is VERY important to make = sure wherever we're going, we are welcomed. THIS is the takeaway of AOCs stupidity, not her actual stupidity. What she said and what she missed is basic Business and Taxation 101. = If she doesn't soon learn this lesson, she will not get a chance to be= reelected. Her constituents will figure out that her platform has a h= ole in it and new jobs, new businesses, buildings, and activity are al= l falling through that hole. What she said was that there are better ways to spend the $3 Billion t= hat Amazon was getting in tax incentives, and they shouldn't be given = to Amazon. What she missed was that it was Amazon's OWN $3 Billion tha= t they were going to get BACK. No one was giving them dime one up fron= t (or maybe just a few million in some infrastructure credits). They h= ad to PAY the $3 Billion and then they would get it back. She didn't g= et this really critical basic piece. There isn't $3 Billion sitting around in an account waiting to be spen= t on Amazon. They have to create the taxes and then get them back. Eve= n after having this explained to her, she continued to double down on = her faulty logic. The overall 10 year projection was about $27 Billion in taxes and spen= ding for New York. $27 Billion! Bring Amazon here! Put $27 Billion int= o this economy before it has issues (see next article). If she is so s= tupid she doesn't get it, she needs to hire an economist or advisor wh= o does get it. She almost single handedly cost New York 25,000 jobs an= d $27 Billion in taxes and activity. I hope she is proud of herself. Oh, I'll have a Double Iced Coffee. DOES A THREAT OF A RECESSION BOTHER YOU ENOUGH TO READ THIS ONE? I hope so. News flash... one is coming. And how you prepare for it wil= l determine whether you are still in business on the other side. So ye= s, this is a biggie! The Chairman of the Fed just testified to Congress... does it twice a = year... on the state of the economy and what the Fed's plans are going= forward. Originally, the Fed had planned for more small interest rate= increases to balance out prior holding back to ensure the economy was= doing well. Well, his report this week is in line with what many/most economists a= re saying. Read carefully and either heed or ignore at your own peril. The economy is doing fine just now but multiple signs indicate structu= ral weakness in many parts of the market such that we (the Fed) will b= e holding off on any further interest rate increases until such time a= s we believe the economy is again moving forward. Not surprisingly, he= cited the trade wars and potential multiple fallout scenarios, loomin= g data that suggests a recession in 2020 or 2021, housing data that do= es not look positive, and other indicators. Separately, the bulk of economists who do predicting believe we are he= aded for a recession. About half say 2020 and half say 2021. All agree= that continued pounding of the trade war drum by the Administration d= emanding fairness could accelerate this timeline by six months to a ye= ar...meaning real damn soon! Housing is already getting kicked around if you watch the numbers. So, what does all this mean to us as publishers? Keep in mind that the overwhelming bulk of what we do is discretionary= spending for households and businesses. As well, recessions generally= mean immediate budget cuts for institutions such as libraries and col= leges and school systems. SO, if you plan to sell books to just about = anyone, you will be in trouble. No, it isn't you wont survive a recession... obviously many publishers= are still here after 2001 and 2008... but 2008 kicked a lot of ass. All I am saying is that if I can see it, and the economists can see it= , and the Fed can see it, then YOU had damn well better see it. Do wit= h this information as you please. If there are sufficient inquiries, I= will do a short series of articles on how to survive a serious recess= ion, likely reprints of articles I did in 2008 and 2009 when the big o= ne started and as we went through it. Times are different, products ar= e different, some marketing is different, but as always, you gotta sel= l something to someone to stay in business. Thanks for reading. Copyright Martin Foner, 2019. CAN SPAM Legal Information: There should be an unsubscribe button somewhere at the footer of this = email, but if there is not, simply email me directly at=C2=A0 mfoner@n= plconsult.com mailto:mfoner@nplconsult.com , and I will have you remov= ed from future emailings. If you don't unsubscribe, we will consider you as approving us to cont= inue to send you newsletters and related publishing information. If yo= u do not approve, you need to unsubscribe. NPL Publishing Consultants, a division of Professional Publishers Grou= p Corporation, Post Office Box 1010, Ventura CA 93002. www.nplconsult.com http://link.rm0004.net/go/R0WNvvGPqriNXARBFAtl7g2/ mfoner@nplconsult.com mailto:mfoner@nplconsult.com This email is being sent to Lojban@lojban.org. 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3D""

