Gas Pump Sticker Shock – Buy A Motorcycle

This past weekend I rolled the bike out of the garage to enjoy the blue sky and 59 degree weather.  Wow, it doesn’t get much better in the northwest for an early spring day!  Never mind that it snowed the very next day!

I headed to the local Shell station and as I topped off the gas tank I tried to recall which of the political candidates detailed how the oversupply in natural gas had caused its price to crash, and then, just when you thought they were about to blame Obama for destroying the income of all those poor natural gas folks, pivoted on a dime and used it as a supporting argument for why $2.50 a gallon gas is very do-able… right, just as the average price of gasoline has increased by 42 cents, from $3.36 to $3.78 per gallon since the beginning of the year.  And that’s from the U.S. Energy Information Administration, and it’s an average of all grades, all formulations, across all regions of the country.

Yet, somehow, the politicians know where there’s enough oil to cause a world oversupply, or something to drive the price down.   Huh?  All I know is that $4 a gallon “creates some very real challenges” for average American families and their household budgets.

The “drill baby drill” makes for a nice bumper sticker. But, the real answer, is there’s no quick fix.  Gasoline prices are linked very tightly to crude oil prices.  The rule of thumb is that a $1 increase in the price of crude produces a 2½-cent increase in the price of gasoline. Lately, gasoline prices have been linked most closely to the price of Brent crude, and since the beginning of the year Brent has gone up from $107 to $123, a $16 increase.   Clearly some of the price difference is also related to oil speculators on Wall Street. Sanctions on Iran may be hurting their ability to ship crude. Additionally, some analysts think that some of the price increase is driven by fear that Iran might cut off oil shipments entirely, or else slow or close the Strait of Hormuz. In other words, some of the pricing might be driven by fear, uncertainty and doubt (FUD).

Clearly demand for oil is pushing up against supply limits, and that’s a permanent condition.  And when supply and demand are tightly constrained, any small bump in demand or disruption in supply causes a big swing in prices for you and I. Last year it was the war in Libya that caused a price spike. This month it’s Iran. But it’s always something and it doesn’t take much anymore to produce a $30 swing in oil prices.

We need to change the conversation.

Yeah, I’ve read about the new shale oil finds in North Dakota too.  It might increase global supplies a bit, but probably not enough to make up for increasing demand from China and other emerging economies. Basically, prices are going to stay high for the foreseeable future.  Like it or not, this is our future.

I recommend buying a motorcycle!

Photo courtesy of Shell

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All Roads Lead To Nowhere

I’ve heard this stated many times before… “When the revolution comes, they’ll not only want to know what side you’re on, but what side you’ve been on.”

I’m reading about the Occupy Wall Street (OWS) and watching the “Occupy Portland” protests skeptically. The protesters in Portland (estimated by police to be about 5000) gathered in Pioneer Courthouse Square in downtown Portland yesterday after marching from the city’s waterfront.  With so few news outlets in the northwest, we’re not quite sure what these protesters want.  Some say they want Obama re-elected, but claim to hate “Wall Street.”  You know the same Wall Street that gave its largest campaign donation in history to Obama, who in turn, bailed out the banks and made Goldman Sachs what seems like the 4th branch of the government!

99%

The one thing we do know is they’re angry, that 1% have all the money and they’ve got next to nothing and believe they are the 99%.

People are hurting. This is not a one party issue. This is a human issue. This is a fight over the future of America.  I’m not saying you can’t be rich, but you’ve got to pay your taxes.  How much should they be?   Let’s start the debate.  However, when people are losing their homes, their jobs, everything they’ve saved, and you don’t exhibit compassion, you don’t reach down to help them, then you’re on the wrong side.

We all know friends or have family members who have worked really hard all their life only to lose their home and get no support from the banks.  The banks are on the wrong side.  Greedy real estate bankers loaned money to anyone who could “fog a mirror” which then cratered the housing market and is now helping bankrupt the country.  Then they demanded taxpayers bail them out, a demand that complicit, corrupt politicians (yes, of both parties) were only too happy to oblige.

Occupy Portland

And, like most of the protestors I’m fed up with the political gridlock in Washington.  Both sides stand in the way of change.  At this point I don’t see any difference between George Bush than when Obama was elected.  The middle-class is worse off.  The gap between rich and poor is alarming. Because it stifles ambition. Why make the effort if you can’t get ahead?  And if you think the American Dream still exists, you probably live in Europe, the odds of going from the bottom to the top are much more difficult.

And suddenly all of this is a hot issue?!  Huh?

Some politicians and members of the media have chastised the protesters suggesting that they should stop protesting and go get a job or should instead start companies so they can help form a less self-involved, more gregarious and forward-thinking American capitalism.  Yeah, that’s the ticket.  Slam the folks trying to shed some light.

