Monday, June 4, 2012

What We’re Reading, 6/4/12

Every morning, we poll the staff and round up their favorite economic, financial and political reads of the day. On our radar as the week starts up: economic slowdown, existential crisis, and the many money problems of the ultra-rich and famous.

"Investors Brace for Slowdown," by Jonathan Cheng, Charles Forelle and E.S. Browning (Wall Street Journal). Well, the week is off to a less-than-thrilling start. Investors are getting antsy as Europe, China and the U.S. show fresh signs of economic turbulence. Just a smattering of the rough market news: Asian markets are down sharply, European stocks slumped last week, and on Friday, the Dow dropped to its lowest point in six months. Happy Monday, everyone!

"Euro Zone is Lurching to a Crossroad," by Landon Thomas Jr. (New York Times). The euro zone faces an existential crisis of the most massive (and massively expensive) kind. Key to the region’s proverbial angst: Should it seek greater fiscal unity or just break up? While Spanish and Italian leaders called for euro bonds and central authority this weekend, they face political opposition from the likes of Angela Merkel, who hesitates to bail Spain out. (If this is all starting to sound rather dizzying and Game-of-Thrones-esque, the Times has helpful interactive charts on the timeline of the crisis and the players in it.)

"Remarks at the Festival of Economics," by George Soros (GeorgeSoros.com). While your friendly curator can think of no festival more dull-sounding than the “Festival of Economics” — are there demand-curve roller-coasters? Keynesian funnel cakes? — Soros’ remarks in Trento, Italy are certainly worth a read. The billionaire investor argues, in grandiose TED-talk fashion, that the foundations of economic theory fail to account for human mistakes. Significantly, he also says the eurozone has about three months to right itself. If that seems dense, CNBC has the Spark Notes

"The Mayor of Mayors," by Gabriel Sherman (New York). He banned trans fat! He shrinks your soft drinks! Michael Bloomberg may be the most visible mayor in the U.S., and certainly one of the most controversial — which leads Sherman to the question, where will he go next?

"Who Has the Spine to Fix the U.S. Economy?" By Fred Hiatt (Washington Post). Spoiler alert: No one. “It’s hard to be optimistic,” Hiatt writes. “Obama has the eloquence, but neither Obama as president nor Romney as governor showed much patience for legislative jawboning or relationship-building … It would be nice to think that the forthcoming campaigns will focus on this issue enough to give voters a basis on which to do more than guess. Judging by the debate so far, any optimism on that score seems even more naïve than refusing to give up on a grand bargain in 2013.”

"Small Fish Burned in Facebook IPO Knew Better," by William Cohan (Bloomberg). Critics railed against Wall Street, Morgan Stanley, Nasdaq, and Facebook itself — but if you fall in Cohan’s camp, small investors who lost big can only blame themselves.

"Life After the NFL a Struggle for Many Former Players," by Jeffri Chadiha (ESPN). Today in people-we-don’t-feel-very-sorry-for: “Terrell Owens hasn’t officially retired yet, and he already has blown the $80 million he earned during his career. Warren Sapp recently filed for bankruptcy. Former first-round picks Michael Bennett and William Joseph currently face federal charges of tax fraud and identity theft.” Apparently uber-rich ex-athletes can’t manage their millions! Seventy-eight percent of NFL retirees are bankrupt or financially strained.

"Mitt Romney Reports He’s Worth Up to $255 Million," by Reid Epstein (Politico). In other breaking news, Mitt Romney’s still rich. (More interestingly, Obama’s tax plan would cost him $5 million. Mo’ money mo’ problems, as they say.)

And in other news: Bernie Madoff’s son can’t get an apartment, these moms raised $1.57 million through the school PTA, and Facebook wants to share the joys of social networking with little kids

Happy reading, Tumblers!

Wednesday, May 30, 2012

What We’re Reading, 5/30/12

Every morning, we poll the staff and round up their favorite economic, financial and political reads of the day. What we’re perusing over coffee this morning: Spain, Greece, India, and Amercia (sic).

"Spain Rattles Markets, Greeks Warned of Catastrophe," by Julien Toyer and Karolina Tagaris (Reuters). Oh look, Spain is the new Greece — but in this case, it’s not a fashionable distinction. Spain’s fourth-largest bank is on the brink of collapse, and the European Central Bank rejected a plan to bail it out. Meanwhile, Greece’s biggest bank warned that living standards, incomes and employment would suffer dramatically post-euro. (Considering all that pathos, a lot of investors have begun banking on U.S. treasury notes instead.)

