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  • Corporate Confidant

    When Jack Welch ran General Electric, every so often he'd schedule an appointment with a man named Ram Charan. They'd sit in Welch's corner suite and spend a couple of agenda-less hours talking about business, people and the world. Charan is a management consultant, but these meetings--like Charan's chats with dozens of other CEOs--were unlike most interactions between consultants and executives. Charan presented no PowerPoint presentation and kept no team of M.B.A.s standing ready to implement his advice. Instead, he just offered informal wisdom about how to improve companies--and even bosses as overscheduled and impatient as Welch routinely have made time to listen. "I'm a huge admirer," Welch told NEWSWEEK, describing Charan as unusually adept at helping companies import "best practices" from other firms. "Ram is an incredibly effective sponge--he's always learning, and he keeps confidences ... People just like to listen to what he's saying."It's a unique way of earning a living,...
  • Leadership Q&A: Vernon Jordan

    During more than 40 years in public life, Vernon Jordan has headed the United Negro College Fund, led the Urban League, been a confidant to U.S. presidents, served on various corporate boards--and most recently, advised President George W. Bush as a member of the Iraq Study Group. In the latest in his series of interviews as part of the NEWSWEEK-Kaplan M.B.A. program, NEWSWEEK Chairman and Editor-in-Chief Richard M. Smith spoke with Jordan, who is senior managing director at the investment bank Lazard Freres. Excerpts: ...
  • Fashionably Connected

    Prada doesn't take cell phones lightly. Although the gadgets have long been considered fashion accessories, the Milan-based company, known for its clothes, handbags and shoes, has stayed out of the business because of all the ugly hardware--the buttons, knobs, switches and keypads--which screams "utilitarian," a quality no fashion house wants its brand associated with. But about a year ago, Prada found that LG's touch-screen technology has gotten good enough to replace the unsightly protuberances altogether.The result of that yearlong collaboration is the Prada Phone, a slim, smooth and sleek device due out in Europe later this month for a whopping $780. Prada executives don't want you to think for a minute that the Prada Phone is just another phone that looks good on the ear, like Samsung's E500 Versus, a Versace-branded clamshell, or the Dolce & Gabbana numbered limited edition Gold Phone V3i, or any of many fashion-branded cell phones introduced in the past year. "This is the...
  • Seeing Clearly

    Need a clear plastic bag to get through airport security? From Prada to Pucci, transparent totes are all the rage. Chanel's Naked bag--easily see-through with a silver strap--is "much more chic than a plastic Baggie," says Neiman Marcus's fashion director Ken Downing ($895; chanel.com ). Oscar de la Renta boasts a variety of styles, from patent-leather-trimmed to a mini makeup case ($350 to $895; oscardelarenta.com ). Fendi offers the stylishly mysterious B. Mix Hologram bag that uses an intricate hologram in its plastic that makes peeking hard $1,580; fendi.com ). Prada's Plexi-Tote, with vibrant reds and yellows, makes a perfect beach bag when summer arrives ($1,250; prada.com ). Just make sure that you don't have anything to hide.
  • Can A $100 Laptop Change The World?

    The green and white gizmo is not much bigger than a clutch purse, but when you extend its plastic bunny-ear antennas and flip it open, clamshell style, the screen is colorful and welcoming, ready to network or create. It's even got a video camera and social networking software? It's the $100 (or so) laptop and its proud parent, the founder of the nonprofit One Laptop per Child, Nicholas Negroponte, believes it is within his sights to equip millions of developing-world children with these gadgets, paid for by governments and grants. NEWSWEEK caught up with the former head of the MIT Media Lab and best-selling author in Germany last month. ...
  • Get Me Agent 99!

    Your shoes know where you've been, but they haven't been talking. That now may change, thanks to new athletic shoes from Miami-based designer Isaac Daniel. The Compass Sneaker comes with an embedded GPS tracking device, a satellite-service hookup and a panic button wearers can push if they're in trouble and need to be found. The sneakers go for $335 a pair, plus $20 a month for the GPS service. Daniel has sold 1,850 pairs off his Web site, isaacdaniel.com , in little more than a month, and is starting to take orders internationally. He's been focused on sales to the military and police, but is finding a market with relatives of autism and Alzheimer's sufferers.These shoes aren't made for casual tracking. To limit searches to serious cases, the firm won't allow spouses or parents to locate relatives unless local police OK the search. To find a person wearing the shoes, a family member has to call Daniel's monitoring firm, ID Connex, where an operator will notify the police and look...
  • Europe's Fallen Angels

