National News

In Mississippi, The GOP's Not-So-Civil War Continues

NPR News - Mon, 2014-07-07 16:23

As of Monday, Chris McDaniel, loser in June's Mississippi Republican Senate primary, still questioned Sen. Thad Cochran's victory, despite minuscule evidence of voter fraud.

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Judge Approves NFL Concussion Settlement

NPR News - Mon, 2014-07-07 16:03

Judge approves NFL concussion settlement

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Judge Approves NFL Concussion Settlement

NPR News - Mon, 2014-07-07 14:53

The landmark deal would compensate thousands of former NFL players for concussion-related claims. The ruling came about two weeks after the NFL agreed to remove a $675 million cap on damages

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Washington State To Start Recreational Pot Sales On Tuesday

NPR News - Mon, 2014-07-07 14:50

The state's Liquor Control Board issued the first 24 marijuana retailer licenses on Monday. Washington is the second state — after Colorado — to allow the sale of recreational marijuana.

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Tyler Perry just trademarked "WWJD?"

Marketplace - American Public Media - Mon, 2014-07-07 14:17

From the pages of The Hollywood Reporter: Tyler Perry has moved one step closer to owning the trademark on the phrase "What Would Jesus Do?" 

For whatever it's worth, he can only use it for entertainment purposes - a movie, live show or TV show - not wrist bands or tattoos or the like.

And, no, your T-shirt won't have to say "Tyler Perry presents," because there's a separate "WWJD?" trademark for clothing. 

Teen Tries To Be The Parent His Own Dad Never Was

NPR News - Mon, 2014-07-07 13:22

Marvin Ramos' father says Ramos ruined his life by having a child at 17. But while he struggles, Ramos, now 18, is determined to be an active part of his daughter's life.

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Bahrain Asks U.S. Diplomat To Leave Over Meeting With Shiite Group

NPR News - Mon, 2014-07-07 13:12

The Foreign Ministry said Assistant Secretary of State Tom Malinowski "is unwelcome." Malinowski met with the Shiite opposition in the island nation that hosts the U.S. Navy's 5th Fleet.

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ADM wants a taste of the flavor business

Marketplace - American Public Media - Mon, 2014-07-07 13:10

Food processor Archer Daniels Midland (ADM) is getting its first taste of the flavor market. ADM says it will buy a company called Wild Flavors for almost $3 billion. Wild Flavors specializes in natural flavors for beverages and food, and natural means big business these days.

To start, we should say that flavor people are a very tight lipped crowd.

“You got that right,” laughs John Leffingwell, president of Leffingwell & Associates, which consults for the flavor and fragrance industry.

He says the flavor industry is competitive. Flavorists keep their discoveries secret as long as they can. But one trend is clear.

“When I started in the industry about 30 years ago,” he says, “about 70 percent of the flavors were artificial flavors. Today it’s close to 80 percent or maybe even more that are all natural flavors.”

That’s an estimate. But foods labeled ‘natural’ did rack up more than $40 billion in U.S. retail sales last year, according to Nielsen.

The problem is healthier foods aren’t always appealing to consumers.

“People would love to have lower sodium or lower sugar in the diet, but when companies reformulate with these changes, a lot of time consumers don’t buy them,” says Devin Peterson, a University of Minnesota professor who works with the Flavor Research and Education Center.

He’s researched solutions like getting salt to release more efficiently in the mouth, so a lower sodium chip tastes just as salty.

Flavor companies are also tackling the low sodium taste conundrum.

“What flavor companies do, they help food companies to reduce the salt content but save the flavor of the crisp,” says Evgenia Molotova, a chemicals analyst at Berenberg.

She says that’s one reason why the flavor business is appealing right now.

“Sales of flavors are growing much faster than the sales of food products,” she says.

Wild Flavors specializes in natural flavors for beverages. That helps ADM diversify its commodities business.

Why Americans spend less of their budgets on food

Marketplace - American Public Media - Mon, 2014-07-07 13:10

Food prices are rising, and the reasons run the gamut. 