 

Martin Foner’s Publishing Newslett= er

Volume 24, Number 5

Because You’re Serious About Publish= ing Success… OR You’re Not<= /span>

Keeping Publishers in Business Since 1995

 

Hello, Everyone= …

Survival in bus= iness, as in the publishing business, is far more than increasing reve= nues and reducing costs. It includes understanding issues like recessi= ons, currency, international copyrights, day to day business operation= s, politics, and even new tax laws that will impact you whether income= or sales tax. So, with my long personal history as a Tax CPA speciali= st and financial advisor, I often have sidebar commentary on these iss= ues as well as publishing concerns.

Somewhere later= in this newsletter I am going to speak about why Ms. Warren’s &= ldquo;Wealth Tax” is the death knell for family wealth or sell o= ut wealth, capitalism in the US, if it gets that far; and why AOC made= a fatal business blunder that we should work to avoid when thinking a= bout relocating a business.

 

MORE DETAILED REVENUE ENHANCING IDEAS FOR PU= BLISHERS

COMPUTING BREAKEVEN

 =

Do you= remember in the last issue when I asked this:

 =

Can yo= u run your company on what is left over? How do you know? Have you run= the numbers every month to figure it out…and to determine what= you have to do to increase your revenues to the point where you break= even?

 =

Do you= even know what your break even point is? By the title and for the ent= ire company each month?

 =

If you= can’t rattle off these numbers, or at least go to an Excel shee= t and read them off from there… you are likely already in trouble.

 =

After = the last issues, I got many inquiries as to how you figure out “= breakeven”. Now all of us should really know this, but since it = came up more than a few times, maybe a quick lesson would be in order.= You don’t have to admit reading this article if anyone asks you= !

 =

The su= bject of computing breakeven could easily take three or four newslette= rs, so I am going to do one very simple example. If this makes sense, = then you are on your way, if not, then I am sure I will hear about it = and work at offering even more detail to explain the subject.

 =

Breake= ven means your revenues EXACTLY cover your expenses. Thus if your busi= ness were 100% cash in and cash out, at the end of the month you would= have EXACTLY zero left over. Ok, let us start with cost of sales, the= n expenses, and this will work us backward to the question of what rev= enues have to be to achieve this position.

 =

Let us= assume for the moment that your costs of sales, meaning your books, a= ll cost you $4 each to print, ship, and pay royalties. Likely $2.50 to= print, $.50 to ship, and $1.00 royalties. If you are sending onesies,= then your shipping is through the roof; if you are sending ten or mor= e per order, then you are getting closer to this per item cost.=

 =

Now, l= et us assume your monthly overhead is nominal. Rent, utilities, office= , computer, website, banking, marketing, telephone, everything, but NO= T including a salary for yourself at this point, comes to $4,000 a mon= th. We don’t include a salary for you since you don’t get = one until the company is doing better than breakeven. And yes, we coul= d get into fixed and variable expenses, but to keep it simple, I am si= mply stating an overall monthly number.

 =

Let us= also assume you have ten books in your line, all retailing for $20., = and wholesaling for $9. each.

 =

Now, w= orking backward, if your cost of sales is $4 and your wholesale revenu= e is $9, then you are making a $5 profit on each sale. Thus, it would = take 800 units at wholesale to achieve $4,000. Voila! You are at break= even.