"Most Aid to Athens Circles Back to Europe," by Liz Alderman and Jack Ewing (New York Times). Europe gave Greece 130 billion euros in bailout funds. But like a recent college grad with too many loans, Greece can only use that money to pay off interest on its debts — and not, you know, provide basic services to its beleaguered citizens.

"India’s Economy Slows, With Global Implications," by Jim Yardley and Vikas Bajaj (New York Times). In case all this talk of Europe is boring you, inflation and deficits are also up in India, where government officials only recently predicted growth rates of more than nine percent.

"Romney Clinches Nomination," by Ginger Gibson (Politico). Surprise, surprise. The real story here is Donald Trump, who tagged along but kept mercifully mum on Obama’s “disputed” birthplace. 

"As Governor, Romney Picked Winners and Losers of His Own," by Andy Sullivan (Reuters). New Romney ads skewer Obama for granting tax breaks and extended loans to favored industries. The problem? As governor of Massachusetts, Romney granted similar favors to firms like Bristol Myers-Squibb and Spherics Inc. — the latter of which shut down and defaulted on its loans.

"Campaigns Mine Online Data to Target Voters," by Beth Fouhy (AP). TV ads and direct mail are so 2008. Now, Obama and Romney are spending hundreds of thousands of dollars to target online ads to tiny niches — and collect data on the people in them. Writes Fouhy: “The 2012 election could be decided by which campaign is best at exploiting voters’ Internet data.” 

"Could Latino Voters Turn Deep-Red Texas Democratic by 2020?" By Jason Margolis (The Atlantic). Some thought-provoking demographics, in light of Romney’s Texas win: Fifty percent of the state’s youth are Latino, and Latinos overwhelmingly vote for Democrats.  

"Networks Built on Milliseconds," by Anton Troianovski (Wall Street Journal). To some people, high-frequency trading isn’t frequent enough. A number of firms are developing microwave relays between Chicago and New York, which will work even faster — 2.3 milliseconds faster — than the current fiberoptic system. That could work out to an extra .08 cents per share traded, by some estimates.

"Apple’s Cook Says Focus Remains on Products," by Dan Gallagher (Marketwatch). Apple CEO Tim Cook sat down for an extensive interview at this week’s All Things Digital conference, with some telling revelations for Apple investors and fans. Among them: Cook wants to move more manufacturing to the U.S., and Apple’s hard at work on that fabled TV. (A more detailed live blog from All Things D is here.)

And in other news: Jaguar was pleasantly surprised by its Mad Men cameo, the author of the Black Swan thinks a euro breakup would be no big deal, and someone on the Romney staff is about to lose her job — the campaign’s “With Mitt” iPhone app misspelled America and inspired a parody Tumblr.

Happy reading, Tumblers!

Friday, May 25, 2012

What We’re Reading, 5/25/12

Every morning, we poll the staff and round up their favorite economic, financial and political reads of the day. On our minds this morning: beaches, barbecues, and the impending three-day weekend. (Er — make that oil prices, Tim Cook and really rich CEOs.)

"Gas Prices Moderately Lower as Driving Season Starts," by Clifford Krauss (New York Times). Some good news to get you in the Memorial Day mood: Gas prices are modestly lower now than they were a year ago, which should make traveling easier for all you weekend road-trippers. Even better, tensions with the Middle East have relaxed, making oil prices less volatile overall. Now for the bad news!

"New Signs of Global Slowdown," by Jon Hilsenrath and Joshua Mitchell (Wall Street Journal). A number of brow-furrowing economic reports dropped this week: U.S. business spending on long-term goods is down, business sentiment in Europe declined, manufacturing around the world dropped off and several international organizations cut their 2012 growth forecasts. “A new economic threat is emerging,” Hilsenrath and Mitchell explain, “… activity is slowing in sync around the globe and not just in a few markets with their own isolated problems.”

"J.P. Morgan Gave Risk Oversight to Museum Head Who Sat on AIG Board," by Dawn Kopecki and Max Abelson (Bloomberg). The guys who oversaw risk at J.P. Morgan are about as qualified for the job as your friendly curator — which is to say, not qualified at all. Of the three, none have worked at banks or as financial risk managers. Only one has Wall Street experience, and it is 25 years (!) out of date.