    It's no secret that emerging markets have had an easy ride for the last few years, as the search for double-digit profit margins has pushed investors into riskier areas. Foreign direct investment in developing countries reached $542 billion in 2005, up 37 percent year-on-year. The numbers are stellar, so much so that many economists have begun taking bets on which country will be the first to falter. But instead of the usual suspects in Asia or Latin America, many experts are pointing to Eastern Europe. There, states like Poland and Hungary, long buffered by their EU membership, are in danger of losing their economic halos as a combination of populist governments, reform fatigue and chronic overspending threaten their prosperity. As Neil Shearing, an analyst at London-based Capital Economics, puts it, "All the dynamics are there for a complete meltdown."You wouldn't guess it at first glance. The four biggest economies to join the EU in 2004--the Czech Republic, Hungary, Poland and...
  • How I Became A Big Wheel

    It was supposed to be a hobby--just a part-time thing to generate a little extra money. We didn't think we could make a living at it. I thought I would work at IBM for 30 years and retire, just as my father had. At that point I had only seven to go. The dot-com bust began in early 1999, about the same time we launched Unicycle.com. The odds seemed stacked against us. Online companies were folding. We had no experience running a company. Amy was an at-home mom to our three boys. I had just earned a degree in journalism by attending college at night. We were deeply in debt.Without telling Amy, I scraped together $700 to buy a business license and six unicycles. I'd been riding a unicycle since the age of 12, but quit four years later when I started driving. At 41, having gained a pound per year since high school, I was anxious to get trim. Diets didn't work for me. I tried running but my hips protested. Swimming only increased my appetite. I took my old unicycle out of storage and...
  • Concierge Impostors

    He's downstairs at the desk, and he looks and sounds like the hotel concierge. He even made your dinner reservations and got your clothes cleaned. But he, or she, may not be a concierge, but a ringer: a ticket broker whose company pays the hotel to let him pretend to be.Outsourcing concierges is becoming popular, especially at midtier hotels. Workers from outside companies like Expedia wear hotel uniforms and do all that traditional concierges do. Those in the industry differ on whether that's a good thing. Howard Lefkowitz, president of Vegas.com, which staffs the desks at Las Vegas hotels like Excalibur and Bally's, says outsourcing gives guests better service. But contract concierges aren't allowed to join les Clés D'or, the professional association of concierges. A spokesman says ringers have a conflict if they get a cut of the tickets and services they recommend.Of course, many old-line concierges take free meals, too. How else would they know where to send you?
  • Time To Bust Up The Club

    On the face of it, he's a most unlikely free-marketeer. A card-carrying socialist, Thilo Sarrazin is Finance minister for the city of Berlin, whose government includes the successor party of the former East German communists. But bankrupt Berlin needs cash, and Sarrazin is determined to get it. So determined, in fact, that he's preparing to break one of Germany's longest-standing political and economic taboos--by selling off Landesbank Berlin, the city's public-owned bank, for some €8 billion.Ho-hum? Not in Germany. The move has sent a tremor through one of the coziest clubs in the land--the state-owned banks that control almost half the country's banking assets. Germany may be Europe's largest economy, home to some of the world's most successful companies, yet the basic structure of its banking system is unchanged since the 1800s--fragmented, inefficient, cosseted from competition. In Berlin's Landesbank sale, some see the coming of a whole new era, freeing up hidden wealth and...
  • Prick Up Your Rabbit Ears

    When cable TV arrived in the ' 70s, rabbit ears seemed destined to go the way of the polyester pantsuit. So, too, the clunky outdoor antenna, a rooftop fixture that once upon a time signaled the rise of television in American life. But a funny thing happened on the way to the analog dust heap: it turns out that a new generation of rabbit ears and antennas can receive high-definition television broadcasts. And it's free.The irony is marvelous. Pushed into obsolescence by the technological advances of cable and satellite, antennas are re-emerging thanks to one of the most promising high-tech services of the digital age. High-def channels can be plucked out of thin air by antennas just like regular broadcast signals--no cable, no satellite dish, no monthly bill, no waiting for the cable man. It's like the old days, except this time antennas (which cost between $18 and $150) may offer the clearest picture. "More than 90 percent of our customers say they want the antennas for high-def,"...
  • Death Is Inevitable. Taxes? Maybe Not.

    It's hard to turn on a TV this time of year without seeing an ad showing smiling people who've supposedly just learned they'll be getting income-tax refunds thanks to a tax service or software program. Of course, your refund is Uncle Sam returning an interest-free loan you graciously made him by overpaying during the year--but it sure feels better to get a check than to write one. So imagine the joy at Great-West Lifeco, which has figured out how to get cash today for tax savings that it won't see for up to 15 years. It will do this by getting $550 million by selling securities backed by tax savings that it expects to get as the result of its $3.9 billion cash purchase of the Putnam Investments mutual-fund business.Getting tax-savings money upfront? You gotta love it. Here's the deal: Great-West, of Winnipeg, Manitoba, is buying Putnam from Marsh & McLennan of New York. Normally, this would be a plain-vanilla deal, with Great-West's buying the stock of the M&M subsidiary...
  • Global Investor: Why Worry, Wall Street?

