Copyright 2008 The New York Sun Wed, 18 Jun 2008 16:44:37 -0400 http://blogs.law.harvard.edu/tech/rss Travis Pantin :: Stories from The New York Sun http://www.nysun.com/authors/Travis+Pantin istoll@nysun.com (Ira Stoll) webmaster@nysun.com en-us TRAVIS PANTIN http://www.nysun.com/business/feds-meeting-more-closely-watched-than-most/70436/ Wed, 30 Jan 2008 00:00:00 EST Investors are eagerly awaiting news from the Federal Reserve today, as Chairman Ben Bernanke meets with his colleagues to consider further interest rate cuts barely a week after they were sliced an aggressive three-quarters of a percentage point. Most economists expect Mr. Bernanke to announce a one-half a percentage point cut in the federal funds rate when the meeting ends this afternoon, bringing the Fed's key rate to 3%. This could make America's economic downturn less painful, but might... TRAVIS PANTIN http://www.nysun.com/business/new-home-sales-dive-as-slump-worsens/70318/ Tue, 29 Jan 2008 00:00:00 EST New home sales plummeted in December, according to data released yesterday by the Commerce Department. The figures were significantly lower than expected, and bode poorly for America's economic outlook, as the housing slump appears to be worsening. The report showed that home sales for the 2007 calendar year dropped 26.4%, the largest annual decline since statistics were first recorded in 1963. The "new home sales data echoed miserable signals from permits data in the fourth quarter, suggesting... TRAVIS PANTIN http://www.nysun.com/business/citi-ad-aims-at-gourmet-non-cooks/70311/ Mon, 28 Jan 2008 00:00:00 EST Citigroup, after an $18 billion write-down, has dropped an additional sum, possibly more than $100,000, on a prominently placed two-page color ad in Gourmet magazine in which a young woman tells readers of the cooking magazine, "I don't cook. So I made my eat-in kitchen a fabulous walk-in closet." The ad on the inside cover and facing page of the Condé Nast magazine's February issue, which costs $112,140 according to the rate card on the magazine's Web site, features a young woman standing in a... TRAVIS PANTIN http://www.nysun.com/real-estate/miami-brokers-look-to-new-york-in-search-of-buyers/70126/ Thu, 24 Jan 2008 00:00:00 EST With Florida's real estate market reeling, brokers in Miami increasingly are targeting wealthy New Yorkers as a potential new audience to buy their unsold properties. The push to market to New Yorkers is ramping up as brokers rush to sell properties now on the South Florida market before a flood of new condominiums goes on sale later this year. "I have three people from my sales team flying up to New York right now to meet with New York brokers and buyers," the president of Miami-based Fortune... TRAVIS PANTIN http://www.nysun.com/business/fed-move-has-economists-worried-about-inflation/70050/ Wed, 23 Jan 2008 00:00:00 EST In a rare and unexpected move, the Federal Reserve cut its benchmark interest rate by 0.75% early yesterday, in response to worldwide selling sprees that sent international stock markets plummeting on Monday. Many economists are worried that aggressive interest rate cuts, which they predict will continue, could threaten America's long-term economic stability by weakening the dollar and creating runaway inflation. Although the move was meant to prevent a worldwide panic from spreading to... TRAVIS PANTIN http://www.nysun.com/business/fed-cuts-rate-amid-global-stock-sell-off/69958/ Tue, 22 Jan 2008 08:36:26 EST In a rare and unexpected move, the Federal Reserve cut its benchmark interest rate by 0.75% early this morning in response to worldwide selling sprees that sent international stock markets plummeting yesterday. The move is the biggest single reduction in interest rates since October 1984, and shows that the Federal Reserve now sees a recession in the American economy as a very real possibility. RELATED: Asian Markets Fall for Second Day The Federal Open Market Committee lowered its federal... TRAVIS PANTIN http://www.nysun.com/business/economy-needs-some-help-bernanke-says/69740/ Fri, 18 Jan 2008 00:00:00 EST Those making the case that America's economic free fall will not reach well into 2008 will find the going more difficult after a number of unexpectedly weak economic signals released yesterday sent shock waves through the markets. Matters were not helped by the Federal Reserve chairman's