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'Agh Economy!' Matt writes: I'm a recent college graduate from UW-Madison. I just finished a phone interview for an entry level position at a large company (NYSE traded). The listed requirements are 2 yrs lower than my education level and the job pays lower than I'd like (~25,000) but right now I only have a part time job and need both more work and health insurance. I'm currently working as a page at the Madison Public Library. I interact with the public and like my coworkers. The busy work I do isn't very rewarding, but it isn't difficult for me either. I think another part time job might be better than a full time job I wouldn't enjoy -- if they would result in the same pay anyway. Health Insurance is the real issue but I think the first job out of college dictates future opportunities in some way too. With the current job market it seems like I should take any full time job I can get ASAP. If they offer me the job, I'll have a hard decision -- quitting the part time job I enjoy, even for full time work. Agh! Economy! » E-Mail This     » Add to Del.icio.us Source: NPR Blogs: Planet Money | 26 Jun 2009 | 3:11 pm Jaguar Land Rover boss warns of more job cuts Jaguar Land Rover made a pre-tax loss of £281 million in the 10 months that it has been on the books of Tata Motors, prompting the Indian company to warn that it may cut more jobs and close plants. Source: Latest Business News from Times Online | 26 Jun 2009 | 3:08 pm Government Turns The Table On Evil Speculators After pouting from not having its every wish met during Chrysler's fall from grace, the DC braintrust may have learned a thing or two in the process. A group of hedge funds that provided over $3 billion in DIP financing to Delphi in 2007 argue they were conveniently left out of the bidding process for the auto supplier's assets and lost out on their opportunity to milk General Motors a little more. They (credibly) contend Delphi struck a government backed deal with a PE firm and GM at their expense. But Delphi and the government are sticking to their story that they were just hitting the best bid out there but would be psyched if a better one materializes- just not from their own creditors. We feel we bent over backwards to accommodate any possible interest in Delphi," said an Obama administration official. "We have no problem with the process and if a better bid comes out, that's awesome." Delphi Fires Back in Asset Fracas [WSJ] Sponsored Topics: General Motors - Hedge fund - Delphi - Wall Street Journal - Chrysler Source: Dealbreaker | 26 Jun 2009 | 3:02 pm FDIC Chairs: They're Just Like Us! If we are Tim Geithner, who, like Sheila Bair, cannot sell his house. The Journal reports that SheBair has taken her Amherst, MA home off the market, after it failed to sell for $745,000, even after she and husband Scott cut their asking price by $100,000. While Shebes bought the pad in 2002 for only $355,000, it was extensively renovated and now includes a (mini) lap pool in the basement. The opportunity to fantasize about that hot piece of FDIC ass in a bathing suit should be enough to get at least one of you to make her an offer. In happier news, we see that Shaq has finally been able to unload his Miami manse, which is nice. Sponsored Topics: Federal Deposit Insurance Corporation - Sheila C. Bair - Geithner Timothy F - Miami - Sheila Bair Source: Dealbreaker | 26 Jun 2009 | 2:52 pm China 'to block' Hummer takeover A Chinese firm's bid to buy the Hummer brand will be blocked on environmental grounds, according to state radio. Source: BBC News | Business | World Edition | 26 Jun 2009 | 2:41 pm Jobs warning at Jaguar Land Rover More job cuts may be made at Jaguar Land Rover, after it reported a £280m 10-month loss, owner Tata Motors warns. Source: BBC News | Business | World Edition | 26 Jun 2009 | 2:35 pm US incomes surge as stimulus kicks in Personal income in the US surged in May thanks to an infusion of government stimulus funds while consumers upped their spending modestly as confidence about the state of the economy continues to improve Source: Financial Times - US homepage | 26 Jun 2009 | 2:33 pm Wall St falters on profit taking, energy shares (Reuters) Reuters - U.S. stocks faltered on Friday as investors booked profits and energy shares pulled back alongside oil prices. Source: Yahoo! News: Business | 26 Jun 2009 | 2:33 pm Wall Street slides in early trading US stocks looked set to finish the week on a disappointing note following their best session since the beginning of the month Source: Financial Times - US homepage | 26 Jun 2009 | 2:31 pm Time For Detroit To Dump NASCAR It is time for Detroit to pull its products and sponsorship dollars out of NASCAR. Toyota (TM) may be able to afford the marketing luxury, but Ford (F), Chevy, and Chrysler cannot. Chevy as 14 cars, Ford 7, Dodge 7, and Toyota 9 cars on the circuit at any given time. Fox Sports reports that it cost $20 [...] [[ This is a content summary only. Visit my website for full links, other content, and more! ]] Source: 24/7 Wall Street | 26 Jun 2009 | 2:31 pm BSkyB blasts watchdog's pay-TV overhaul plans British pay-TV giant BSkyB on Friday blasted regulator Ofcom's plans to overhaul the sector and force it to sell on exclusive coverage of sports and movies at set prices to rival... Source: RSS feed - channel BNewsBusiness | 26 Jun 2009 | 2:28 pm CORRECTED: KB Home posts loss, housing drop moderating (Reuters) Reuters - (Corrects first bullet point to show loss of $1.03/share, not $1.02) Source: Yahoo! News: Business | 26 Jun 2009 | 2:28 pm Altria announces departure of UST executive Altria Group Inc. said on Friday that Murray S. Kessler, chief executive of the smokeless tobacco company UST Inc., will leave the company at the end of June after overseeing key elements... Source: RSS feed - channel BNewsBusiness | 26 Jun 2009 | 2:27 pm Michael Jackson's death leaves AEG Live facing £300m bill AEG Live the promoters of Michael Jackson's 50date residency at London's O2 Arena faces a bill of up to £300 million following the cancellation of the concerts. Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 26 Jun 2009 | 2:26 pm 30-acre NYC waterfront site set for development A 30-acre piece of Queens waterfront property is one step closer to development. New York City has acquired the land for $100 million. Mayor Michael Bloomberg announced the deal on... Source: RSS feed - channel BNewsBusiness | 26 Jun 2009 | 2:26 pm Few take up McClatchy debt exchange offer The McClatchy Co.'s offer to exchange debt for a fraction of its value met a 9 percent acceptance rate, the newspaper publisher said Friday. The Sacramento-based company had hoped to... Source: RSS feed - channel BNewsBusiness | 26 Jun 2009 | 2:26 pm Qantas cancels Dreamliners in new Boeing setback SYDNEY (Reuters) - Boeing Co , the world's No.2 plane-maker, suffered another heavy blow to its Dreamliner project on Friday when a major customer, Australia's Qantas Airways , scrapped and Source: RSS feed - channel BNewsBusiness | 26 Jun 2009 | 2:25 pm Stock market declines as savings rate jumps Investors are nervous because consumers are saving rather than spending. Source: L.A. Times - Business | 26 Jun 2009 | 2:24 pm Consumer spending rebounds, supports recovery view (Reuters) Reuters - U.S. consumer spending rose last month for the first time since February as government stimulus pushed incomes sharply higher, the Commerce Department said on Friday, supporting the view the economy was close to pulling out of recession. Source: Yahoo! News: Business | 26 Jun 2009 | 2:23 pm GE’s New Research Center, Maybe More Than Meets The Eye (GE) General Electric Co. (NYSE: GE) has now confirmed that it will open an advanced manufacturing technology and software center in Michigan called The Advanced Manufacturing and Software Technology Center. We had reports initially at 1,200 jobs, and the report from the company puts this figure as growing to more than 1,100 GE employees over the [...] [[ This is a content summary only. Visit my website for full links, other content, and more! ]] Source: 24/7 Wall Street | 26 Jun 2009 | 2:22 pm Madoff judge's historic moment When it comes time to sentence Bernie Madoff on Monday morning, the spotlight will shift -- briefly but inevitably -- to Denny Chin, the federal judge who will determine the term of the Ponzi scammer's incarceration. Because Madoff eschewed a trial and instead pleaded guilty, on March 12, to 11 counts of fraud, money laundering, theft, and perjury, Chin avoided the attention that would have come if he had been ruling on objections and refereeing courtroom dust-ups day after day. Source: Business and financial news - CNNMoney.com | 26 Jun 2009 | 2:21 pm Jacko's wealth 'Spendaholic' singer dies in debt after spending millions Source: BBC News | Business | World Edition | 26 Jun 2009 | 2:18 pm House energy bill heads to final vote House lawmakers begin debating a sweeping energy bill that would set new limits on U.S. greenhouse gas emissions and hand President Barack Obama a huge legislative victory if approved; vote is expected later in the day. Source: MarketWatch.com - Top Stories | 26 Jun 2009 | 2:18 pm Spending Up, A Little Consumer spending rose in May for the first time in three months. The increase came as incomes jumped 1.4 percent. The jump in incomes is partially due to reductions in payroll tax witholding that were part of the stimulus package. Consumer spending is an important factor in judging the health of the economy because it accounts for 70 percent of total economic activity. Meantime, the savings rate increased to 6.9 percent, the highest level since December 1993. » E-Mail This     » Add to Del.icio.us Source: NPR Blogs: Planet Money | 26 Jun 2009 | 2:17 pm Rail bosses get £1.2m in bonuses Some Network Rail bosses are to receive bonuses of more than £300,000 each, drawing fierce criticism from unions. Source: BBC News | Business | World Edition | 26 Jun 2009 | 2:17 pm Stock market declines as savings rate jumps (AP) AP - Investors are nervous because consumers are saving rather than spending. Source: Yahoo! News: Stock Markets News | 26 Jun 2009 | 2:16 pm Kevin J. Lewis Named President of Upscale and Extended Stay Brands SILVER SPRING, Md., June 26 /PRNewswire-FirstCall/ -- Choice Hotels International, Inc., (NYSE: CHH) today announced that it has appointed Kevin Lewis as president, upscale and... Source: RSS feed - channel BNewsBusiness | 26 Jun 2009 | 2:15 pm GE to build manufacturing tech center in Mich. General Electric Co. says it will open a manufacturing technology center in Michigan that will eventually employ more than 1,100 workers. The Advanced Manufacturing and Software... Source: RSS feed - channel BNewsBusiness | 26 Jun 2009 | 2:14 pm This Week’s Weird Jobs Most of this week’s weird jobs cover things you’d only do as a last resort. Like drive a school bus. Or fetch golf balls. Or–gulp–sell gay porn to people you’ve never met before: 1. CA: School Bus Driver This position transports children, parents, and staff by driving a school bus to and from the school on morning or afternoon routes, and to and from special outings / field trips while adhering to driving regulations and providing a safe vehicle. Requirements – - High school diploma or equivalent (GED) required - 1+ yrs college preferred - Fully Certified School Bus Driver Deafness also a plus. 2. CA: Memory Care Director The Memory Care Director will manage the overall operation of the Memory Care Neighborhood in accordance with resident needs, government regulations and policies and procedures. Duties include: conducting resident screenings and family interviews; development and implementation of residents’ FlexCare Plans; planning, conducting and implementing staff training and coordinating educational opportunities; coordinating the annual review of the Alzheimer’s Program policy and procedures; coordinating in-service training; assisting in marketing and sales efforts; organizing and leading Resident Aide meetings; and providing written reports. Job duties may also include reminding patients, on a daily basis, why they live in a place called Memory Care Neighborhood. 3. CA: Juice company seeking Part-Time Demo Specialist We are seeking a highly-personable and energetic individual to sample our juice products at retail locations throughout Sacramento and surrounding cities. Key Duties: - Demo product for scheduled hours (3-4hrs) at retailers like Raley’s, Bel Air and Nugget Markets - Write demo recap reports (template provided) and submit in timely manner, approximately 24-hour turnaround Please do not bring vodka, rebrand the samples as shooters, and charge $1/per. The grocery stores won’t appreciate that. 4. CA: Entry level part-time sales in gay porn industry (training provided) Part-time sales assistant needed for 11 year old company in San Fernando Valley that sells high quality gay porn. Will work with industry veteran sales person as assistant / trainee. Possibility to convert to full-time. Job function will be calling new leads (provided) and entering sales orders under the guidance of industry veteran sales manager. Must be comfortable talking about anuses with complete strangers. 5. Vancouver: Golf Ball Fetcher Looking for young, outgoing people looking to learn business through a hands on approach. This job requires general labour of rounding up golf balls at various locations which will then be reused. Fantastic pay, and great for people looking to get the insides into the services business, while still getting exercise and enjoying the great outdoors! Now that is an optimistic take on golf ball fetching. Happy Friday! Source: Business Pundit | 26 Jun 2009 | 2:12 pm Economic Report: Consumer sentiment rises to 70.8 in June U.S. consumer sentiment rises in June on improved views of current conditions, but overall sentiment remains relatively low, according to a survey by the University of Michigan and Reuters. Source: MarketWatch.com - Top Stories | 26 Jun 2009 | 2:12 pm The rise and fall of iPorn Source: Business and financial news - CNNMoney.com | 26 Jun 2009 | 2:11 pm M&I Announces Extension of Foreclosure Moratorium MILWAUKEE, June 26 /PRNewswire-FirstCall/ -- Marshall & Ilsley Corporation (NYSE: MI) (M&I) today announced it has extended its foreclosure moratorium an additional 90... Source: RSS feed - channel BNewsBusiness | 26 Jun 2009 | 2:10 pm Economic Report: Incomes surge on one-time stimulus checks U.S. personal incomes jump 1.4% in May due to one-time stimulus checks, sending the savings rate to a 15-year high, the Commerce Department says. Source: MarketWatch.com - Top Stories | 26 Jun 2009 | 2:10 pm Toyota's man at the wheel Even though he has the same last name as five of the 10 previous presidents of Toyota Motor, Akio Toyoda is nothing like his predecessors. Source: Business and financial news - CNNMoney.com | 26 Jun 2009 | 2:09 pm KB Home 2Q loss narrows, new orders up from 1Q KB Home said today its new home orders in the second quarter spiked 59 percent over first-quarter levels, but its financial results still missed Wall Street's estimates. Source: L.A. Times - Business | 26 Jun 2009 | 2:09 pm Oil slips below $70 after Nigeria amnesty report LONDON (Reuters) - Oil slipped below $70 a barrel Friday after Nigeria said it would halt a battle with rebels during a 60-day amnesty period for militants and release a suspected rebel leader if he accepted an amnesty offer. Source: Reuters: Business News | 26 Jun 2009 | 2:08 pm Apple raises stake in U.K. chip designer British chip designer Imagination Technologies Group says Apple has raised its stake in the firm to 9.5%. Source: MarketWatch.com - Top Stories | 26 Jun 2009 | 2:08 pm How the climate bill hits your wallet Lawmakers are set to debate a sweeping energy bill Friday. This is how it may affect you. Source: Business and financial news - CNNMoney.com | 26 Jun 2009 | 2:07 pm Oil below $70 as worries over US demand resurface By mid-afternoon in Europe, benchmark crude for August delivery was down 43 cents to $69.80 a barrel in electronic trading on the New York Mercantile Exchange. On Thursday, it gained... Source: RSS feed - channel BNewsBusiness | 26 Jun 2009 | 2:06 pm Ista wins US panel support for eye itch drug SILVER SPRING, Md., June 26 (Reuters) - A proposed drug from Ista Pharmaceuticals Inc won unanimous support from a U.S. advisory panel on Friday for treating itchiness in the eye caused by allergies. Source: RSS feed - channel BNewsBusiness | 26 Jun 2009 | 2:06 pm U.S. Consumer Sentiment Increased to 70.8 in June Confidence among U.S. consumers rose this month for a fourth straight time, reflecting signs that the worst of the recession has passed. Source: L.A. Times - Business | 26 Jun 2009 | 2:05 pm Refund issues over Jackson gigs Ticketholders for the sell-out Michael Jackson concerts at the O2 Centre in July should now get their money back. Source: BBC News | Business | World Edition | 26 Jun 2009 | 2:04 pm Consumer sentiment rises in June: survey NEW YORK (Reuters) - U.S. consumer confidence rose in June to the highest since February 2008, as expectations grew that the worst economic recession since the Great Depression may be ending, a survey showed on Friday. Source: Reuters: Business News | 26 Jun 2009 | 2:02 pm Earnings Watch: Updates, advisories and surprises A roundup of the latest corporate earnings reports and what companies are saying about future quarters. Source: MarketWatch.com - Top Stories | 26 Jun 2009 | 2:01 pm Spain launches $12.7bn bank fund Spain has launched a 9bn-euro ($12.7bn; £7.7bn) fund in case any of its troubled banks needs rescuing. Source: BBC News | Business | World Edition | 26 Jun 2009 | 2:00 pm Wiped out by Madoff Some people invested everything they had with Bernard Madoff, not knowing he was a Ponzi schemer. Now, they have nothing. Here are their stories. Source: Business and financial news - CNNMoney.com | 26 Jun 2009 | 1:58 pm Caption Contest Friday: The King And The Prince Jacko and Prince Alwaleed, who is deeply broken up over this, in happier times. [via] Sponsored Topics: Jacko - United States - Society and Culture - Counties - Prince William Source: Dealbreaker | 26 Jun 2009 | 1:57 pm KB Home shares take hit on lower revenue, orders BOSTON (MarketWatch) -- KB Home on Friday said its second-quarter loss wasn't as bad as the year-earlier period as the home builder tries to ride out the housing downturn and return to profitability. Source: MarketWatch.com - Top Stories | 26 Jun 2009 | 1:57 pm Consumer sentiment rises in June: survey (Reuters) Reuters - U.S. consumer confidence rose in June to the highest since February 2008, as expectations grew that the worst economic recession since the Great Depression may be ending, a survey showed on Friday. Source: Yahoo! News: Business | 26 Jun 2009 | 1:56 pm JPMorgan: Wall Street's new king JPMorgan Chase is grabbing a bigger slice of a smaller dealmaking pie -- leaving less for rival Bank of America. Source: Business and financial news - CNNMoney.com | 26 Jun 2009 | 1:56 pm Futures Movers: Oil falls, heading for second weekly loss Oil falls, heading for weekly loss as demand worries resurface. Source: MarketWatch.com - Top Stories | 26 Jun 2009 | 1:54 pm Regulator's attack on Sky may gift ITV an opportunity The communications watchdog may have just created an opportunity for struggling ITV. Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 26 Jun 2009 | 1:53 pm May incomes surge, but savings outpace spending WASHINGTON -- Households pushed their savings rate to the highest level in more than 15 years in May as a big boost in incomes from the government's stimulus program was devoted more to bolstering nest eggs than increased spending. Source: L.A. Times - Business | 26 Jun 2009 | 1:53 pm Nigerian rebels say hit Shell site despite amnesty LAGOS (Reuters) - Nigeria's main militant group said it had blown up a well-head in a Royal Dutch Shell oil field in Delta state late on Thursday, hours after President Umaru Yar'Adua announced an amnesty offer for gunmen. Source: Reuters: Business News | 26 Jun 2009 | 1:52 pm Stock market declines as savings rate jumps NEW YORK -- Investors are nervous about the savings rate outpacing spending. Source: RSS feed - channel BNPaperBusiness | 26 Jun 2009 | 1:51 pm Stocks struggle as week winds down Stocks were mixed at Friday's open as investors mulled a government report that showed personal income surged -- but so did savings, as investors opted to sit out the recession rather than spend. Source: Business and financial news - CNNMoney.com | 26 Jun 2009 | 1:49 pm Can A New Marketing Head Revive NutriSystem? (NTRI) NutriSystem, Inc. (NASDAQ: NTRI) is well known as the weight management and weight loss company for bulk food delivery to the home or office.   You have seen their commercials on TV.  Now the company is naming a new Chief Marketing Officer.  This might be noise at most companies, but for a company such as NutriSystem [...] [[ This is a content summary only. Visit my website for full links, other content, and more! ]] Source: 24/7 Wall Street | 26 Jun 2009 | 1:49 pm KB Home 2Q loss narrows, new orders up from 1Q KB Home said today its new home orders in the second quarter spiked 59 percent over first-quarter levels, but its financial results still missed Wall Street's estimates. Source: RSS feed - channel BNPaperBusiness | 26 Jun 2009 | 1:48 pm Currencies: China calls for new reserve currency; dollar slips The dollar slips after China repeats call for new reserve currency. Source: MarketWatch.com - Top Stories | 26 Jun 2009 | 1:44 pm Palm shares rally as investors look beyond losses Shares of Palm Inc. rally out of the box, sprinting 10% higher as investors react favorably to the handset maker’s fourth-quarter financial results, which encompass the three months just prior to the launch of the Pre smart phone. Source: MarketWatch.com - Top Stories | 26 Jun 2009 | 1:40 pm Wall St opens lower on profit taking NEW YORK (Reuters) - U.S. stocks opened lower on Friday as investors took some profits after stocks gained more than 2 percent in the previous session, and as a jump in the rate of savings pointed to a more cautious consumer. Source: Reuters: Business News | 26 Jun 2009 | 1:38 pm Wall St opens lower on profit taking (Reuters) Reuters - U.S. stocks opened lower on Friday as investors took some profits after stocks gained more than 2 percent in the previous session, and as a jump in the rate of savings pointed to a more cautious consumer. Source: Yahoo! News: Stock Markets News | 26 Jun 2009 | 1:38 pm Tata Motors reports loss as Land Rover sales fall Tata Motors reports annual loss of 25 billion rupees, or over $500 million, on fewer sales of Land Rover cars. Source: MarketWatch.com - Top Stories | 26 Jun 2009 | 1:36 pm Citi ordered to suspend Japan units Japan's financial regulator has ordered Citigroup to halt some of its businesses for a month and fundamentally improve its internal controls, after finding that the US group failed to implement sufficient measures aimed at preventing suspicious transactions Source: Financial Times - US homepage | 26 Jun 2009 | 1:31 pm Thinking of Switching Financial Planners? (BusinessWeek Online) BusinessWeek Online - You've got a dirty little secret. During long lunch breaks, or after work when everyone else heads home to their families, you're sneaking out to a secret rendezvous. You know what you're doing is perfectly justified, but you still feel a little bad afterwards. You never thought it would come to this. But here you are -- cheating on your financial planner. Source: Yahoo! News: Business | 26 Jun 2009 | 1:28 pm Freddie Mac May portfolio shrank annualized 9.9 pct NEW YORK (Reuters) - Freddie Mac , the second-largest U.S. home funding company, on Friday said its mortgage investment portfolio shrank by an annualized 9.9 percent rate in May, while delinquencies on loans it guarantees accelerated. Source: Reuters: Business News | 26 Jun 2009 | 1:27 pm U.S. consumer spending rises 0.3 percent in May WASHINGTON (Reuters) - U.S. consumer spending rose last month for the first time since February as government stimulus pushed incomes sharply higher, the Commerce Department said on Friday, supporting the view the economy was close to pulling out of recession. Source: Reuters: Business News | 26 Jun 2009 | 1:25 pm Freddie Mac May portfolio shrank annualized 9.9 pct (Reuters) Reuters - Freddie Mac , the second-largest U.S. home funding company, on Friday said its mortgage investment portfolio shrank by an annualized 9.9 percent rate in May, while delinquencies on loans it guarantees accelerated. Source: Yahoo! News: Business | 26 Jun 2009 | 1:24 pm Oil rises back above $71 a barrel Oil prices rise past $71 a barrel as investors remain optimistic about an economic recovery. Source: BBC News | Business | World Edition | 26 Jun 2009 | 1:20 pm Personal income boosted by stimulus Personal income jumped more than expected, helped by an increase in unemployment benefit payments and lower taxes, while consumer spending edged higher, the government said Friday. Source: Business and financial news - CNNMoney.com | 26 Jun 2009 | 1:12 pm KB Home posts loss, says housing drop moderating NEW YORK (Reuters) - KB Home, the No. 5 U.S. homebuilder, posted a wider-than-expected quarterly loss on Friday, but said it saw signs that negative trends in the housing market were moderating. Source: Reuters: Business News | 26 Jun 2009 | 1:09 pm UBS problems to remain after $3.5 billion capital hike ZURICH/BASEL (Reuters) - Investors welcomed UBS plans to raise 3.8 billion Swiss francs ($3.5 billion) of new capital but said the bank will not turn the corner until it stems client withdrawals and settles U.S. legal problems. Source: Reuters: Business News | 26 Jun 2009 | 1:05 pm What you need to know about health debate Rx: Health reform. Source: Business and financial news - CNNMoney.com | 26 Jun 2009 | 12:42 pm Personal Income and Spending Dwarfed by Personal Savings The Commerce Department’s Personal Income and Consumer Spending numbers have been released for the Month of May-2009 and the numbers were +1.4% on Personal Income and Consumer Spending was Up +0.3%.  The income portion was significantly better as Bloomberg had a consensus estimate of +0.4% on income and +0.3% on spending.  The prior report for [...] [[ This is a content summary only. Visit my website for full links, other content, and more! ]] Source: 24/7 Wall Street | 26 Jun 2009 | 12:38 pm G8 foreign ministers signal cautious stance on Iran Group of Eight foreign ministers meeting in Italy cautiously bridged their differences over how to deal with Iran by deploring the deaths of peaceful demonstrators but reiterating their invitation to Tehran to join direct talks over its nuclear programme Source: Financial Times - US homepage | 26 Jun 2009 | 12:36 pm Opening Bell: 06.26.09 Pang Took $83 Million From Firm, Filing Says (WSJ) The court-appointed temporary receiver over Mr. Pang's former company, Private Equity Management Group Inc., also revised his estimate of potential losses by investors, saying they could range from $287 million to $654 million. The latter figure would represent a loss of nearly 80% of the $823 million still owed to investors. And here's a new pic of DP, leaving federal court: Administrative Actions against Citibank Japan Ltd. (FSA) All sales operations in retail banking suspended for one month starting July 15, due to lax oversight of money laundering controls. The Big C is sorry and swears it won't happen again. UBS Expects Second Quarter Loss (WSJ) Don't shed tears for the Swiss just yet, though, because they're entirely okay with this, as the figure, while not good, is better than previous quarters, and represents "a sequential improvement." Death spurs Michael Jackson album sales (Reuters) Jacko occupied the top 15 slots on Amazon's best-selling albums within hours. "Thriller" at number one, "Off the Wall" at two, "Bad" at three. Judge Says Stanford May Be Freed On Bond (AP) And why not? He totally does not seem like the type that would make a run for it. Oh wait, that's exactly what he seems like. (Re: GPS monitoring system, Big Al would find away around it.) Volcker Gets Less Than He Wants in Curbing Excesses (Bloomberg) "After the inauguration and Geithner's confirmation, Volcker was elbowed aside, White House insiders say. His economic recovery board took weeks to get off the ground -- a delay people close to Volcker say he blames on Larry Summers...The biggest obstacle to Volcker's reform agenda is Summers, Volcker's friends say." Jack (And Suzy) Welch Says Bernanke Deserves A Second Term (Bloomberg) J Dubs also added that the Fed Chair deserves some sort of teaching gig at Jack Welch's Online School Of Business, either as a full-time or adjunct professor. Not So Green Shoots, By Maria Bartiromo (CNBC) And it continues: From my vantage point, I have trouble buying into the whole idea of green shoots. I know the market itself has bounced, but people I talk with everywhere I go are still feeling squeezed financially. Sponsored Topics: Michael Jackson - United States - Off the Wall - Jack Welch - Fred Thompson Source: Dealbreaker | 26 Jun 2009 | 12:30 pm House price falls stabilised last month Fresh evidence that house prices have begun to stabilise came as official figures showed a modest 0.2 per cent decline in May, bringing the average price to £152,497. Source: Latest Business News from Times Online | 26 Jun 2009 | 12:28 pm Michael Jackson should have died a rich man Reckless spending can destroy even the most creative genius. Michael Jackson provides a sad example. Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 26 Jun 2009 | 12:21 pm Jackson's tour: What might have been One of the executives whose hapless job it was to determine whether Michael Jackson really had it in him to mount a 50-show concert gig in London slated to begin next month told me a few weeks ago that Jackson was surprisingly robust. Source: Business and financial news - CNNMoney.com | 26 Jun 2009 | 12:08 pm Rising commodity prices boost European markets (AP) AP - Rising commodity prices pushed European markets higher on Friday, but gains were trimmed ahead of an expected weak opening on Wall Street. Source: Yahoo! News: Stock Markets News | 26 Jun 2009 | 12:05 pm Premier League 'not happy' about regulator's review of pay TV market The Premier League is angered by regulator's sweeping review of the payTV market. Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 26 Jun 2009 | 11:57 am When Ads Don’t Lie Source: Business Pundit | 26 Jun 2009 | 11:48 am Potash Earnings Issues Now Credibility Issues (POT, MOS, AGU, CF, TRA, TNH, IPI, MOO) Potash Corporation of Saskatchewan Inc. (NYSE: POT) did last night what most traders already feared was coming. The Canadian potash supply giant said that weak demand for its products and lower prices were going to take earnings for the quarter down to about $0.70 EPS versus a previous forecast of $1.10 to $1.50 EPS.  This [...] [[ This is a content summary only. Visit my website for full links, other content, and more! ]] Source: 24/7 Wall Street | 26 Jun 2009 | 11:48 am Regulator's attack on Sky proves that Britain still hates winners Since early this morning I've been wading through Ofcom's 360 page demolition job of BSkyB. Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 26 Jun 2009 | 11:38 am China argues to replace US dollar China's central bank reiterates its call for a new global reserve currency to replace the US dollar. Source: BBC News | Business | World Edition | 26 Jun 2009 | 11:31 am Michael Jackson promoter faces million pound bill over tour at 02 Arena AEG only has insurance for half the dates at London's O2 Arena. Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 26 Jun 2009 | 11:27 am House prices decline again in May House prices in England and Wales fell slightly again last month, according to figures from the Land Registry. Source: BBC News | Business | World Edition | 26 Jun 2009 | 11:25 am Jackson cancellations to hit AEG AEG Live, the organiser of Michael Jackson's concerts at the 02 arena, could lose millions from their cancellation. Source: BBC News | Business | World Edition | 26 Jun 2009 | 11:25 am Top Analyst Upgrades and Downgrades (CETV, CQB, CME, CFX, JAZZ, OSG, PII, UBS, WBS) These are the top early-bird analyst calls with upgrades and downgrades seen this Friday morning with over two hours until the market opens: Central European Media (CETV) Raised to Neutral at JPMorgan. Chiquita Brands (CQB) Raised to Buy at Janney Montgomery Scott. CME (CME) Raised to Neutral at JPMorgan. Colfax (CFX) Raised to Buy ar KeyBanc. Jazz Pharmaceuticals (JAZZ) Cut [...] [[ This is a content summary only. Visit my website for full links, other content, and more! ]] Source: 24/7 Wall Street | 26 Jun 2009 | 11:21 am Ten ways to cut mortgage costs If payments are becoming too onerous here are some of the tactics you can adopt to reduce the burden. Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 26 Jun 2009 | 11:18 am European stocks gain on US data (AFP) AFP - European stock markets rose on Friday after gains in Tokyo and overnight on Wall Street helped by positive US economic data, traders said. Source: Yahoo! News: Stock Markets News | 26 Jun 2009 | 11:04 am John Lewis reports shoppers spending again John Lewis has added to the signs of green shoots in the economy, saying shoppers appear to be returning to pre-recession spending. Source: Latest Business News from Times Online | 26 Jun 2009 | 11:02 am China repeats criticism of dollar dominance The People's Bank of China repeated its call for the world to cut its reliance on the dollar, saying it saw serious defects in one currency dominating the global monetary system Source: Financial Times - US homepage | 26 Jun 2009 | 11:00 am Oil smashes through $71 on economic optimism Crude broke through $71 a barrel on continued optimism for a sharp upswing in world economic activity and a further rebel attacks on the petroleum industry in Nigeria Source: Financial Times - US homepage | 26 Jun 2009 | 10:50 am Borrowers face repossession over unsecured debts Borrowers who have fallen behind on repayments on unsecured debts face losing their homes because of court orders allowing the debts to be converted to secured loans a charity has warned. Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 26 Jun 2009 | 10:39 am Deflation Becomes Real Danger In Japan Japan’s consumer price index fell 1.1% in May. According to the AP, that is a record drop. The Japan of 2009 is starting to look like the Japan of the 1990s when real estate prices and the stock market collapsed. It took almost a decade for the nation to get its economy back into shape and [...] [[ This is a content summary only. Visit my website for full links, other content, and more! ]] Source: 24/7 Wall Street | 26 Jun 2009 | 10:13 am BSkyB slams 'unwarranted intervention' in TV market for topflight football Broadcaster hits out at regulator for proposals that would force Sky to distribute topflight football and movies to rivals. Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 26 Jun 2009 | 10:07 am China Kills Buyout Of Hummer GM wants to sell Hummer. It needs the money. Sichuan Tengzhong, a heavy equipment firm based in China, looked like a ready buyer. GM would like to find an acquirer that would save most of the unit’s jobs. Sichuan Tengzhong seemed to fit that bill. Now it appears that the Chinese government has killed any chance [...] [[ This is a content summary only. Visit my website for full links, other content, and more! ]] Source: 24/7 Wall Street | 26 Jun 2009 | 9:56 am Lindsey oil refinery jobs dispute resolved Wildcat strikes by thousands of contract workers were ending on Friday after a deal was agreed to resolve a bitter row over jobs at an oil refinery. Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 26 Jun 2009 | 9:36 am Chaos At The Apple (AAPL) App Store As Nudity Programs Disappear Software applications which allowed owners of Apple (AAPL) iPhones to download pornography have started to disappear from the firm’s huge App Store which now has more than 50,000 offerings. According toThe Washington Post,  Apple’s rules do allow for program that include nudity, so it is not clear what happened to the lewd content. The porno firms [...] [[ This is a content summary only. Visit my website for full links, other content, and more! ]] Source: 24/7 Wall Street | 26 Jun 2009 | 9:34 am Profit takers move in on Wall Street Wall Street traders took profits in morning trading after yesterday's rally that raised the Dow Jones industrial average 2 per cent, and shares fell today 13.99 points at 8,452.67 at the start. A jump in the savings rate also suggested that consumers were becoming more cautious. Source: Latest Business News from Times Online | 26 Jun 2009 | 9:31 am Betfair takes a punt on US horseracing Betfair, the online betting company, is gambling on an easing of regulations in the United States as it launches an ambitious push into the American horseracing market. Source: Latest Business News from Times Online | 26 Jun 2009 | 9:21 am China Shampoo Company Raises $214 Million In IPO, Retail Investor Orders Hit $9 Billion A sign that the IPO market in Asia may be overheating is the case of BaWang International, which raised $214 million. The company makes shampoo, and the offering was oversubscribed by 400 times at the retail investor level. At the open, the firm’s shares will trade for 18 times earnings. The retail demand totalled $9 billion [...] [[ This is a content summary only. Visit my website for full links, other content, and more! ]] Source: 24/7 Wall Street | 26 Jun 2009 | 9:18 am Sky asked to open up premium sports and movies Ofcom, the communications regulator, said today that BSkyB should make its premium content, such as sports and movies, available to more broadcasters at lower prices to increase choice for consumers. Source: Latest Business News from Times Online | 26 Jun 2009 | 9:13 am UBS unveils SFr3.8bn equity placement UBS moved to bolster its balance sheet by raising SFr3.8bn (£2.1bn) in an equity placing, following heightened pressure from regulators, and warned it would record a loss in the second quarte Source: Financial Times - US homepage | 26 Jun 2009 | 9:02 am UBS unveils SFr3.8bn equity placement UBS moved on Thursday to bolster its balance sheet by raising SFr3.8bn (2.1bn) in an equity placing, following heightened pressure from regulators, and warned it would record a loss in the second quarter... Source: RSS feed - channel BNPaperBusiness | 26 Jun 2009 | 9:02 am Berkeley's founder Tony Pidgley moves aside Tony Pidgley is to end an era at Berkeley, the housebuilder, by stepping down as its day-to-day boss. He will become its chairman, replacing Victoria Mitchell. Source: Latest Business News from Times Online | 26 Jun 2009 | 8:24 am Capital markets save dealmakers' fees as M&A wilts LONDON/NEW YORK (Reuters) - Dealmakers saw business pick up again in the second quarter as they helped companies raise cash in capital markets, but lucrative mergers and acquisitions (M&A) languished. Source: Reuters: Business News | 26 Jun 2009 | 8:23 am Capital markets save dealmakers' fees as M&A wilts (Reuters) Reuters - Dealmakers saw business pick up again in the second quarter as they helped companies raise cash in capital markets, but lucrative mergers and acquisitions (M&A) languished. Source: Yahoo! News: Business | 26 Jun 2009 | 8:10 am Lindsey dispute settled as workers reinstated A dispute involving hundreds of workers who were sacked last week at the Lindsey Oil Refinery was settled last night. Source: Latest Business News from Times Online | 26 Jun 2009 | 7:39 am Delphi defends its proposed sale to Platinum Equity The auto parts maker says it has welcomed bids since entering bankruptcy four years ago and has kept creditors -- who claim Delphi never seriously pursued other offers -- informed of developments. ... Source: RSS feed - channel BNPaperBusiness | 26 Jun 2009 | 7:00 am Ritzy Newport Beach mall goes on a spending spree Fashion Island is getting a $100-million upgrade. Plans calls for the addition of a Nordstrom department store, other upscale stores, fountains, a 24-foot-high water wall and improved landscaping. Shoppers might not be ready for new luxury stores and pricey restaurants just yet, but the owner of ritzy Fashion Island in Newport Beach is betting they will be soon. Source: L.A. Times - Business | 26 Jun 2009 | 7:00 am Best picture change triggers a backlash Many Oscar voters criticize the sudden decision to double the field of nominees for the top Academy Award, worrying it will cheapen the honor. ... Source: RSS feed - channel BNPaperBusiness | 26 Jun 2009 | 7:00 am Fed says economic gains reduce need for some loan programs Demand has plunged and funding will be cut for one program set up to improve market liquidity. Other temporary measures will be extended, however. ... Source: RSS feed - channel BNPaperBusiness | 26 Jun 2009 | 7:00 am Culligan lobbies hard as water softeners become a drought issue The company is fighting a state Assembly bill that would let regulators ban devices that discharge salt into municipal sewer lines, rendering water difficult to recycle. ... Source: RSS feed - channel BNPaperBusiness | 26 Jun 2009 | 7:00 am Porsche wraps a 4-door hulk in racy corset The 2010 Panamera sedan is filled with luxury and speed. But compared with a 911, this thing handles like well-upholstered field artillery. The new Porsche Panamera is the best-handling big sedan in the world, which I grant is a little like being the smartest kid on the Arizona State football team or the most chaste governor of South Carolina. No matter how hard you try -- and Porsche's engineers have busted their adorable lederhosen here -- a 4,344-pound, 16.3-foot four-door cannot beguile physics like a sports car, and it certainly cannot be made to handle anything like a 911. Source: L.A. Times - Business | 26 Jun 2009 | 7:00 am SEIU wins another election of healthcare workers Employees of a hospital and two nursing homes in Hollister, Calif., vote to remain with the giant labor organization instead of defecting to the rival National Union of Healthcare Workers. ... Source: RSS feed - channel BNPaperBusiness | 26 Jun 2009 | 7:00 am Best picture change triggers a backlash Many Oscar voters criticize the sudden decision to double the field of nominees for the top Academy Award, worrying it will cheapen the honor. Let the backlash begin. Source: L.A. Times - Business | 26 Jun 2009 | 7:00 am Commerce toy importer is fined for hazardous items OKK Trading imported and sold toys with high levels of lead and violated other federal child safety standards, Consumer Product Safety Commission says. The importer says it didn't do so knowingly. ... Source: RSS feed - channel BNPaperBusiness | 26 Jun 2009 | 7:00 am 'Transformers' sequel alters opening-day record The Paramount movie takes in $60.6 million at the box office during its weekday start in the U.S. and Canada. Workday be damned. "Transformers: Revenge of the Fallen" blew away the existing record for a weekday movie opening by selling an estimated $60.6 million worth of tickets Wednesday in the U.S. and Canada. Source: L.A. Times - Business | 26 Jun 2009 | 7:00 am 'Transformers' sequel alters opening-day record The Paramount movie takes in $60.6 million at the box office during its weekday start in the U.S. and Canada. ... Source: RSS feed - channel BNPaperBusiness | 26 Jun 2009 | 7:00 am Culligan lobbies hard as water softeners become a drought issue The company is fighting a state Assembly bill that would let regulators ban devices that discharge salt into municipal sewer lines, rendering water difficult to recycle. Government bureaucrats want your water softener. Source: L.A. Times - Business | 26 Jun 2009 | 7:00 am Fed says economic gains reduce need for some loan programs Demand has plunged and funding will be cut for one program set up to improve market liquidity. Other temporary measures will be extended, however. The Federal Reserve, signaling increased optimism that the economy is improving, is scaling back some of the emergency loan programs it created over the last 18 months to deal with the nation's financial crisis. Source: L.A. Times - Business | 26 Jun 2009 | 7:00 am Bernanke denies Fed threatened BofA over Merrill deal WASHINGTON (Reuters) - Federal Reserve Chairman Ben Bernanke, facing his toughest grilling yet by U.S. lawmakers, said on Thursday he had never threatened to fire Bank of America's management if they pulled the plug on a planned merger with Merrill Lynch. Source: Reuters: Business News | 26 Jun 2009 | 6:47 am NZ stocks: Market closes flat, other markets rise News of a worse-than-expected contraction of the New Zealand economy in the March quarter led to an under-performance of nation's stockmarket today. The benchmark NZSX-50 index closed down 0.039 points, or 0.001 per cent, at 2770.619.... Source: New Zealand Herald - Business | 26 Jun 2009 | 6:08 am Currency: Dollar slightly down on GDP data The New Zealand dollar fell in response to worse-than-expected gross domestic product data then recovered today. The local currency closed its domestic session at US64.50c, little changed from the US64.51c at 8am and up from US64.16c... Source: New Zealand Herald - Business | 26 Jun 2009 | 5:25 am Qantas cancels Dreamliner orders Qantas, the biggest customer of Boeing's 787 Dreamliners, announced that it had cancelled orders for 15 planes and delayed the delivery for another 15 in a further blow to the US company Source: Financial Times - US homepage | 26 Jun 2009 | 4:57 am Stryker's Stock Is En Route to Recovery THE THIGH BONE'S connected to the hip bone, and the hip bone's connected to the backbone. The connections, however, wear out with age, which is bad news for baby boomers but big business for Stryker , a leading maker of hip, knee, spine and other joint replacements, and a likely beneficiary of a coming wave of surgeries in the U.S. and abroad. The recession has knocked Stryker (SYK) out of joint, curbing its historic double-digit rate of sales and profit growth. Patients have delayed costly elective surgery, hurting the orthopedic-implant business, while hospitals have reined in spending on beds and stretchers, denting the company's Med Surg Equipment unit. As a result, investors have the opportunity to snap up shares for $40 apiece, nearly 50% below the stock's 2008 high of $75. Stryker's business -- and its shares -- could rebound sharply in 2010, as the economy recovers and employment perks up. Analysts expect the Kalamazoo, Mich., company to earn $1.2 billion, or $2.96 a share, this year, up just 5% from last year's $2.83. But earnings could rise 12% next year, to $1.3 billion, or $3.31 a share, on sales of $7 billion. Help could come from any increase in hospital spending, which is likely to be flat to up 5% in 2010, after falling more than 20% this year, according to some analysts. Also, foreign-currency exchange could turn from a headwind to a tailwind toward the end of '09 if the dollar stays weak. Overseas markets account for 35% of Stryker's sales, and the company is pushing to expand in Japan, Africa, the Middle East and other regions. "As the economic situation stabilizes, a favorable exchange rate and increased health-care spending will be significant upside catalysts for Stryker's growth," says Ronnie Moas, president of Standpoint Research in New York. Moas thinks the stock could trade between 50 and 55 next year. Founded in 1941 by Dr. Homer Stryker, an orthopedic surgeon, Stryker is the tenth-largest medical-device company in the U.S., and a prominent player in the $38 billion orthopedic-implant market, where it competes with Johnson & Johnson (JNJ), Zimmer Holdings (ZMH), Medtronic (MDT) and others. Last year the orthopedic-implants business contributed 59% of total sales of $6.7 billion, while the Med Surg unit chipped in 41%. With $2.2 billion of cash and only $20 million of debt, Stryker has one of the strongest balance sheets in the health-care sector. It has generated return on equity of at least 19% for nine straight years, and produces more than $1 billion a year of cash flow. The company has used its cash to buy back stock and pay a dividend -- now 40 cents a share, for a yield of 1%. It also has made small acquisitions and is rolling out new products, including a titanium hip cup and a wireless HDTV operating-room monitor. Worries that health-care reform will crimp profits are obscuring Stryker's long-term prospects, as are concerns the slowdown in domestic hospital spending could go global. "An [international] capital-equipment slowdown may be the next leg down for Stryker," says Needham analyst Ed Shenkan, who has a Hold rating on the shares. Moreover, the company has received four "warning letters" from the Food and Drug Administration in the past two years that led in some cases to voluntary product recalls. The letters, the latest received in May, alleged, among other things, improper quality and compliance issues at company facilities, including the sale of products without marketing approval. Stryker also is fending off regulatory investigations into its promotion of a bone-growth protein, and the sale of medical devices overseas. The company is in the early stages of a three-year plan to spend $200 million to upgrade its quality controls and compliance system. At an analyst meeting in May, Chief Executive Stephen MacMillan, a J&J veteran, said management is making "tremendous progress" in improving quality, but conceded "regulatory overhang in the next 12 months" is the biggest risk facing the company. Stryker officials weren't available to comment. Stryker's stock could fall to 35 or so in coming quarters if the market loses steam. But investors' concerns largely are baked into the price. Morningstar analyst Julie Stralow says a $40 stock assumes that sales increase only 4%, compounded, through 2013, and that operating margins fall to 18% from 23% now. "The current share price reflects a dire scenario" that is unlikely, says Stralow, who pegs fair value at $72 a share. Stryker sells for 12 times 2010 estimates, slightly above peers. Back out its $5-plus per share in net cash, and the price/earnings ratio falls to 10. For a company with Stryker's healthy prospects, it doesn't get more out of joint than that. The Bottom Line Stryker's stock has fallen 47%, to $40, from its peak. It could rise to the mid-$50s as health-care spending rebounds. Morningstar pegs fair value at $72. SMARTMONEY ® Layout and look and feel of SmartMoney.com are trademarks of SmartMoney, a joint venture between Dow Jones & Company, Inc. and Hearst SM Partnership. © 1995 - 2009 SmartMoney. All Rights Reserved. Source: SmartMoney.com | 26 Jun 2009 | 4:00 am 10 Things Rental Car Companies Won't Say (10 Things) 1. “We’re a tax magnet.” Rental-car customers are paying more, due to an unprecedented slew of taxes and fees. But that extra money doesn’t go to the rental car companies; it goes into city and state coffers, where it’s used to fund municipal projects. For example, in 2005 car rentals in Arlington, Tex., were hit with a 5 percent tax to help pay for the new Dallas Cowboys stadium. Car rentals get tapped as fund-raisers because local politicians won’t feel the repercussions at the voting booth. “They’re taxing people who are flying in from someplace else,” says a Hertz spokesperson. “These people can’t and don’t vote locally, so there’s no harm for them.” But there’s a way for consumers to dodge some of these fees: Pick up your car in town, not at the airport. In 2005 Travelocity found that taxes and fees were 45 percent lower for off-airport rentals. An added bonus, according to Neil Abrams, president of Abrams Consulting, is that you’ll save on rates, too: On average, they’re $10 cheaper per day in town. 2. “We track your every move.” Over the past few years, rental agencies have begun to install GPS devices in their vehicles. These units allow companies to track cars that are lost or stolen. But global-positioning technology also lets them know when a renter has been speeding or has taken a car into another state, which may be construed as increasing wear and tear. “Opportunity for a rental car operator to impose geographic limitations was never pitched by GPS sellers, but was discovered coincidentally,” says Michael LaPlaca, an attorney who specializes in rental car law. To date, most companies don’t use the technology to impose fines, but it can and does happen. American Car Rental, for example, was charging customers in Connecticut $150 each time they topped the speed limit for two minutes at a stretch, claiming it damaged their vehicles. Connecticut’s Consumer Protection Commission deemed the fines excessive, ordering the company to refund penalized customers, and in 2005 the state’s Supreme Court affirmed the decision. (American Car Rental has since gone out of business.) Since then other states, including New York and California, have passed laws preventing rental car companies from imposing such penalties. But some still try to get away with it: In 2006 California’s attorney general announced a settlement of over $700,000 in a consumer protection lawsuit against Fox Rent A Car for using GPS to illegally charge customers who traveled outside a three-state area and for forcing customers to purchase liability insurance. (Fox Rent A Car has not returned calls for comment.) 