    For several months, Treasury Secretary Hank Paulson and a number of top guns on Wall Street have been screaming that U.S. capital markets are losing their competitiveness to London and Hong Kong. Two months ago their claims received support from a study by some of America's most highly respected financiers and academics. In mid-January, McKinsey & Co., focusing on New York City in particular, delivered a report to Mayor Michael Bloomberg also bolstering Wall Street's fears. Now the U.S. Treasury plans to host a conference on the subject this spring. You have to give credit to the American financial community for orchestrating this crusade with such persistence. But the fact is, the bankers have a very flimsy case. They are too smart not to know that, so you have to wonder what's really going on.Their central argument rests on the decline in the number of initial public offerings in the United States and the simultaneous growth of such listings abroad. This is undeniable,...
  • Steven Levy: Microsoft’S Slick New Vista

    Last night the giant billboards of Times Square lit up with the long-overdue news: Vista, Microsoft's endlessly awaited new version of the Windows operating system, is finally on sale to consumers. CEO Steve Ballmer and chairman Bill Gates both contend that it's the best operating system that Microsoft has ever produced. That's not necessarily so impressive: after five years and billions of dollars of development (including five million beta testers pounding on prototypes of the system) it would be pretty shameful if Microsoft turned in something worse than one of its Windows predecessors. But Gates and Ballmer can rest easy on that count. While the operating system is not the "wow" generator that its marketing campaign promises, it is definitely an improvement over the Windows of yore.If you are a Windows user, the question is not whether you will use Vista, but when: a solid majority of people will not upgrade their machines to run Vista but will get the system when they buy a new...
  • The Internet Trembles

    In 1866, the British ship Great Eastern lowered a grappling hook by rope down to the frigid Atlantic Ocean floor far below. Its quarry: a line that had snapped the previous year during one of the first attempts to lay a transatlantic cable connecting the United States with Europe. One hundred and forty years later, repair ships are performing the same task, using essentially the same methods, in the Luzon Strait between Taiwan and the Philippines. They're trying to snag at least six cables that were damaged in a massive Dec. 26 earthquake off the coast of Taiwan. The mangled cables are out of reach of remotely controlled submersibles often used in such work. By the latest estimates, the task won't be finished until at least mid-February.While the earliest transatlantic lines bore messages in Morse code, the cables near Taiwan carried 90 percent of East Asia's voice and Internet traffic. A month after the earthquake, services in the region were still not back to their full capacity....
  • Low Cost, Long Hop

    Tony Fernandes comes across as slightly cocky. But then the 42-year-old has earned the right to be. In five short years he's transformed air travel in South East Asia, and if his latest gamble pays off he'll soon be shaking up the aviation scene worldwide. This month, he announced the launch of Air Asia X--sister carrier to his Malaysia-based Air Asia--which aims to apply the budget airline's short-haul business model to transcontinental flights. "There's a real yearning to go further both from Europe and China down to Malaysia and vice versa," Fernandes says. "So over the last year and a half we've been exploring to see whether there's a product that will [apply] the principles of low-cost carriers to this new airline."Come July, Air Asia X plans to launch its inaugural service between Kuala Lumpur and the United Kingdom with roundtrip fares starting at around $80 for early bookings. The plan is a network of budget routes linking Asia to Europe and eventually North America. Nor is...
  • Escape From The Money Pit

    This could be your magic moment to save some serious money. The mortgage you chose during the heady housing boom may soon cost you more per month than you really need to pay. On home-equity loans, rates are up by 4 or 5 percentage points--far from the supercheap money you expected when you first signed up.The tooth fairy probably made your problem worse. Buyers thought they could tuck their home values under their pillow at night to double while they slept. In that kind of dream, there's no such thing as a risky loan. But the tooth fairy has been missing in action for more than a year. If you made a bad mortgage choice, you'll have to unwind it yourself.Two types of mortgages need special attention. First, the "interest only" loan, where you're paying the interest but not reducing the debt itself. And second, the "option ARM" that allows you to pay even less than the interest due (any unpaid amounts are added to your loan, so your debt rises over time). You usually have to start...
  • The Insurance Climate Change

    During the nine years she's lived in her historic sea captain's house on Cape Cod, Mass., Paula Aschettino never filed a claim against her homeowner's insurance policy. But last year she received a letter from her insurer, Hingham Mutual Group, canceling coverage on her nine-room, $600,000 oceanfront home, which has withstood its share of hurricanes since 1840. She and her husband, Michael, scrambled to find other insurance but were repeatedly denied. "They just said we are in a high-risk area," she says. A spokesman for Hingham, which canceled 9,000 Cape Cod policies, says that the company's own coverage--known as "reinsurance"--had doubled in the past year, making it necessary to withdraw from the coastal market.The Aschettinos finally found other insurance, but only for nearly double their old premium of $1,800, and with a sky-high deductible of $12,000 against wind damage. Incensed, Aschettino circulated a petition among her neighbors demanding price reform from industry...
  • Software Savior?