These people aren’t against the system. Most are not lazy people sitting around looking for a handout.  They don’t want to bring down America. They just want some sense of fairness restored to the system as it is, and they want a chance to participate and be heard. Instead, they’ve been marginalized by corporate money and ripped off by their banks and financial institutions.  They’ve been promised that hard work and a good education are what it takes to succeed, then slammed by a lack of opportunities, then told by sneering political candidates that if you’re poor, well it’s they’re own fault. It’s not really surprising that things have reached a boiling point.

This isn’t about protests; it’s about how banks, corporations and corrupt government policies are disenfranchising and bankrupting everyday Americans.  The protests are about taking proactive steps towards rectifying — or at least shedding light on — that situation.

Since the Vietnam War, I’ve never seen anything like this as a form of political protest. It’s wrenching, honest and true.  Personally, I can’t stop thinking about this guy,

Photos courtesy of AP (Map), Oregonlive (Pioneer Place) and We Are The 99 Percent.

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Inside Job

“Forgive me, I must start by pointing out that 3-years after our horrific financial crisis caused by massive fraud, not a single financial executive has gone to jail, and that’s wrong,” stated Charles Ferguson as he accepted the Oscar for the documentary movie, ‘Inside Job’,  which explored the financial crisis of 2008-09.

And now a word from our sponsors – JP Morgan Chase, who ran a series of ads during the Academy Awards promoting and defending its’ small business and home lending practices.  At one point an ad even stated they would reconsider small business loans for those denied.

Talk about a ballsy “green washing” campaign and a bizarre spectacle to say the least.  It’s similar to when BP donated money to America’s WETLAN Foundation (a shell group established by Shell oil) who then partnered with a group called “Women of the Storm” to spread the message that U.S. taxpayers should pay for the damage caused by BP to the Gulf Coast.  Nowhere in the star-studded “Restore the Gulf” campaign is BP ever mentioned, but when this situation was ‘outed’ by the press – Shell along with primary “sustainability” sponsors Chevron, ConocoPhillips, Exxon Mobil, Citgo, British Gas, Spectra, Hornbeck, the America Petroleum Institute and BP – stated that the funds were for “purely scientific or ecological functions.”

Words matter.  The most powerful words have helped launch social movements and cultural revolutions around the world.  The right words at the right time can literally change history.

Harley-Davidson management could really teach JP Morgan Chase and BP a couple things about public relationships.  They understand that words matter and it’s not what you say, but it’s about what people hear.  The Global financial meltdown cost people their homes and jobs.  Many families were seriously hurt and like we now want to hear JP Morgan Chase defend their actions.  What the hell happened Mr. James “Jamie” Dimon?  You can’t be serious!  It’s clear that JP Morgan Chase could learn from Harley-Davidson who more than ever these days live the following phrases with their customers:

“No Excuses” – Of all the messages used by American business and political elite, no phrase better conveys accountability, responsibility and transparency.  This phrase generates immediate respect and appreciation.

“Uncompromising Integrity” – Of all the truthiness words, none is as powerful as “integrity,” but in today’s cynical environment, even that’s not enough.  People need to feel that your integrity is absolute.

If you are not enraged by the JP Morgan Chase advertising activity then you’re not paying attention.

Photo courtesy of Wall Street.  Mr. Ferguson further explains his Oscar comments HERE.

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What Harley-Davidson Exec’s Want For Christmas

Santa wasn’t good to the motorcycle industry in 2009.  A weak economy, company layoffs, a housing melt-down, credit freeze, higher manufacturing costs and an ever discriminating consumer to boot.  As Harley-Davidson executives ponder over what happen this year, I can’t help but believe there are some major things on their wish lists to Santa.  So I’ve taken a scientific (parody alert!) guess of what some of H-D’s top executives want for Christmas:

Keith Wandell, CEO, Harley-Davidson: I got the head honcho job with the industry’s most iconic motorcycle manufacture in history, that has a cult-like following, with vendors tripping all over themselves to copy what we’ve done and I didn’t even have a motorcycle endorsement. I can’t think of anything more to ask for.  Oh wait, all those government stimulus funds – listen up Santa, I’ve been to the White House twice for dinner.  Have I not been nice enough?  Please let the spinner land on my project.

Mark-Hans Richer, Sr. VP & Chief Marketing Officer:  What the ho?  Please, Santa send us Tiger Woods!  As the leader of the world’s foremost authority on brand marketing, our team of cutting edge hoo-ha marketers developed a new strategy with Tiger as the spokesperson!  It’s set to appeal to the outlaw in every man.  We plan to dump that “ludicrous” campaign in favor of “Night of the Tiger”…complete with an exclusive Elin ghost flame paint scheme…

Bill Davidson, VP Core Customer Marketing: Please Santa let 2010 be the year for H-D in professional motorcycle racing.  Nothing but wins – in the dirt or drag or NHRA Pro – whatever it says on my t-shirt. Wait, can you also help people forget about that botched firing of Anne Paluso.  Really our plan is to go racing – go “team scream” or something like that.

