National News

California Quake Means Big Damage For Napa Valley Wineries

NPR News - Mon, 2014-08-25 04:19

It's still too early to tell just how much the magnitude-6.0 quake will cost the region, but it comes after a drought had already made things difficult for wineries.

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PODCAST: Nadella's vision for Microsoft

Marketplace - American Public Media - Mon, 2014-08-25 03:00

First up, Sony's Playstation gaming network is back functioning to its usual standards today after being crippled for a time by a major cyber attack this weekend. And that's just one part of a strange business of entertainment story today. Plus, microsoft is expected to unveil a new version of its Windows operating system. The last one, Windows 8, was nice enough but did not take the world by storm. But since then, Microsoft has gotten a new CEO: Satya Nadella. Windows 9 could say a lot about his vision for the company. Also, Japan has resumed exporting rice grown in the Fukushimia region for the first time since the nuclear power disaster in 2011. A shipment of 650 pounds of rice sold out at a big supermarket in Singapore.  That local success could help reopen markets beyond Singapore for struggling Japanese farmers.

At Michael Brown's Funeral, A Call For A Day Of Reckoning

NPR News - Mon, 2014-08-25 02:49

The shooting death of the 18-year-old sparked violent protests in Ferguson, Mo. At his funeral, there was resignation but also a clarion call for change.

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How the sharing industry gets insurance

Marketplace - American Public Media - Mon, 2014-08-25 02:00

Sharing may sound utopian. But the sharing industry has a dark side and its name is insurance.

“Probably one of the hardest things we had to do in order to start our company was to get the insurance,” says Seth Peterson, co-founder and CEO of AllYouCanArcade.com, an arcade game rental business. Peterson says he had to call more than 100 insurance agents before he found one willing to work with him.

“Eventually what I did was I started to get my insurance license," he says, "because I thought if no one is going to underwrite this, I’ll underwrite this myself.”

Peterson says the brokers he talked to were okay with the arcade game part of his business: “Then we would say, 'Well, actually, though, we have these independent contractors who work for us, who fill demand across the entire United States.' And that was the point where they just freaked out.”

While she didn't freak out, Ashley Hunter, an insurance broker specializing in risky markets with HM Risk Group, does admit to a certain amount of surprise, confusion and doubt when she received the first inquiry from a potential client about the cost of a policy for his car sharing company.

"I literally looked at him and started laughing and said, 'No one is going to insure this,'” she says. "There’s too many variables. I don’t know who’s using the vehicles. I don’t know when these cars are going to be used. What happens if someone is sharing the car and then it gets stolen? Who’s responsible?”

In the end, Hunter says, she was able to find a policy that worked for the car sharing service, as well as others. Now, she says the sharing industry is a niche she specializes in, as well as other, equally risky to insure industries - like fertility. But she notes that calculating rates for policies and deductibles for businesses like these can be complicated.

Just imagine a possible scenario, says Ted Devine, CEO of Insureon, an online broker specializing in small businesses, many of which share. “You’re an independent programmer; you run into your Uber car; you forget your laptop," he says.

If you work for a big company, says Devine, and leave your laptop in a taxi from a sharing service, or at a co-working space, ready your  lawyers, because everyone could get sued. Of the category of risk dealing with cyber data, like the recent Target breach, Devine says: "the sharing economy puts that on steroids.”

Rob Auston, founder of Outdoors.io -- think Airbnb-like site, but for skis, tents, backpacks and other outdoor gear -- says as a young sharing company, he found himself in a Catch-22. Insurers wouldn't provide him with a policy until he had established a solid customer base. But at the same time, it was tricky to find customers willing to rent out their gear without insurance.

"I spent a ton of time talking to insurance companies who just didn't understand our business," he says. "I made the decision to stop wasting time on it and just build the business."

Though he wasn't happy about it, Auston and his partners decided to provide up to $500 of coverage for clients' gear out of their own pockets. He says that now that he has a more fully fleshed out operating business, he's been able to find an insurance broker who is willing to provide coverage and he hopes to have damage and liability coverage in place later this year.

“Sharing sounds so good,” says Christie Alderman, vice president for Chubb Personal Insurance. “Our parents taught us to share when we were toddlers, right? But in this case sharing has some challenges."

Alderman says consumers need to read the fine print on their insurance policies. Especially if they're engaging in paid sharing on either side of the equation. For them, she has this message:  "If you want to share, beware."