A disease known as porcine epidemic diarrhea virus has killed millions of piglets and young hogs, driving up the price of pork and bacon. A drought in Texas and Oklahoma cattle country has caused a spike in the price of beef. Coffee rust in Central America could raise the price of a cup of high-end joe, and a disease called citrus greening is wiping out orange and grapefruit trees in Florida. And yet, consumers in the U.S. spend a smaller percentage of their disposable income on food than citizens of any other country in the world. 

It's not simply that food in the U.S. is cheaper. "Americans on average have a higher income level and when you're talking total income and the amount spent on food, it's just a lower percentage," said Anne Marie Kuhns, an economist with the Department of Agriculture's Economic Research Service. People who live in developing nations have incomes that are far lower than those of a typical American. Food is bound to eat up a larger percentage of a typical family's budget.

Graphic by Shea Huffman/Marketplace

Americans, though, also spend less on food than people in higher-income European countries like France, Sweden and Germany.

A number of factors are in play,  including the amount of farmland in the U.S., estimated, says Dan Basse, president of the consulting firm, AgResource Company, at "around 350 million acres," and different quality standards. Genetically modified plants are restricted in Europe, but, are considered technological advances that help increase the productivity of farmland in the U.S.

Graphic by Shea Huffman/Marketplace

And while food is susceptible to price hikes, Americans eat a very varied diet, and if one product becomes expensive, there are others that can be swapped in to take its place. Think substituting chicken for beef when meat prices are high. 

Finally, some researchers say European consumers simply have different standards of quality. 

"Consumers take their food a lot more seriously in Europe than we do here," said Timothy Richards, the Morrison Chair of Agribusiness at Arizona State's W.P. Carey School of Business. "They're more likely to buy higher-end things. Here, Walmart is the dominant food supplier because it's cheap." 

Failing deals: a trend, or temporary?

Marketplace - American Public Media - Mon, 2014-07-07 13:09

You or I might borrow money from a bank, put up our house as collateral, and pay interest on the cash. Financial institutions do this too amongst themselves; they borrow cash and put up bonds as collateral. Or they’ll lend cash in order to get collateral. This is called the repo market. Banks use this to cover pulls and pushes on the financial system. Traders use it to make short sales.

But some odd things have been happening in this market over the past few weeks and even years.

For starters, negative interest rates. “It’s like if the bank lends you money, they would paying you interest to be able to lend you cash,” says Peter Anderson repo trader with Potomac River Capital.

For example, just this morning, lenders were willing to loan cash for -0.1 to -0.15 percent interest -- meaning they would pay -0.1 to -0.15 percent interest in order to lend that money if it meant they would get their hands on the newest five year treasury notes as collateral.

Why? Because they really, really need collateral. Collateral to make other deals, collateral to cover short sales.

There isn’t enough to go around, and this means that deals are failing. Fails happen all the time, but their volume has been increasing.

In 2012, the average volume of failed deals per week was around $30 billion. In 2014, it’s about $67 billion.

Some fails can be particularly bad. For example, when one entity fails to find the collateral it needs to complete a deal with another party, who needs that collateral to complete a deal with another party, and so on. “It creates a daisy chain of fails, a chain reaction of fails,” says Anderson.

This is what happened at the start of the financial crisis. Fails now are nowhere near that level, but they still present a source of unease.

“The fact that we are seeing repeated episodes where security doesn’t clear up for days at a time is a sign of a market that’s not functioning very well,” says Louis Crandal, chief economist at Wrightson ICAP.

Among the reasons for the tighter repo market is a new set of rules on bank capitalization that make banks less willing to tighten their grip on bonds being sought for use as collateral.

“Banks have been required to hold more capital against trades that prior to the crisis were seen as being relatively low risk, and which are low risk in good times.” However in a crisis, trades can create systemic problems like the daisy chain effect that took out Bear Sterns and Lehman Brothers. Regulators have insisted more capital be held against such trades, and so fewer trades are made.

“Thats not an unintended consequence,” says Crandal. “One of the points of Dodd-Frank and all the other changes in regulatory structures globally was to increase the cost of financial intermediation,” the fear being that razor thin margins amplified financial risk.

But regulators didn’t intend to increase the number of failed deals per se. In 2009, they developed a new rule to incentivize institutions looking for collateral to keep looking. Simply put: it’s a fee for failure. A financial institution looking for collateral to finalize a deal somewhere else now has to pay a 3 percent fee if it fails to find it.