    When you think of technology visionaries, Hasso Plattner's name probably doesn't spring to mind. But it should. As the founder of the German company SAP, the world's third largest software maker after Microsoft and Oracle, Plattner has been every bit as influential as better-known peers like Bill Gates or Steve Jobs. Back in the 1980s and '90s, he and a few other former IBM engineers started doing for companies what Microsoft did for consumers--providing easy-to-use software that was accessible on desktop computers. It was a paradigm shift that changed the way corporations worked. Today, anywhere from 20 to 50 percent of the world's business transactions--inventory, accounting, human resources and the like--runs on SAP software, depending on whose estimates you believe. SAP was also important as a symbol: It proved that "slow Europe" could actually be an innovator in the digital age.Now Europe's software giant is at the heart of another shift, as the rise of the Internet turns the...
  • Q&A: Corning's Comeback Ceo

    At many companies, Wendell Weeks might've been fired. In2001, Weeks was running Corning's fiber-optics business when the telecom market went bust. But instead of becoming the fall guy, Weeks managed through the sales drop--and in 2005, Corning's board promoted him to CEO. In the latest installment of a series of leadership interviews conducted for the Kaplan University-NEWSWEEK M.B.A. program, NEWSWEEK Chairman and Editor-in-Chief Richard M. Smith spoke with Weeks about Corning's turnaround: ...
  • My Turn: Why Different Is Better

    The incoming CEO of a global mining company says being an extroverted outsider has helped her advance. Being a woman who loved the sciences didn't hurt, either.
  • Wii Plays Hard To Get

    If a man is known by the company he keeps, Tom Lee must be one heckuva guy. At the height of last year's shopping season, friends from California to England were diligently checking store after store to find the 26-year-old Washington, D.C., software developer the one thing he truly wanted for Christmas: a Nintendo Wii. And since Lee refused to pay the eBay markup (typically double the $250 list price), the global hunt stretched into December with no hope in sight. Then his friend and fellow D.C. resident Sommer Mathis, a 26-year-old documentary filmmaker, scored one of a handful of units remaining from a resupply at the Nintendo World store in New York City. "He was thrilled," says Mathis, "and he promised to shower me with favors over the coming year."Yet while Lee and his friends revel in the console's simple pleasures, many Wii seekers have been left in the cold. Sony's cutting-edge Playstation 3 was widely expected to be last year's Christmas craze. But when the Wii--as white...
  • Global Investor: Off The Radar: The No. 1 Risk

    Earlier this month I spent several days in Singapore meeting with government and business executives for a Yale project to identify key trends in Asia. It was fascinating for what I heard, and what I did not hear.With most of the emerging markets in the region entering their fifth year of an economic boom, it is no surprise that sentiment is bullish. There is an acknowledgment of possible risks, such as pandemics or North Korean nukes. The rise of China and India fall somewhere in between. Reactions range from enthusiasm about taking advantage of the new dynamism these giants are bringing to Asia to some apprehension that Beijing and New Delhi could over time monopolize capital, trade and technology. What surprised me most, however, was how little was said about the United States--about the opportunities that it will bring in the future or the risks its policies pose.I have a theory: The biggest risk in the world economy today, for Asia especially but for everyone else too, is the...
  • Taming To-Dos

    It's true-confession time: how many messages are in your in box? How often do you check your e-mail? And just how many items did you check off your to-do list today? For many of us, the answers are "too many," "too often" and "not enough." There has to be a better way--and productivity blogger Gina Trapani is here to help. For the past two years Trapani has edited Lifehacker.com, a Web site owned by Gawker Media that offers advice designed to help people work smarter. This month she joined the blogger-turned-author brigade by publishing "Lifehacker: 88 Tech Tips to Turbocharge Your Day" ( Wiley, $24.99 ). The book includes tricks to automatically back up hard drives, optimize to-do lists, construct and remember passwords, filter e-mail and make better use of search engines--just a few of the methods Trapani believes can help desk jockeys cram more into the average workday. "My focus is ... to automate tasks to make things easier, to free up your head to think about important things,...
  • The Big Power Shift