3. “Our prices are etched in sand.” Trying to find the best rental deal can be frustrating, since rates can fluctuate dramatically from day to day, even minute to minute. “Prices are constantly changing,” Abrams says. That’s because rental car agencies use something called yield-management technology, which continually adjusts pricing depending on how many cars are available. A sudden rash of cancellations or bookings, for example, can push rates up or down. When we priced an Enterprise rental for a spring trip to Los Angeles, the cost vacillated dramatically: Two hours after we first checked the company’s website, the per-day rate for a full-size car dropped almost $8, and over the next week it continued to yo-yo dramatically, with a range of $40. (“There are any number of reasons why the price of a rental car can fluctuate,” says a spokesperson for Enterprise. “During weekend specials you may see savings up to 50 percent; renting during the week could cost you more.”) Even the way you book can affect prices. When we called the Avis desk at LAX to reserve a minivan, we were quoted a price more than $150 higher than the amount being advertised simultaneously on the company’s website. Also, online travel agencies like Orbitz or Priceline can have completely different prices. That’s why it pays to comparisonshop and check back later to see whether rates have fallen—there’s usually no fee to cancel a reservation or rebook at a lower rate. 4. “You probably don’t need our insurance.” Most companies make reserving and renting a car pretty simple—until it comes to the issue of insurance. That’s where they offer a bewildering array of supplemental coverage, which can easily add $10 to $30 to your daily bill. What the overeager reps won’t tell you is that you may already be covered, either partially or completely. There are two major types of insurance you’ll want: a collision/damage waiver and liability. The former covers repair and replacement costs to the car should anything happen to it; the latter protects you from lawsuits if you’ve injured anyone or damaged property when driving. If you have auto insurance, it usually extends to rental cars, providing both collision/damage and liability, as long as you’re on a leisure trip. And many credit cards cover damages to the vehicle but don’t offer liability. As with any type of insurance, it’s always more complicated than it seems. “You shouldn’t assume you’re covered by your credit card,” says a spokesperson for the Insurance Information Institute. Check ahead of time with both your credit card and auto insurance providers to see if, when, and how you’re covered. 5. “Your reservation doesn’t mean bupkes.” Andy Parker was looking forward to spending his winter vacation exploring the back roads of Aruba. He even reserved a Jeep with Hertz to handle the rough driving conditions. But when he went to pick it up, he was told all they had on the lot was a sedan. “It was a sore spot,” says the Buffalo, N.Y., meteorologist, who got stuck with a small Nissan. As Parker found out, a reservation isn’t a guarantee. The rental agreement is contingent on availability. In fact, you’re not reserving a specific car model, but simply a class of car. (One exception: Hertz allows you to reserve high-end models in its “Prestige Collection.”) What a reservation actually means is that the company is supposed to have some kind of vehicle on the premises for you to rent. So if you get a smaller car than what you reserved, be sure to ask for a rate adjustment. (Parker got Hertz to take 20 percent off his bill; Hertz did not return our calls for comment.) If the lot is empty, the company is supposed to find you a car even if it means calling another agency and covering the difference. So if the clerk doesn’t offer, remind him that the company is liable if you wind up paying more for a rental car elsewhere. 6. “Special orders are our bread and butter.” Just like supermarkets, rental car companies bank on getting their customers to do some impulse buying at the checkout counter—where you can now choose from a sizable menu of à la carte amenities and services. The strategy seems to be working: 2007 revenue reached $21.5 billion, a 21 percent increase since 2002, according to Auto Rental News. A spokesperson for the American Auto Association says that a rental vehicle tricked out with extra features could run you $20 more a day. Here’s how it breaks down: GPS with turn-by-turn directions costs about $12 a day. Avis and Budget rolled out a service that for a minimal amount each day will let you pay highway tolls electronically—but that fee doesn’t include the tolls themselves. And if you want a baby seat for the minivan, add another bill to the pile. Companies have also begun pushing specialty cars. In 2007 Avis introduced its “Cool Car” collection, which includes the Nissan Altima Hybrid, Cadillac CTS, and Hummer H3. And even low-priced Thrifty has a “Beyond Luxury” collection, offering cars like the BMW 5-series and Cadillac Escalade. “It can be a place to make money,” the AAA spokesperson says. 7. “You’ve got to do a little detective work to find a good deal.” It used to be that better deals were to be had at smaller, independent rental car companies. But with rising energy prices and weakening demand, that’s no longer true. In fact, the changing rental car landscape is making it any company’s game to pitch a bargain—which means it’s more important than ever to shop around for the best deals. Good to know, since rental car rates—which remained relatively flat after 2000—have begun to rise again. The average daily cost of a rental was $73 in the second quarter of 2008, a 3 percent increase over the year before, according to American Express Business Travel. So how to find a bargain? Your best bet is to hit the Internet: Expedia.com and Orbitz.com offer reliable online comparison-shopping tools for rental car companies at locations near you. A recent search of Orbitz.com, for example, turned up a $230 weekly rate for an economysize car from Budget’s location at New York’s John F. Kennedy International Airport—that’s nearly half of what Avis was charging ($458). 8. “We’re cutting corners anywhere we can.” You may not have noticed, but over the past few years the fine print on rental contracts has been changing, restricting privileges and perks, even for the industry’s best customers. For example, in the winter of 2005, Hertz shortened the grace period for returning a car from one hour to half an hour for everyone including its #1 Club Gold members; customers also can no longer return a car after a location has closed for the night without incurring a late fee. (Hertz did not return our calls for comment.) In another move to cut corners, rental companies across the board have begun making customers liable for damage caused by so-called acts of God, such as hurricanes and floods. Avis and Budget, the last major holdouts on this policy change, have recently added it, even to their frequent renters’ contracts. The new rule means it’s now up to renters either to return a car before the natural disaster hits, drive the vehicle out of harm’s way, or pay up for the newly developed insurance option to cover this type of damage. 9. “you won’t believe what we’re charging for fill-ups.” Even when Brandon Harris is in a hurry, he tries to gas up before returning his rental car. When he was on vacation in Costa Rica a few years ago, he had to travel 15 minutes out of his way to find an open station. “I don’t think the rates that [rental agencies] are charging are fair,” the Chicago resident says. “It’s cheaper to do it yourself.” Although most car rental companies claim they charge the same for gas as local market conditions, it’s really the service charge that jacks up the price: You’re paying for fuel plus the luxury of not having to pump it yourself, says an AAA spokesperson, and not filling up the tank can tack on an additional $20 to your bill. Car rental companies do offer another option: prepaying for a tank of gas at a more reasonable rate so you don’t have to worry about finding a station at the last minute. There’s only one problem: You’re not likely to return the car empty. “Whatever gas you leave in the tank is a donation to the rental car company,” the AAA spokesperson says. So unless you’re tight for time, it still pays to gas it up yourself upon return. But watch out for gas stations right next to the airport, since they tend to have higher prices. These pumps “make a killing on out-oftowners filling up rental cars,” the AAA spokesperson says. 10. “We offer some terrific deals—on Thursdays when the moon is full.” Jay Winger thought he’d found a great deal. He was planning to use a Budget double-upgrade coupon when he rented a car for his Las Vegas vacation. The coupon had been accepted when he made the reservation online, but when he arrived at the rental desk, the agent refused to honor it. Why? At the bottom of the coupon in “really small print,” Winger says, it stated that the coupon wasn’t valid in all areas— including, as it turned out, Vegas. “There are always certain locations that don’t take part in national promotions,” says an Avis Budget Car Rental spokesperson. Winger wound up spending about $60 more than he had planned. “Renting a car is really tricky,” the Minneapolis native says. On every rental car company website, there are ads flaunting the companies’ latest deals. Not to mention the paper coupons that appear regularly in newspapers. But there are so many rules and restrictions involved that it’s often impossible to get exactly the deal that’s being advertised. For starters, some require a Saturday-night stay or a minimum five-day rental. Companies also designate blackout days, exclude popular locations like New York and Las Vegas, and reserve the right to terminate any given offer at any time. SMARTMONEY ® Layout and look and feel of SmartMoney.com are trademarks of SmartMoney, a joint venture between Dow Jones & Company, Inc. and Hearst SM Partnership. © 1995 - 2009 SmartMoney. All Rights Reserved. Source: SmartMoney.com | 26 Jun 2009 | 4:00 am Why Printer Ink Is So Expensive (Tough Customer) Leo Tolstoy, wordy fellow that he was, used a lot of ink. He was also on the frugal side, eventually renouncing his fabulous inheritance, trying to free his serfs and opting to stay in his kid sister’s convent. So you’ve got to wonder, if the Russian novelist had a home office, what kind of ink-jet printer would he use? It’s a question worthy of a great thinker’s consideration. After all, depending on which system you choose, the cost of printing a black-and-white page can range from two to 14 cents. Whether you’re printing a 1,400-page novel or your favorite borscht recipes, it adds up fast. Maybe he’d go for the Kodak. Unlike its rivals, which sell printers at a loss and make huge profits on the ink, the photo giant has been marketing its ESP printer line with an appealingly contrarian pitch: a fairly priced printer that takes cheap ink. Yes, it costs 30 percent more than comparable models, but the cartridges cost less than $15, and per-page printing costs are among the lowest in the industry. When I recently tried printing War and Peace using the Kodak ESP 5 and its $10 black cartridge, I got all the way up to page 317, where Rostov hears that the czar has been hit with a cannonball. Three cents a page works for me. You’d think the line would be a surefire hit. After all, the cost of printer ink is an old sore spot with consumers. In a 2007 Ipsos survey, 69 percent of respondents said cheaper ink tops their home-printer wish list. And it’s a legitimate gripe. The average retail price of a milliliter of ink shot up 360 percent between 1999 and 2007. Meanwhile, a $30 ink cartridge costs just three bucks to make; suppliers could cut prices in half and still take in a nice profit, says Lyra Research senior analyst Andy Lippman. But for most manufacturers, the traditional model is too lucrative to change. HP, for one, says its $29 billion Imaging and Printing segment is its most profitable division, earning three times what the company does on personal computers. That’s because even while printer makers lose about $30 on every $100 printer sale, the typical customer spends more than three times as much on ink over a three-year period as he did on the printer. And often, the cheapest models require the most expensive ink. If you find yourself irresistibly drawn to, say, the $30 Lexmark Z611 printer, replacement cartridges will set you back $66 a pop. So is Kodak revolutionizing the industry? Hardly. While the line launched with huge press fanfare, it sold just 520,000 printers last year—a tiny fraction of the 85 million ink-jet printers sold overall. Analysts say it’s because consumers are too shortsighted to consider the cost of ink when buying a printer. But I suspect the real reason is a strange quirk in the law that makes it almost impossible to compare long-term ink costs. The 1966 Fair Packaging and Labeling Act, which requires manufacturers to state quantities on consumer packaging, allows just a few exceptions, including lighters, safety pins and—you guessed it—ink. Only one of the major makers, HP, offers page-yield information on its cartridge packaging, and you still have to calculate per-page costs. “Consumers don’t have the right information to make the right choice,” says American Consumer Institute President Steve Pociask, who studies the ink market. Actually, the information is available, if you know where to look. Two years ago printer makers agreed on a universal standard to test how many pages their ink cartridges produce. HP and Epson, bless their inky souls, link to this information from their product pages. Canon and Lexmark, meanwhile, bury it so deeply online that I had to call their press offices for directions. Once you’ve got the data, you simply have to perform a series of seven calculations to determine the three-year cost of ownership for any particular printer. Have fun! Personally, while Tolstoy may not approve, I think I’ll let my serfs do the work. SMARTMONEY ® Layout and look and feel of SmartMoney.com are trademarks of SmartMoney, a joint venture between Dow Jones & Company, Inc. and Hearst SM Partnership. © 1995 - 2009 SmartMoney. All Rights Reserved. Source: SmartMoney.com | 26 Jun 2009 | 4:00 am 20 Index Fund Winners and Losers If you needed any more proof that investors are bailing out of safe havens and back into riskier bets, look no farther than the first-half performance of index funds. Index funds, which seek to replicate the performance of their underlying benchmarks, shine a light on what has become all-too apparent since the market started its remarkable 35% rally off its early March low: Emerging markets and growth stocks like technology and biotech are hot; Treasurys and value stocks are not. (Real estate investment trusts, or REITS, aren't so hot, either, but for different reasons that we touch upon below.) Indeed, the top 10 performing index funds for the year to date through June 23 either track the Nasdaq-100, which consists of the 100 largest nonfinancial securities listed on the Nasdaq Stock Market, or emerging market benchmarks such as the MSCI Emerging Markets index, according to data provided by Morningstar. If nothing else, the results are proof positive that an appetite for risk has returned with a vengeance, says Kevin Mahn, portfolio manager at Hennion & Walsh Asset Management. "Everyone from institutional investors to retail investors are anxious to rally right now," he says. "Everyone is chasing returns trying to make up for everything they lost in 2008." Brazil, Russia, India and China (the so-called BRIC countries that form the keystone of emerging markets) have seen their broad equity markets produce an average total return of 47% year to date, according to Standard & Poor's Index Services. Little wonder then that Vanguard Emerging Markets Stock Index (VEIEX) and Northern Emerging Markets Equity (NOEMX) lead the winner pack, gaining 28% and 27%, respectively through Tuesday. (See table below.) Coming in third is Amidex35 Israel (AMDEX), which tracks the 35 largest Israeli companies traded on Wall Street or in Tel Aviv. The fund gained 23% for the year through June 23. What's so special about Israel? It benefits from the fact that it is both an emerging market and has lots tech and other high-growth companies, says Aaron Katsman, chief executive of Lighthouse Capital in Jerusalem. Looking at the laggards, the flight from safety is put into sharpest relief by the performance of Treasury bond index funds, especially those holding debt with long maturities. Just take a look at Fidelity Spartan Long-Term Bond Index (FLBIX). It's off 13% year to date. Part of that decline is attributable to the fact that the longest-dated Treasurys returned more than 20% in 2008, meaning investors were willing to pay fat premiums for the government to safeguard their principal. The selloff has also been exacerbated by the so-called bond vigilantes -- traders who sell bonds in the belief that future inflation will force the Fed to raise rates. (Remember when interest rates rise, bond prices fall.) Mahn, who oversees the SmartGrowth index funds among the year-to-date laggards, says they were hurt by their allocation to bonds, among other factors, as well as the fact that the underlying Lipper indexes are constructed to stay within a certain band of risk. As for the REITs? They're being hurt by ongoing troubles in the credit and commercial real estate markets, says Morningstar analyst David Rodziewicz. "We're at the front end of declines for commercial real estate in general," he says. "The other issue is financing concerns. They're a highly levered business model with significant fixed costs, so they can't bring expenses down quickly."
Fund	Ticker	Year-to-Date Return (%)*
Vanguard Emerging Markets Stock Index	VEIEX	28.19
Northern Emerging Markets Equity	NOEMX	26.94
AMIDEX35 Israel	AMDEX	23.34
VALIC Company I NASDAQ-100 Index	VCNIX	18.77
California Investment Nasdaq 100 Index	NASDX	18.75
USAA NASDAQ-100 Index	USNQX	17.65
MassMutual Select NASDAQ-100 A	MOTAX	17.51
Homestead Growth	HNASX	16.01
HighMark NYSE ArcaTech 100 Index A	PPTIX	13.99
Fidelity Nasdaq Composite Index	FNCMX	12.33

