Fine, then. YOU fix the budget deficit.

November 22nd, 2010

The New York Times is sick of reporting about all the different options for taking on our massive budget deficit, so it set its interactive feature monkeys to figuring out how to make you do it. They made this.

Super fun. See how easy it is to actually make decisions like cutting off Medicare benefits for the elderly. Raise taxes! Cut defense spending! Destroy NASAAAAAAAAAAAAA!

U.S. Companies Sitting On Piles Of Cash, Not Hiring

October 27th, 2010

Where did all the money go after the recession hit? Well, some of it appears to have gotten stuck at the top of the consumption chain...

  • Moody’s Investor Service reported this week that U.S. companies are “hoarding” almost $1 trillion with no intention of expanding business or hiring new employees.
  • The future of the economy is still unclear, so these companies are likely holding out on growth activities until they can be sure of success.
  • During the economic crisis, many companies cut costs, downsized, and sold corporate bonds to raise the cash.

Facts & Figures

Current cash holdings, by sector:

  • Technology – $207 billion
  • Pharmaceuticals – $124 billion
  • Energy – $105 billion
  • Consumer Products – $101 billion

Best Quote

“We believe companies are looking for greater certainty about the economy and signs of a permanent increase in sales before they let go of their cash hoards, which they suffered so much to build.” – Moody’s Investor Service report

U.S. To Build World’s Largest Solar-Power Plant

October 27th, 2010

China may be in the lead when it comes to investing in renewable energy, but the U.S. is about to take a 1,000 megawatt leap.

  • The Obama administration just approved a permit allowing a $6 billion solar thermal plant to be built on federal land in a California desert.
  • Solar thermal energy production isn’t the same as photovoltaic solar panels. The plant works by using mirrors to direct sunlight into a tube, where its heat generates steam and moves turbines.
  • The company building the plant, Solar Trust of America, intends to start construction immediately to take advantage of government incentives for renewable energy projects before the year ends.

Facts & Figures

  • This plant, along with 8 others recently approved by the CA Energy Commission, will produce enough power to sustain 800,000 homes.
  • CA law requires all state utilities generate 1/3 of their power from renewable energy by 2020.
  • Solar Trust estimates that this project alone will create 7,600 jobs.

The Hobbit Lives In New Zealand!

October 27th, 2010

New Zealand wants the new Hobbit films to be shot within its borders so badly that it’s changing labor laws to make it happen.

  • Just when it seemed the J.R.R. Tolkien film adaptation industry was moving to New Zealand for good, Warner Bros. almost pulled its latest project – a two-part adaptation of The Hobbit – out of the country.
  • After an actors’ union boycott threatened production, Warner Bros. management flew to New Zealand to discuss whether the movie could be made there or not. Thousands of Hobbit fans took to the streets to protest.
  • New Zealand’s government responded swiftly, promising Warner Bros. additional tax breaks on future movies, setting up a joint marketing deal, and changing the country’s labor laws to “clarify the differences between a contract worker and a movie production employee.”

Facts & Figures

  • The Hobbit film project is worth about $500 million to New Zealand.
  • Losing the film could have meant up to a $1.5 billion loss.
  • “The Hobbit,” by J.R.R. Tolkien, was first published in 1937.

Best Quote

“Making the two Hobbit movies here will not only safeguard work for thousands of New Zealanders, but it will also follow the success of the “Lord of the Rings” trilogy in once again promoting New Zealand on the world stage.” – John Key, Prime Minister of New Zealand

omg i just maxed out my ira!

October 27th, 2010

They say lifelong habits start early. But what does that mean when it comes to sharing financial information on social media sites? See the full report here (in a new window).

young-adults-money-habits.png

(via visualeconomics.com)

Kiva Partners With Accion To Microlend In The U.S.

October 25th, 2010

Poor entrepreneurs are everywhere, so why limit U.S.-based microfinance operations to overseas customers?

  • Kiva.org, an online nonprofit that helps anyone make microloans to foreign businesses via local institutions, is expanding its scope to include entrepreneurs in the United States.
  • Through a partnership with Accion Texas-Louisiana, Kiva will start to offer microloans to new and existing business owners in those states. Kiva’s model is a kind of “crowdfunding,” which allows lots of small donors to make a big impact.
  • Microfinance helps poor entrepreneurs get access to loans. These individuals are usually seen as too risky for traditional bank loans, so microloans can greatly increase their chances of success.

Facts & Figures

  • Accion is the third U.S. microfinance institution Kiva has partnered with since October 2009.
  • Less than 1% of the borrowers featured on Kiva’s website are based in the U.S.
  • The average U.S. microloan is about $7,000.