    The official theme for last year's World Economic Forum in Davos was "The Creative Imperative." But chitchat in the hallways and hotel suites of the glittery Swiss resort centered on the rise of China and India as the century's new superpowers. As the world's top bankers, CEOs, think tankers and statesmen gather once again for Davos 2007, it raises the question: what will the assembled movers and shakers actually be talking about?Don't anticipate a rehashing of the already tired idea that power is geographically shifting from West to East. (If it is.) Instead, expect talk to focus on the way power is slipping its traditional institutional bonds--from the domain of nation-states and megacorporations, say--and into the hands of the masses. From the few to the many, in other words, thanks to the accelerating digital revolution. "When we say 'the shifting power equation'," says Jonathan Schmidt, director of the World Economic Forum, "what we mean is that power has dispersed." Think...
  • Balmy Biking

    Now you can stay warm and manage to still look hot riding your Vespa this winter. Tucano Urbano, the leader in moped and motor-cycle accessories, has just added a line of fur- and cashmere-lined faux-zebra or -leopard leg aprons that recycle air from the radiator in order to keep you warm ($200 to $800; tucanourbano.it ). Dainese has introduced a black waterproof overcoat for women that actually makes reflective striping look glamorous (from $400; dainese.it ). And Italian headwear manufacturer Borsalino is offering a fur-lined helmet, the Lapin, complete with silk-covered neck strap (from $450; borsalino.com ). Not to be outdone, Prada is coming out with a gazelle-fur-covered helmet. It's available only by special order (about $3,000; prada.com ). Now keep your eyes on the road. -Barbie Nadeau
  • Edible Cotton

    If it weren't poisonous, cotton would make a terrific food. Its seeds are rich in high-quality protein, and the plant is hardy. Nearly 80 countries produce 44 million metric tons a year. That's enough to feed 500 million people--if only it weren't for gossypol, a toxic chemical.Now, after trying to develop gossypol-free cotton for several years, Keerti Rathore, a biologist at Texas A&M University, has finally managed to produce a strain that he says could meet the World Health Organization's standards for food. "We have brought down the level of gossypol in the seed."The trick was to silence the gene that's responsible for producing gossypol in the seeds of the plant, but to allow the gene to produce the substance in the flowers and leaves. Scientists will have to study the new seeds extensively, so the plant won't be ready to be used as food for at least a decade. And remember: don't make a salad from the leaves.
  • A Single Piece Of Plastic...

    A single piece of plastic could revolutionize the delivery of vaccinations worldwide, according to U.K.-based Cambridge Consultants, who recently unveiled Conix One, a tiny inhaler that has no moving parts, costs only four cents to manufacture and is 40 percent more effective than traditional inhalers. It will be a while before the powder-form medications get government approval, but once they do, millions could be saved--in dollars and lives.
  • Mr. Clean

    A decade ago, when Gordon Shaw first considered making the switch from his successful chemical-based dry-cleaning operation to a more environmentally friendly, pressurized liquid carbon dioxide (C02) cleaning system, virtually everyone told him he was crazy. "I'm a businessman first, but I've always been an environmentalist at heart," he says. "I wanted to do something that would make me feel better about my work, I wanted to make a difference in my lifetime, for both people and the planet. But everyone told me it would never work."Shaw had used the chemical solvent perchloroethylene, better known as perc, since he started his San Diego dry-cleaning business in 1978. Perc has been the industry standard since the late 1930s, when Dow Chemical and other manufacturers introduced it as a replacement for the flammable hydrocarbon and smelly hydrocarbon solvents. But in the back of his mind he always wondered about the possible toxicity of perc, and at a dry-cleaning trade show in Orlando...
  • The King Of HDTV

    John Malone Built A Cable Empire That Changed Television Forever. Now He's Trying To Repeat The Feat With A High-Definition Satellite-Tv Dynasty.
  • The Politics Of Symbolism

    Fulfilling their promise, democrats in the House have voted to raise the minimum wagefrom its current $5.15 an hour to $7.25 by 2009. But before you count the big gains for low-income families, consider this fact: among the poorest fifth of U.S. households (their 2005 incomes: less than $19,178), only one in seven actually has a full-time, year-round worker. About 60 percent have no worker at all, says the Census Bureau. The rest have part-time or part-year workers. A higher minimum wage won't help most of these households, which consist heavily of single parents and the elderly.Among social scientists, it's no secret that the minimum wage is a weak weapon against poverty. Modest numbers of workers are affected; a lot are teenagers, often from middle-class homes; and many of the poor don't work. And a higher minimum may destroy some jobs. No matter. Democrats plunged ahead because raising the minimum wage is symbolically powerful. It says that you care about "economic justice."This...
  • Buddhist Economics

