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2 - Super Bowl Betting And The Irrational Stupidity Of Investors
3 - Micron's Steve Appleton Was A Daredevil Stunt Pilot, Diver And Off-Road Racer
4 - Apple's iPhone Business Alone Is Now Bigger Than Microsoft
5 - Here's The Other Worrying Thing About The FBI's Expanding No-Fly List
6 - Iran's Revolutionary Guard Begins Military Exercises Near The Strait Of Hormuz
7 - Switzerland Should Be Terrified Of The Rampaging Justice Department
8 - 16 New Insights That Challenged What We Knew About The Markets And Economy
9 - Here's What You'd Earn If You Invested Your Credit Card's Interest
10 - Twitter Thinks BeachMint Would Make An Interesting Acquisition
11 - Key Windows Phone Leader Goes To Amazon (MSFT, AMZN)
12 - Wait, Charlie Sheen's New TV Show Actually Sounds Kind Of Good
13 - Here Are 5 Reasons To Skip Sunday's Big Game
14 - If The Worst Case Scenario For The US Is Japan, Then Everything Will Be Fine
15 - 10 Cities Where Home Prices Are Still Too High
16 - One Former Harper's Bazaar Intern Is Standing Up For Unpaid Interns Everywhere
17 - The Stunning Homes Of The World's Most Famous Fashion Designers
18 - Dow Jumps To A 4-Year High, Nasdaq Surges To An 11-Year High (DIA, SPY, QQQ)
19 - Facebook Wants Mobile Ads To Go Live Before Stock Starts Trading
20 - Mikhail Prokhorov Has Promised To Donate His Billions To Charity If Elected Russian President
This editorial is part of our GREAT DEBATE feature 'What Resource Do We Most Need For Our Future?'
Among the industries that spend huge sums of money lobbying Congress and bankrolling political campaigns, few spend more generously than those representing energy and natural resource interests.
From 2009 through 2010, this sector donated over $75 million to political campaigns on the federal level. Of that total, two-thirds went to Republican candidates, putting it in line with historical partisan trends — since 1989, the sector has favored Republicans by a 70-30 split, according to Open Secrets.
Yet the bulk of the industry's influence is secured through lobbying efforts, which amounted to $870 million over that same two year period.
Here's how that spending breaks down by groups within that sector.
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I was driving all day long yesterday and heard an interesting statistic on the radio. The last 14 coin flips in the Super Bowl have been won by the NFC. The odds of this happening are 16,000:1. Beyond a statistical anomaly.
Anyhow, the commentator, a Vegas bookie, was discussing a bet they had going in which they wager on the coin flip every year. He was talking about how silly the bet is because, obviously, the odds are 50% heads or tails.
But Vegas is playing it NFC vs AFC and guess what? 75% of the public is betting on the NFC to win the coin flip!
Clearly, this is a case of the recency effect taking hold of sentiment and influencing the betting psychology. The same thing happens in the stock market on a daily basis. We have a tendency to focus only on the short-term and what has happened in the last few days, weeks or months.
The NFC might win the coin flip on Sunday, but it won’t have anything to do with the past coin flips. And history proves this as 22 of the total 45 Super Bowls have had a tails flipped (very near the expected 50% probability of a coin flip).
Vegas is taking advantage of the recency effect in establishing a silly, but profitable bet. Vegas loves the Super Bowl. And the market loves for you to focus on the recent past. After all, it’s one of the primary pitfalls the average investor can’t seem to avoid getting caught in….
As for me, well, I am a Redskins fan, so when it comes to American football, I always lose….
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BOISE, Idaho (AP) — The image Steve Appleton cultivated as a stunt pilot and off-road rally driver became the perfect metaphor for his wild, 18-year ride as the leader of Micron Technology Inc., where stomach-churning swings from billion-dollar profit to billion-dollar loss required the constitution of a business daredevil to survive.
Appleton, Micron's chief executive officer, died Friday morning when his experimental plane crashed at the Boise Airport, west of Micron's desert campus.
He was no stranger to plane crashes, surviving at least two earlier wrecks including one in 2004 that left him seriously injured. He was the only person aboard on Friday when the small Lancair crashed shortly after its second take-off attempt in Boise, according to safety investigators.
Appleton was known as a driven competitor in a volatile industry. Away from the office, he channeled that energy into high-octane hobbies, pursuing his passions as a stunt pilot, off-road racer and scuba diver.
"He lived life to the fullest, and while he enjoyed great success in business and in life, he never lost his intensity or his drive," Gov. C.L. "Butch" Otter said in a statement.
In the wake of the 51-year-old's death, Micron's board of directors headed to Boise for a weekend meeting to discuss the company's next steps. Micron spokesman Dan Francisco said company president and chief operating officer D. Mark Durcan would take on Appleton's responsibilities until the board appoint his successor.
Corporate governance experts raised questions in the past about whether Appleton, as CEO, should be engaging in a hobby as risky as stunt piloting, but Micron's board accepted it as simply part of Appleton's work-hard and play-hard personality. The company's shares have traded between $3.97 and $11.95 over the past year, and shares were up 23 cents at $7.95 Friday before trading was halted for the announcement.
"Steve's passion and energy left an indelible mark on Micron, the Idaho community and the technology industry at large," Micron's board of directors said in a prepared statement.
Micron makes semiconductor chips for computers, mobile devices, cameras and other devices. It makes products under the Lexar and Crucial brands, and is one of Idaho's largest and most influential employers. In its latest fiscal year, which ended Sept. 1, Micron earned $167 million, or 17 cents per share, and had revenue of $8.8 billion.