"Obama Stumbles Out of Gate," by Mike Allen and Jim Vandehei (Politico). The race to the 2012 election is a long one, and things that seem to matter now could fade by November. But there’s no ignoring the fact that President Obama is off to a slow start: Between sluggish fundraising and the Bain back-and-forth, he might lose the edge that Democrats expected.

"CSI: Housing Bust," by Beth Raymer (The Atlantic). While your friendly curator doubts that Digital Risk boasts the theme music and cheesy punchlines of a primetime crime show, the company’s work is pretty intriguing. Analysts there look for evidence of bust-era fraud — as in the case of a Las Vegas man who applied for 15 mortgages in a week, or a Michigan woman who refinanced her house five times in five years (and didn’t tell her lender she didn’t have a job).

"The Choice" (The Economist). While the “Grexit” was on everyone else’s minds, The Economist dreamt up another solution to Europe’s fiscal woes: a semi-federalist “superstate,” where countries rely on each other more than they do now. (What horrible portmanteau can we devise for this? The Euperstate, perhaps?) 

"How Tim Cook is Changing Apple," by Adam Lashinsky (Fortune). Apple’s new CEO worked in an Alabama paper mill, eats in the company cafeteria, and cares far more about investors than Steve Jobs did. 

Johns Hopkins Commencement Speech,” by Tim Geithner. Treasury Secretary Geithner talked economic recovery, Barack Obama and public image to graduates at the Nitze School. An excerpt: “If you are going to make a difference, especially in public life, you need to be willing to get close to the flame. You need to be willing to take risk and feel the heat … There was no precedent and no playbook available to any of us, other than the graveyard of mistakes from other crises. But we knew we had to act.”

And in other news: Jack White could teach econ 101, the FTC has its eyes on your POM, people rob banks to pay for dentures, and the country’s highest-paid CEO made — wait for it! — $137.2 million last year.

Happy reading, Tumblers!

Monday, May 14, 2012

What We’re Reading, 3/14/12

Every morning, we poll the staff and round up their favorite economic, financial and political reads of the day. On our radars this morning: Toms shoes, student debt, and boatloads of next-week analysis on the J.P. Morgan loss.

"J.P. Morgan May Lose Sway in D.C.," by Scott Patterson and Victoria McGrane (Wall Street Journal). The fall-out from J.P. Morgan’s massive trading loss continues: as if the big-name executive departures weren’t bad enough, a number of the firm’s political allies are also backing away. Patterson and McGrane quote an unnamed banking lobbyist, who says J.P. Morgan’s loss “sets us all back.”

"Obama’s Wall Street Problem," by Ben White (Politico). Banks aren’t the only ones feeling the J.P. Morgan sting. Wall Street’s suffering image might also hurt Obama, who claimed to shake up Wall Street after the 2008 collapse. 

"How Wall Street Killed Financial Reform," by Matt Taibbi (Rolling Stone). No one can say with any certainty that more strident financial reforms would have prevented the latest Wall Street drama. But Dodd-Frank is certainly weaker than it could be — and Rolling Stone has a stinging, longform history to prove it. Taibbi’s true to form: “The giant reform bill turned out to be like the fish reeled in by Hemingway’s Old Man – no sooner caught than set upon by sharks that strip it to nothing long before it ever reaches the shore.”

"Analysis: The Core Problems with J.P. Morgan’s Failed Trades," by David Henry and Carrick Mollenkamp (Reuters). If you’re still wondering how J.P. Morgan managed to lose that startling $2 billion, Reuters has a solid rundown on the firm’s bad investments (and investment strategies). Also worth a read: Maureen Farrell’s take on J.P. Morgan and “massive speculative bets,” which major banks still make en masse.

"Missing: Stats on Crisis Conviction," by Jean Eaglesham (Wall Street Journal). How many executives landed in jail for their role in the financial collapse? Good question! No one knows. 

"A Generation Hobbled by the Soaring Cost of College," by Andrew Martin and Andrew Lehrin (New York Times). Ninety-four percent of B.A. students take out loans to go to school — more than double the borrowing rate a mere 20 years ago. (In more optimistic news, however, this year’s graduates will also see better job opportunities than the three classes before them.)