congressional testimony. Ben Bernanke's message to Congress was dire: The economy needs all the help it can get. Mr. Bernanke, whose job it is to temper America's economic cycles through monetary policy... TRAVIS PANTIN http://www.nysun.com/business/art-of-the-digital-threat-is-visible/69679/ Thu, 17 Jan 2008 00:00:00 EST A New York-based computer security firm, MessageLabs Inc., is bringing digital demons to life. A new MessageLabs advertising campaign features illustrated versions of computer security threats, including spyware, spam, and phishing attacks. The 3-D shapes correlate to actual characteristics of the malicious computer code. "Computer security advertising often struggles to visualize computer threats. You normally just see boring clichés, like someone frowning behind a PC. We wanted to visualize... TRAVIS PANTIN http://www.nysun.com/business/weeks-economic-indicators-focus-of-intense/69645/ Wed, 16 Jan 2008 00:00:00 EST Wall Street economists are anxiously awaiting and scrutinizing the economic indicators being released this week, which could predict if, when, and how deeply America will sink into recession. The numbers will also give investors a sense of how drastically the Federal Reserve is likely to cut interest rates later this month, in an attempt to revive America's ailing economy. Today, the Bureau of Labor statistics will release the December consumer price index, which measures the pace of inflation... TRAVIS PANTIN http://www.nysun.com/business/investment-bank-sees-recession-s-p-battered/69252/ Thu, 10 Jan 2008 00:00:00 EST Goldman Sachs said yesterday it is confident the economy is entering a recession, adding significant support to a similarly negative prediction issued by economists at Morgan Stanley earlier this week. The investment bank said in a research note that the economy may already be in a recession, or will fall into one within three months. Both Morgan Stanley and Goldman Sachs pointed to weak employment data and the impact of credit and housing woes on the economy. "The unemployment rate has now... TRAVIS PANTIN http://www.nysun.com/business/tort-lawsuits-soar-over-subprime-lending/68916/ Fri, 4 Jan 2008 00:00:00 EST The number of class action lawsuits filed against Wall Street firms surged in the last year, fueled by the meltdown in the subprime mortgage market, according to new research published yesterday. There was a 43% jump in the number of securities fraud class action lawsuits last year to 166 suits — 100 of which were filed after the mortgage crisis hit, the study by Stanford Law School and Cornerstone Research found. "I think we're going to see more litigation coming out of the subprime crisis," a... TRAVIS PANTIN http://www.nysun.com/business/investors-await-indicators-of-economic-health/68794/ Wed, 2 Jan 2008 00:00:00 EST The first significant economic indicators of 2008, to be released today following the close of the first market session of the new year, will be eyed carefully by investors trying to determine whether some of last year's economic storms will blow over any time soon. The Census Bureau will announce November's construction spending figures, which could indicate whether the credit crunch — which began as a residential mortgage crisis — is beginning to damage the commercial real estate market. Also... TRAVIS PANTIN http://www.nysun.com/business/stocks-tumble-on-news-of-bhutto-killing-weak-data/68669/ Fri, 28 Dec 2007 00:00:00 EST Wall Street skidded yesterday after several events appeared to confirm traders' expectations that the American economy is facing serious trouble going into the new year. The rise of oil prices above $97 a barrel, the death of the Pakistani opposition leader, Benazir Bhutto, and weak economic indicators for the domestic economy contributed to a spate of selling yesterday, pushing all the major indices down and increasing the likelihood that the Federal Reserve will cut interest rates again in... TRAVIS PANTIN http://www.nysun.com/business/demand-at-fed-auction-seen-as-bad-sign/68394/ Thu, 20 Dec 2007 00:00:00 EST Banks eagerly gobbled up the loans offered by the Federal Reserve Board through its so-called term auction facility, according to figures released yesterday. Monday's auction — whereby banks can trade in their risky assets in exchange for short-term loans from the Fed — showed strong demand, confirming fears of a