This penalty should keep a lid on fails, says Joseph Abate, short rate strategist for Barclays. “I think this is transitory and will resolve itself within a week or so,” he says, speaking of the recent spike in fails. Periodically as economy improves and people begin to foresee interest rate rises, “the demand to borrow securities is picking up,” as people seek to short securities. In the process, they are applying demand side pressure on those securities in the repo market.

As treasury bonds are auctioned in tranches over a quarter, there are choke points at the beginning of an auction period where there are fewer bonds, and towards the end of the quarter, financial institutions will have used up

Crandal, at Wrightson ICAP, says the increasing fails rate is unlikely to blow up, but “it’s a case of existing market structures not really making sense in a new capital framework, and we haven’t developed new avenues for sourcing those bonds.”

If the issues persist, either the financial system on its own or regulators down the road will have to figure out a new way of doing business -- such as a central clearing house for all repo trades, or a new type of financial entity tasked with handling that process.

Meet the man who invented the pool noodle

Marketplace - American Public Media - Mon, 2014-07-07 12:58

Steve Hartman is the CEO and president of Industrial Thermal Polymers, but he's got another claim to fam: He's the guy who first decided that colorful foam tubes make a pretty fun pool toy.

Hartman invented the pool noodle three decades ago when he first went into business with his dad in Toronto, Canada.  

"We're going to make backer rod," his dad said. Steve's follow-up question: What's a backer rod?

Steve's dad told him backer rods are used in anything with expansion joints - high-rises, roads, ramps, runways - you peel away the caulk or tar and there's a foam rod in there to seal it. The Hartmans would make those foam rods.

"We always had these foam rods (lying around)," Hartman says. "They were gray and 9-footers and it seemed like every time we jumped in the pool, we were playing with these things."

So Hartman mixed up a batch with color and tried to sell them to a few of the local pool supply stores. There was just one problem: What do you do with these things?

"We said, 'Well, you float around with them, you hit your brother with them.' It was a tough sell," Hartman says. 

For over a year Hartman peddled his noodles, but no one was biting. Since he made no sales, he figured why patent the thing?

But then a funny thing happened. Canadian Tire, a company that sells all kinds of stuff, bought a batch of the noodles and priced them low enough to draw folks in. 

"People would walk by them and see these bright colored foam rods and they weren't sure what to do with them.But the price was right, so they would grab a couple and try them out," Hartman says.

The noodle took off slowly for awhile. But these days it's a staple of pools, docks and beaches everywhere. Hartman says his company sells between 6 and 8 million of them a year. Even though he can't ward off imitators, Hartman estimates that Industrial Thermal Polymers produces around half of North America's noodle supply.

And best of all? He no longer needs to tell people what to do with them. There are plenty of other places to find that information.

Meet the man who invented the pool noodle

Marketplace - American Public Media - Mon, 2014-07-07 12:58

Steve Hartman is the CEO and president of Industrial Thermal Polymers, but he's got another claim to fam: He's the guy who first decided that colorful foam tubes make a pretty fun pool toy.

Hartman invented the pool noodle three decades ago when he first went into business with his dad in Toronto, Canada.  

"We're going to make backer rod," his dad said. Steve's follow-up question: What's a backer rod?

Steve's dad told him backer rods are used in anything with expansion joints - high-rises, roads, ramps, runways - you peel away the caulk or tar and there's a foam rod in there to seal it. The Hartmans would make those foam rods.

"We always had these foam rods (lying around)," Hartman says. "They were gray and 9-footers and it seemed like every time we jumped in the pool, we were playing with these things."

So Hartman mixed up a batch with color and tried to sell them to a few of the local pool supply stores. There was just one problem: What do you do with these things?

"We said, 'Well, you float around with them, you hit your brother with them.' It was a tough sell," Hartman says. 

For over a year Hartman peddled his noodles, but no one was biting. Since he made no sales, he figured why patent the thing?

But then a funny thing happened. Canadian Tire, a company that sells all kinds of stuff, bought a batch of the noodles and priced them low enough to draw folks in. 

"People would walk by them and see these bright colored foam rods and they weren't sure what to do with them.But the price was right, so they would grab a couple and try them out," Hartman says.

