"Only" 17 .9 Weeks

I hate to follow, but this article is too important not to reprint, Jeff Matthews had it on his site yesterday, the Wall Street Journal is the original source.

When supply is centrally controlled, the goods that government deems essential become cheaper and more readily available, the side effect is that the market for "non essential" services tends to dry up, leading to shortages and higher prices for those services. Unfortunately, it seems that many key medical procedures are non-essential in Canada. The article specifically cites long waits for cancer treatment, hard to imagine waiting that long for cancer treatment.

Waits for Canadian Health Care Shorten a Bit

By ELENA CHERNEY Staff Reporter of THE WALL STREET JOURNAL
October 19, 2005; Page A11

TORONTO -- After a dozen years of lengthening durations, Canadians awaiting medical care got access to treatment a little faster in 2005 than in the prior year, according to a survey of medical specialists by a conservative think tank.

The study by the Fraser Institute, which supports introducing more private-sector health care in Canada, comes as provinces grapple with potential fallout from a Supreme Court of Canada ruling last summer. In a decision on a Quebec case that could open the door to more private health care across Canada, the court found that long waits under the current public system violate Quebecers' rights by preventing them from paying for private care. Each of the 10 provinces runs its own health-care system, funded partly by federal payments.

Canadians waited an average of 17.7 weeks for treatment after their first visit to a general practitioner during the first three months of 2005, compared with 17.9 weeks in the same period last year, the study by the Vancouver, British Columbia-based Fraser Institute found. One reason for the incremental improvement was that Saskatchewan improved its performance by 7.8 weeks to 25.5 weeks. The study looked at 12 kinds of treatment, including cardiovascular surgery, cancer care and plastic surgery.

Timothy Burger
timothyb(at)timothyburger.com

Where is the Money Going?

We are now in the heart of earnings season, here are my quickies thoughts:

Bank of America reported a strong quarter, with net income up 9.6%. Results were good in all segments. A quick survey of smaller bank earnings is not as positive, with many smaller banks reporting lower or flat earnings year over year, indicating to me the power of the big banking brands.

However, BAC continued to see bad debt rise, now at .86%, up from only .57% last year.

UPS reports this morning, should be an interesting call. UPS is at the center of the global economy and a prime beneficiary of both increasing international trade and e commerce. Unfortunately UPS also operates massive truck and aircraft fleets that burn a lot of $62 oil. Up to this point UPS has done a good job of managing fuel costs, it should be interesting to see how they do this quarter.

Pfizer reported earnings down 52%. Amgen reported a decent quarter.

Kansas City favorite Cerner has a call this afternoon, should give a good progress report regarding the move to a modern medical records system.

Finally, my pick for the random but interesting call of the day: Cash America, at 3:45. Cash America is a company that does all the financial services you hope you never need: pawn shops, cash advances, check cashing, all the things that people may want more of when banks begin to tighten up credit card standards and raise interest rates.

If big banks are starting to see more bad loans, and changing the way they calculate minimum payments, I wonder how business looks for Cash America.

Timothy Burger
timothyb(at)timothyburger.com

A "Lifestyle alternative"?

This morning Safeway announced earnings, I normally don't follow Safeway, but this article caught my attention.

I don't think of Safeway as a "Lifestyle alternative" and I tend to think that Safeway deciding that convenience and low prices aren't how most of their customers decide where to shop for groceries is a very bad idea. I don't know about you, but when I need a gallon of milk I don't think of it as a chance to define my lifestyle, I tend to think where would be the easiest, cheapest place to get a gallon of milk. Unfortunately, it seems the managers at Safeway have decided the answer to that question is quickly becoming Wal-Mart.

Oct. 18 (Bloomberg) -- Safeway Inc., the No. 3 U.S. grocer,said
third-quarter profit fell to $122.5 million. Net income dropped
to 27 cents a share from $159.2 million,or 35 cents, a year earlier, the
Pleasanton, California-based company said today in a statement distributed by
Business Wire.Sales rose to $8.95 billion from $8.34 billion.

Safeway boosted marketing with a $100 million advertisingcampaign,
its largest ever, to lure upscale customers fromsupermarkets including Whole
Foods Markets Inc. and keep discounters such as Wal-Mart Stores Inc. at bay.
Chief Executive Steve Burd is remodeling many of the stores to differentiate
Safeway from its larger peers Kroger Co. and Albertson's Inc.

``They are trying to position themselves as a lifestyle
alternative, not just about lowest prices or most convenient,''said
David Dietze, president of Summit, New Jersey-based PointView Financial
Services, which manages about $95 million,including Safeway shares. ``It
does give them something to hang their hat on. They are still fighting
vicious competition from Wal-Mart.''

-Josh Fineman via Bloomberg

Timothy Burger
timothyb(at)timothyburger.com

Tuesday Morning Update

Coming Soon:

Politics: Fire Dennis Moore Straw Poll Winner David Lindstrom be the man to finally unseat Dennis Moore.

Investing: A value stock, from Jim Cramer, really?

Today's Highlights:

John Mauldin's Outside the Box:

"Influenced by natural disasters, all interest rates moved higher in the third quarter. This late summer/early fall backup in long term rates should be viewed as a transitory upshift in inflationary expectations that will be quickly reversed in the ensuing quarters. Although energy prices have entered uncharted waters, Fed authorities have left no doubt that the price increases will not translate into a generalized inflationary environment.

Accordingly, additional Fed funds rate hikes should boost short term interest rates even as bond yields fall. Such a policy mix will expose the highly leveraged U.S. consumer to a tightening vice of lower discretionary income, higher interest payments, and reduced money and credit availability. Such basic considerations, of far broader significance than catastrophic weather events, ensure that the present slowdown in economic activity will persist and undoubtedly worsen in the quarters ahead."

Earnings Call Season:

In full swing over the next couple of weeks, so many calls, schedule here.

Timothy Burger
timothyb(at)timothyburger.com

Roundup

The Wall Street Journal reports this morning that a Delphi worker in the US costs on average $65 per hour, while a Delphi worker in China doing the same work costs $3.

Refco in negotiations to sell of part or all of the company, private equity firm JC Flowers seems to be in the lead.

Barron's reports that my former employer, UBS now ranks as the number three private bank in the US, behind only Merrill and Citigroup.

Timothy Burger
timothyb(at)timothyburger.com