severe credit shortage and indicating a bleak outlook for the economy. The Fed offered $20 billion worth of 28-day loans, but received more than $61.55 billion in bids, the agency... TRAVIS PANTIN http://www.nysun.com/business/discussion-on-dollars-fate-draws-criticism/68305/ Wed, 19 Dec 2007 00:00:00 EST The dollar's recent fall might signal that the "fiat" money system, which has been in place since America departed from the gold standard in 1971, was something of a mistake. That was among the arguments put forth yesterday by the four panelists who spoke at the Council on Foreign Relations on whether the falling dollar should be considered worrisome. "Unique in the annals of money is a reserve currency that is uncollateralized," the editor of Grant's Interest Rate Observer, James Grant, told... TRAVIS PANTIN http://www.nysun.com/business/ny-manufacturing-index-drops-but-some-see/68204/ Tue, 18 Dec 2007 00:00:00 EST New York State's manufacturers are faring worse than predicted and may continue to suffer into next year, according to data released yesterday by the New York Federal Reserve. The monthly Empire State Manufacturing Survey, which measures general business conditions, plummeted 17 points in November, to 10.3, the lowest level since spring. The index fell well below its six-month average of 22.11, a far steeper drop than analysts had expected. "Generally we look at the New York Fed as a leading... TRAVIS PANTIN http://www.nysun.com/business/shipping-companies-brace-for-last-minute/68146/ Mon, 17 Dec 2007 00:00:00 EST Shipping companies are expecting a torrent of holiday business today, with DHL, FedEx Corp., and the U.S. Postal Service predicting it will be their highest shipping volume of the year. "Everyone waits until the last minute to send their holiday gifts," a manager for Mail Boxes Etc., Peter Boggia, said. "People end up spending more on last-minute shipping than they did on the gift itself." Such a high volume of mail is expected because today is the last opportunity to get gifts delivered on... TRAVIS PANTIN http://www.nysun.com/business/report-manhattan-retail-real-estate-prices-jump-26/68126/ Fri, 14 Dec 2007 00:00:00 EST Manhattan real estate rental prices jumped significantly during the past year, increasing 26% to $133 a square foot, according to a report released this week by the Real Estate Board of New York. Every neighborhood surveyed in the report showed an increase in asking rents for retail space compared to last year. The president of REBNY, Steven Spinola, said the increases show that the city's retail market remains healthy. "This is a strong indication of continuing retail market growth and the... TRAVIS PANTIN http://www.nysun.com/business/perfect-storm-of-strikes-could-cripple-film/68042/ Thu, 13 Dec 2007 00:00:00 EST As New York City's film industry suffers from the shocks of the writers' strike, even bigger storms may be looming: In July, the Screen Actors Guild and the Directors Guild of America are expected to lead strikes of their own, which would immediately halt all filmmaking and could threaten the survival of scores of New York's independent film companies. In preparation for a possible SAG and DGA strike, many Los Angeles-based studios have been rushing to get their filming done before July. That... TRAVIS PANTIN http://www.nysun.com/business/new-mutual-fund-is-more-mtv-than-cnbc/67812/ Tue, 11 Dec 2007 00:00:00 EST Aiming to draw a younger generation into the world of investments, two friends recently started a mutual fund that makes use of MySpace, YouTube, and fashion Web logs. The founders of GendeX, James Perkins, 28, a Yale graduate, and Khalid Jones, 29, a Stanford Law School graduate, are targeting a demographic that "more established players have decided is not important enough to service," Mr. Jones said. "We're making something that was closed off to a certain ilk open to all." The two met while... TRAVIS PANTIN http://www.nysun.com/business/foreign-acquisition-of-us-firms-seen-as-good/67530/ Wed, 5 Dec 2007 00:00:00 EST This week's announcement that France's Vivendi will acquire American video game maker Activision for about $9.8 billion, the largest American M&A deal since the credit crunch took hold in July, reflects a growing trend, experts say. Since July, the 10 largest M&A deals have involved foreign companies acquiring American firms, according to data