 =

If you= r sales are roughly 50/50 retail on site and wholesale, your algebraic= formula becomes 5X + 16X =3D $4,000, where X is the number of units t= o breakeven of $4,000. Thus, roughly 191 units of each will get the jo= b done:

 

$5 pro= fit x 191 units =3D $955  plus $16 profit ($20 less $4 cost) x 191 units =3D $3,056

       =      $955 + $3,056 =3D $4,011… $11 o= ver breakeven.

 =

And, o= f course, if you ONLY sell on your site at retail, then 250 units will= get you there.

 =

Yes, i= t is a big difference, even in small numbers, between selling retail a= nd selling wholesale. This is why you have to have a Strategic Plan to= decide if you are doing one, the other, or both. You have to sell OVE= R three times as many books to breakeven at wholesale. And of course t= hat assumes you are paid timely for them and never run into a Baker &a= mp; Taylor buy/return buy /return cycle and earn nothing from them. Wa= tch that carefully.

 =

If you= want to add some ‘salary’ or ‘draw’ for yours= elf to the equation, you now know how to do that and make the computat= ions.

 =

 =

DIVIDING A LARGE LOSING REVENUE BOO= K INTO SMALLER AND PROFITABLE PIECES, PHYSICAL OR EBOOK

 =

 =

Why this isn&rs= quo;t obvious to anyone who has been in the industry for more than abo= ut two weeks, is way beyond me, but here goes. Let’s assume you = have a reference title, or a title with multiple authors on multiple s= ubjects, or a title that just seems to cover EVERYTHING about a specif= ic topic. Likely it is 400 pages or more and could be upwards of 600 p= ages. You are trying and failing to get the $49 to $69 price point tha= t the book’s cost and effort and information requires.

You pre-sold. Y= ou didn’t? We’ll talk about that in the next issue. You ma= rketed; you worked like hell, pushed your authors, and got good review= s. Unfortunately, an exhaustive reference work on mid century British = collector automobiles just isn’t cutting it in the marketplace. =  

Now, what is in= teresting is that the book seems to have about six chapters on each of= five marques: Rolls-Royce, Bentley, Jaguar, MG, and Aston Martin.

So, isn’t= it obvious that if you truly believe the subject matter is worthy, an= d the information is worthy, and the pictures are worthy, and the mark= et is there (you did do your marketing research didn’t you, befo= re signing this book?...you didn’t… ok one more thing we = need to cover shortly)… then it is worth a shot to chop the big= book down into five smaller titles, one covering each marque, with ab= out six chapters in each.

Instead of 500 = pages, you now have five books of roughly 100 pages each. If you feel = the need to bulk each of them up, you may, but if you don’t want= to make much more investment, then don’t. The $49 book will now= sell in five “pieces” for $14.95 per piece… ($9.95= pre-sale… ok, we will discuss that too). And of course, the en= tire volume is still available, since you have plenty in the warehouse= , for the $49 price. Notice how if someone buys all five pieces it has= cost them $75?

Yes, you will h= ave to reprint, or POD, or whatever, five different books and covers. = BIG DEAL! Do you want to recover your investment or not? Of course, ag= ain, this assumes you have done your homework and the five books will = have some market traction, unlike their parent title. And at $14.95 in= stead of $49, of course you have a much better shot.

As physical boo= ks OR eBooks (and you know I am not fond of eBooks but some of you liv= e and die by them) the deal is pretty much the same unless you are one= of those $2.99 for everything eBook sellers. You gotta get rid of tha= t mentality!

In the field of= collector automobiles, physical will outsell eBook by 5 to 1 or 10 to= 1… just saying. So I would risk the pre pub work to do the fil= e splits, five quick covers, and get the darn things into pre pub sale= ASAP since all the work is already done. Normally, with new titles, I= hold up on pre press until I have a solid response to my marketing an= d sales efforts (something I have championed for a long time… I= call it the Bennett Cerf rule), but since I am already done with pre = press, then forward movement is warranted.

