In my favorite spaghetti Western, "The Good, the Bad, and the Ugly," there is a memorable scene that sums up the world economy today. Blondie (Clint Eastwood) and Tuco (Eli Wallach) have finally found the cemetery where they know the gold is buried.
Consumers are getting the short end of the stick in their dealings with banks. But the pain isn’t felt equally across the country, and the rates you get on your certificates of deposit and home loans differ depending on where you live. We’ve pored through the data to determine which cities offer their residents the best rates.
In case you hadn’t noticed, President Obama has been on a mission to love-bomb corporate America in recent weeks, from cutting a deal to extend Bush-era tax rates to peppering the State of the Union address with paens to private enterprise. But are business leaders buying into the courtship?
At least I’m not the one who crashed the Bentley. But I nearly did. It wasn’t my fault: a pile of slush, a pleasant conversation, and before I knew it I was swerving toward a snowbank. The landing was soft, and my passengers—a fellow hack and a Bentley representative—thankfully were unscathed. As for the car, well, the baby-blue Mulsanne proved forgiving. As we sat nestled in the snowbank two thoughts came to mind: first, this is what happens when you send a literary editor to do a man’s job. (I should be home skimming galleys, not braving icy country lanes!) And second, the seats are amazingly comfortable, and I would be perfectly happy spending the rest of the afternoon so ensconced. (And this was before I discovered the seat massager.) But tea awaited us, and there were more cars to drive, so my reverie ended and we carried on, gingerly. Little did we know, another snowbank was in our future.
An ugly fight over money is threatening the future of Bono’s Silicon Valley private-equity firm, Elevation Partners. After several rough years, a key founding partner, Marc Bodnick, is bailing out and fighting with Elevation’s leader, Roger McNamee, over his share of the firm’s profits, according to a person close to the company. The feud, which has been simmering in private, is now erupting into a nasty public battle.
Sometimes geopolitical lessons come from the strangest places. With Eric Schmidt stepping down as CEO of Google and replaced by founder Larry Page, I can’t help but wonder if world leaders are taking note.
By all appearances, Chinese President Hu Jintao's visit to Washington last week changed little in the lopsided American-Chinese relationship. What we have is a system that methodically transfers American jobs, technology and financial power to China in return for only modest Chinese support for important U.S. geopolitical goals: the suppression of Iran's and North Korea's nuclear weapons programs. American officials act as though there's not much they can do to change this.
Pundits will say President Obama’s poll numbers are rising because he can define himself against the GOP, he’s cutting deals, and he’s shifting to the center with new appointments. Bollocks. Most Americans can’t tell Bill Daley (the new, corporate-friendly chief of staff) from Rahm Emanuel (the old, corporate-friendly chief of staff). No, Obama’s slowly improving political fundamentals—just in time for his State of the Union address, thank you very much—can be attributed to steadily improving economic fundamentals. In early January, he said, “We’ve got a big hole that we’re digging ourselves out of.” But how much of the shoveling is behind us—and how much more do we have left? We offer a progress report on the recovery.
The U.S. porn industry began vibrating last week when a market-research group reported that Marriott, one of the country's biggest hotel chains, would phase out in-room porn channels--a mainstay of the adult industry. In a press release, Marriott cited changing technology trends, and admitted that revenue from the movies was down.
For the past decade, Google’s management structure has been something of a three-ring circus. Cofounders Larry Page and Sergey Brin served as the main attractions—the wunderkind Stanford graduates who created the search engine that changed the world.
We are, it's said, living through the most wrenching period since the end of World War II. The feelings and facts are genuine, but the conclusion amounts to historical amnesia. At least one other period rivals the present for its disillusion and contentiousness—the 1960s.
Today, hundreds of millions among the world’s poor have access to microloans—small sums of money borrowed from financial firms, sometimes at sky-high interest rates. What they haven’t been able to acquire is something far more basic: a savings account. Few banks in developing countries have found ways to profit in poor, rural areas, leaving people with a dearth of safe options for accumulating cash. According to one recent survey, nearly 90 percent of adults in emerging markets store money at home, with friends, or with a local co-op.
Facebook CEO Mark Zuckerberg says the company probably won't be offering shares to the public until 2012, at the earliest. So it will be tough to get a piece of America's fastest-growing tech company. Unless you're rich.
President Obama must take some comfort that the latest economic forecasts are becoming more optimistic about 2011 and beyond. The more upbeat of these (from, say, Richard Berner of Morgan Stanley) have the economy's growth accelerating next year to about 4 percent from less than 3 percent and the unemployment rate dropping from the present 9.8 percent to 8.6 percent by year-end.
Transparency and job creation receive great gusts of political lip service. Just not at the same time. Programs for job creation—each state’s unique mix of tax breaks and other inducements to new business—are among the least transparent parts of state government, according to a recent report by Good Jobs First. The D.C.-based watchdog looked at economic-development efforts in all 50 states, a total of 245 initiatives worth more than $10 billion. What it found would make an open-government activist cringe: most states fail to disclose the details of at least one key subsidy program—and 13 states are entirely dark on the subject. That prevents people from evaluating corporate-welfare programs, even as politicians tout their benefits.
In the annals of e-commerce, the last few years may be seen as a regulatory tipping point. Four states passed laws that require Amazon to collect local taxes, eliminating a major advantage for the site’s retailers. Now Montana is leading a similar charge against Travelocity and its ilk, saying that the travel sites evade the “bed tax”—a charge tacked onto the cost of a hotel room. In Montana, for example, the bed tax is 8 percent of the room price. Local hotel owners pay it or pass on the cost to their customers. But the state says online retailers take their cut of each room transaction bed-tax-free. “It’s not a bad gig,” Montana Gov. Brian Schweitzer tells NEWSWEEK. But he’s out to make sure these “coyotes” do not get away with it for long.
By rights, the careless consumers of the developed world should be in a chastened mood. After all, it was their binge spending on houses and consumer goods—fueled by credit and mortgages from recklessly indulgent banks—that helped bring the world to the brink of financial disaster back in 2008. Americans and the British, in particular, were done in by their free-spending ways. For years, Americans had been saving only 2 or 3 percent of their income, compared with 10 percent or more in European and Asian countries. The British, in turn, amassed even larger amounts of personal debt. By 2008, average household debt had reached 183 percent of annual disposable income, the highest level of any major economy.
You know times are bad whenyou can overhear elderly ladies on the bus using phrases like “the current budget deficit,” as I did recently, on a pleasant autumn morning in Dublin. You know times are really bad when one of them just about knows the figure: “Oh, God, it’s 30 percent or something.”
At their November meeting inSeoul, the leaders of the G20 nations once again patted themselves on the back for their massive efforts to stabilize the global economy since the 2007–08 financial panic. The rest of the world might be forgiven for not sharing their enthusiasm.
Look at global economics from a moral point of view, and it’s a story of virtue rewarded. Growth in the West, fueled by easy credit and consumption, collapsed in the 2008 financial crisis. Growth in the East, by contrast, fueled by saving and production, has held steady. But look more carefully, and the reality is that Asia’s legendary culture of saving, while not quite a myth, is fast declining in many places.