CORRECTION: An earlier version of this story misspelled the name of Insureon. The text has been corrected.

It's still summer, but gas prices haven't spiked

Marketplace - American Public Media - Mon, 2014-08-25 02:00

It’s peak driving season, yet increased demand is not pushing up gas prices. The national average sits at $3.44 a gallon, a six-week low. How does that happen?

Well, first, consider global prices. The international Brent price of crude is at a soft $102 per barrel.

That may sound odd, given global instability in the Middle East and Ukraine. Despite geopolitical events, though, oil continues to flow from those places. 

“There will be no sanctions against Russian oil or gas exports,” says consultant Bob McNally at the Rapidan Group. “So that initial fear we saw in March and May has kind of come out of the market.”

Elsewhere, there have been supply hiccups. The International Energy Agency reports disruptions in Iraq and Libya. Those shortfalls have been made up, however, by increased North American output.

U.S. production, now 8.5 million barrels per day, is at its highest since 1987.

“We’ve had this dramatic increase in crude oil production because of new technology,” says economist Tancred Lidderdale of the federal Energy Information Agency. “And that’s helped offset supply disruptions across the world.”  

Of course, calm markets always precede something. AAA notes hurricane season is approaching, which is always a risk for Gulf coast refineries.

Los Angeles Gas Prices provided by GasBuddy.comClick here to add this map to your website. Los Angeles Gas Prices provided by GasBuddy.com Click here to add this map to your website.

It’s peak driving season, yet increased demand is not pushing up gas prices.

 

The national average currently sits at $3.44 a gallon. That’s a six-week low. As to why, consider global prices. The international Brent price of crude is at a soft $102 per barrel.

 

Which may sound odd, given global instability in the Middle East and Ukraine. Despite geopolitical events, though, oil continues to flow from those places.

 

“There will be no sanctions against Russian oil or gas exports,” says consultant Bob McNally at the Rapidan Group. “So that initial fear we saw in March and May has kind of come out of the market.”

 

Elsewhere, there have been supply hiccups. The International Energy Agency reports disruptions in Iraq and Libya. Those shortfalls have been made up, however, by increased North American output. U.S. production, now 8.5 million barrels per day, is at its highest since 1987.

 

“We’ve had this dramatic increase in crude oil production because of new technology,” says economist Tancred Lidderdale of the federal Energy Information Agency. “And that’s helped offset supply disruptions across the world.”  

 

Of course, calm markets always precede something. AAA notes hurricane season is approaching, which is always a risk for Gulf coast refineries.

  

Inversions can hit small investors with a big tax bill

Marketplace - American Public Media - Mon, 2014-08-25 02:00

Ninety-five-year old Lois Powers of Okoboji, Iowa, owns about $40,000 worth of Medtronic stock.

“I’ve been buying it all through the years,” she says.

Now, Medtronic is considering an inversion. Currently, it’s a pharmaceutical and medical device company.

It plans to buy Covidien, a surgical supply firm based in Dublin. Ireland has a lower corporate tax rate than the U.S., meaning Medtronic’s taxes would go down, but Lois Powers’s would spike up.

“It’ll be thousands,” she says.

That’s because Powers will get stock in the new company created by Medtronic’s merger with Covidien. To the IRS, it’ll look like Powers sold her old Medtronic stock. 

She’ll have to pay capital gains taxes on the difference between what she originally paid for the stock, and on what it’s worth at the time of the merger.

But the profit’s all on paper. She didn't make a bundle of cash.

Steven Davidoff Solomon is a professor of law at University of California, Berkeley. 

He says, for example, “Let’s say you bought the stock at $10 a share and now it’s at $40 a share. The IRS will look at that as $30 in profit and they’re going to tax that at the capital gains rate.”

Depending on your tax bracket, that rate can reach nearly 24 percent. 

Why is the IRS doing this to shareholders? Believe it or not, it’s part of a 1994 law intended to discourage inversions. 

Robert Willens is an independent tax adviser in New York.  

He says the thinking was: “You know, no one will ever want to invert if we create this penalty, but it just hasn’t worked out that way.” 

That’s partly because corporations reimburse executives for any capital gains taxes they pay. Little guy investors aren’t reimbursed, of course. But they don’t protest. 