Again… t= his program works well with any big book, heavy page count, expensive,= that you can divide easily and market the pieces individually. SO, ye= s, even if the main title is successful, after a year or two you are w= elcome to do the dividing and reintroduce the product into the marketp= lace in pieces. Just remember, some customers will still want the whol= e thing once they are solicited of the pieces, so make sure to have so= me inventory of the large book available.

 

As always, if y= ou have questions, comments, don’t understand something, or have= a different take on a subject… my direct email is = = mfoner@nplconsult.com . Feel free= to contact me, as many have done each issue in the past for 24 years = now. Keep it clean, spare me the bashing, I am here to advise and help= , not jam my ideas down your collective throats. Above all, my recent = goal over the last twenty five years or so is to work hard to keep the= publishing industry relevant. I intend to continue.

And yes, if you= feel you have questions or wish to discuss your own situation with me= , in terms of Strategic Planning, improving your revenues, profitabili= ty, growth, Exit Strategy, or whatever… I am happy to do so, an= d beyond, would be happy to be your publishing consultant, for a few h= ours, a day, or long term, and with my 40+ successful years in publish= ing, guide you to achieving your own Strategic Goals in publishing. Si= mply email me at mfoner@nplconsult.com . I have been located in sunny Southern California now= for the last seven years. If you are close by, we can arrange to meet= .

 

COMMENTARY - WARREN

I think it is v= ery interesting that I did have a few people call me crazy from my las= t Commentary… at least people are reading it. That is most cert= ainly your business to decide. My job is to bring these issues to your= attention.

Speaking of&hel= lip; Ms Elizabeth Warren is running for President. She is floating the= idea of a Wealth Tax. If she decides to pursue this piece of communis= t insanity, we should collectively float her out of the race ASAP.

Why does it mat= ter to us as publishers? Well, for the few of us who will ever get to = sell out with some personal wealth, it could be an issue. But this one= is for the greater good of business everywhere and the continuation o= f the capitalist system in the United States. Failing this, we WILL se= e business and commercial destruction of unbelievable proportions if t= his concept becomes law.

Briefly, she wa= nts to tax, ANNUALLY, 2% of anyone’s wealth (everything they own= at retail value, cars, paintings, gold, houses, stock, businesses, ev= erything) who has wealth valued at $50 Million or more. Doesn’t = apply? Not today. But if this gets in, like every other tax scheme, th= e number will keep coming down and eventually hit $10 Million just abo= ut the time 10-15 years from now when you just might sell your company= for $4 or 5 Million and have a house or two and some savings and BING= O… you’re next!

Here, in a para= graph, is why it is so both communist and dangerous to our society. Le= t’s assume your company is worth $50 Million and you hold stock = and all your worth is in that stock. You get wealth taxed 2% or $1 Mil= lion. You have to sell $1 Million of your stock to pay the tax. But li= kely that stock has a basis of zero if you were the founder. And that = means you will pay an ADDITIONAL TAX of $200,000 just to be able to pa= y the wealth tax. This pattern continues and in 20 years, HALF of your= worth is gone! And to whom and for what?

It is more than= enough to pay income tax in your income. A wealth tax is nothing more= than the government coming to your home, as they will to make an asse= ssment of your real worth and taking your property at the point of a g= un.

Ms. Warren&rsqu= o;s overall objective is to destroy wealth wherever she sees it and re= distribute it to everyone else. That is the definition of Communism. S= he is free to call herself a Democratic Socialist, but unfortunately, = if she pursues this, she becomes Little Putin and should be dismissed = as quickly as humanly possible.

 

COMMENTARY – AOC

It is most unfortunate that A= lexandria Ocasio-Cortez can’t seem to stop her mouth before her = brain gets into gear. I do believe she has a future in politics, but h= er background as a barista is showing. And right now, is showing heavi= ly whether the media is ragging on her or not. And they should be.