Betsy Van Hees, an analyst from San Francisco's Wedbush Securities, always figured Appleton was the ideal persona to lead an upstart from the wilds of Idaho in the turbulent global memory industry. People must be thrill-seekers to be in the computer memory business, especially in recent years, Van Hees said.
"You look at what's happened in the industry over the years, its many ups and downs — more downs than ups lately — and Steve had stayed committed to that, and to staying in Boise," she said. "It's not a business for the faint of heart."
Crash investigators say Appleton hadn't filed a flight plan and by all indications planned to stay in the area for a recreational flight on a clear, sunny morning.
Air safety investigator Zoe Keliher with the National Transportation Safety Board said the crash happened during Appleton's second attempt to fly that morning. She said Appleton's first take-off ended abruptly — witnesses said the plane only got about 5 feet off the ground — when he re-landed and returned to a hangar for about five minutes.
Keliher said witnesses reported that the plane then returned to the runway to take off again, but Appleton almost immediately told the tower he needed to turn around and re-land. His plane was about 100 or 200 feet in the air before witnesses say it crashed and caught fire. Appleton's body was thrown from the wreckage.
Keliher said the remains of the pilot weren't immediately identifiable, but Appleton's wallet and other belongings were among the debris. She said the body was being fingerprinted by authorities.
The runway was dry and there were no indications that birds or weather caused the crash, Keliher said. Investigators planned to look for any evidence of equipment failure, pilot error or other problems.
Airport spokeswoman Patti Miller said the aircraft was a fixed-wing prop plane Lancair, which is built from kits.
Planes like the Lancair have caught the attention of the National Transportation Safety Board, which is in the midst of a study of their safety. Last year, the agency investigated 222 experimental and amateur-built plane accidents in which 67 people were killed. More than half involved planes that were bought used rather than having been built by the current owner.
In 2004, Appleton sustained a punctured lung, head injuries, ruptured disk and broken bones after his stunt plane crashed in the desert east of Boise.
He didn't immediately reveal the severity of injuries he sustained in that crash, and at the time a Micron spokesman described Appleton as only sustaining some "bumps and bruises." But in 2006 a corporate governance expert began questioning disclosures about the crash.
Appleton's death came one week after the company's president and chief operating officer, D. Mark Durcan, announced plans to retire in August. Mark W. Adams, Micron's vice president of worldwide sales, was named to succeed Durcan.
News of Appleton's death sparked an outpouring of homage from Idaho leaders, with Otter lauding him as a champion and visionary businessman who "understood the value as well as the cost of excellence."
Idaho's congressional delegation also mourned Appleton's death, with Sen. Mike Crapo and Reps. Mike Simpson and Raul Labrador saying that Appleton was to Idaho what the late Apple co-founder Steve Jobs was to America.
Appleton was the face of Micron for most Idahoans. The company was instrumental in Idaho's tech boom and is known for charitable giving, recently donating $13 million for a new building at Boise State University.
Appleton had his business administration degree from Boise State fresh in hand in 1983 when he took a graveyard job at the new high-tech startup, Micron. His starting wage on the chip fabrication line was just $4.46 an hour, but it wasn't long before Appleton was promoted, and promoted again — 11 times in all.
By 1991 he was the youngest-ever chief of a Fortune 500 company, serving as president and chief operating officer of Micron. In 1994, he was appointed to the position of chairman, chief executive officer and president, though he dropped the president title in 2007. He is survived by his wife, Dalynn, and four children.
Appleton owned several different types of aircraft, piloted in air shows and frequently flew the planes in the skies over Idaho. He had a penchant for other adventures too: In 2006, he won the 20-car Baja Challenge Class of the SCORE Tecate Baja 1000, completing the 1,047-mile run from Enseneda to La Paz in 25 hours and 25 minutes, 30 minutes ahead of his nearest competitor.
At the time, Appleton said he wasn't worried about putting himself and his executive team behind the wheels for the pounding, often brutal race over rough and remote terrain.
"I don't know what could be worse than being in the memory business for risk-taking," he said. "If we were in some stable, monopolistic business, I'd probably get objections from my executive staff about doing this, but they're all dying to go."
Micron shares were up 23 cents at $7.95 Friday before trading was halted in the early afternoon for the announcement. The company's shares have traded between $3.97 and $11.95 over the past year.
____
Associated Press correspondent Todd Dvorak and reporters Nick Jesdanun and Joan Lowy contributed to this report.
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Tech writer MG Siegler just noted a remarkable fact:
Apple's iPhone business alone is now bigger than Microsoft.
Not Windows. Not Office. Microsoft.
Think about that.
The iPhone did not exist five years ago. And now it's bigger than a company that, 15 years ago, was dragged into court and threatened with forcible break-up because it had amassed an unassailable and unthinkably profitable monopoly.
The iPhone also appears to be considerably more profitable than Microsoft.
In the December quarter, Apple's iPhone business generated $24.4 billion of revenue. Microsoft's whole company, meanwhile, from Windows to Office to servers to XBox, generated $20.9 billion.
If we assume that Apple generates the same operating profit margin on its iPhone business that it generates on its overall business--38%--the iPhone business generated about $9.3 billion of profit in the December quarter.
All of Microsoft, meanwhile, generated only $8.2 billion.
It was not long ago that Microsoft CEO Steve Ballmer was fending off those observing that Apple's market capitalization was closing in on Microsoft's by saying that, regardless of market cap, Microsoft's business was much bigger and more profitable.
Not anymore.
Now, Apple's business is more than twice the size of Microsoft's--$46 billion to $21 billion--and more than twice as profitable: $17 billion to $8 billion.
