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Costco Will Raise Membership Prices (Blame Walmart’s Sam’s Club)

The two warehouse clubs have seen their businesses grow due to the pandemic, but costs have also gone up.

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The two warehouse clubs have seen their businesses grow due to the pandemic, but costs have also gone up.

Walmart's (WMT) - Get Walmart Inc. Report Sam's Club just made the most careful price increase that any company could pull off. The warehouse club has raised its basic membership fee from $45 to $50 per year and its "Plus" membership from $100 to $110.

But, because the company understands the optics of raising prices at a time when consumers are hyper-conscious about rising costs, the increase comes with a pretty major caveat. Sam's Club will be giving existing members $5 or $10 in "Sam's Cash," essentially a gift card, on their next renewal.

That move dulls the blow of the increase and allows the company to raise prices for the first time in nine years for regular members and the first time since 1999 for Plus members without it actually causing a negative reaction.

Yes, new members who join after the increase takes effect on Oct, 17 will pay the higher prices, but anyone thinking about joining now has roughly six weeks to join before they would have to pay the higher price. This is Walmart making a very smart, long-range move that will minimize the impact on customers which should limit, if not eliminate, increased churn.

It's also a move that clears the way for the company's chief rival, Costco (COST) - Get Costco Wholesale Corporation Report, to do the same thing.

Ting Shen/Xinhua via Getty) (Xinhua/ via Getty Images

Costco Has Addressed Raising Membership Fees

Costco generally raises its membership prices every five-and-a-half years. The chain last increased the cost of joining in June 2017, putting it roughly in the ballpark of where it would communicate an upcoming price increase to members.

Currently, a Costco Gold Star membership costs $60 while an Executive Membership, which offers 2% back on most purchases (up to $1,000 annually), costs $120.

Costco Senior Vice President of Finance Bob Nelson, filling in for vacationing CFO Richard Galanti, addressed a possible price increase during the warehouse club's third-quarter earnings call.

"As we approach this five-and-a-half-year mark, there will be more discussions with Craig, Ron, and the executive team," he said. "But for today, we have nothing more specific to report in terms of timing. In addition, given the current macro environment, the historically high inflation, and the burden it's having on our members and all consumers in general, we think increasing our membership fee today ahead of our typical timing is not the right time."

Costco Will Likely (and Should) Raise Its Membership Fees

Costco has, like its rival, been very wary of the appearance of adding to its customers' burdens during an already financially stressful time. Sam's Club increasing its prices does give the chain some cover for its own increase, and offering a similar "cash back" incentive that makes the first increase not really an increase at all is a move the company could copy.

It makes more sense, however, for Costco, which still charges more than Sam's Club for both membership tiers, to announce an increase that goes into effect after the holiday season. That would give the company a more equal playing field with its rival in the fourth quarter while giving potential new members an incentive to lock in the current rates for the next 12 months.

It's hard to argue that Costco and Sam's Club don't offer members excellent value for the price of a membership. Both face higher costs and a small increase in membership fees is more than justified. Both chains are right, however, to approach the idea carefully and to give existing members a lot of notice.

Realistically, while the extra money has a meaningful bottom-line impact on both chains, its impact on customers -- even in strained economic times -- is very minimal. That's why Sam's Club won't experience much, if any, blowback from making the move and Costco should be able to follow.

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Spread & Containment

License Plates Could Be Printed On McDonald’s Bags To Stop Littering

License Plates Could Be Printed On McDonald’s Bags To Stop Littering

There’s been talk about McDonald’s in southwest Great Britain could print…

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License Plates Could Be Printed On McDonald's Bags To Stop Littering

There's been talk about McDonald's in southwest Great Britain could print car license plates on drive-thru bags to prevent customers from littering. 

"It's not clear exactly how the number plate would be printed on packaging, but it could be scanned onto the brown bags that contain the food," Daily Mail noted. 

Chris Howell, Swansea Council's head of waste, parks and cleansing, told a climate change corporate delivery committee meeting: 

"The Welsh Government has explored with McDonald's, or their franchises, whether or not they could print number plates of cars collecting takeaways from their drive-throughs with a view that that would discourage people from discarding their materials (litter)."

Howell said one of the biggest hurdles with fast-food companies is that if one chain adopts the climate initiative, customers will go to competitors that don't print license plates on bags. 

"If McDonald's do it, then people will just go to Burger King instead of McDonald's, because nobody wants to have their private details printed on that packaging." He added: "I think it's a really good idea but at the minute it's fraught with some difficulties." 