Best Quote

“Awareness of microfinance is really low here.” – Premal Shah, President of Kiva

Hotel Owners Not Sure About Online Review Sites

October 25th, 2010

Well, that’s not entirely true. Hoteliers with happy customers are reaping the benefits of increasingly visible recommendations. But not every hotel has happy customers…

  • The popular hotel review resource TripAdvisor.com is facing lawsuits from hotels claiming the site is bad for their businesses.
  • Anyone can post an anonymous review of a hotel on the site. TripAdvisor argues that this makes for the most honest reviews, but opponents say it creates a protected space for libel and defamation. Sites like TripAdvisor are usually exempt from these accusations because they just publish reviews – they don’t write or edit them.
  • TripAdvisor typically doesn’t remove old or inflammatory reviews, but it does allow hotel owners to post responses to negative reviews. In response to the popularity and influence of these review sites, consulting firms have sprung up promising to monitor and control online customer feedback.

Facts & Figures

  • There are 35 million hotel reviews on TripAdvisor.com.
  • TripAdvisor was sued in 2009 over a review that claimed the owner of a hotel restaurant was seen buying drinks for a prostitute.
  • Revinate, a San Francisco image protection firm, charges hotels hundreds of dollars a month to track online reviews.

Best Quote

“We have pretty happy customers, so something like TripAdvisor works in our favor.” – Niki Leondakis, President and CEO of Klimpton Hotels

Group Of 20 Wants The World’s Currencies To Stay Steady

October 25th, 2010

It doesn’t make sense at first, but sometimes countries actually want their currencies to be worth less. Of course, if everyone tried to do it at the same time, disaster would ensue…

  • The G-20 – a group of financial leaders from 19 nations and the European Union – met this weekend in South Korea to discuss economic policies related to global economic stability.
  • One of the goals of this meeting was to encourage countries to end “competitive devaluation of currencies.” Devaluing your country’s currency makes it cheaper for other countries to buy from you, and more expensive for your citizens to import goods from other countries. This can boost domestic production and export profits. When a country devalues its currency, other countries often do the same so they can remain competitive in the export market.
  • Both China and the U.S. were singled out for recently devaluing their currencies. Though the G-20 hasn’t set up specific regulations and wouldn’t have the power to enforce them if it had, the hope is that public shaming will keep finance ministers around the world in line.

Facts & Figures

  • China is currently taking in 4% more money than it is expending, reflecting a favorable balance of trade.
  • The U.S. is spending 3.2% more money than it is taking in, indicating a trade deficit.
  • As of Monday morning, one euro was worth $1.39, and one dollar was worth 81.31 yen.

Best Quote

“I want the market to value the fact that we were able to forge a certain level of agreement.” –  Yoshiko Noda, Japanese Finance Minister

U.S. Taxpayers Actually Profit From TARP

October 22nd, 2010

The mere mention of TARP sends many people into grumble-mode, but the emergency measure to bail out large financial institutions has actually turned the government a profit.

  • The Troubled Asset Relief Program traded banks much-needed capital in exchange for partial government ownership.
  • Now that two-thirds of TARP recipients have paid the money back, the government has seen a profit of about 8.2%. That’s more than the return on any U.S. Treasury bond, high-yield savings account, money-market fund, or CD.
  • Despite the return on investment, the public is not happy about TARP. Several politicians have lost primary elections this year because they voted in favor of the program, and authorities say the return rate is misleading because it doesn’t take into account the other costs of the bailouts.

Facts & Figures

  • The government has earned about $25.2 billion so far on $309 billion in TARP investments.
  • The return rate on 30-year Treasury bonds averaged 4.1% during the last two years.
  • Over the same period of time, high-yield savings rates averaged 0.36% – 0.92%.

Best Quote

“From the perspective of the taxpayers getting their money back, TARP has been a great success. But there are other costs as the government made it possible for the banks to pay back TARP. Those costs can turn out to be larger, and their legacy could last longer.” – Todd Petzel, Chief Investment Officer at Offit Capital Advisors LLC

Chicken Gas Chambers For Humanity

October 22nd, 2010

If nobody wants to be reminded that their chicken was slaughtered before arriving in the supermarket, then how can chicken producers advertise their new “humane” slaughtering process?

  • Your typical chicken arrives at the slaughterhouse on a truck. It’s plucked from its cage and hung upside-down with its legs shackled to a rail that takes it first to an electrical stunner, and then to a machine that slits its throat and bleeds it to death.
  • But electrical stunners aren’t perfect, and the ethics of hanging already-stressed live chickens upside-down for the last minutes of their lives are sketchy. So some producers are starting to use a gas-based alternative to the electrical stunner.
  • You can call it “controlled atmosphere stunning,” “sedation stunning,” or “slow induction anesthesia,” but the new method uses a carbon dioxide gas chamber to knock the birds out before they’re slaughtered, vastly reducing the stress, pain, and suffering that come with traditional methods.

Facts & Figures

  • Bell & Evans, one of the companies using the new gas-stunning method, “processes” 200,000 chickens a week.
  • Tyson Foods, which uses electrical stunners, slaughters more than 1 million chickens per week.
  • Companies in Britain and Nebraska that already use “controlled atmosphere stunning” tend not to advertise this fact on their product packaging.

Best Quote

“People don’t want to know too much. It’s hard to sell humane killing as a concept.” – Marc Cooper, Senior Scientific Manager in the Farm Animals Department of the Royal Society for the Prevention of Cruelty to Animals, London

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