And, needless to say, Apple's market cap now dwarfs Microsoft's. (Although, interestingly, Apple's market cap is not yet 2X Microsoft's, despite the difference in revenue, profitability, and growth rates. The market still appears to be concerned that Apple's "closed system" is vulnerable to the same sort of disruption by Android and other more open systems that Apple's Mac business was back in the 1990s).
What's just as remarkable here is that Apple invented the iPhone business out of thin air in 2007. This is not an old product category. It's a completely new one. Which means that Microsoft or anyone else could have invented it.
(The same can be said for the more recently introduced iPad, which is now cleaning Microsoft's clock in that category, too.)
For the first decade of Steve Ballmer's reign at Microsoft, some folks cut him a break for the company's stagnant stock price by observing that the market had changed. But the market changed for Apple, too, and Apple innovated two huge new product lines, one of which is now bigger and more profitable than Microsoft's entire business. So Steve can't be cut a break for that anymore.
 Microsoft just plain missed these markets (iPhone and iPad). And Apple created them. And it turns out that, at least for now, they are much more valuable and lucrative markets than the ones Microsoft dominated.
The other mistake Microsoft made, one that ultimately could be far more devastating, is that it became obsessed with the wrong competitor.
For the past decade, Microsoft has obsessively targeted Google as Enemy No. 1, blowing more than $10 billion trying to compete with Google's amazing search engine.
Microsoft has made some progress, but not much--and it is still losing $2 billion a year on the effort. And, meanwhile, a once-forgotten company has blown past it in business lines that much closer and more threatening to Microsoft's core businesses--Apple.
Microsoft still has a strong hold on the enterprise market, and it may now be able to rededicate itself to that market and try to withstand the Apple and Google onslaught.
But regardless of what happens, Microsoft can only now look up in awe and realize that a product that was introduced 5 years ago and that Steve Ballmer famously dissed is now larger and more profitable than Microsoft's whole company.
Remarkable.
SEE ALSO: Steve Ballmer's First Take On The iPhone, January 2007
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The announcement that the FBI's "No Fly List" had more than doubled to over 21,000 names from 10,000 last year caused plenty of uproar.
But there's something equally troubling in the FBI's justification for this expansion, which was attributed to changes made after the underwear bomber incident on Christmas Day 2009.
Namely that it took two years for the FBI to learn from its mistakes.
The list now includes people who are "deemed to be a threat to national security" or who "have gone to terrorist training camps." Previously it included only people who represented "a specific threat to take down an airplane."
Underwear bomber Umar Farouk AbdulMutallab wasn't included on the list even after his own father reported Umar to the U.S. Embassy in Nigeria.
According to CNN, "...AbdulMutallab's father was a respected businessman and would have been viewed as a credible single source under the new procedures. The official said all the changes are evidence the listing process has 'matured.'"
It took two years to make this simple change?
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TEHRAN, Iran (AP) — Iran's powerful Revolutionary Guard began military exercises Saturday in the country's south, the latest show of force after threats to close the strategic Strait of Hormuz in retaliation for tougher Western sanctions.
Plans for new Iranian naval games in the Persian Gulf off the country's southern coast have been in the works for weeks. State media announced new maneuvers in southern Iran involving ground forces, but it was not immediately clear whether they were part of the planned naval training missions scheduled for this month or a separate operation.
The latest military maneuvers got under way following stern warnings by Iran's Supreme Leader, Ayatollah Ali Khamenei, about any possible U.S. or Israeli attacks against Tehran's nuclear facilities. It also comes after Western forces boosted their naval presence in the Gulf led by the American aircraft carrier USS Abraham Lincoln.
Iran officials and lawmakers have repeatedly said that their country would close the Strait of Hormuz at the mouth of the Persian Gulf in retaliation for sanctions that affect Iran's oil exports. They have as yet made no attempts to disrupt shipping through the waterway, the route for one-fifth of the world's crude oil, and the U.S. and allies have said they would respond swiftly to any attempts at a blockade.
Last month, Iran's navy wrapped up 10 days of exercises in the Gulf, but the Revolutionary Guard — which is directly under control of the supreme leader — represents a significantly stronger military force and controls key programs such as missile development. Iranian state media announced the new maneuvers, but gave no further details.
Khamenei, in a speech nationally broadcast on Friday, staked out a hard line after suggestions by Israel that military strikes are an increasing possibility if sanctions fail to rein in the Islamic Republic's nuclear program.
He pledged to aid any nation or group that challenges Israel and said any military strikes would damage U.S. interests in the Middle East "10 times" more than they would hurt Iran. The comments also may signal that Tehran's proxy forces — led by Lebanon's Islamic militant group Hezbollah — could be given the green light to revive attacks on Israel as the showdown between the archfoes intensifies.
The West and its allies fear Iran could use its uranium enrichment labs — which make nuclear fuel — to eventually produce weapons-grade material. Iran insists it only seeks reactors for energy and medical research.
Israel has so far publicly backed the efforts by the U.S. and European Union for tougher sanctions that target Iran's crucial oil exports. But Israeli leaders have urged even harsher measures and warn that military action remains a clear option despite Western appeals to allow time for the economic pressures and isolation to bear down on Iran.
Iran's oil minister repeated claims that an EU oil embargo will not cripple Iran's economy, claiming Saturday that the country already has identified new customers to replace the loss in European sales that accounted for about 18 percent of Iran's exports.
Rostam Qassemi also reinforced Iran's warning to Saudi Arabia and other fellow OPEC members against boosting production to offset any potential drop in Tehran's crude exports, saying the cartel should not be used as a political weapon against a member state.
Although Israel has raised the strongest hints that it is likely to start a military campaign, Khamenei reserved some of his strongest comments for Israel's key U.S. ally.
"A war itself will damage the U.S. 10 times" more in the region, said Khamenei.