She has made a fatal mistake = in logic and we, as business people should take note not of what she d= id wrong, but of the lesson of not moving into places where we might n= ot be welcome. No, we aren’t Amazon, and most of us aren’t= going to get any tax incentives to move our businesses, but even if n= ot, if we need to move, it is VERY important to make sure wherever we&= rsquo;re going, we are welcomed.

THIS is the takeaway of AOCs = stupidity, not her actual stupidity.

What she said and what she mi= ssed is basic Business and Taxation 101. If she doesn’t soon lea= rn this lesson, she will not get a chance to be reelected. Her constit= uents will figure out that her platform has a hole in it and new jobs,= new businesses, buildings, and activity are all falling through that = hole.

What she said w= as that there are better ways to spend the $3 Billion that Amazon was = getting in tax incentives, and they shouldn’t be given to Amazon= . What she missed was that it was Amazon’s OWN $3 Billion that t= hey were going to get BACK. No one was giving them dime one up front (= or maybe just a few million in some infrastructure credits). They had = to PAY the $3 Billion and then they would get it back. She didn’= t get this really critical basic piece.

There isn&rsquo= ;t $3 Billion sitting around in an account waiting to be spent on Amaz= on. They have to create the taxes and then get them back. Even after h= aving this explained to her, she continued to double down on her fault= y logic.

The overall 10 = year projection was about $27 Billion in taxes and spending for New Yo= rk. $27 Billion! Bring Amazon here! Put $27 Billion into this economy = before it has issues (see next article). If she is so stupid she doesn= ’t get it, she needs to hire an economist or advisor who does ge= t it. She almost single handedly cost New York 25,000 jobs and $27 Bil= lion in taxes and activity.

I hope she is p= roud of herself. Oh, I’ll have a Double Iced Coffee.

 

DOES A THREAT OF A RECESSION BOTHER YOU ENOU= GH TO READ THIS ONE?

I hope so. News= flash… one is coming. And how you prepare for it will determin= e whether you are still in business on the other side. So yes, this is= a biggie!

The Chairman of= the Fed just testified to Congress… does it twice a year&helli= p; on the state of the economy and what the Fed’s plans are goin= g forward. Originally, the Fed had planned for more small interest rat= e increases to balance out prior holding back to ensure the economy wa= s doing well.

Well, his repor= t this week is in line with what many/most economists are saying.

Read carefully = and either heed or ignore at your own peril.

The economy is = doing fine just now but multiple signs indicate structural weakness in= many parts of the market such that we (the Fed) will be holding off o= n any further interest rate increases until such time as we believe th= e economy is again moving forward. Not surprisingly, he cited the trad= e wars and potential multiple fallout scenarios, looming data that sug= gests a recession in 2020 or 2021, housing data that does not look pos= itive, and other indicators.

Separately, the= bulk of economists who do predicting believe we are headed for a rece= ssion. About half say 2020 and half say 2021. All agree that continued= pounding of the trade war drum by the Administration demanding fairne= ss could accelerate this timeline by six months to a year…meani= ng real damn soon!

Housing is alre= ady getting kicked around if you watch the numbers.

So, what does a= ll this mean to us as publishers?

Keep in mind th= at the overwhelming bulk of what we do is discretionary spending for h= ouseholds and businesses. As well, recessions generally mean immediate= budget cuts for institutions such as libraries and colleges and schoo= l systems. SO, if you plan to sell books to just about anyone, you wil= l be in trouble.

No, it isn&rsqu= o;t you wont survive a recession… obviously many publishers are= still here after 2001 and 2008… but 2008 kicked a lot of ass. =

All I am saying= is that if I can see it, and the economists can see it, and the Fed c= an see it, then YOU had damn well better see it. Do with this informat= ion as you please. If there are sufficient inquiries, I will do a shor= t series of articles on how to survive a serious recession, likely rep= rints of articles I did in 2008 and 2009 when the big one started and = as we went through it. Times are different, products are different, so= me marketing is different, but as always, you gotta sell something to = someone to stay in business.

Thanks for read= ing.

© Martin F= oner, 2019.

 

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