Laggards FundTickerYear-to-Date
Return (%)* *As of 6/23/2009
Source: Morningstar Vanguard Value IndexVIVAX-5.09 SmartGrowth Lipper Optimal Conservative Index ALPCAX-5.25 Wells Dow Jones Global RESI Index AWDGAX-5.45 Fidelity Spartan Interm Treasury Bond IndexFIBIX-6.51 SmartGrowth Lipper Optimal Moderate Index ALPMAX-6.64 JHFunds2 Large Cap Value 1JICZX-8.19 SmartGrowth Lipper Optimal Growth Index ALPGAX-8.77 Fidelity Spartan Long-Term Bond IndexFLBIX-13.25 Vanguard REIT IndexVGSIX-16.30 Wells Dow Jones U.S. REIT Index AWDJAX-18.15

SMARTMONEY ® Layout and look and feel of SmartMoney.com are trademarks of SmartMoney, a joint venture between Dow Jones & Company, Inc. and Hearst SM Partnership. © 1995 - 2009 SmartMoney. All Rights Reserved.

Futures Stay Put on Economic Data (Market Update)

News at a Glance

• Mixed Markets: Dow futures down; S&P, Nasdaq steady.
• Banks Up: Bank stocks lead European markets higher.
• Oil Bump: Crude futures top $71 in Asian trading.
• Dollar Thumped: Greenback hit as China seeks new currency.