Khamenei claimed Iran, however, could only emerge stronger. "Iran will not withdraw. Then what happens?" asked Khamenei. "In conclusion, the West's hegemony and threats will be discredited" in the Middle East. "The hegemony of Iran will be promoted. In fact, this will be in our service."
On Thursday, Israel's defense minister, Ehud Barak, suggested the world is increasingly ready to consider a military strike if sanctions fail. The head of the country's strategic affairs ministry, Vice Premier Moshe Yaalon, also suggested Iran's main military installations are still vulnerable to airstrikes — even as Iran starts up a new uranium enrichment facility deep in a mountainside bunker south of Tehran.
Yaalon's comments appear to reinforce earlier suggestions by other Israel officials that the window for a possible attack is closing and Israel would need to strike by summer to inflict significant setbacks on Iran's nuclear facilities. The officials spoke on condition of anonymity under standing guidelines.
At Ramstein Air Base in Germany, U.S. Defense Secretary Leon Panetta said sanctions remain the best approach to pressure Iran. But he told U.S. airmen Friday that Washington keeps "all options on the table and would be prepared to respond if we have to."
Khamenei answered by repeating Iran's declarations that it will never roll back its nuclear program, which he had earlier said was now part of the country's "identity" and a cornerstone of its technological endeavors. On Friday, Iran said it successfully sent a small satellite into orbit in the third such launch in recent years, state media reported.
"From now on, in any place, if any nation or any group confronts the Zionist regime, we will endorse and we will help. We have no fear expressing this," said Khamenei, using the phrase widely used by Iran's leader to describe Israel.
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 Wow! The Department of Justice took an extraordinary step yesterday. It indicted Swiss private bank, Bank Wegelin, for aiding and abetting in US income tax fraud. This is a big deal.
WSJ: Swiss Bank Wegelin Indicted On US Tax Charges.
I’ll try to keep this fascinating story brief.
Bank Wegelin (W) has been around for 270 years. In Switzerland, it is referred to as a “Private Bank”. There are dozens of Private Banks in the country (less every week).
Private Banks do private things and charge big fees. Up until four years ago, the Swiss Private Banks were doing private things for private clients from all over the world, including many US names.
The DOJ sued the big Swiss bank, UBS, over this private business. UBS folded when the DOJ threatened a criminal complaint. (UBS would have had to close all its US businesses had a criminal complaint prevailed.) It ended up costing the bank $780 large and, for the most part, the DOJ got the “names” it were after.
Having blown UBS to smithereens, the DOJ set its sights on the other Swiss Banks. It targeted eleven Private Banks. W was on the list.
Talk of a settlement, including big buck fines and the release of more "names", has been in the press for a few months. Treasury Secretary Geithner met with Eveline Widmere-Schlumpf (Swiss Finance Minister) in Davos last week. It seemed like progress was being made on the thorny problem of the private banks:
Widmere-Schlumpf: “We’re hoping that we’ll reach an agreement with the U.S. within the next couple of months”
I was surprised when the non-USA assets of W were “sold” to Notenstein Private Bank on January 27. Notenstein is 100% owned by Raiffeisen Bank (R). This sale should have been a tip off that the conversation between Geithner and Widmere-Schlumpf was not as friendly and optimistic as the public comments suggested.
The Senior Managing Partner of W, Konrad Hummler (KH), commented on the sale of his bank: (Apparently he was surprised too)
“I never could have imagined that we, as owners of Switzerland’s oldest bank, would have ever considered selling”
KH was clear that the sale was a reaction to the pending DOJ hammer blow:
“The extraordinarily difficult situation and threat to the bank brought about by the legal dispute with the US”.
With the non-US assets stripped out of W, the DOJ suit is functionally against a dead person.
Note: Wegelin had no physical assets in the USA. It did have a bank account in the US holding $16.2mm. That was seized yesterday. But that amount is peanuts. The DOJ wants much, much more.
There's an unusual part to this which I find curious. W had an ‘old school’ way of doing business. To give assurances to its private customers that the bank was solid, and their money was safe, the Board of Directors of W assumed personal liability for the affairs of the bank.
No one has lost a Franc in the account transfers from W to R, so it would appear that those directors are now free from any liability. However, the DOJ has named EXECUTIVE X as a plaintiff in the charges files yesterday. So it would appear that Konrad Hummler’s (KH) problems are not over.
It just so happens that KH is also the Chairman of the Neue Zuricher Zeitung (NZZ), an influential Swiss rag. KH has a long history in Swiss banking. He used to run Swiss Bank Corp., which he later sold to UBS. He was the former head of the Swiss Private Bankers Association. He was an adviser to the Swiss National Bank for seven years! (He lost that job in April, 2011 as the DOJ noose was getting tighter.) This guy is wired.
The DOJ might also pursue the former assets of W. This could be problematic. The timing (and the surprise) of the sale of W's non-US assets to Raiffeisen Bank (R) might have pissed off the folks at the DOJ. There are (unconfirmed) reports in the Swiss press that the sale price for W's non-US assets was CHF 700mm ($725mm). That might explain the actions DOJ took. That’s a lot of loot.
Will the DOJ go after R? This would seem unlikely. R has a very big presence in Switzerland. It is a retail bank with three million customers and branches all over. It is affiliated with Raiffeisen Bank International (RI). RI is a very big bank in Eastern Europe with 13mm customers . Of further interest is that both R and RI are part of Unico Banking Group.
This consortium includes the big Dutch bank, Rabo and also the French bank, Credit Agricole. Maybe I’m nuts, but I don’t see the DOJ messing with a hornets' nest this size.