from Thomson Financial. "These types of deals bode well for American industry," a director at Thomson Financial, Richard Peterson, said. "They show that... TRAVIS PANTIN http://www.nysun.com/business/comptroller-warns-of-6b-city-budget-gap/67468/ Tue, 4 Dec 2007 00:00:00 EST New York City could face a budget gap of more than $6 billion for fiscal year 2011, the city comptroller, William Thompson Jr., predicts in a report issued yesterday. "New York City's economy is at a turning point," Mr. Thompson warned. "Turmoil in the nation's housing and mortgage markets has reverberated through the financial sector, threatening to produce a marked slowdown in local economic activity." Mr. Thompson said in the report that the "collateral effects" of the housing crisis are... TRAVIS PANTIN http://www.nysun.com/business/report-sees-10b-in-losses-due-to-subprime-crisis/67142/ Wed, 28 Nov 2007 00:00:00 EST The greater New York area stands to lose more than $10 billion as a result of the recent subprime mortgage crisis, a new report says. The region covering New York City, Northern New Jersey, and Long Island will be more severely impacted than other metropolitan areas in 2008, according to the study released yesterday by the U.S. Conference of Mayors. This economic slowdown will lead to lower taxes in New York, the report says, estimating that New York State could lose as much as $686 million in... TRAVIS PANTIN http://www.nysun.com/business/mistaken-thinking-on-the-dollar-and-oil/67032/ Tue, 27 Nov 2007 00:00:00 EST Many economically literate bloggers are patiently trying to explain why the falling price of the dollar isn't a direct cause of the rising cost of oil. The flawed logic, as applied by Presidents Chavez and Ahmadinejad and some reporters from important American news outlets, goes like this: If the dollar falls and the price of oil, which is denominated in dollars, goes up, then surely the two must be related. Thankfully, economists such as James Hamilton (econbrowser.com) are here to save us... TRAVIS PANTIN http://www.nysun.com/business/shoppers-push-post-thanksgiving-sales-83-over-2006/66958/ Mon, 26 Nov 2007 00:00:00 EST New York City retail stores are reporting especially strong sales for the Friday after Thanksgiving, historically known as "Black Friday," both from local customers and visiting foreigners capitalizing on the weak dollar. National sales figures are up, too, with Chicago-based retail sales research group ShopperTrak RCT Corp. reporting a strong start for the inaugural weekend of the holiday shopping season. ShopperTrak's National Retail Sales Estimate reported over the weekend that sales on... TRAVIS PANTIN http://www.nysun.com/business/how-yale-professors-lose-weight/66874/ Fri, 23 Nov 2007 00:00:00 EST A Yale economics professor and a Yale law school professor are hoping that the next diet trend to take off is their own, which involves getting dieters to sign binding contracts committing to pay significant sums of money if they fail to meet their weight-loss goals. The economist, Dean Karlan, tested the method himself, promising to hand over $1,000 to a friend every week that he didn't drop one pound. Soon enough, he lost 10 pounds, getting down to 170 pounds without paying a cent. Now, Mr... TRAVIS PANTIN http://www.nysun.com/business/when-business-school-students-get-married/66911/ Fri, 23 Nov 2007 00:00:00 EST Congratulations to Charlie Cooper, a student at the University of Chicago Business School, who got married earlier this summer. While planning his wedding, Mr. Cooper had the sort of idea that one might expect from a business school student: Why not securitize the wedding? His thinking, outlined in a humor piece for the University of Chicago student newspaper (chibus.com), went like this: Weddings these days are expensive – really expensive – both for the families of the couple and for the... TRAVIS PANTIN http://www.nysun.com/business/growth-policy-vs-social-policy/66816/ Wed, 21 Nov 2007 00:00:00 EST A professor of international political economy at Harvard, Dani Rodrik (rodrik.typepad.com), presents his readers with a dilemma: per-capita income in a "landlocked African country," which he declines to name, "stands at a fraction of levels it had reached in the 1970s, with only the last few years seeing some decent economic growth. What kind of a growth strategy should this country