Notes from the Kakistocracy: DeJoy goes postal, pads his portfolio


Better give your crime boss Trump a cut of the profits:

Postmaster General Louis DeJoy continues to hold a multimillion-dollar stake in his former company XPO Logistics, a United States Postal Service contractor, likely creating a major conflict of interest, according to newly obtained financial disclosures and ethics experts. Outside experts who spoke to CNN were shocked that ethics officials at the postal service approved this arrangement, which allows DeJoy to keep at least $30 million in XPO holdings.

Raising further alarms, on the same day in June that DeJoy divested large amounts of Amazon shares, he purchased stock options giving him the right to buy new shares of Amazon at a price much lower than their current market price, according to the disclosures.

I wouldn't even dream of trying to speculate what DeJoy's investment goals are, but XPO and Amazon had a painful divorce last year:

XPO’s “largest customer,” which the company won’t identify but which everyone believes to be Amazon (NASDAQ:AMZN), is taking away $600 million of annual spend with XPO and bringing it in-house. That amounts to two-thirds of the customer’s total spend with XPO. The first tranche, which disappeared last quarter, was so-called postal injection, where XPO moves goods from fulfillment centers to local post offices for deliveries to residences. The move happened suddenly and near the end of peak season. XPO knew the business would eventually depart, but it didn’t know when. Yet it had to allocate assets as if it was business as usual.

The inability to quickly replace such a large amount of business blew a huge hole in the company’s last-mile results. As a result, XPO reported that its key earnings metric – EBITDA – fell short in the fourth quarter, and that quarterly operating income in its transportation and logistics divisions declined year-over-year. In the case of transportation, the year-over-year drop was a substantial $25 million.

So, is DeJoy beefing up his Amazon holdings to offset any losses by XPO? Or does he have some plan to use his position as Postmaster to boost stocks for both companies? Whatever the case, it stinks to high heaven, and the USPS will (as usual) end up on the shit end of the stick.