I think the DOJ's steps yesterday were just “shock and awe”. This puts more pressure on the remaining Private Banks. The DOJ blew up W in a rather spectacular fashion. Other Swiss bankers in the DOJ's cross-hairs must be crapping in their pants. Many of them are gathering up client dossiers - and getting ready to write big checks.
The DOJ is like a Rhinoceros. It's not very good looking, and when it puts its head down and charges into the brush, it tramples anything in its way. Nothing can stop it.This matter will come to a head pretty soon. If it doesn’t, the DOJ will knock off the next Private Bank on the list.
Fines will get paid. Names will be turned over. Some individuals will be prosecuted. The “names” have some explaining to do. At the top of this list is the good old IRS. Other interested parties will include creditors, wives, ex-wives, ex-wives’-lawyers, current-wives’-lawyers, business partners, employers, the press, relatives and friends.
After a while, this will all be forgotten. Sort of. The door for Americans to hide money away from the IRS is closed. Sort of. The foreign banks won’t want American customers; it’s too much of a hassle. If you do find a Banca di..... outside of the USA, you will have to plunk down a SS card, and agree to have info given to the IRS.
The door is closed for all electronic money. But the door is not completely closed. This story is as old as the Egyptians. Folks have been cheating their partners, wives and the taxman forever. It’s not likely to stop.
I understand that cash boxes are filling up with bills in some locations. In a zero interest rate environment, that makes some sense. Sort of. It makes infinite sense if rhinos are around.
On second thought, this episode will not be forgotten. Many people have already been trampled. More are in harm's way. Such is life. It has left a scar on the US image in some of the financial centers. The US played hardball and won. You don’t win many friends playing hardball. But this had nothing to do with friends. (Switzerland was once a friend of the USA.) It was always about the money.
There are many pieces of this story that would make for a good movie. For the life of me, I can’t figure out who are the good guys. Maybe that's the point.
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 We thought we had it all figured out before this week started.
We were wrong.
The top minds in the investment business offered some novel analysis, broke conventional wisdom, and even opened our eyes to some misperceptions.
This particular week we learned that the Obama recovery is stronger than Reagan's, Reagan's recovery is stronger than Obama's, the real reason why Wall Street loves leverage, and that many respected investors are staying away from the Facebook IPO.
What follows are excerpts from such stories this week. All of the important stuff you might have missed this week, right here. SOLVED: The Real Connection Between Stocks And Treasuries
"The connection is not between stocks and yields, but between PE ratios and yields, and although the stock market has been gaining, that's apparently not been due to significantly higher PEs. The good news for equity investors is that, at least as Kitano sees it, long-term rates are likely to rise thus pushing up PE ratios."
Read more here >
Why The Obama Recovery Has Been Much More Impressive Than Reagan's
"If you really want an apples-to-apples comparison, it's hard to fathom why Reagan doesn't have to answer for a recession happening so soon on his watch, and why he only gets measured on those two years. What's more, as you can see in the chart above, the 1984-1988 period was pretty average, so we're really just talking about two years of really impressive morning-in-America growth."
Read more here >
Why The Reagan Recovery Was Much More Impressive Than Obama's
"In the first ten quarters of the OR, GDP is up a total of 6 percent. During the first ten quarters of the RR, GDP rose 15 percent. Point for Reagan. In the first ten quarters of the OR, the economy created 790,00 jobs. During the first ten quarters of the RR, the economy created 7.5 million jobs Point for Reagan."
Read more here >
See the rest of the story at Business Insider
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 This post originally appeared at Investing Answers.
Is your January credit card statement staring you in the face, and looking eerily similar to your December one? You know that unpaid holiday shopping, and everything else you're putting on your plastic in the meantime, is costing you.
But did you know that even if you pay your bill in full every month, you'll probably spend more on a credit card than if you would have paid in cash or on a debit card?
[InvestingAnswers Feature: "Credit or Debit? Your Choice Could Cost You 3%"]
The Journal of Consumer Research completed a study that shows paying with a credit card increases a consumer's propensity to spend compared to using cash.
Similarly, Javelin Strategy and Research took a look at Cyber Monday spending habits and found that the average credit card purchase was $82.10, whereas the average debit card purchase was only $58.29. And those debit card purchases wouldn't still be haunting you today.
Overspending isn't the only hazard of credit card usage. Let’s face it, not everyone pays off credit cards in full every month. The common rationale is that credit card rewards make them more desirable than other methods of payment.
However, couple overspending with the cost of interest payments and the meager rewards of many credit cards pale in comparison.
In May 2011, Americans held $793.1 billion in credit card debt. If you divide that number by the number of Americans with credit cards (50.2 million) it means the average American has an astounding $15,799 in credit card debt.
The number keeps on growing, because even with legislation aimed at protecting consumers from credit card debt, the system is stacked against consumers.
Credit Card Debt's Downward Spiral
For example, let's say you have $5,000 in credit card debt. Your minimum payment, typically between 2% and 5% of the total balance, which if we assume it is 4%, would be $200. Of that $200, $62 is going to interest and only $138 is actually going toward the $5,000 in debt.
Here's how you can calculate this amount:
APR typically runs between 12% and 17%. Let’s assume for the example, the APR is 15%.
1. Divide the APR by the days in a year: 15% / 365 = .041%
2. Multiply .041% by the average days in a month, 30 = 1.36 or .0136%
3. Then, multiply .0136% by the original balance, $5,000 to find the total amount spent on interest per month = $62
If you pay minimum payments in this scenario, it would take 105 months to pay off $5,000. That is almost nine years!
Over that time, you would pay $2,118 in interest, and these numbers assume that you never purchase anything else with that credit card.