"Can the Euro Avert Collapse?" By Andy Robinson (The Nation). Robinson weighs the euro’s future from Spain, where debt and unemployment look particularly tough.

"Here Be Dragons: Anthony Bolton," by Robert Cookson (Financial Times). ”Britain’s Warren Buffett” composes classical music, can’t use chopsticks, and struggles to recoup two years of poor returns. 

In other news: the economics of Toms shoes, a super PAC for the under-30 crowd, and why you should keep your baby off Facebook.

Happy reading, Tumblers!

Wednesday, May 9, 2012

What We’re Reading, 5/9/12

Every morning, we poll the staff and round up their favorite economic, financial and political reads of the day. On our agendas for this afternoon: moderate Republicans, CEOs, and unpaid interns.

"Moderate Republicans Fall Away in the Senate," by Nate Silver (New York TImes). In case you missed it, six-term Indiana Senator Dick Lugar was defeated by a Tea Party-backed challenger in primary elections yesterday. (He went on to write a fascinating 1400-word screed about partisanship.) The Times’ Nate Silver ran some numbers and found that Lugar’s race, while dramatic, is by no means unique: Moderate Republican Senators have an attrition rate of 78 (!) percent.

"CEOs: Don’t Raise Taxes on Dividends" (Politico). The CEOs of 18 major corporations — including UPS, Verizon and Xcel Energy — penned a Politico op-ed re: Obama’s proposed tax hike on dividends and capital gains. An excerpt: “Dividend-paying stocks offer investors a bright spot in a challenging financial marketplace … The threat of looming tax increases on dividends and capital gains could also increase volatility in the stock market this year.”

"Private Jobs Increase More with Democrats in the White House," by Bob Drummond (Bloomberg). If you believe Bloomberg’s latest analysis, almost two-thirds of private sector job growth occured under Democratic presidents over the past 50 years.

"Morgan Stanley’s Grimes Is Where Money and Tech Meet," by Evelyn M. Rusli (New York Times). Silicon Valley’s “banker of choice” wears leaf-print ties, knows computer science, and helps tech companies like LinkedIn, Groupon and Facebook go public.

"How to End This Depression," by Paul Krugman (New York Review of Books). Krugman goes long on austerity, stimulus and the “moral imperative” of getting people back to work. 

"Why College Football Should Be Banned," by Buzz Bissinger (Wall Street Journal). As if that Krugman essay weren’t controversial enough, Friday Night Lights author Buzz Bissinger is tackling the economic consequences of college football. “College football has no academic purpose. Which is why it needs to be banned,” he declares early on. “A radical solution, yes. But necessary in today’s times.” 

And in other news: Sacha Baron Cohen “endorsed” Mitt Romney, The Billfold weighs the cost of various summer blockbusters, and The Atlantic collects stories from unpaid interns.

Happy reading, Tumblers!

Monday, May 7, 2012

What We’re Reading, 5/7/12

Every morning, we poll the staff and round up their favorite economic, financial and political reads of the day. On our agendas this morning: The austerity backlash, Mark Zuckerberg, and Warren Buffett playing ping-pong. 

"Challenge to Austerity, and Germany, Is Sharpened," by Matthew Karnitschnig and William Boston (Wall Street Journal). Voters in Greece and France really shook things up this weekend — the French elected Socialist candidate Francois Hollande, and the Greeks voted up a number of fringe parties. Translation: Both countries are sick of strict austerity measures. But even the big elections may not be enough to change those policies.

"Markets Could Stumble After France, Greece Votes," by Daniel Wagner (AP). All this political uncertainty is startling the markets — CNN Money also has a telling chart

"Battleground Poll: Obama, Romney in Dead Heat," by James Hohmann (Politico). Six months until the presidential election and the numbers look “extremely fluid” and incredibly close. The latest poll puts 48 percent of likely voters in Romney’s camp, and 47 percent in Obama’s.

"The Maturation of the Billionaire Boy-Man," by Henry Blodget (New York). A fascinating profile of Facebook’s semi-infamous CEO, only weeks before the social network’s highly hyped public offering. From the dek: “Incredibly, Mark Zuckerberg has grown up to become an ace CEO — one whose way of thinking might drive Wall Street nuts.”