The nationalist political party in Wales, Plaid Cymru, first proposed the idea more than two years ago during the pandemic lockdown when party leaders noticed a spike in fast-food trash along city streets and highways. 

Welsh Government spokesperson told MailOnline:

"There are no current plans to introduce a requirement for drive-through restaurants to add vehicle registration details to fast food drive-through packaging.

"We are continuing to support Keep Wales Tidy with other initiatives to tackle roadside litter including their No Regrets campaign and their Adopt a Highway initiative."

Now 'the cat is out of the bag'. It's only a matter of time before governments start forcing fast-food companies to print license plate numbers on drive-thru bags. The dangers of this could be more surveillance, and who knows what corporations would do with license plate data if such a system were implemented. 

Tyler Durden Sat, 11/26/2022 - 18:00

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Energy is the master resource but it could be Bitcoin that reigns supreme

Nothing shines a light on the importance of energy as much as a fast-approaching winter.
The post Energy is the master resource but it could be Bitcoin…

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Nothing shines a light on the importance of energy as much as a fast-approaching winter. When the temperature drops, the scarcity of energy becomes obvious and global efforts to preserve it begin.

This year, the fight for energy is more aggressive than it’s ever been.

The fiscal and monetary policies set in place during the COVID-19 pandemic caused dangerous inflation in almost every country in the world. The quantitative easing that set out to curb the consequences of the pandemic resulted in a historically unprecedented increase in the M2 money supply. This decision diluted the purchasing power and led to an increase in energy prices, sparking a crisis that is set to culminate this winter.

CryptoSlate analysis showed that the E.U. will most likely be the one hit the hardest by the energy crisis.

The European Central Bank (ECB) has been struggling to keep core inflation down this year. The Core Consumer Price Index (CPI) began to increase substantially in 2021 due to the pandemic both in the U.S. and the E.U.

The U.S. has seen its Core CPI decrease sharply since its culmination in February and posted better-than-expected results last month. However, Core CPI in the Eurozone has continued to increase throughout the year and currently shows no sign of stopping.

Graph showing the Core CPI in the U.S. and the Eurozone from 2017 to 2022 (Source: The Daily Shot)

A similar increase in Core CPI can also be seen in Japan and the U.K. One of the factors that may have contributed to their monetary instability is a lack of investment and support for commodities like oil and gas. Widespread efforts to switch to renewable sources of energy led to a decrease in oil and gas purchases in the E.U. and the U.K.

In contrast, the U.S. and Russia have been investing heavily in oil and gas and promoting innovation in the field.

Looking at the value of fiat currencies against the U.S. dollar further confirms this impact.

The Russian Ruble and the DXY have both increased in value in the past two years, while the euro, British Pound, and Japanese Yen have all seen their Dollar value decrease.

global fiat currencies
Graph showing DXY, GBP, EUR, JPY, and RUB and their value against the U.S. dollar (Source: TradingView)

With rising inflation and a seriously weakened currency, the E.U. will have a hard time competing for oil and gas on the global market. Natural gas producers warned that almost all long-term contracts for natural gas coming out of the U.S. have been sold out until 2026. Until then, when a new wave of natural gas supply is expected to come, the E.U. will have to compete with Asia for the limited supply and swallow the high gas price.

All of this uncertainty could have a positive effect on Bitcoin. While the broader crypto market struggles to remain afloat after the FTX fallout, Bitcoin has positioned itself as a pillar of stability in a market plagued with bad actors. Devalued fiat currencies could push retail investors away from safe-haven assets like gold and commodities and towards an asset like Bitcoin.

The post Energy is the master resource but it could be Bitcoin that reigns supreme appeared first on CryptoSlate.

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Government

‘Forgetful’ Fauci Could Not Recall Key Details Of COVID Crisis Response During Deposition: Louisiana AG

‘Forgetful’ Fauci Could Not Recall Key Details Of COVID Crisis Response During Deposition: Louisiana AG

Authored by Zachary Stieber via The…

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'Forgetful' Fauci Could Not Recall Key Details Of COVID Crisis Response During Deposition: Louisiana AG

Authored by Zachary Stieber via The Epoch Times (emphasis ours),

Dr. Anthony Fauci said he could not recall key details about his actions during the COVID-19 pandemic, according to one of the officials who questioned him on Nov. 23.

Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, speaks in Washington on May 11, 2022. (Alex Wong/Getty Images)

Fauci, the director National Institute of Allergy and Infectious Diseases (NIAID) since 1984 and President Joe Biden’s chief medical adviser, was deposed by Louisiana Attorney General Jeff Landry and Missouri Attorney General Eric Schmitt, both Republicans.