John Olin, CFO: Motorcycle sales!  Santa it’s not my fault.  Please let me milk this “new in my job” for just a while longer.  What do they expect?  Miracles on Juneau Avenue!  Doesn’t it matter that I’ve been here less time than Keith?  I do have a motorcycle endorsement.  And, my calculator is newer than Lawrence’s!

Matthew Levatich, President & COO: Santa please get the Wisconsin Department of Transportation to approve and recognize my heroic role in getting the special license plate commemorating Harley-Davidson through the political red-tape as the state’s official motorcycle.   Yep, 2010 is shaping up to be a good performance review!  Memo to Enrico… get the bottle of Chianti ready!

Lawrence Hund, President & COO of H-D Finance: A new platinum edition HP 12C calculator.  The minus button on my last one quit working.

Gail Lione, EVP & General Counsel: Santa please tell us who is behind that NWHOG?!  Send us that macrant email address.  We have an important legal document gift we wish to serve send over to Northwest Harley Blog.

Paul James, Harley-Davidson Company Spokesperson: Please let me graduate the training class called “If the dream is big enough, the facts don’t matter” — a.k.a. the Mohammed Saeed al-Sahhaf school of bubbling optimism to distract the media and bloggers with superfluous BS so they ignore our fundamental problems.

James McCaslin, EVP Corporate Product Planning:  Santa can you get me a copy of Keith’s industry information?  I’ve never heard of “vendors tripping all over themselves to copy what we’ve done?”  I do remember a blogger at the 105th Anniversary trying to take a photo of a plant tour and we ran his butt right out the building before he was able to take pictures of the lunch room.

Karl Eberle, Sr. VP Manufacturing: Please make Indian go away. We are tired of being embarrassed in our own back yard when it comes to American cruisers and we don’t want that company bragging about their superior performance anymore.

Enrico D’Onofrio, Managing Director – MV Augusta: I already got what I wanted. Thanks for the early Christmas present H-D!  That sale notification surprised Wall Street… as you say in your home land… my golden shute is priceless. All this talk about motorcycles when the grape reigns supreme here in the zone of Tuscany… please pass the Chianti.

Jon R. Flickinger, President & COO of Buell: A job!  Also could you unload some of those dusty Buell’s in the warehouse?  My exit bonus is on the line.

Thanks for your readership during this past year. You may not have agreed with what I had to say at times, but it made for some lively discussions nevertheless. Merry Christmas, happy holidays and best wishes to you in 2010.

Photo courtesy of Flickr.

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Afghanistan Troop Surge Benefits Harley-Davidson

By this time you’ve already heard that our President, Barack Obama, a man who ran on a platform of hope and change, is getting us deeper into Afghanistan.  Isn’t Al-Qaeda in Pakistan?  And, if the Soviets couldn’t win there, why can we?  A country owned by China with disastrous financials (that’s us, in case you didn’t recognize your homeland).

If you join the armed forces to serve your country, to pay your bills, you’re entering Hotel California.  It seems you can never leave.  You jumpily wait for people to attack you or detonate IEDs.  Coming home to a country that pays you lip service, but doesn’t give a rip because people can’t find a job.  If you come home at all.  And if you do return, you’re likely traumatized.

Meanwhile, Goldman Sachs is paying record bonuses and their Chairman Lloyd Blankfein says the firm is doing God’s work.  Huh?  What deity does Mr. Blankfein pray to who wants to see the populace suffer?  Used to be Wall Street helped build America, now traders just profit off exotic investment instruments.

But there is good news (sarcasm alert!).  The enormous financial outlay of the 8+ year war has brought into sharp focus Bagram Airfield, where off-duty soldiers can obtain everything from Kyrgyz massages to purchase a BK burger.  Including a Harley-Davidson motorcycle.  According to AFP reports, the dealer for those away from the front lines sells about 4 motorcycles a month to U.S. servicemen.  With another 30,000 troops being deployed, and most of them set to take off or land on Bagram’s runway in route to fight the Taliban it means H-D should expect a sales increase proportional with the troop surge.  In fact, I just read a post on the H-D forum from a soldier who bought a 2009 Night Train yesterday.  Congrats Army_Train85 and thank you for your service!!

Obama’s speech wasn’t all that inspirational for me, but he did state (you can read the full text of his speech here) that sending the extra troops will cost the U.S. military $30 billion dollars this year — or $1 million for each newly deployed soldier.  That’s high-finance and hard for me to wrap my head around it.  In fact, it’s difficult for me to understand the cost ($28 a head) of each and every meal prepared for U.S. soldiers on the base cost more than most Afghans earn in a month.  That alone might explain the attraction to the Taliban-linked narco-terrorists.  Sigh. I wish there was a better way…

At any rate, as Bagram turns into a military “boom-town”…H-D is poised to take advantage.

Photo courtesy of Corbis/Shaun Schwartz.

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