    Thailand's finance minister, Prodiyathorn Devakula, said the new rules were meant merely to "close loopholes." But that's not how foreign business leaders saw it last week, when he briefed them in Bangkok on plans to revise the country's investment restrictions. They viewed the move as starkly protectionist, according to one participant. In the tense discussion that followed, the visitors peppered the minister with pointed questions, warning that the measures could be challenged at the World Trade Organization. "There's a fundamental philosophical gap," said the source. "It became obvious we were getting nowhere."When Thai generals toppled the elected government of Thaksin Shinawatra last Sept. 19, they did so in the name of halting the turmoil that had gripped the country for the last year. But though the daily street demonstrations may have ended, the euphoria that followed Thaksin's fall has now been replaced with a sense of profound confusion. The return to normalcy promised by...
  • Global Investor: Why Bears Are Wrong

    It was a good year for world equity markets. most major indexes were up in the mid-double digits, and many emerging markets did even better. Some investors (including yours truly) expect this year to be more of the same. So, why are so many pros so cautious about 2007? Legendary investors such as George Soros, Julian Robertson and Jeremy Grantham are downright bearish. Wall Street strategists David Rosenberg of Merrill Lynch and Stephen Roach of Morgan Stanley are all muttering impending gloom and doom. Hedge funds, supposedly the best and the brightest, have kept their net long positions at very moderate levels and have not chased the current rally.Many of the best economists are no cheerier. Jim Walker, the highly regarded "Austrian school" thinker for CLSA, the Asia-focused brokerage house, looks for growth to slow precipitately in China and America, while much of the rest of the world slips into recession, resulting in substantial earnings disappointments.Treasury bond yields...
  • Models: A Big Step to the Left

    It's hardly surprising that Chilean President Michelle Bachelet didn't take them seriously at first. They were just a bunch of chiquillos --kids--decked out in their black-and-white high-school uniforms complaining about the quality of education. But those "kids" are part of a new generation that has grown up free of the repressive 17-year dictatorship of the late Gen. Augusto Pinochet.Coordinating protests through e-mail, blogs and cell phones, they turned out for three weeks last June--an estimated one million of them--to boycott classes, close schools and clash with police in the largest student movement in Chile's history. Their "Penguin revolution," as it came to be called, rocked a complacent establishment and focused a spotlight not only on education but on the 12th worst income gap between rich and poor among countries worldwide. By the end of the year, the protests had spread to strikes by workers at hospitals and schools, and Bachelet was aggressively pushing an agenda of...
  • Netting Friends Online

    Like millions of teenagers around the world, Sue Bloom spends several hours socializing online every day. She posts pictures, meets new friends, updates her blog and runs a popular online photography group with almost 500 members. The only thing is, Bloom isn't a teenager or a twentysomething college student--she's a 58-year-old art historian. And the brand-new site where she hangs out, Eons.com, is for baby boomers (and older) only: you have to be at least 50 to join. "Social-networking sites are wonderful for people of my generation," says Bloom, who lives in Maryland. "We've always been really social, and they're all about developing a community."Forget teen haunt Xanga and college-student staple Facebook. Online social networking isn't just for youngsters anymore. Of course, only 1 million of the more than 215 million social networkers regularly active today are older than 50. But by the end of the year that number could explode to 20 million, says a new study from global...
  • A Great ' 06. Now for ' 07.

    HOME VALUES SINKING. OIL PRICES SCARY. DEBT MOUNTAIN-HIGH. IRAQ AFIRE. Gotta sell stocks and crawl into a hole, right? Wrong, as it turned out. I just quoted some of the headlines of 2006, which, after a bumpy start, turned into a great year for almost every investor. The only way to lose money was flipping condos in Miami. Stocks scored big.What juiced returns? Sensational corporate profits and a global expansion that isn't over yet. Most economists expect slower growth in 2007, along with lower profit margins, but no recession. Historically, stocks have done just fine in years like that. Inflation eases, interest rates fall and stock-market valuations rise. Politics helps, too: stocks perform well in the third year of presidential-election cycles--in fact, they've never had a loss. Here's the '06 rundown, and some thoughts about '07: ...
  • Steven Levy: Apple Computer Is Dead; Long Live Apple