The noodle took off slowly for awhile. But these days it's a staple of pools, docks and beaches everywhere. Hartman says his company sells between 6 and 8 million of them a year. Even though he can't ward off imitators, Hartman estimates that Industrial Thermal Polymers produces around half of North America's noodle supply.

And best of all? He no longer needs to tell people what to do with them. There are plenty of other places to find that information.

Afghan Election Numbers Come With A Warning: Results Not Final

NPR News - Mon, 2014-07-07 12:51

More than three weeks after a runoff vote in Afghanistan's presidential elections, preliminary results have been released. Candidate Ashraf Ghani has a wide lead, but audits are yet to come.

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In Maine, A Gay Candidate With An Uneven Record On LGBT Rights

NPR News - Mon, 2014-07-07 12:38

The state could elect the nation's first openly gay governor this fall. But Mike Michaud only recently came out, and some question whether he deserves the backing of Maine's largest gay rights group.

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We Asked, You Answered: Going To Extremes To Disconnect On Vacation

NPR News - Mon, 2014-07-07 12:29

Giving up digital devices — even if for just a few hours or days — is a struggle. Whether it was to catch up on the news or peek in on the World Cup, NPR listeners found it tough to kick the habit.

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MayDay PAC: The end of the Super PAC era?

Marketplace - American Public Media - Mon, 2014-07-07 12:17

Money plays a crucial role during the political campaign season. The amount of money backing your campaign could mean a win or loss in a seat in Congress. And when Super PACs were deemed legal by the Supreme Court in 2010, the game changed.

Before Super PACs were "super", a PAC was limited to spending no more than $2,500, with corporations and unions strictly forbidden from making donations. Now corporations and unions are allowed to make donations and the limit to spending? Well there is none.

Fair or not, this is one issue that is set in stone... or at least was. Lawrence Lessig, a Harvard Law professor, wants to take down these Super PACs... by creating one of his own. This past weekend, the MayDay PAC reached its fund raising goal of $5 million. Lessig plans to start the anti-Super PAC campaign for this year's House of Representative election.

"We want to win five seats so we can convince the people of Washington that this issue really matters to voters so that we can build the campaign we have to have for 2016 that will win a Congress that is committed to changing the way that elections are funded."

This goal isn't an easy feat. The elections take place in a few months and the majority of people who donated are from areas that have a Democratic seat in the House, according to a map from the MayDay website. But Lessig says this issue is as important to people on the right as well as the left.

"You know, when Dave Brat beat Eric Cantor, the number two issue he talked about was that Eric Cantor had become a Crony Capitalist. So our view is this is cross partisan and we can talk about this in a way that gets people on the right and people on the left to recognize that though they don't have a common end, they have a common enemy. And the common enemy is the way we fund campaigns today."

Now that Lessig has done his part to raise money for the MayDay PAC, he'll hand it over to the campaign shops "that are experts at winning campaigns" and wait until November to see if it was all worth it. 

More Than 50 People Were Shot In Chicago Over The Holiday Weekend

NPR News - Mon, 2014-07-07 12:15

The Chicago Tribune called it "the greatest burst of gun violence Chicago has seen this year." The number of shootings in the city has risen since last year even as the homicide rate has fallen.

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Pope Meets Sex Abuse Victims, Bearing A Plea For Forgiveness

NPR News - Mon, 2014-07-07 12:07

In his first meeting with victims of clerical sex abuse, Pope Francis asked forgiveness on behalf of the church.

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In Jerusalem, And Caught In A Crossfire Of Thrown Stones

NPR News - Mon, 2014-07-07 12:07

Following the deaths of three Israeli teens and the apparent revenge killing of a Palestinian, Jerusalem is as tense as it has been in years. NPR's Ari Shapiro and his translator found themselves victims of rock-throwing there. Their story offers a window into a city on edge.

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In Brazil, Pacification Paves Way For Baby Steps To Democracy

NPR News - Mon, 2014-07-07 12:07

Brazil's ambitious effort to drive crime out of Rio de Janeiro's violent, low-income favelas ahead of the World Cup has had a mixed record. One positive effect: giving residents a say in local issues.

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