The Lowdown

Stocks look poised for a flat open Friday, capping a bumpy week on Wall Street. 

Dow, Nasdaq and S&P 500 futures continued trading a bit below fair value after the Commerce Department released May data on income and spending. Stocks bounced back on Thursday after declining for most of the week, as bargain-hunting lifted each of the major indexes more than 2%. Investors sought cheap shares of homebuilders, techs, consumer goods and commodities firms whose prices had been depressed by the recent selloff.

In Europe, the broader markets rose Friday with banks, including HSBC (HBC), BNP Paribas (BNP) and Credit Suisse (CS). Asian markets also saw gains.

Crude oil prices topped $71 a barrel in Asian trading Friday, as investors responded to mixed signs about the economy. Fear of further interference from Nigerian militants with the country's oil installations after Thursday's attack on a Royal Dutch Shell (RDS.A) pipeline also drove the price increase. Shortly before 6 a.m., crude traded up 94 cents at $71.17.

The dollar is on track for its biggest weekly loss against the euro in a month. It fell Friday, as China sought a new currency.

Corporate News

• UBS (UBS) raised about $3.5 billion by selling shares to boost capital and said it expects a second-quarter loss. The European bank with the biggest credit-crisis losses announced it sold the 293.3 million shares to a “small number of institutional investors” in order to boost confidence.
• Japanese authorities ordered Citigroup (C) to suspend all sales operations at its retail banking arm for a month after the company failed to take steps to curb money laundering. This is the second time in five weeks that the Financial Services Agency has cited Citi for inadequate oversight of possibly criminal transactions. Citibank is a relatively small player in the Japanese consumer market. It will suspend sales from July 15 through August 14.
• Qantas Airways said Friday it has cancelled delivery of 15 of Boeing (BA) 787 Dreamliner aircraft and deferred orders for another 15. The Australian carrier cited a dramatically changed operating climate and said the cancellation would save it about $3 billion. Earlier in the week, Boeing said it had again postponed the maiden flight of the Dreamliner again after having pushed it back by two years.

The Economy

• Personal income increased $167.1 billion or 1.4% in May, up from a 0.7% increase in April, the Commerce Department announced Friday morning. Consumer spending rose 0.3% in May, up from no change in April. Adjusted for inflation, spending was up 0.2%, compared to a 0.1% increase in April. Analysts expected personal income to rise 0.3%, compared to a 0.5% increase in April. Spending was expected to rise 0.3%. The rise in spending is evidence that the governments economic stimulus plan may be having an effect. The PCE deflator, a measure of inflation, rose 0.1% from May 2008, meeting analyst expectations.REPORT
  • The University of Michigan is scheduled to release revised June figures for the Reuters/University of Michigan Index of Consumer Sentiment at 9:55 a.m. Analysts forecast an index value of 68.8, down slightly from the June preliminary estimate of 69, but up from 68.7 in May.

SMARTMONEY ® Layout and look and feel of SmartMoney.com are trademarks of SmartMoney, a joint venture between Dow Jones & Company, Inc. and Hearst SM Partnership. © 1995 - 2009 SmartMoney. All Rights Reserved.

5 Housing Markets That Have Further to Fall (Consumer Action)

Home buyers looking for a bottom in the real estate market may have been encouraged by housing data released earlier this week. Sales of existing homes rose 2.4% in May, according to the National Association of Realtors. The increase was a little less than most analysts had expected, but it represented the second straight month of improvement. Meanwhile, sales of new homes dipped 0.6% in May, continuing a trend of fairly flat months so far this year, according to data released by the Commerce Department.

Don’t get too excited – it’s still too early to say the housing market bottomed out, analysts and economists say. Distressed properties still account for about a third of all sales, and 29% of sales were to first-time home buyers, who are currently benefiting from an $8,000 tax credit.

The sales trends are telling. “You’re not really seeing a lot of move-up buying,” says Richard F. Moody, chief economist and director of research at Forward Capital, LLC. “There are so many vacant homes and so many foreclosures that [there’s] not the normal trade-up pattern that you would have traditionally seen,” Moody says.

Housing prices fell nationwide during the first quarter, according to Standard & Poor’s Case-Shiller Index. The decline appears to be slowing: in February and March, the annual rate of decline did not set a new record, but home owners should take little solace in those numbers. “Based on the March data… we see no evidence that that a recovery in home prices has begun,” David M. Blitzer, chairman of the Index Committee at Standard & Poor’s, said in a statement.

All of this less-than-terrible news has left analysts cautiously optimistic that much of the country will start to see housing prices rise sometime in the next year or two. Looking at the nation as a whole, today through the spring of 2011 may be the window for those looking to buy a house at the bottom of the market, says Gary Hager, president and founder of Integrated Wealth Management, a New Jersey-based financial planning company.

A few markets where the housing crisis started earliest have already shown signs of bottoming out. Early-suffering cities like Denver and Boston are now seeing slower declines in home prices, which could indicate they’re already poised for a comeback.

And in some areas, buyers have seized on rapidly falling prices. Existing-home sales rose 9% in the Midwest in May, according to the National Association of Realtors.

“There will be regional differences in the turnaround,” says Maureen Maitland, vice president of index services at Standard & Poor’s. “Most economists I talk to are expecting the beginning of the turnaround to be sometime next year,” she says. However, she added, “the last market may not turn around for two or three years.”

For those hoping to buy at the best possible price, we’ve got a list of five cities where home prices may still have farther to fall. But keep in mind, getting a house at a discount is still not necessarily a house you can afford.

“In light of the housing market boom and bust, consumers should feel very comfortable financially” before deciding to buy, says Lawrence Yun, chief economist for the National Association of Realtors. “They should not try to overstretch their budget to get their dream home.”

1) Detroit

Housing prices fell 4.9% in Detroit in March, according to the latest reading of the Case-Shiller Index. That marked the city’s largest monthly decline since January 1991, when S&P’s backlogged data begin. Houses in Detroit are currently selling at 1995 prices – and with prices still falling so fast, it’s hard to say when the city will rejoin the 21st century.

“Detroit is Detroit because of the auto industry,” says Maitland. The whole Midwest is hurting from car companies’ woes, but Detroit is hurting the most.

2) New York City

Anyone who was hoping to see Wall Street suffer from the financial crisis can relax. New York may have avoided the nationwide implosion in home prices early on, but the city saw its largest-ever monthly decline in March, at 2.5%.

“New York may not be out of the woods,” Maitland says. “Because of what’s going on with the financial markets and the layoffs on Wall Street, New York may be one of the last places to turn around.”

3) Phoenix

Home prices in Phoenix have fallen 53% from their peak in June 2006, and the 2009 data suggest they’ve got farther to go. In March, prices in Phoenix fell 4.5%.

The Southwest has been one of the hardest-hit regions in the mortgage crisis. The region still faces a glut of recently-built homes.

“In Phoenix, you had some of the worst excesses,” in terms of overbuilding, Moody says. “The surplus of houses is so great that it could take two or three years” for prices to turn around. However, a steady influx of new residents into the region suggests the long-term prospects for the market are sound, he says.

4) Portland, Ore.

In the Northwest, median home prices are down but they remain above the national average. Portland’s prices fell 2.1% in March. Home prices in Seattle were down 2.0% for the month.

“Portland’s still going down,” says Dave McCarthy, president and chief executive of Integrated Asset Services, a real estate valuation and asset disposition and management company that collects data on the housing market.

The city “has remained pretty strong but they’re starting to feel some of the effects,” he adds.

The local labor market may be playing a role, Moody says. Portland’s unemployment rate was 11.6% in April, according to the Department of Labor. That’s well above the national average for the month (8.9%).

The Pacific Northwest bubble was among the last to burst, which could mean the market will be among the last to recover.

5) Minneapolis

Housing prices in Minneapolis fell 6.1% in March, the largest monthly decline of any metro area since data tracking began in 1987.

More than half of all March home sales in Minneapolis were due to foreclosure or short-sale activity, according to the Federal Reserve Board’s Beige Book, which gathers information on regional economic conditions. Foreclosed homes tend to drive prices down because “the bank’s best interest is to get the asset off their books” as quickly as possible, Maitland says.

SMARTMONEY ® Layout and look and feel of SmartMoney.com are trademarks of SmartMoney, a joint venture between Dow Jones & Company, Inc. and Hearst SM Partnership. © 1995 - 2009 SmartMoney. All Rights Reserved.

11 Smart Books: Our Latest Staff Picks

A whipsawing stock market has been keeping many of us busy—along with June’s weddings and graduations. While the unceasing rain in much of the country has meant more time for reading, it also delayed the start of summer. Now, though, with the prospect of sunnier days and more leisure time ahead, here's a chance to expand your reading list with some notable new books that our writers and contributors have enjoyed—including business reads and titles for relaxation.

Here’s our latest crop of staff picks:

The Age of the Unthinkable

Why the New World Disorder Constantly Surprises Us and What We Can Do About It

Author: Joshua Cooper Ramo
Reviewed by: Anne Kadet, Senior Writer, SmartMoney

Geostrategic advisor and former Time editor Joshua Cooper Ramo says we've entered a super-scary era marked by unprecedented risk and unpredictability. Even worse, lumbering Western nations are stuck on a worn-out approach to problem-solving that aggravates crises. Rather than dealing with the chaos, we approach this new world order as if it's a big game of pool, where logical strategies bring predictable outcomes. Among the results: economic meltdown, environmental disaster and a bungled war in Iraq. In his search for alternatives, Ramos explores people and organizations that seem to thrive amid chaos. This is the fun part of the book: We meet venture capitalists, terrorists, hackers, videogame designers and a South African doctor successfully treating AIDS. Unfortunately, the supposedly "revolutionary" approaches that Ramo distills from his excursions tend toward the sort of vague generalities one encounters in an introductory meditation seminar. And his policy recommendations (universal health care, more education spending) are depressingly familiar. Read it for the stories, not the solutions.

In the Sanctuary of Outcasts

Author: Neil White
Reviewed by: Robert J. Hughes

In 1993, Neil White, a writer and magazine publisher, seemed to be all you'd want in a good-looking and prosperous southern gentleman with a happy home. But his wants outstripped his means. To keep up appearances, White committed fraud by kiting checks ("an occasional financing technique"). After he was found out and convicted, White was sent to a federal prison, in Carville, La., on the banks of the Mississippi, that was like no other: It was also the last leper colony in the continental U.S. (The government treated lepers as less than human and figured it was okay to have them live alongside felons and murderers.) White describes his year of imprisonment as he grew to understand the facts of those living with leprosy (known as Hansen's disease), which helped him overcome his self-pity and the wayward sense of entitlement that had led to his illegal schemes. This poignant and very readable memoir introduces us, of course, to White's eccentric fellow prisoners, including a noted bodybuilder and an innovative doctor. More important, we meet the leprosy patients who taught White the value of appreciating life as it comes, not as one wishes it to be.

The Whiskey Rebels

Author: David Liss
Reviewed by: Will Swarts, Reporter, SmartMoney.com

America, it seems, has always been a country of speculators. In another of his historical thrillers, this one set in the early days of our American republic, author David Liss goes back to 1792 and places hard-drinking accidental detective Ethan Saunders amid actual events surrounding Secretary of the Treasury Alexander Hamilton and the founding of the Bank of the United States. Financial chicanery and dirty doings in the markets mix closely with the volatile politics and shifting loyalties of the fledgling United States where, Liss demonstrates, the more things have changed, the more they stay the same.