    Apple Computer Incorporated is no more. On Jan. 9, CEO Steve Jobs announced that the name he and Steve Wozniak gave to their new business 30 years has changed. It will now be called simply Apple Inc. Jobs had deleted the word “computer” with the same ruthlessness that he once used to deny cursor keys to the original Macintosh, and an on/off switch to the iPod.It was no coincidence that Jobs revealed this on the day that he unveiled the iPhone, Apple’s long-awaited entry into the mobile marketplace. The device further broadens the scope of the company once known primarily for making things with keyboards. It also enhances Apple’s legacy for swooping into a creatively moribund category and upending the established players with a level of style and innovation that has seemed beyond their grasp.During Jobs’s keynote address at the Macworld Expo in San Francisco on Tuesday—a seamless two-hour infomercial that mesmerized 4,000 people, some of whom had waited all night for a seat—he...
  • Driving Forces: Driving Through the Looking Glass

    Greetings from the Alice in Wonderland Auto Show in Detroit. On one end of this city’s aging conference center, General Motors, maker of the hulking Hummer, is generating buzz with its 150-miles per gallon hybrid electric concept car, the Chevy Volt . At the other end, Toyota, best known for its gas-sipping Prius, has rolled out an enormous pickup truck that will guzzle a gallon of gas every 17 miles or so. The car business, it seems, has driven through the looking glass.As strange as all this sounds, 2007 is the year of role reversals in the car business. After all, this is the year when most analysts figure Toyota will overtake GM to become the world’s largest automaker. But GM—emboldened by signs of a nascent comeback—isn’t conceding. “We’re not giving up just because somebody got a calculator for Christmas and worked some numbers,” says GM CEO Rick Wagoner. “This is going to be a dogfight.” Toyota, meanwhile, is so worried about a patriotic backlash from U.S. consumers that it...
  • Honda Primes the Pump

    Falling gas prices have taken some of the steam out of hybrid car sales lately. But you wouldn’t know that from all the buzz about hybrids at the opening day of the Detroit Auto Show. First, GM introduced its Chevy Volt plug-in hybrid concept . And then Honda CEO Takeo Fukui revealed in an interview with NEWSWEEK that his company is developing an all-new small hybrid car that he described as a five-passenger version of its quirky two-seater, the Insight gas-electric car. But unlike the Insight, which sells in small numbers to die-hard greenies, Fukui says this new Honda hybrid will be aimed at mainstream car buyers when it hits the road in two or three years. “Hybrid technology is very strong and proven technology for improving fuel economy,” he says. “And we won’t relent in our efforts.”For Honda, this new hybrid could finally be the answer to the megawatt popularity of the Toyota Prius, which controls more than half the market for hybrids in the U.S. Even though the Honda Insight...
  • The New Generation

    India's rise as an economic power is known the world over, thanks largely to the global ambitions of its biggest corporations. But names like Infosys, Tata and Reliance aren't necessarily as important to India's future as modest firms like Acme Tele Power Ltd. It sounds a bit like a store you might find on Main Street in Peoria, but one look at the numbers belies this association. Acme has a profit margin of 33 percent on 2006 revenues of $300 million, which have risen more than 3,000 percent in four years. Acme makes energy-efficient sheds that protect cell-phone relay stations, but its 32-year-old founder Manoj Upadhyay is plowing most of that profit into R D, and files for a new patent about once a month. "He is poised to grow exponentially," says Sandeep Ghosh, director of commercial banking for Citigroup India. "If only one of Upadhyay's new ideas comes off, it's going to be fabulous."Acme is part of a new wave of small, entrepreneurial firms that are rising in the wake of the...
  • Running Out of Time

    When South Korea reopened its lucrative beef market to the United States in late October, ending a nearly three-year ban stemming from the outbreak of mad-cow disease, American beef exporters were upbeat. After all, beef sells for three times more in Korea than it does in the United States. Their joy was brief. Korean quarantine inspectors sent back the first three shipments on the grounds that they were in violation of an agreement restricting imports only to U.S. beef that is free of bones. After a painstaking search of the 22,000-kilogram shipment, the inspectors unearthed 11 pieces of bone, each smaller than a bean....
  • Let the Good Times Roll

    Ten years ago, when the "big bang" hit London, a burst of deregulation reversed years of stagnation in the markets and propelled the City to become one of the world's biggest and most vibrant financial centers. When we look back on 2007, there is a good chance that it will be remembered as the year of the global big bang, ushering in a new boom in financialdeals from mergers to buyouts to IPOs, in unprecedented numbers and scale, with a quantum expansion of deals across national borders. Whether this phenomenon lasts or whether it ends in a collapsing financial universe --well, that's another question.The first flares of the global big bang are already visible. The world's biggest IPOs are coming out of China, such as the recent $350 billion underwriting deal for the Industrial and Commercial Bank of China, and more are on the way. David Vinar, Goldman Sachs's CFO, says that the firm's pipeline of deals is bigger than at any time since the height of the Internet boom. David...
  • The Economic Mega-Worry