Willens says many don’t realize they’re paying higher taxes in inversions because they hold mutual funds, which tally up your capital gains for the year without breaking it out stock by stock. 

And individual investors may be thinking the stock price will eventually go up because of the inversion.

“Once it’s all said and  done, we’ll be happy that we bore this short term penalty for the greater payoff that comes later,” Willens says.

But Lois Powers, our 95-year-old  Medtronic shareholder, is skeptical.

“I don’t know that exactly," she says. "And furthermore, I probably don’t have that much time.”

Powers says she planned to pass the Medtronic stock on to her heirs so she wouldn’t have to pay tax on it.

“This is money that I have put away for my elder years and for my estate when it’s passed onto my children,” she says.

Now, Powers says, that money will take a hit. 

 

 

 

 

 

 

 

What will Windows 9 say about Microsoft's new CEO?

Marketplace - American Public Media - Mon, 2014-08-25 02:00

Next month, Microsoft is expected to unveil a new version of its Windows operating system. Since it released Windows 8, Microsoft has gotten a new CEO, Satya Nadella, and the next iteration of Windows could say a lot about his vision for the company.

Microsoft’s customers – especially its corporate customers – didn’t exactly embrace Windows 8.

“If anything, the operating system tended to get in the way more than help you get your work done,” says Al Gillen, a tech analyst with IDC. Windows 8 was designed for touchscreens, but many users still rely on PCs with keyboards.

According to Brendan Barnicle, with Pacific Crest Securities, while the next version of Windows is sure to look different, in a way, that is beside the point.

“You know, I think the biggest difference is going to be around distribution, where we start to see something that is genuinely a cloud-based version,” he says.

Microsoft’s new CEO has adopted a “Cloud First” strategy, and he has also made some personnel changes since he started. Morningstar analyst Norman Young says Nadella has remade the company’s engineering department, and that is reflected in the timing of this release.

“Usually, development times for operating systems for Microsoft took multiple years,” he notes.

Analysts say Microsoft is moving toward introducing a new version of its operating system annually.

What will Windows 9 look like? A collection of the rumors.

The rumor mill is full of tidbits about what exactly Windows 9 will look like. As for Marketplace, we hope it'll look something like this:

But we digress. The real Windows 9, a complete update of the operating system, will attempt to have more unification across devices (confirmed), and much less Jeff Bridges (unconfirmed).

Here are some of the more prominent rumored features of Windows 9:

It will be a lot less "charm"-ing: Windows is reportedly removing the "charms bar" completely from the desktop version for computers and laptops.

Virtual desktops: There are also reports that the the newest version will feature virtual interfaces so users don't gunk up their main window while running multiple apps.

Speaking of desktops...Microsoft is allegedly removing the desktop for mobile versions of the OS.

And move over Siri: Cortana, Microsoft's version of Siri, is rumored to be up and running for computers and tablets as part of the new OS.

You can expect all this and more...on September 30th (allegedly).

But remember, until the actual release of Microsoft 9, these are all just rumors.

Let's all hope that the new system will mark the return of a familiar friend:

 

Pandora near parity on gender stats

Marketplace - American Public Media - Mon, 2014-08-25 01:30

Pandora, the music streaming company, has entered the continuing debate over demographic diversity in the tech industry with a release of its own numbers. While the company has a similar racial profile to its tech peers, it has a remarkably high representation of women.

The statistics, just under 51% for men and 49% for women, are a marked departure from the breakdowns of other companies. Even so, the technical and leadership roles are still overwhelmingly male.

It is not clear what Pandora is doing differently -- It, along with other companies, has been reluctant to talk in closer detail on the issue because diversity is considered such a sensitive subject.

Adrienne LaFrance, technology reporter at The Atlantic, adds that even if companies address issues with hiring, retention rates pose another major challenge; from support groups to the possibility of flexible working hours. 

Click the media player above to hear Adrienne LaFrance in conversation with Marketplace Tech guest host Noel King.

The Tale of the City Service Station

Marketplace - American Public Media - Mon, 2014-08-25 01:00

Before there was Exxon, there was ESSO. Before there was CITGO, there were Cities Service stations. That brand is long gone, but this summer marks the return of something you might call “City Service.” Sick and tired of high local fuel prices, a town in Kentucky in recent weeks opened up its own gas station. It is a filling station owned by the town of Somerset. 