Down Around Midnight

A Memoir of Crash and Survival

Author: Robert Sabbag
Reviewed by: Matthew Heimer, Deputy Editor, SmartMoney

Late at night on Father’s Day in 1979, an Air New England turboprop crashed in a forest on Cape Cod with eight passengers aboard. By some combination of luck and aerodynamics, everyone but the pilot survived — including Sabbag, a writer who was "half a celebrity" at the time thanks to his best-selling cocaine-trade exposé "Snowblind." Three decades later, Sabbag revisited the crash and its aftermath, tracking down other survivors, their families and friends, and paramedics and civilians who responded to the disaster. The recounting of the crash itself, a harrowing and lightning-fast read, doesn’t take up much space here; the rest is a meditation on the relationship between memory and trauma and on the small-world connections among the survivors. Oddly enough for a "memoir," other people come across much more vividly on the page than Sabbag himself does; it seems he’s still struggling to decide exactly what to say about his own life-altering night.

Road Dogs

Author: Elmore Leonard
Reviewed by: Brad Reagan, Staff Writer, SmartMoney

The latest crime novel from Elmore Leonard starts as a love triangle of sorts, featuring laconic bank robber Jack Foley, diminutive Cuban killer Cuando Rey and Dawn Navarro, a professed psychic who nonetheless needs Foley's help to get at Rey’s fortune. Leonard junkies will recognize these characters from previous books, and he clearly enjoys letting them play off one another. The triangle quickly expands to become something like an octagon, with each character working a different angle, even if none of them take it all too seriously. The plot doesn’t quite fit together neatly but, as always with Leonard, the fun is in eavesdropping on the banter between streetwise players. To pluck just one snippet, listen in as Foley compliments the tanned midriff of a B-actress not exactly mourning the death of her wealthy husband:

"You must spend a lot of time in the sun."
"Alone by the pool," Danialle said, "with my grief. Thanks to you I’m beginning to feel like myself again."
"I haven’t done anything."
She glanced at him. "Are you sure?"

Among Leonard’s famous "10 Rules of Writing" is: "If it sounds like writing, I rewrite it." "Road Dogs" shows the old master, now 83, still practicing what he preaches.

$20 Per Gallon

How the Inevitable Rise in the Price of Gasoline Will Change Our Lives for the Better
Author: Christopher Steiner

Why Your World Is About to Get a Whole Lot Smaller

Author: Jeff Rubin
Reviewed by: Sarah Morgan,

If you’re not worried enough about the future, check out these two books about how increasingly scarce oil could fundamentally reshape the global economy. Start with Rubin, who lays out the case for why oil prices will get more volatile even as they climb inexorably higher, dragging the world economy along on a boom-and-bust ride. If Rubin convinces you that the price of oil has caused the current recession — and will cause the next — and has given you the broad-stroke outline of how globalization is about to be thrown into reverse, move on to Steiner. Steiner offers an enthusiastic and detailed description of the way we’ll live in a post-oil future. For Steiner, the decline of the suburbs, the end of air travel, and the re-localization of manufacturing and agriculture are all fantastic news. Steiner’s optimism (even in the face of a world without sushi) is infectious. But Rubin (even with his alarming predictions) is the better writer.

Get a Financial Life: Personal Finance in Your Twenties and Thirties

Author: Beth Kobliner
Reviewed by: Kelli B. Grant, Senior Consumer Reporter, SmartMoney.com

Today’s graduates may be strapped for cash — with an average student loan debt of more than $23,000 and few jobs in sight — but Kobliner’s guide is one worth giving to the recent grads in your life (or their shelling out $16 for). Kobliner has updated her 1996 original "Get a Financial Life" and her new version offers necessary and timely advice for today's finance novices. She provides a quick and dirty how-to on everything from picking a checking account and reducing debt to buying a home and investing. It’s an ambitious task for a 300-page book, and not without its failings (it's geared more toward financial neophytes in their 20s than to 30-somethings). But even with its few gaps, many readers will find everything they need here for starting out on the right financial path.

Maxxed Out

Author: David Collins
Reviewed by: Thomas E. Weber, Editor, SmartMoney.com

We’ve all had to suffer through the financial crisis, so we may as well at least get some beach reading out of it. In "Maxxed Out," when a ghostwriter teams up with a fictional mogul to produce a guts-and-glory business book, the result is an inside look at financial hubris — and crime. But despite sprinkled mentions of subprime loans, the story doesn’t feel ripped from today's headlines. Instead of a scurrilous 21st-century hedge-fund titan or a Madoff-style charlatan, billionaire Robert Maxx here is a real-estate dealmaker meant to evoke Donald Trump. Such a character might seem a tad '90s compared to our current crop of outsized financial scandal-mongers, but the story at least includes a cautionary tale about the perils of leverage. And it’s more than diverting enough to distract from a down-market day.

The Last Trials of Clarence Darrow

Author: Donald McRae
Reviewed by: Robert J. Hughes

The re-examination of life and career is thrust upon many people today, whether through their being bought out or laid off. But such personal quandaries are nothing new in America. Think of renowned lawyer Clarence Darrow, whose dazzling courtroom legerdemain is familiar even 80 years after his most famous trials. In the 1920s, well into his 60s, Darrow worried about what would make his life more meaningful. He wanted to write (he'd already published a novel), wondered about his ongoing affair with an ambitious journalist, anguished over his legacy. Then he found himself taking on a vital role in a series of sensational trials (including Leopold & Loeb and Scopes) that cemented his reputation as the century's most brilliant and courageous lawyer. Author McRae, who has written widely on sports, gives us an absorbing look at this important decade in Darrow's life, and draws a subtle portrait of the private and public man. With novelistic skill McRae also manages the singular feat of creating almost unbearable suspense about the trials' outcomes — even when we already know how they ended.

Horse Soldiers

The Extraordinary Story of a Band of U.S. Soldiers Who Rode to Victory in Afghanistan

Author: Doug Stanton
Reviewed by: Robert J. Hughes

Who'd have thought that one of the most potent weapons in the arsenal of the U.S. military was inadvertent horsemanship? Shortly after the events of Sept. 11, 2001, a band of Special Forces soldiers was dispatched to Afghanistan to battle the Taliban and Al Qaeda there. In order to fight the enemy on Afghanistan's legendarily difficult terrain — which has stymied foreign warriors throughout history — many of the soldiers learned to ride the region's small, tough horses, although the training of these men was better suited to wheeled vehicles that long ago replaced four-legged beasts on battlefields. Stanton captures the chaos and the urgent improvisatory nature of urban warfare, and describes the series of events, from early victory to subsequent ambush, with a flair for the broad dramatic stroke (the book has been sold to Jerry Bruckheimer Productions, which developed "Black Hawk Down"). There are a lot of players here, and sometimes it's hard to tell some of these valiant men apart, but together they emerge as an extraordinary band of brothers.

SMARTMONEY ® Layout and look and feel of SmartMoney.com are trademarks of SmartMoney, a joint venture between Dow Jones & Company, Inc. and Hearst SM Partnership. © 1995 - 2009 SmartMoney. All Rights Reserved.

Economy falls faster than expected, second half growth expected

Closure of Fletcher's Kumeu plant confirmed - 41 jobs to go

Warehouse expands online with new shopping site

Riviera Holdings stock removed from NYSE (AP)

Restaurant Brands predicts profit, welcomes share price rise

Stanford pleads not guilty to 21 charges

Russia considers bail-out for banks

Funds missing after Mrs Christmas hampers collapse

Qantas cancels, defers orders for 787 Dreamliner

Rest in Peace, Michael Jackson

Michael Jackson died of cardiac arrest today in his Los Angeles home. The shocking news almost overloaded the infrastructure of the entire World Wide Web. Go to TMZ to watch events unfold around Michael Jackson’s death.

I haven’t felt this rattled by a celebrity death since Princess Di perished in 1997. Michael Jackson was an icon. Although troubled in real life, his celebrity was almost superhuman. He was a legend, and I’m glad to have been around long enough to experience the sensation that he was.

Rest in Peace.

UBS unveils £2bn capital raising and warns of second-quarter loss

Alistair Darling set to boost FSA’s powers with new Banking Act

Write-Offs: 06.25.09

$$$ Inflation: The Real Threat To Sustained Recovery, By Alan Greenspan [FT]

$$$ Death of MJ: Good news for Colony Capital? [DB]

$$$ Sanford's Latin Lovah [LALATE]

$$$ Gazprom seals $2.5bn Nigeria deal, comes up with unfortunate name for new firm. [BBC]

$$$ Wall Street Sets Campaign On 'Populist Overreaction' [Bloomberg]

$$$ Cliff Asness's apartment is for sale. Someone should buy it and turn it into the DB Funhouse. [Cityfile]

Presented By:

Media : TV congested with road ads

Ron Insana's Gonna Make You All Rich

Provided you-- yes, you Big Guy-- act fast.

From: Ron Insana

Sent: Thu Jun 25 17:52:00 2009

Subject: First Time Ever: Invest with Me Now

Dear Investor,

I'd like to introduce myself. I'm Ron Insana -- perhaps you recognize me from CNBC, where I was a senior analyst for many years.

I'm writing today to let you know about a brand new product I've developed with TheStreet.com. It's called Market Movers by Ron Insana and it has only one purpose: to help you make more money in the markets.

Let me be direct: I have never offered a service like this before. And to thank you for becoming a charter member, I would like to offer you a special personal rate to see exactly how my service will help you become a better investor.

The Dow Jones industrials' moves since Lehman fall (AP)

Wren Says S&P 500 Will Move Over 1,000 By Year's End

Larry Kantor Sees Fed on Hold Until End of Year

NZ Shares: Local market ahead early

Kaufman Says Largest U.S. Banks Could Become Public Utilities

DeLong Says Americans Should Be Saving in `Uncertain World'

Wall St. Firing Squad Coming Together

The newest manifestation of Congress' insatiable appetite to play the Wall St. blame game will be unleashed soon. The 10-member Financial Crisis Inquiry Commission will have about 18 months to determine once and for all how last year's meltdown happened. For those hoping to get in on the fun, it appears as though there are 7 seats left.

A short list of names has emerged for the Financial Crisis Inquiry Commission that includes former Republican presidential candidate Fred Thompson; former Democratic head of the Commodities Futures Trading Commission Brooksley Born; and Alex Pollock, a fellow at the conservative think tank American Enterprise Institute, according to a source familiar with the matter.

Nominees emerge for US panel on Wall Street meltdown [Reuters]

Red Hat Cut to `Neutral' at Bank of America

How the major stock indexes fared on Thursday (AP)

UBS Suing Everyone Who Leaves Them

Why is UBS getting so bent out of shape over losing its (ex) global head of healthcare and half the group to Jefferies? Maybe because it's not the first time Jefferies has moved in on the Swiss's bitches! Less than two months ago Jefferies performed what our favorite tax evaders would characterize as a (panty) raid on its quants, stealing Jatin Suryawanshi, who was head of algorithmic trading, and five members of the team. Now UBS is suing Suryawanshi, Partha Sakar, and Sanjay Girdhar on the claims that when they moved to Jefferies they took "prop trading secrets" with them. What they don't include in the suit is the matter of not paying bonuses for 2008, which made the revenue generating prop team not very happy and was probably the reason they sought employment elsewhere.

Charlie Gasparino Recommends Protein Shakes

As previously mentioned, I had dinner last night with, among others, Charlie Gasparino. We dined at Campagnola, which was CG's pick, natch, as he has been going there for years, and the owners have a lax policy on unlicensed firearms and underage drinking. Before CG got there (he was taping Kudlow, who disappointingly did not join us), we did a little investigative reporting with the other regulars. Some blonde British lady who goes way back with CG very excitedly told us about the time a few years ago when Chaz had an altercation at Campagnola with Lance Armstrong. Apparently One Ball had appeared on CNBC earlier that day to discuss his sponsorship of a mutual fund and Charlie brought up the matter of doping rumors, which did not please Lance, and there was a bit of an on air tiff.

Coincidentally they both ended up at the restaurant that night, and friend insisted on introducing Chaz to OB, who pointed his finger in Gaspo's face and said, "You're an asshole." At first Charlie was (suspiciously) apologetic and told Lance how great he was "on the tube" and what an ace guest he was at handling CG's tough line of questioning. But Lance was having none of it, and continued to insist that no, Charlie was an asshole, that everyone on CNBC is an idiot and that he'd never do the show again. Charlie then told OB that he was sure CNBC could get someone else to come on his place and to have "a shitty fucking dinner."

We were also regaled, by Sal the maitre d', with a story about Chaz coming in for a drink a couple weeks after BSC went down for the dirt nap, and having a table full of Bear guys get up in his grill and make claims he was a two-bit reporter. Things got "openly hostile." Gasps told them "I feel bad if you lost your job but I was just doing my job." They continued tell CG how much he sucked, to which he finally responded, "Any time, anywhere, I don't care how many of you there are." Boom. Done.