This means the original $5,000 balance will cost you $7,118 -- so much for those Black Friday and Cyber Monday so-called deals.
Any money that you might have saved on a great sale likely went out the window after the $62 in interest you spent in the first month.
A Better Way to Look at How Much Your Credit Card Is Really Costing You
Obviously, paying off a credit card in full every month is the ideal situation, but to get a true grip on the opportunity cost, it is important to see how much could be earned if the money paid in credit card interest was invested instead in, say, a corporate bond.
If you were to take the $62 a month that would go towards interest on your credit card, and invest it into a corporate bond fund with a 4% return, your investment could have grown to $8,044 over nine years. If the investment's return was higher, you could have earned even more...
Investing $62 per month over nine years, your money could grow to:
Even at a modest 2% return, $62 a month could grow to $7,330 over nine years.
[Want to try your own savings calculations? Try our Simple Savings Calculator]
What you're seeing is the power of compound interest. Keeping a balance on your credit card only holds you back from taking advantage of it.
Let's go back to our original example. By choosing to pay the minimum credit card payment over nine years instead of paying off your credit card fast, you're racking up $2,118 in interest charges. And because the interest charges you paid every month could have gone toward investing toward your future, you've lost out on potentially $10,000 more.
All said, simply paying the minimum in this case is a $12,118 mistake. Now are you convinced that you should be more serious about paying off your credit card and investing your money?
The Investing Answer: When you pay interest on credit cards rather than making interest on investments, the power of compound interest works against you, resulting in increased debt.
By paying credit cards in full and investing a little every month, you can end up making money and avoid crippling debt.
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 Twitter's corporate development director Mike Brown told a panel at Vator Splash that BeachMint, a service that lets customers buy products picked by celebrities, would be an interesting one for Twitter to buy next.
Brown said that while celebrities make Twitter what it is, the celebrities are not paid to produce content.
"We are lucky they share content and say crazy things," Brown said, because they make Twitter interesting to read.
Right now, celebrities tweet for free because of the exposure they get in real-time. They also get paid by brands to endorse products in various venues -- including on Twitter.
Brown's comments suggest that the company is at least thinking about getting more directly involved in those kinds of transactions.
Brown made his comments after ScaleVP's Sharon Wienbar talked at length about Beachmint, an investment her firm made early on. For the celebrity connection to work, it has to feel authentic for social commerce.
See also: Facebook Reorg May Pave The Way For More Acquisitions
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Brandon Watson, who was in charge of getting developers to build apps for Windows Phone, is quitting Microsoft to work on Kindle apps at Amazon.
Mary Jo Foley at ZDNet first reported the news.
Watson told us that he was attracted to Amazon largely because he's a huge fan of the Kindle. In fact, in 2009 he was featured in a New York Times article talking about how much more he started reading after he bought a Kindle.
Watson was originally recruited to the role by Charlie Kindel, who once held a similar role on the Windows Phone team.
Kindel left Microsoft earlier this year to found a mystery startup.
Earlier this week, it leaked that the next version of Windows Phone would be based on a lot of the same technology as Windows 8. That's a big switch from the current state, where Windows Phone uses different underlying technology, and may indicate that the Windows team is taking more control over Microsoft's phone platform.
Last month, Microsoft replaced the head of its mobile division, Andy Lees, with one of his lieutenants, Terry Myerson. Lees is still with the company, but in a mysterious new role.
Don't miss: Why Everybody In Seattle Suddenly Wants To Work For Amazon
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In his new comedy series for FX, Charlie Sheen plays a divorced, former baseball player with anger issues who winds up as an unconventional anger management therapist.
And now, Selma Blair has just been cast as Sheen's female lead as his therapist-slash-love interest. Shawnee Smith, most well known for her work in the "Saw" franchise, will play his ex-wife.
According to The Hollywood Reporter, Blair's character, Kate, is described as "beautiful, if a bit neurotic. As his former team psychologist, she helped Sheen’s Charlie control his anger. Now, she is both his friend and his therapist with benefits."
In interviews at NATPE last week, Sheen raved about the possibility of working with Blair, who was one of two finalists for the role.
Production on the show is set to begin in mid-march and according to Deadline.com, could get an order of 90 episodes if the initial 10-episode run hits the ratings target.
While Blair's last TV endeavor on NBC's "Kath & Kim" alongside Molly Shannon ended after only one season, it sounds like the unpredictable actor and the funny new mom could make for a "winning" combination.
As long as Sheen stays off the tiger blood.
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 This post originally appeared at Bleacher Report.
Super Bowl XLVI has arrived in Indianapolis, and with it, a plethora of fanfare and media hype.
More than a billion people will most likely tune into the yearly spectacle. For many of them, it will be the only football game they see all year.
For others, it will be the last of many on the season. And then there are those who don't even like football, but are watching it because everyone else is.
However, there are a few quick and prudent reasons why not to watch the annual extravaganza.
They are as follows.
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In 1991, former MIT dean Lester Thurow wrote that "If one looks at the last 20 years, Japan would have to be considered the betting favorite to win the economy honors of owning the 21st century."
He wasn't alone. The standard view of the 1980s held that Japan's sway over the world economy was unbreakable. Its economy grew faster. Its corporations were more efficient. Its workers more productive. In 1988, former Reagan official Clyde Prestowitz warned: "The American century is over. The big development in the latter part of the century is the emergence of Japan as a major superpower."
Such comments are now ridiculed relentlessly by analysts and commentators, including myself. Japan, after all, did not boom. Far from overtaking the United States, its economic growth stagnated for two decades, its stock and housing markets collapsed, and its government entombed itself in debt. Twenty years ago, Japan was synonymous with the phrase "juggernaut." Today, it's often seen next to the phrase "lost decade."