The mayor, in what’s been described as a Republican stronghold, says residents have been complaining for years that gas prices in Somerset tend to run higher than in surrounding areas, and spike when vacationers come in for boating and fishing on a nearby lake. Somerset already owned a 60,000 gallon gasoline storage facility. Jazzing up the place to take cash and credit cards required a modest investment of  $75,000. Somerset also lucked into having an independent wholesaler in the neighborhood that is willing to supply the gas to the town little station.

The city is charging per gallon based on an average regional price. The mayor is quoted saying the idea isn’t necessarily to sell gas, but to help bring gas prices down. The strategy appears to be working in the early weeks of the venture. Local drivers are delighted, but private sector gasoline sellers are not. Some say it smacks of socialism, even communism, and see the idea as an assault on the free market.

I looked around for some precedents and they are interesting. Some cities have long had municipal public utilities. The power company in San Francisco is owned by the city and county, for instance. In North Dakota, there has been a state-owned bank that for 95 years has been serving as a kind of mini-Federal Reserve for the region to target cheaper loans to projects deemed in the public interest, like nurturing local entrepreneurs.

There are precedents in the retail sector as well. The town of Kotzebue, Alaska owns its own liquor store. In Minnesota, 207 municipalities own their own booze emporiums. 

More typically however, the response to high prices or other perceived market failures has not been ownership of the retail outlet by a municipality. Instead, the solution is more often local citizens banding together. Heating fuel co-ops are common, in which locals pool resources to get a better price on oil by buying in bulk. In Powell, Wyoming, there is even a department store called Powell Mercantile owned by a group of 500 local shareholders. The store is popular enough to have become a tourist destination. 

As Ferguson Unraveled, The World Found A New Way Of Watching

NPR News - Mon, 2014-08-25 00:46

When protests over the shooting of Michael Brown turned violent in Ferguson, Mo., live-streaming videos showed Americans what they couldn't see on TV.

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Ebola Took Her Daughters And Made Her An Outcast

NPR News - Sun, 2014-08-24 23:30

The disease that has claimed over 600 lives in Liberia and 1,400 across West Africa has had another tragic impact. People who've lost family members may find themselves shunned by friends and family.

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Grocers Lead Kids To Produce Aisle With Junk Food-Style Marketing

NPR News - Sun, 2014-08-24 23:29

Grocers are hoping to entice young consumers and their parents to eat more vegetables by creating kid-focused produce. They're borrowing tactics from the soda and snack industries to win them over.

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On The Fall Docket: Who Gets To Vote — And Who Gets To Decide?

NPR News - Sun, 2014-08-24 23:28

A federal court will hear arguments Monday on whether Kansas and Arizona can require proof of citizenship when people register to vote. It's the first of a wave of voting law cases this fall.

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In New Hampshire, An Unexpected Tight Race For Senate

NPR News - Sun, 2014-08-24 23:27

When talking competitive U.S. Senate races, New Hampshire isn't at the top of the list. But the contest between Sen. Jeanne Shaheen and likely opponent Scott Brown has become surprisingly close.

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People With Down Syndrome Are Pioneers In Alzheimer's Research

NPR News - Sun, 2014-08-24 23:25

By age 40, the brains of people with Down syndrome start to resemble those of Alzheimer's patients. Scientists hope to speed up Alzheimer's drug development by studying people with Down syndrome.

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Burger King In Talks To Buy Canada's Tim Hortons

NPR News - Sun, 2014-08-24 21:15

The companies say Miami-based Burger King Worldwide Inc. and Ontario-based Tim Hortons Inc. would continue to operate as separate brands but would share corporate services.

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Latecomers Bring Fresh Outrage To Weary Ferguson

NPR News - Sun, 2014-08-24 13:25

As the streets of Ferguson, Mo., calm down, new protesters are arriving to carry on demonstrations.

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Ebola Outbreak Emerges In Central Africa

NPR News - Sun, 2014-08-24 13:02

With two deaths caused by the virus reported by the Democratic Republic of Congo's health ministry, the disease appears to have moved beyond West Africa.

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Powerful Earthquake Rattles Northern California

NPR News - Sun, 2014-08-24 12:59

A magnitude 6.0 earthquake struck the Bay Area of California early Sunday morning. The quake caused some injuries and heavy damage to buildings, particularly in Napa.

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