What are we supposed to do? Kraft foods made 540 MILLION DOLLARS in a quarter and they are talking about the need to increase prices of its products in order to offset rising commodity/ingredient costs? Are you kidding me? And why? Because 'analysts,' the most useless, pointless people in the world, call for the company to hit certain price targets? This is ludicrous. When will it be enough? When the company makes 800 million? 2 billion? 10 billion?
Analysts - or Wall Street really do rule. A brother-in-law, who works for Conoco, said he could make the company much more money - if he had an assistant - but WS refused to sanction the cost of an assistant to this brilliant man who has already made gazillions for this company. Wall Street does rule.
Davemiehl, let's think this through:
Yes, Kraft made 540M, but that was on revenue of 13.7B - so about 4% margin.
Now, look at commodity costs increases. Input costs just for the last quarter alone rose 500M - equal to their profit. And prices have continued higher this quarter.
So, of course, Kraft has to raise prices. And it's nothing to do with greed - as you misguidedly implied. It's about surviving. If prices don't increase, Kraft loses money next quarter.
So guess what? They will raise prices. Just like Heinz, ConAgra and every other company that sells food.
Meanwhile even Algore now admits that using corn as fuel was stupid. Gracious of the fat pervert, after he`s made $50,000,000 off the Goreball warming scam.
I normally don't repost information that I have previously posted, but I am not sure you really get it. Almost the entire cost rise in all commodities that kraft uses (particularly grains) is being caused by CORN ETHANOL PRODUCTION.
When you light 40% of the nation's corn on fire, which is exactly what our government has mandated then the price tends to go up! We are burning up our food supply people and food producers with pricing power just pass the cost on down the line to you and me. Corn ethanol means more super high price corn and less soy, less wheat, meat, etc which raises the price of those commodities worldwide also. Corn ethanol has no environmental or economic benefit, yet we are making the stuff to 'buy off' farm state Senate votes for both parties! You say enough is enough -- I would agree...lets outlaw the production of ethanol from food sources like corn and watch the grocery bill come down. Please read below to see how you can make a difference.
To all fellow shareholders...please contact your representative or senator and ask them to outlaw production of ethanol from foodstocks including corn.
KFT uses a lot of corn and corn products, so the huge price rise in corn due to corn ethanol production is hurting KFT badly. But the problems with corn ethanol production go much deeper, and I think it is a very destructive policy for the U.S.
Not sure if everyone knows this, but this year in the US 40 percent of all corn production will be burned up into corn ethanol due to government mandates that were put in place by the farm lobby and big agribusiness. To me burning up food is immoral on many levels and our government shouldn't be subsidizing it.
Corn ethanol provides no economic or environmental benefit and it is only produced to "buy off" farm state votes with tax subsidies. In fact, no one would produce the stuff without the tax subsidy and mandates. Yet corn ethanol is actually more environmentally destructive than fossil fuels as the EPA recently pointed out. We are dumping huge amounts of pesticide, fertilizer, insecticide into our water supply and soil in the name of almighty corn. This year, about 6 million acres will come out of the conservation program (CRP) and plowed up and put into production, much of it marginal land that is important to wildlife -- a guy down the road from me recently cut down 40 acres that was previously classified forest to grow, you guessed it - more corn.
Corn ethanol is good for rich Iowa corn farmers, most of whom are multimillionaires, but it is a horrible policy for the average person. The corn ethanol lobby touts the thousands of jobs that the industry has created, yet it fails to mention the MILLIONS of jobs that have been eliminated or are put at risk due to dramatically higher corn prices and food costs. Oh, and by the way, next time you hear a farmer or member of the agribusiness lobby or land grant university (i.e. Purdue) mention how corn ethanol lessens our dependence on foreign oil, please politely point out to them that about 80% of ethanol in the U.S. is currently be exported! http://switchboard.nrdc.org/blogs/slyuts...
Again, as a KFT shareholder you can make a difference by lobbying your representative and senator and becoming an activist AGAINST corn ethanol and its powerful lobby. You can also lobby KFT management to become more vocal in their opposition to current US corn ethanol policies.
No doubt. People complain about companies and making profits (and providing those same people with all the creature comforts since they came out of caves) when in reality they should be complaining about how gov't ruins lives by providing subsidies for some industries and not others (ethanol), costs jobs by manipulating markets, destroys savings with the FED, causes the largest housing bust ever with Fannie Mae and Freddie Mac ... and the list goes on and on and on.
it is never "enough"
Wall Street always wants more. more than last year, more than last qtr. more, more then even more. then
when your growth slows...they beat the crap out of your company.
nothing new here.
Companies have to make money so they can reinvest in the company for future success (or failure if they don't reinvest and lose to businesses that do).
It is called capital expenditures and they are not expenses in the current quarter.
That is why the oil companies don't make anything near what most people who do not understand business think they make.
The same goes for most businesses. Warren Buffett understands this concept well and is one reason he has done so well as an investor over the years.