"The Frequent Fliers Who Flew Too Much," by Ken Bensinger (LA Times). Steven Rothstein has flown more than 30 million miles in his lifetime. That makes him a bit fanatical, extremely well-traveled — and part of the reason American Airlines no longer offers an unlimited travel pass.

And in other news: Vanilla Ice feels good about the housing market, you could theoretically buy the White House for $110 million, and one brilliant Wall Street reporter is collecting photos of Warren Buffett “doing folksy things.”

Happy reading, Tumblers!

Friday, May 4, 2012

What We’re Reading, 5/4/12

Happy Friday, Tumblers! Every morning, we poll the staff and round up their favorite economic, financial and political reads of the day. On our agenda as the week wraps up: Job numbers, #Julia and J.P. Morgan coffee sleeves. 

"Economy Adds 115,000 Jobs in April; Unemployment Rate Drops to 8.1 Percent," by Peter Whoriskey (Washington Post). The latest jobs report is a bit of a bummer, to say the least — economic growth has slowed, and even the slight drop in unemployment has more to do with job-seekers giving up the search. For a quicker (and slightly snarky) summary, we direct you to the Billfold: “Everyone Still Needs Jobs.”

"Jobs Report Will Provide Fodder for Campaigns," by Laura Meckler and Sara Murray (Wall Street Journal). What the new numbers mean for Obama and Romney.

"Facebook Sets IPO Share Price at $28-35," by Matt Krantz (USA Today). At that price, the IPO will raise about $10.6 billion, or enough to make Facebook the fifth-largest IPO in U.S. history. The company, valued at $86 billion, is also the most valuable U.S. company to ever go public.

"More Americans Stashing Cash in Home Safes," by Charles Passy (Smart Money). Some safe manufacturers have announced sales jumps of more than 40 percent in the last few years. Writes Passy: “Experts say that many savers and investors feel a lingering sense of insecurity in their finances — a hard-to-shake fear borne out of the jolting recession and, at times, wobbly recovery — which is helping to spur the new safeguarding mentality.” 

"Conservatives Mock Obama’s ‘Julia,’" by Tim Mak (Politico). If you were anywhere near Twitter yesterday, you saw a barrage of tweets about some mysterious woman named #Julia. Said woman does not actually exist — she’s a graphic, meant to illustrate Obama’s policies — and many conservatives are not fond of her.

"This Is Why I Hate Big-Money Art Auctions," by Jerry Saltz (Vulture). New York mag’s chief art critic argues that auctions ruin art: “The bad magic here is that people can no longer see this work as a painting. Now people look at The Scream or Van Gogh’s Irises or a Picasso and see its new content: money.” 

And in other news: The Red Sox “sellout” streak is actually a sales tactic, Pepsi partnered with Michael Jackson’s estate to put his face on pop cans, and J.P. Morgan made Facebook coffee sleeves to celebrate the social network’s impending IPO.

Enjoy your Friday, Tumblers!

Wednesday, April 25, 2012

What We’re Reading, 4/25/12

Every morning, we poll the staff and round up their favorite economic, financial and political reads of the day. On our radar this morning: Apple, Facebook, and slow-jamming the news.

"Apple Profit Rises 94% on Growing Global iPhone Demand," by Adam Satariano (Bloomberg). Uneasy investors who saw their Apple shares fall in recent weeks have nothing to worry about: Apple’s profit doubled last quarter, driven largely by global demand for products like iPhones and iPads. Apple has sold 35.1 million iPhones in China since January.

"Facebook’s Status Update," by Jennifer Schonberger (Kiplinger’s Personal Finance). While we’re talking tech stocks, your friendly curator would like to point you toward a killer piece on our site today. Jennifer ran the numbers on Facebook’s upcoming IPO — with mixed results. “The layup that was Facebook’s initial public offering is no longer a sure thing,” she writes. 

"Sugar Daddies," by Frank Rich (New York). Twenty-five wealthy donors (“sugar daddies,” in Frank Rich parlance) have given more than a million dollars each to the GOP and the Romney campaign. Rich writes: “empowered by myriad indulgent court and Federal Election Commission rulings, an outsize posse of superrich white men will spend whatever it takes to have its way with the body politic and, if victorious, with the country itself.” The full list of donors is here.