follow?" Mr. Rodrik presents two options: The country can spend its resources on educating and improving the... TRAVIS PANTIN http://www.nysun.com/business/global-market-and-the-subprime-crisis/66762/ Tue, 20 Nov 2007 00:00:00 EST At Aleablog (aleablog.com), a blogger by the name of JCK links to a report published by the Bank of England that attempts to "map" the current state of the world's financial system. The bank's Financial Stability Report, published last month, contains many interesting figures; one of the most intriguing is a diagram showing that the subprime assets that have created so much turmoil in the world's markets comprise a tiny sliver of the financial pie. Felix Salmon of Market Movers (portfolio... TRAVIS PANTIN http://www.nysun.com/business/nfl-as-american-microcosm/66670/ Mon, 19 Nov 2007 00:00:00 EST A professor at the University of Michigan, Mark Perry (mjperry.blogspot.com), compares income inequality in America and within the community of National Football League players. According to the Internal Revenue Service, the top 25% of taxpayers earned 67.5% of America's total income in 2005. If all of the NFL players seceded and formed their own country, Mr. Perry asks: What would their income distribution look like? About the same, he says. Mr. Perry examined a 2006 USA Today salary database... TRAVIS PANTIN http://www.nysun.com/business/credit-crunch-as-game-theory/66579/ Fri, 16 Nov 2007 00:00:00 EST A professor at the London School of Economics, Willem Buiter, posts a lengthy treatment of the current credit crisis on his blog, Maverecon (blogs.ft.com/maverecon). His conclusion: "The single best thing that could happen would be for the true magnitude of the losses suffered by banks and other exposed parties to be revealed." Unless that happens, "fear of getting stuck with the hot potato makes banks unnaturally unwilling to extend credit against the kind of collateral that they would not... TRAVIS PANTIN http://www.nysun.com/business/inflation-target-in-all-but-name/66495/ Thu, 15 Nov 2007 00:00:00 EST Greg Ip of Real Time Economics (blogs.wsj.com/economics) reflects on the Federal Reserve's announcement yesterday that it will seek to improve communications with the public by both increasing the frequency and lengthening the horizon of Federal Open Market Committee forecasts. Although the Fed will not provide a formal inflation target, Mr. Ip notes that what it will provide essentially functions as one. "The projection for inflation at the end of the forecasts can serve as an informal... TRAVIS PANTIN http://www.nysun.com/business/politics-of-flu-shots/66426/ Wed, 14 Nov 2007 00:00:00 EST Alex Tabarrok of Marginal Revolution (marginalrevolution.com) stirred up a debate in the blogosphere by asking who really benefits when he gets a flu shot. "People who have the flu spread the virus so getting a flu shot not only reduces the probability that I will get the flu it reduces the probability that you will get the flu," he writes. "In the language of economics the flu shot creates an external benefit, a benefit to other people not captured by the person who paid the costs of getting... TRAVIS PANTIN http://www.nysun.com/business/pursuit-of-happiness-and-a-rising-dollar/66346/ Tue, 13 Nov 2007 00:00:00 EST DEBATING HAPPINESS This past Saturday, the Economist magazine inaugurated a series of public debates in New York (economist.com/nydebates) that pitted well-known bloggers Tyler Cowen and Will Wilkinson against top-tier economists Betsey Stevenson and Jeffrey Sachs. The topic was whether "America is failing at the pursuit of happiness." The executive editor of the Economist and editor in chief of Economist.com, Daniel Franklin, moderated. Arguing against the proposition were Mr. Cowen of... TRAVIS PANTIN http://www.nysun.com/business/milton-friedman-answers-phil-donahues-charges/66258/ Mon, 12 Nov 2007 00:00:00 EST MILTON FRIEDMAN SPEAKS … As the one-year anniversary of economist Milton Friedman's death approaches, Tom Armstrong at the Armchair Economist (blog.financeandeconomicscenter.com) points us toward a short video from 1979 wherein Friedman delivers a sound thumping to talk show host Phil Donahue. In the video, Mr. Friedman meditates on greed and virtue. Donahue asks: "When you see around the globe the mal-distribution of wealth, the desperate plight of millions of people in undeveloped countries …...