Climate Change & Industry Readings
With yesterday's signing of an Executive Order rolling back many of the climate change-related mandates of the Obama Administration, President Trump has caused a recognition of the continued schism in the industry when it comes to climate change.
On one hand, there are the companies that have actively supported changes in many of the EPA regulations they feel have retarded economic growth. On the other, the companies more concerned with climate change. They believe the relaxing of any
climate regulation only accelerates the negative impact of man on the environment.
The Outdoor Industry Association wasted no time decrying the Trump order, calling it a reversal of policies put in place to "protect our public lands, air and water and reduce carbon emissions that contribute to climate change."
"Outdoor businesses rely on a stable climate," said Alex Boian, OIA vice president of governmental affairs, "many have taken steps to reduce their own contributions to climate change. Today's executive order is a disappointing step in the wrong direction to mitigate the threat of climate change."
Defenders of Wildlife (DOW) President and CEO Jamie Rappaport Clark called climate change the "single greatest global threat we face," saying the executive order "only serves polluters who would operate without regard for our natural heritage for future generations."
"It does not serve the clear majority of American people who want our children to inherit a healthy planet….And it absolutely does not serve our nation's wildlife, which must fight for survival against habitat damage and pollution in a rapidly changing climate."
"President Trumps actions," the DOW statement continued, "mark a dismal beginning for an administration that promised to 'Make America Great Again.'"
These groups don't speak for the majority of outdoorsmen in the United States, and certainly not the majority whose tax dollars fund the vast majority of all conservation work on the local, state and national level. They do, however, represent the most vocal of outdoor enthusiasts.
The Outdoor Industry Association's policy and advocacy agenda considers climate change "one of the most significant threats to the outdoor recreation industry". It has called on Congress to pass "comprehensive climate change legislation" and actively supported many of the policies reversed in yesterday's Executive Order.
Expect to hear more from these groups and others in the near future.
On Another Topic Entirely
….we've heard, read and discussed a variety of positions on just how the firearms industry's doing in the new "Trump business environment". We've heard a variety of reasons for some of the ebb and flow of the industry and reasons proffered range from a lessening of demand for certain products (a reasonable industry position) to the "end of fear-based gun buying" offered by many in the mainstream media.
But what does a true business observer see? To find that out, I've been speaking with Nicholas Kirk, Managing Director of The Hickory Group. THG provides strategic financial advice to investment firms, public and private firms and "special purpose entities" and Kirk's experience enables him to see through a lot of the confusion.
Is the American firearms industry really in trouble as the mainstream would have you believe?
Here, in its entirety, is his response:
"Mark Twain presciently alluded that the death of the U.S. firearm & accessory industry has been greatly exaggerated. Specifically, the mainstream media has attempted to present three general issues as indications of a slowing firearm industry under Trump: Issue 1 - Stock prices of firearm firms; Issue 2 – Layoffs; Issue 3 - NICS results. These three items can be refuted with data and logic which readers won't find in the mainstream media.
Concerning issue 1:
Share price change results from a number of factors, including, but not limited to, trading volume, market sentiment and the share price of peers. To point to share prices as a gauge of industry health is a myopic view that is professionally negligent.
Concerning issue 2:
Layoffs are a matter of corporate operations specific to a firm and, in cases of publicly traded firms such as Ruger, layoffs tend to boost share prices after a layoff is announced. In short, many issues, including automation, share price concerns and generally poor corporate planning are the general drivers of layoffs.
Concerning Issue 3:
A review of NICS results for February 2017 demonstrates that such NICS checks exceeded January 2017 NICS checks by 9%. Further, February 2017 was the largest month of NICS checks by volume since the "fear" years of February 2013 and February 2016. Moreover, January 2017 NICS month-over-month growth was only off the median January month-over-month growth for the same time period of 2012 – 2016 by 3%. Finally, the "Black Friday" NICS checks for 2016 were 185,713, which broke the FBI's forecast of approximately 180,000 and the previous "Black Friday" record set in 2015.
In sum, an honest intellectual analysis of the three Issues presented by the mainstream media are refutable with hard data and comparison to prior year results. "When in doubt, tell the Truth", wrote Twain in Pudd'nhead Wilson's New Calendar. We agree.
—Nicholas Kirk, Managing Director
The Hickory Group
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