"Earth to Ben Bernanke," by Paul Krugman (New York Times). This excerpt from Krugman’s soon-to-be-released book, “End This Depression Now,” takes a long look at how the Fed chairman could be doing more, and better, for the U.S. economy. Worth reading for the illustration of Bernanke in a spacesuit, if nothing else. (In related news, the Wall Street Journal says the Fed is “likely to provide information but not action” in a series of statements and press conferences this afternoon.)

"Should We Return to the Gold Standard?" By John Waggoner (USA Today). Short answer: Probably not. Despite renewed interest in the gold standard, courtesy politicians like Ron Paul, it remains impractical to attach the value of the dollar to the price of gold. Copy editor Liz Whitehouse flagged this fun fact: There physically isn’t enough gold in the world to equal the economy.

"Marco Rubio Biography Says Grandfather Was Ordered Deported," by Mike Allen (Politico). An early glimpse inside Manuel Roig-Franzia’s book on Florida Senator Marco Rubio, who looks like a top pick for Mitt Romney’s VP.

And in other news: It’s apparently more difficult to become a Secret Service agent than to get into Harvard, CNNMoney has a cool interactive on the world’s largest economies, and President Obama “slow-jammed” about student debt on Jimmy Fallon last night. (A sample: “The Pell Grant is a beautiful thing, but with college getting more expensive, is it enough by itself to fulfill all our collegiate needs? Aw, Pell no!”).

What are you reading?

Monday, April 23, 2012

What We’re Reading, 4/23/12

Good morning, Tumblrs! Every morning, we poll the staff and round up their favorite economic, financial and political reads of the day. What we read over the weekend: hidden problems at Lehman Brothers and Wal-Mart, universities as entrepreneurial hubs, and the many struggles of making $5 million a year.

"It’s Still the U.S. Economy, Stupid," by Ben White (Politico). Ignore the sideline debates on dogs, moms and Etch a Sketch. The deciding issue in the 2012 election will still be the economy, White argues — five economic issues specifically, like whether things are getting better and who connects with the middle class. (Our take on this: “5 Economic Issues that Will Drive the 2012 Presidential Election.”)

"The Case Against Lehman Brothers" (60 Minutes). We don’t usually link to TV transcripts, but this one is fascinating. Four years after the collapse of the world’s fourth-largest investment bank, no one has been held accountable — despite allegations that Lehman’s financial reports were unfair and misleading.

"Vast Mexico Bribery Case Hushed Up By Wal-Mart After Top-Level Struggle," by David Barstow (New York Times). Wal-Mart dominates the Mexican market, but it appears that the mega-chain didn’t win that position through low-priced goods and red-tagged “rollbacks.” A New York Times investigation revealed widespread bribery between Wal-Mart and Mexican officials, totaling more than $24 million. (Shares have dropped since this news surfaced over the weekend.)

"Romney’s Healthcare Plan May Be More Revolutionary than Obama’s," by Noam Levey (L.A. Times). Romney has made healthcare reform one of the hallmarks of his campaign. But Levey’s analysis suggests that “repealing and replacing Obamacare,” as Romney campaign posters tout, could actually prove more disruptive than Obamacare itself, introducing more risk for consumers and leaving a large number of adults uninsured.

"Get Rich U," by Ken Auletta (The New Yorker). Stanford’s focus on launching entrepreneurs has made a lot of students rich (and netted more than $1 billion for the university itself). But the university’s priorities and its close relationship with Silicon Valley speak to deeper issues about why students go to school and what education means in this economy.

"An Athlete and His Money Don’t Have to Part," by Noah Davis (GQ). Your friendly curator struggles to sympathize with the financial “woes” of pro athletes who can’t manage their multimillion-dollar salaries. Still, the second installment of GQ’s series on athletes and money proves an interesting read — if for the pie charts, alone.

"What Makes Some Cities Greener than Others?" By Richard Florida (Atlantic Cities). The Atlantic’s urban-economist-in-residence examines the correlations between high CO2 emissions and the economy. Hint: Bike lanes and granola types would seem to factor in.

In other news: Presidential eating habits are now a campaign issue (good thing Shake Shack opened last year), tax refunds shrunk in 2012, and a store in Brazil has added an electronic display of Facebook “likes”  to its hangers in an effort to drive Mother’s Day sales. 

What are you reading?