America should take notice, we hear these days. If we don't get our act together, we could be in for a lost decade or two just like Japan.
But there's an interesting rebuttal to these warnings by a Japan-based journalist named Eamonn Fingleton. He summarizes his views bluntly: "[A]fter studying the facts on the ground in Tokyo for decades I find it hard to avoid the conclusion that the story of Japan's stagnation is a media myth."
How so? Consider:
- The highest Japan's unemployment rate has been in the last 20 years is 5.5%. Its current unemployment rate, 4.6%, is about half that of the United States. Among those of prime working age, unemployment is virtually nonexistent in Japan today.
- Japan's average life expectancy at birth increased by more than four years -- from 78.8 years to 83 years -- between 1989 and 2009. Japanese, Fingleton points out, "now typically live 4.8 years longer than Americans," and better health care is a major factor.
- Japan had a current account surplus of nearly $200 billion in 2010, up threefold in 20 years. By contrast, America's current account deficit was nearly half a trillion dollars in 2010, up fivefold in 20 years. In short, Japan supplies the world with products and capital, while America supplies it with debt.
- Based on purchasing power parity, Japan's income per capita has grown at nearly the same rate as America's over the last 20 years (0.8% vs. 1%, respectively).
- According to the Japanese Statistics Bureau, during the "lost decade" of 1991-2001, the average Japanese citizen spent more time enjoying arts and culture, gardening, reading books, sightseeing outside the country, and visiting family.
- The yen has strengthened 87% against the dollar and 94% against the pound over the last two decades.
- Japan's ranking in the world Corruption Perceptions Index has increased substantially over the last decade, and is now well ahead of the U.S.
The average Japanese citizen, in other words, is living longer, earning more money, spending more time in leisure activities, being better represented by government, and enjoying some of the highest job security in the developed world. If this is the narrative of a failed economy, sign me up.
Why the gulf between perception and reality? Part has to do with the standard metric we use to judge economy's health: gross domestic product. Over the last two decades, Japan's real GDP has grown at 1% a year, compared with about 2.5% for the United States. Clearly, Japan looks like the loser of the two countries.
But there's a difference: Japan's population is in decline, while America's is rising. From 1990 to 2007, Japan's working-age population fell from 86 million to 83 million, while America's jumped from 160 million to 200 million. When GDP is measured on a per capita basis, the growth difference between Japan and America narrows by two-thirds. When viewed as GDP growth per working-age resident, the difference between the two nations virtually disappears. The size of Japan's pie may not be growing as fast as America's, but the amount of pie available to each citizen, and each worker, is plodding along at a similar rate.
Make no mistake: Japan's economy faces unimaginable challenges because of its staggering debt load. Demographics magnify those dangers. "Japan is a bug searching for a windshield," investor John Mauldin said two years ago -- a comment that was probably as accurate as it was controversial.
But Fingleton's points are valid, and highlight two important issues.
One, gross domestic product can be a poor way to measure an economy's worth and progress. It counts things that don't matter -- a vague calculation of output -- while ignoring how actual people on the ground are doing. In his book The Rational Optimist, author Matt Ridley shows how Africa frequently falls into the same trap. Judged by GDP growth, most of Africa looks like a pit of stagnation and decline. But using metrics that are actually meaningful to people -- life expectancy, access to health care, clean drinking water, disease prevention, education, democratic representation -- Africa has made incredible strides in recent decades.
Fingleton makes a somewhat analogous argument for Japan: "There's a dramatic gap between what one reads in the United States and what one sees on the ground in Japan," he quotes journalist William Holstein as saying. He continues: "The fallacy of the 'lost decades' story is apparent to American visitors the moment they set foot in the country. Typically starting their journeys at such potent symbols of American infrastructural decay as Kennedy or Dulles airports, they land at Japanese airports that have been extensively expanded and modernized in recent years."
Second, misconceptions about Japan's economy demonstrate how easy it is to assume something is accurate just because you've heard it ad nauseum. Admittedly, I've mentioned Japan's lost decades in the past without asking whether there were another side of the story. I heard enough about stagnation and decline to assume it was all true. Not until I read Fingleton's rebuttals did I look at the details and realize, to my shock, that he was right. What's the saying? Trust, but verify.
Fingleton finished a recent essay with a note: "I feel so strongly about all this that I have more than once over the years challenged the principal proponents of the 'lost decades' story to a debate. I first tried in 1998; and then again in 2002. On each occasion there were no takers."
Anyone care to step up to the plate?
This post originally appeared at The Motley Fool.
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Many Americans still are holding off on buying homes in some of the country’s most expensive cities.
While home prices fell 23% on average in the largest cities since the housing crisis began, for many home buyers the drop was not enough.
Based on a new report released by Trulia, 24/7 Wall St. identified the 10 metropolitan areas to which no one wants to move.
Trulia ranked the 100 largest metropolitan areas by their Metro Movers ratio, which measures homebuyer activity and interest in metropolitan areas. The ratio compares the number of online searches of local residents looking to buy elsewhere to the number of out-of-town homebuyers looking for real estate in the area. According to the report, a ratio of two means that there are twice as many home searches by people looking to move in than to leave. For the cites no one wants to move to, twice as many people searching online are looking to leave the area than looking to move to the region.
The cities that attract few buyers experienced modest home price declines since the recession began, especially relative to their high home value. As a result, home prices in these areas are forecast to decline further, and homebuyers are waiting until they do.
All of the 10 cities no one wants to move to have among the most expensive homes in the country. Newark and Bethesda, two cities with twice as many people looking to leave as looking to move in, have among the top 10 highest median home values in the country. Home prices in these cities declined at just the national average, and next year, they are projected to decline more.