    The start of a new year is a good time to take stock, and there are few better indicators of our long-term economic prospects--and also our prospects for political and social peace--than productivity. As anyone who's taken basic college economics should know, productivity is simply jargon for efficiency. It's also what most people think of as economic progress. The good news is that productivity has been growing strongly; the bad news is that it may slow down.To see why that matters, consult a fascinating government report, "100 Years of U.S. Consumer Spending." A century ago, Americans spent 43 percent of their incomes on food and another 14 percent on clothing. By 2002, those shares were 13 percent and 4 percent. Meanwhile, family incomes (after inflation) had tripled. Filling the spending gap are all the things we take for granted--cars, TVs, travel, telephones, the Internet. Home ownership has zipped from about 20 percent to almost 70 percent of households.This triumph of mass...
  • Morality vs. Money

    When the French police arrested two Austrian on-line-gambling executives on September 15, they did it in the name of protecting France from "the explosion of money games in a heedless manner." Indeed every recent state move to crack down on online gambling, from the United States to Denmark, Finland, Germany, Hungary, Italy, the Netherlands and Sweden, has followed the same moral argument: it's all about saving our people from the sins of gambling.The problem is that all of these countries allow licensed gambling at home, and in some cases are promoting its expansion very aggressively. So what's it really about? In recent months the EU has launched proceedings against all these nations (except of course the United States) for protecting national monopolies in violation of EU laws guaranteeing free movement for goods and services.Gambling may be the world's most tightly regulated industry. But the result in virtually all cases is a business that flowers in chosen places precisely...
  • Samuelson: Let's Not Hide Health Costs

    We are awash in health-care proposals. President Bush has one. So does California Gov. Arnold Schwarzenegger. Democratic Sen. Ron Wyden has a plan, as does a coalition led by Families USA (a liberal advocacy group) and America's Health Insurance Plans (a trade group). To some extent, all these plans and others aim to provide insurance to the estimated 47 million Americans who lack it—a situation widely deplored as a national disgrace. But the real significance of all these proposals, I submit, lies elsewhere.For decades, Americans have treated health care as if it exists in a separate economic and political world: when people need care, they should get it; costs should remain out of sight. About 60 percent of Americans receive insurance through their employers; to most workers, the full costs are unknown. The 65-and-older population and many poor people receive government insurance. Except for modest Medicare premiums and payroll taxes, costs are largely buried in federal and state...
  • Why Gasoline Is Priced With Nine Tenths of a Cent?

    Why is gasoline always priced with nine tenths of a cent? No other products are sold that way. —Bob E. Peel, Stratford, Conn. A shirt that's $9.99 feels a lot cheaper than $10, doesn't it? Just like that, gas marked $1.36 9/10 strikes most drivers as a bargain compared with $1.37 per gallon—even though gas stations just round up. (Because you can buy fractions of a gallon of gas, they can charge you fractions of a cent.) Why do all stations do it? Because it works; most folks will never even notice they're paying more. And once one station goes with the cheaper-seeming prices, the others must follow suit to remain competitive.
  • Is It a Conflict of Interest to Be CEO and Chairman of the Board?

    Why don't we consider it a conflict of interest for one person to serve as a company's CEO and chairman of the board? —Carole Mcintyre, Waynesburg, PA. The CEO manages the company, while the board oversees the management. So, effectively, chair-CEOs must monitor themselves. But the benefits of a combined position outweigh the conflict, says Charles Elson, director of the Center for Corporate Governance at the University of Delaware. While controversial, the combined chair-CEO model—used by the vast majority of U.S. companies—helps avoid employee confusion about who's ultimately in charge.
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    Steve Jobs Comes Back

    At 33, the computer wunderkind has a slick new product and sales pitch to match. It may be the most exciting machine in years. But will it sell?
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    The New Girl in Town

    Like a magician readying his best trick, Steve Jobs waited for the houselights to dim and the crowd to quiet down. A spotlight focused on a table where a bulky shape lay hidden beneath a buff-colored cloth. "The personal computer was created by a hardware revolution of the 1970s," Jobs, the 27-year-old multimillionaire chairman and cofounder of Apple Computer, told 1,200 Apple stockholders gathered last week in Cupertino, Calif. "The next dramatic change will come from a software revolution . . . which Apple is introducing here today." On cue, the cloth was lifted -- revealing Lisa, a new $10,000 computer and a $50 million gamble for Apple.
  • For an 'America, Inc.'

    When the Japanese government decided in 1971 that having only 6 percent of the world’s computer business was inadequate and unsatisfactory, the Ministry of International Trade and Industries “urged” the six principal manufacturers to work out a system of cooperation on research and development for both hardware and software. This led to create three cartels and ultimately, in 1975, when a second consolidation occurred, they reduced the three to two.