I couldn't recall this morning what Gaspo had ordered but was reminded by another member of our party that he got an app of baked clams and shrimp, then half a chicken (which he put ketchup on), steamed spinach, and at least 7 [Update: Charlie tells me it was more like 10] martinis. I do recall that before our entrees came Chaz made a point to alert me that he hadn't touched any of the sopressat' on the table, though I suspect he had them wrap it up (plus whatever was left in the kitchen) for him to take home and tear into later. The famous "Eddie," who runs a family-owned chain of gay strip clubs, wasn't able to attend but toward the end of dinner a guy purporting to be Charlie's brother joined us (they looked nothing alike so I requested to see his driver's license, which did in fact bear the Gaspo name, though I remain not entirely convinced). CG tipped $100 on a pretax bill of $350, and at one point got very serious and insisted I report back that he has "a fetish for flossing and gargling," then whipped out a case of floss and a travel sized bottle of Scope to prove it. We then went to Elaine's where one guy at the table passed out and fell off his chair, which Charlie maintains he had nothing to do with. Here are the answers to your questions I was allowed to print (a decent number of them I was barred from sharing, unless I had an interest in ending up in a body bag).

Do you use moisturizer on your hands or face?
Never.

What do you think of David Faber's book?
I haven't read it yet. I'm too busy penning the definitive book on this crisis.

Is Jeff Macke writing the forward to your book?
No, there's no forward. I get right into it.

When are you going to dye your hair, which is going gray? Up top and below deck.
The hairs on my head, never. As for downtown, tell whoever asked that, oo gatz, like my mother used to say.

What kind of cologne do you wear?
Addidas sport set at the gym, Old Spice on the job, Drakkar Noir for special occasions.

Palm rises after quarterly results (Reuters)

Palm rises after quarterly results (Reuters)

Hear: Planet Money At WBUR

Adam & David live at WBUR. Sarah Abdurrahman/On Point

 

The audio from Adam & David's live show at WBUR is now available. Listen to them take questions from On Point listeners.

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GM Speeding Through Bankruptcy

General Motors continued its dash through bankruptcy court today with a hearing that granted the company $33 billion of debtor-in-possession financing in just 15 minutes. The bulk of the money, $30.1 billion comes from the U.S. Treasury, the rest from the Canadian government.

Debate over one potential conflict, the fees the automaker is paying its investment adviser, has been postponed until July 2. G.M.'s next big hearing, for final approval of its asset sale, is scheduled for June 30. If all goes well, the automaker could be out of bankruptcy by mid-July.

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How Will the 2010 Census Affect the Economy?

The US Census Bureau has received $11 billion to conduct the 2010 census, which takes place on April 1, 2010. On its surface, the census exists to count people for congressional zoning purposes. However, in a society with the scale and complexity of our current one, a people count can mean a lot more. Here are five ways the census will affect the economy:

Create jobs. The Census Bureau hired more than 860,000 people to help with the 2000 census. This year, the numbers could be higher. The government has a census jobs page here.

Allocate federal funds. A census helps the federal government decide where to send more than $300 billion worth of funds. If the census finds that certain communities lack in government-supported areas like healthcare, education, and law enforcement, the government may send money or resources to those regions.

Find new markets. Businesses can use census data to find out where to build homes, open stores, and target products.

Determine representation. The US census determines seats on the House of Representatives. Depending on the population count, states can gain or lose seats in the Senate (In 2000, Utah lost a seat to North Carolina by fewer than 1,000 citizens). The Washington Times speculates that growth states–most of which are Republican–will gain more seats in the House after the 2010 census.

Other factors. One economic downside of the census has to do with opportunity costs. The government claims the census is short, but if this list of questions (which includes another survey) is final, the form will take a little while to fill out.

Secondly, if you read the questions below–I informally summarized them from the official list–you might also find some of them rather probing. The 2010 census seems to contain a whiff of potential social engineering. See the questions for yourself:

Name
Age
Date of Birth
Sex
Marital Status
Have you given birth in the past 12 months?
Any granchildren living in the house?
Are you of Hispanic, Latino, or Spanish origin?
What is your race?
Is this a house, apartment, or mobile home?
Is it owned, rented, or occupied without payment?
How many people are currently living in this house/apt/mobile home?
Have you lived in this house for one year?
What is your phone number?
Please provide information for each person living here.
Where were you born? Are you a citizen of the US? If not, when did you move here?
Do you speak a language other than English at home? How well do you speak English?
Highest level of education completed.
Any military service?
Are you deaf/blind/otherwise disabled?
Food stamps?
List your income.
Are you laid off? Working? Temporarily absent from a job? Looking for work? Able to work?
What kind of employee are you? What are your duties?
How long did you work last week? Where? Any sick leave or other leave last year?
How many hours do you work per week?
Where did you work last week? How did you get there? What time did you leave home to get there? How long does your commute take?
How many cars does your household have?
When was your building built?
What kind of building is it?
How many bedrooms?
What kinds of plumbing/appliances are in the home?
How do you heat it?
Is there a business in the same building?
How much do you pay for utilities?
What’s your HOA? Real estate taxes? Insurance? Mortgage payment?
Are you covered by health insurance? What kind?
How many times have you been married? When was the last time you got married?

Half-Built China

Seen in Changzhou, China. Andi VanderKolk

 

Andi VanderKolk recently moved to China to teach English. She writes:

I work in Changzhou, China which is a fairly middling size city for China but which has been hopping aboard the business/development train. I don't think work has ENTIRELY halted because occasionally I see a worker or two, but I pass these buildings every day on my way to work, and they are just sitting there. I haven't seen a change in 3 weeks.

After the jump, more pictures.

Seen in Changzhou, China. Andi VanderKolk

 

I work in a neighborhood called Xinbei, which is full of businesses, but although it is very developed, everything seems to be empty. The restaurants, many of the apartments -- I was sure that China would be teeming with people, but there are sections of Changzhou that aren't even a little teeming

Seen in Changzhou, China. Andi VanderKolk

 

Share your pictures with Planet Money on Flickr.

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Fridson Sees U.S. Beginning Ordinary Cyclical Recovery

Levitt Says Lobbyists May Kill U.S. Financial Reform Proposals

Holland Says Low Valuations Make Profitable Investing Easier

Peroni Sees S&P 500 in Mid-900s, Dow at 9,200 This Summer

Haverty Says Microsoft May Buy Yahoo, Compete With Google

Reading "Between the Assassinations"

Businesses adapting to climate change

Foreclosures reach prime borrowers

Unemployed stay afloat on credit

Pizza Hut: Just think of us as 'The Hut'

Financial industry tries image revamp

Bernanke denies hiding information

FTSE 100 down on US jobs data (AFP)

AFP - The London stock market closed lower on Thursday, dragged down by US jobs data, as investors remained anxious about the economic climate.

Porn Hits the iPhone App Store

Image: Pocketpicks.co.uk

In case you were wondering whether iPhone 3.0’s age restriction feature meant porn was on the way, the answer is yes. Wired has the details:

Apple has finally allowed pornography into the iTunes App Store. The application, called Hottest Girls, costs $2 and includes “2200+ images of topless, sexy babes and nude models.”

The most interesting part is the social media aspect, or at least a crowd-sourcing one. When you view a picture full-size you are asked to rate it as either good or bad. Supposedly these ratings will steer future updates, which will be free and pushed directly to buyers.

If you hear a distant rumbling, it’s probably a porn industry stampede towards Cupertino.

'My Very Own Stimulus'

Clay from Maryland writes:

I think did everything right. (and I'm pretty lucky) I live within my means and put 20% down when I bought my home in 1999. I have a 14-year old truck, a steady job and a 1 mile commute. After this latest meltdown and the interest rates dropped, I took advantage of the situation and enacted my very own stimulus program.

Even with the recent drop in home prices, my home is still worth double what I paid for it. So I got a re-fi (30 yr fixed) and pulled out some cash. I am now taking advantage of every tax credit and incentive I can get my hands on -- new Energy Star appliances, new energy efficient heating and a/c units. And to top it off, I'm even putting on solar panels.

I've calculated that the spending I'm doing now will have a pay-off of about 10 years. After that the utilities savings are free money. And since all my stuff was about 20 years old it was time to replace anyway.

I feel that the government is finally putting enough incentives out there that folks like me with money in the (FDIC insured) bank and a bit of fiscal savvy are going to get the economy going again.

I'm even thinking about using my 14-year old truck in the cash-for-clunkers program to get a Hybrid. Taking yet another few thousand bucks from Uncle Obama.

Bottom line. There are opportunities out there that I don't think will be coming our way again anytime soon.

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Matt Taibbi’s “The Great American Bubble Machine” Demystifies Goldman Sachs

Matt Taibbi’s latest Rolling Stone article, “The Great American Bubble Machine,” undresses Goldman Sachs–and finds a “giant vampire squid wrapped around the face of humanity.” Not only do former Goldmanites essentially run the world, they help manufacture and burst economic bubbles, harvesting mean profits the entire time. Taibbi details how the bank manipulated investors, starting during the Great Depression.

Zero Hedge scanned the entire article onto Scribd; find it here.

Taibbi’s conclusion: “It’s a gangster state, running on gangster economics, and even prices can’t be trusted anymore; there are hidden taxes in every buck you pay. And maybe we can’t stop it, but at least we know where it’s all going.”

Read it!

Tying Spending To Housing

Amir Sufi and Atif Milan of the University of Chicago Booth School of Business argue in today's Wall Street Journal that the recent decrease in consumer spending has been directly fueled by a drop in housing prices. The article is a response to a piece last week by Charles Calomiris and several other economists which suggested the relationship between the two has been overstated. From Sufi and Mian:

...We find striking results: from 2002 to 2006, homeowners borrowed $0.25 to $0.30 for every $1 increase in their home equity. Our microeconomic estimates suggest a large macroeconomic impact: withdrawals of home equity by households accounted for 2.3% of GDP each year from 2002 to 2006.

Our results demonstrate that homeowners in high house price areas borrowed heavily against the rise in home equity from 2002 to 2006. We also provide evidence that real outlays were a likely use of borrowed funds. Money withdrawn from home equity was not used to buy new homes, buy investment properties, or invest in financial assets. In fact, homeowners did not even use home equity withdrawals to pay down expensive credit card debt! These facts suggest that consumption and home improvement were the most likely use of borrowed funds, which is consistent with Federal Reserve survey evidence suggesting home equity extraction is used for real outlays.

The bottom line for Sufi and Mian is clear, unless the housing market recovers, consumer spending will continue to fall.

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Amazon Warns State of California to Back Off

This week Amazon.com Inc. sent a letter to California legislators threatening to sever business relationships with affiliates in the state if they passed a law forcing the Seattle based company to collect and remit California sales tax.

Last week Amazon sent letter to North Carolina and Hawaii as they got closer to passing similar legislation. The states are looking to require e-commerce companies with online affiliates in their state to collect tax. These affiliates receive commission from sales that are the result of links on their own websites. According to the WSJ, the letter sent to California Gov. Arnold Schwarzenegger and leaders in state government called the proposed law, AB 178, unconstitutional and said it ”ultimately would require sellers with no physical presence in California to collect sales tax merely on the basis of contracts with California advertisers” .

Geoffrey A. Fowler reports:

Assemblywoman Nancy Skinner, a Democrat, said that the law could raise nearly $150 million in revenue for the state when she proposed it in February. The California law is based on one passed by New York last year, which Amazon and Overstock.com Inc. have challenged in court. Ms. Skinner’s bill is still pending its first hearing in committee.

Aside from desperately needed revenue for the State of California, the new tax law is hoped by some to ‘level the playing field’ between brick and mortar stores and online retailers. They cite boarded up store fronts and struggling local economies.

I don’t know about you, but when I buy online, it’s not because I’m saving the 10% sales tax (yes, where I live it’s just under that). It’s because shopping online is convenient. It’s time efficient. Sure I might save a little on with the discounts and tax savings, but I make up for it in impulse purchases and shipping costs.

Do online retailers really have a competitive advantage, and if so, does it have anything to do with sales taxes?

Image Credit: Robert Scoble, Flickr

Morning Roundup: Up And Down

Two bits of economic data from the government today: the Bureau of Economic Analysis released the Gross Domestic Product numbers for the first quarter of 2009, and the Department of Labor released new unemployment insurance claims for the week ending June 20.

The first-quarter GDP decreased at a rate of 5.5 percent from the fourth quarter of 2008. Not great news, but an improvement over the previous quarter's 6.3 percent drop. Also on the plus side: the first-quarter shrinkage is lower than the 5.7 percent rate initially expected.

The bad news? Unemployment numbers are up. The number of new claims rose last week by 15,000 to 627,000. The total number of people collecting unemployment also rose, by 29,000, to 6.74 million.

Looks like it might take a while to recover from this economic crisis. But you knew that.

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