See the rest of the story at Business Insider
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The recession has completely changed the workplace. People started taking jobs they wouldn't have considered before — including unpaid internships.
In 2011, more than 1 million Americans worked in internships, roughly half of which were unpaid, according to an NPR report.
This week, a former unpaid Harper's Bazaar intern fought back, filing a lawsuit against Harper's owner, the Hearst Corporation, for unpaid wages, according to Jonathan Allen at Reuters. From the report:
Xuedan Wang, 28, was an intern at the magazine's accessories department from August to December last year, where she typically worked at least 40 hours a week, and sometimes as much as 55 hours, without pay, according to her lawsuit filed on Wednesday.
"Unpaid interns are becoming the modern-day equivalent of entry-level employees, except that employers are not paying them for the many hours they work," the lawsuit says.
Wang's lawsuit mirrors a class-action suit filed late last year against Fox Searchlight Pictures by former unpaid interns, citing a decades-old Supreme Court decision that only work done for training purposes can go unpaid.
According to U.S. Department of Labor, companies can only offer unpaid internships if the intern does not replace workers and the company does not receive "immediate advantage from the activities of the intern."
When companies hire older, more experienced workers for unpaid internships, it gets harder to claim that they aren't attaining serious financial benefits from the hires.
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From sleek and styled to bright and eclectic, the homes of fashion designers are just as stunning as their collections.
In honor of Mercedes-Benz Fashion Week, we’re looking beyond the glitz and glam of the runway to the homes of fashion’s biggest names.
This post originally appeared at Zillow. Vera Wang
Beloved by celebrities for her princess-perfect wedding gowns, Vera Wang is no stranger to Fashion Week. The 2005 “Womenswear Designer of the Year” winner has been on the forefront of fashion’s most elegant collections for years.
According to the Wall Street Journal, the native New Yorker has been spending more time in Los Angeles and decided to purchase a mid-century modern house in star-studded Trousdale Estates for a reported $10 million. The home was once owned by Burt Reynolds and was completely renovated top-to-bottom by celebrity designer Steve Hermann. Sleek and modern, the home features views nearly as stunning as Wang’s gowns.
See more photos of Vera Wang’s home.
Jenna Lyons
As the creative director of J.Crew, Jenna Lyons is credited as the visionary responsible turning the brand from preppy basics to oh-so-chic earning endorsements from the First Lady herself. Lyons’ Park Slope townhouse radiates with the same high-end design aesthetic.
Stunning in its simplicity, Lyons’ townhouse has been the darling of shelter magazines and interior design blogs alike. Purchased by Lyons and her estranged husband, artist Vincent Mazeau in 2004 for $1,308,000, they knocked it back to the studs for a delicious remodel. The couple is reportedly headed for divorce, so the beautiful home was recently listed on the Brooklyn real estate market with a $3.75 million price tag.
See more photos of Jenna Lyons’ home.
Nina Garcia
Marie Claire magazine fashion director Nina Garcia is better known as the“Señora Don’t Bore Me” judge on the hit Bravo reality show “Project Runway.”
Back in 2010, Garcia sold her sprawling apartment on the New York real estate market for a whopping $8.5 million. Located but a few Manolo Blahnik steps from the retail haven of Madison Avenue, Garcia’s two-unit co-op home is everything one would expect from the stern fashion editor. The home is stylish, but elegant with dramatic 11.5-foot ceilings, picture windows, a master suite with two humongous dressing rooms, library, staff room and adjoining dining and living rooms that are separated by double pocket doors.
See more photos of Nina Garcia’s home.
See the rest of the story at Business Insider
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Today was a huge day for the economy. U.S. companies added 243k jobs in January and the unemployment rate fell to 8.3%.
This fueled a major surge in the stock markets, which hit some major milestones. Both the Dow Jones Industrial Average and the Nasdaq hit pre-financial crisis levels. The Dow closed at 12,862, a 4-year high, and the Nasdaq jumped to 2,905, an 11-year high.
The S&P 500, which is arguably the best snapshot of the U.S. stock markets, hit 1,344, a 6-month high.
Here's a look at some historical charts courtesy of Yahoo Finance.
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Facebook wants the new mobile ad product it is developing to go live before its IPO starts trading, a source tells us.
Lack of mobile ad revenue was one of the few negatives Facebook revealed in its S-1 filing. It's actually a drag on revenue, because Facebook's overall ad business is slowing and more of its users are accessing their accounts on phones.
Thus it makes total sense that Facebook is in a rush to get a new revenue stream online before it sells stock, so that it can convince retail investors that there is future growth in a company whose stock is clearly already over-hyped.
"I heard it from five people in the Palo Alto office," said the source who requested anonymity because they "don't want to get them into trouble [and] I don't want to get in trouble either!"
The source continued, "Obviously it depends on when the product is ready for release of course, though—time scales are not guaranteed by engineering on anything at Facebook."
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Mikhail Prokhorov, Russian presidential candidate and the country's third richest man, announced in an interview on Russian TV that he would donate practically all his money to charity if he was elected president
The Telegraph reports that the Prokhorov, a metals tycoon and owner of the New Jersey Nets, pledged to give away $17 billion of his $18 billion fortune during an intense debate, where one of his rivals accused him of 'robbing' his way to wealth in the 1990s.
He said he would keep the $1 billion for personal expenses. "I will need something to live on," he said, Bloomberg reports.
But it looks like Prokhorov's will not have to show his largesse anytime soon. His popularity ratings remain in single digits for now, and despite anti-Putin protests, an opinion poll released on Friday showed Putin would win 52 percent of the vote if a presidential election was held now, eliminating the need for a run-off.
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