“It was amazing, literally, that we spent seven hours with Dr. Fauci—this is a man who single-handedly wrecked the U.S. economy based upon ‘the science, follow the science.’ And over the course of seven hours, we discovered that he can’t recall practically anything dealing with his COVID response,” Landry told The Epoch Times after leaving the deposition. “He just said, ‘I can’t recall, I haven’t seen that. And I think we need to put these documents into context,'” Landry added.

“It was extremely troubling to realize that this is a man who advises presidents of the United States and yet couldn’t recall information he put out, information he discussed, press conferences he held dealing with the COVID-19 response,” Landry added later.

Fauci and NIAID did not immediately respond to requests for comment.

Landry declined to provide more details about the deposition until it is made public, which will happen at a future date. But he said officials would be able to take some of what they learned to advance their case.

Landry and Schmitt sued the U.S. government in May, alleging it violated people’s First Amendment rights by pressuring big tech companies to censor speech. Documents produced by the government in response bolstered the claims. U.S. District Judge Terry Doughty, the Trump appointee overseeing the case, recently ordered Fauci and seven other officials to testify under oath about their knowledge of the censorship.

Doughty concluded that plaintiffs showed Fauci “has personal knowledge about the issue concerning censorship across social media as it related to COVID-19 and ancillary issues of COVID-19.”

While Fauci qualified as a high-ranking official, the burden of him being deposed was outweighed by the court’s need for information before ruling on a motion for a preliminary injunction, Doughty said.

Wednesday was the first time Fauci testified under oath about his interactions with big tech firms, including Facebook founder Mark Zuckerberg.

Before the deposition, Landry said in a statement, “We all deserve to know how involved Dr. Fauci was in the censorship of the American people during the COVID pandemic; tomorrow, I hope to find out.”

“We’re going to follow the evidence everywhere it goes to get down to exactly what has happened, to get down to the fact that our government used private entities to suppress the speech of Americans,” Landry told The Epoch Times.

Louisiana Attorney General Jeff Landry (C) speaks during a press conference at the U.S. Capitol in Washington, on Jan. 22, 2020. (Drew Angerer/Getty Images)

Great Barrington Declaration

Jenin Younes with the New Civil Liberties Alliance, another lawyer representing plaintiffs in the case, said that Fauci claimed he did not worry about a document called the Great Barrington Declaration.

Penned in October 2020, the document called for focused protection on people most at-risk from COVID-19 while rescinding the harsh restrictions that had been imposed on children and others at little risk from the disease. Two of its authors, Dr. Jay Bhattacharya and Martin Kulldorff, are plaintiffs in the case.

I have a very busy day job running a six billion dollar institute. I don’t have time to worry about things like the Great Barrington Declaration,” Fauci said, according to Younes.

Fauci, though, has spoken multiple times about the declaration.

In internal emails that were later published, Fauci and Dr. Francis Collins, Fauci’s former boss, both criticized the declaration. “There needs to be a quick and devastating published takedown of its premises,” Collins wrote, prompting Fauci to send him a Wired magazine article he claimed “debunks this theory.”

In another missive, obtained by The Epoch Times through a Freedom of Information Act request, Fauci said the declaration reminded him of AIDS denialism.

Fauci also talked about the declaration in public, including defending his criticism during a congressional hearing in May.

I have come out very strongly publicly against the Great Barrington Declaration,” Fauci wrote to Dr. Deborah Birx in another email.

Other Depositions

The government moved to block some of the depositions, but not Fauci’s. It just won an order blocking the depositions of Surgeon General Vivek Murthy, Cybersecurity and Infrastructure Security Agency Director Jen Easterly, and Rob Flaherty, a deputy assistant to Biden.

Similar efforts to block the depositions of former White House press secretary Jen Psaki and FBI official Elvis Chan have been unsuccessful.

Chan is scheduled to answer questions next week. Psaki is scheduled to be deposed on Dec. 8.

Chan was involved in communicating with Facebook, LinkedIn, and other big tech firms about content moderation, according to evidence developed in the case and public statements he’s made. Psaki publicly said while still in the White House that platforms should step up against alleged mis- and disinformation.

Plaintiffs have already deposed several officials including Daniel Kimmage, an official at the State Department’s Global Engagement Center.

That center worked with Easterly’s agency to create a coalition of nonprofits called the Election Integrity Partnership, which pushed social media companies to censor speech.

Kimmage was also responsible for meetings during which censorship was discussed, with State Department official Samaruddin Stewart acting on his orders, according to documents produced by LinkedIn.

Read more here...

Tyler Durden Sat, 11/26/2022 - 13:30

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