National News

Disney vs movie theaters in the next box office fight

Marketplace - American Public Media - Wed, 2015-05-06 02:00

Hollywood is buzzing about a reported battle between Walt Disney Studios and theater owners over "Avengers: Age of Ultron." The recently released film has already pulled in more than $400 million. Theater owners say Disney has been trying to boost its cut by taking a bigger share of the box office and restricting matinee hours. 

Barry Blaustein, Chapman University screenwriting professor, says theaters make money by getting people in the door to buy those overpriced, $5 boxes of Raisinets.

"Basically, movie theaters are in the candy selling business," he says.

Sam Craig teaches marketing at NYU's Stern School of Business. He says historically, theaters and studios typically split box office receipts 50/50. But Disney reportedly wants 60 percent of the box office for the Avengers sequel — and that could add up.

"Studios need theaters. Theaters need films to make money," he says.

If Disney keeps churning out big hits, the studio could have even more power over theaters, and other studios might follow Disney's lead. 

"It's likely to gross over $500 million, so now we're talking $50 million," Craig says.

Disney pricing power

Marketplace - American Public Media - Wed, 2015-05-06 02:00

Hollywood is buzzing about a reported battle between Walt Disney Studios and theater owners over Avengers: Age of Ultron. It's barely been out for a couple weeks and has already pulled in more than $400 million dollars. Theater owners say Disney has been trying to boost its cut by taking a bigger share of the box office and restricting matinee hours. 

You might think movie theaters are in the movie business, but you'd be wrong.  Barry Blaustein teaches screenwriting at Chapman University. Blaustein says "basically movie theaters are in the candy selling business." What he means is that theaters make money by getting people in the door so they can buy those $5 boxes of Raisinets.

Sam Craig teaches marketing at NYU's Stern School of Business. Craig says historically, theaters and studios typically split box office receipts 50/50. But Disney reportedly wants 60 percent of the box office for the Avengers sequel. And that could add up. "Studios need theaters. Theaters need films to make money." 

If Disney keeps churning out big hits, the studio could have even more power over theaters. And other studios might follow Disneys lead. "Over its run it's likely to gross over $500 million. So now we're talking $50 million," Craig adds. 

The green movement heads underground

Marketplace - American Public Media - Wed, 2015-05-06 02:00

The “green” movement is headed underground — to the grave, that is. More and more cemeteries around the country are offering burial options that use fewer materials and less energy; some are landscaped with native plants and trees. These simplified burials can also be cheaper, but there’s often a catch.

At a dedication ceremony for the St. Kateri Preserve at Calvary Cemetery in Dayton, Marge Devito and her husband Bill watch as a priest blesses the site. Bill has a terminal illness—and they love the idea of burying him in a nature preserve.

“This is exactly what Bill wanted,” says Marge. He had been planning to be cremated and have his ashes scattered, because he wanted something simple, but their kids insisted that he should have a grave site they would be able to visit. When they came to Calvary and learned about the planned nature preserve, Marge Devito says they jumped on it and bought two plots. “It’s just perfect."

Right now the preserve actually looks like some bulldozed dirt on a construction site, but Judy Pavy, who sells plots for the cemetery, says she can picture it. “It’s going to have the wildflowers and native Ohio grasses, and I just envision butterflies and birds visiting.”

The preserve won’t require expensive vaults or underground liners—in fact, those will be forbidden, along with formaldehyde embalming, so the cemetery can get a certification from the Green Burial Council as a green cemetery. For those who want headstones, there will be boulders, as well as a stone wall near the path where people can have their names engraved.

But just like the conventional side of the cemetery, a green plot comes at a price—or a range of prices, actually. A meadow spot is the cheapest, but it gets no marker, and you can’t visit the exact grave site. For a spot by the path or the lake, patrons of the St. Kateri Preserve will pay more. A boulder or a stone engraving is another charge.

Of course, price differentials and upselling are standard in the funeral industry. What’s new is branding the options as “green.”

“What we call green burial is what our ancestors about 130 years ago called burial,” says Josh Slocum, the head of the Funeral Consumers Alliance, a national watchdog group. He’s concerned that green funerals will become an overpriced industry of their own—that people will be encouraged or even pressured to purchase natural embalming fluid and expensive biodegradable coffins as boutique items, showing a commitment to the environment. “Whereas really, it’s charging just as much money for fewer services and fewer products.”

Slocum’s not opposed to simplifying the burial process—if anything, he says pricing needs to be more transparent. Taboos around death sometimes make it hard to talk dollars and cents, especially in times of crisis. His advice to would-be funeral consumers? Do what feels right—and ask to see a price list. 

"The flash crash" five years later

Marketplace - American Public Media - Wed, 2015-05-06 02:00

May 6, 2015, marks the five-year anniversary of the so-called ‘flash crash’ on the New York Stock Exchange. That day, the Dow Jones Industrial Average plummeted more than 1,000 points, before regaining much of its ground by the end of the day.

The causes of the ‘lash crash are still debated, but certainly included a combination of civil unrest and market volatility sparked by the European debt crisis, plus high-frequency trading. Another key factor is now thought to be market manipulation by a single rogue trader in London, who was allegedly ‘spoofing’ S&P futures (in particular, the S&P 500 E-mini contract). That trader, Navinder Sarao, 36, was charged last month in the U.K.

Similar cases have followed.  

On May 5, 2015, in Manhattan federal court, the Commodities Futures Trading Commission, working with the Chicago Mercantile Exchange, filed civil charges against two traders in the United Arab Emirates. They allegedly spoofed the gold and silver markets from February to April 2015.

University of Maryland law professor Michael Greenberger, a former director at the CFTC, says "embarrassment" over the 2010 flash-crash revelations seem to be galvanizing securities regulators to identify and track down alleged market manipulators. But he says the Obama Administration’s prosecutorial approach isn’t helping, as it has favored civil over criminal charges in most securities-fraud cases since the financial crisis.

“The cleanest and clearest way to stop people from doing these things is the real possibility of ending up in jail,” says Greenberger. When traders and their firms face only civil charges, Greenberger continues, “they pay penalties. Penalties are a cost of doing business. Spending time in prison is the most effective deterrent to the fraudsters.”

Greenberger also believes part of the blame for lax enforcement against spoofing and other attempts to manipulate market prices lies with the equity and futures exchanges themselves. He charges that the Chicago Mercantile Exchange, for instance, has dueling incentives—to ensure market integrity, but also to generate profits from higher trading volume, which high-frequency trading provides. Greenberger also says members of Congress, acting to help financial firms that are also big campaign contributors, have not adequately funded federal securities regulators like the CFTC and SEC.

Karen Petrou, a banking analyst at Federal Financial Analytics in Washington, D.C., believes that since the flash crash in 2010, the problem of market manipulation by participants with sophisticated technology for super-fast online trading has only gotten worse—in U.S. markets and overseas. She cites recent examples in the past year, including flash crashes on the German and Swiss markets and in the U.S. bond market. Petrou attributes much of the problem to under-regulated high-frequency traders.

“In its algorithm, in a nanosecond, a liquidity or temporary market phenomenon will give the high-frequency trader a teeny-tiny advantage,” says Petrou. “And if you do that a lot, very, very fast, you can make a lot of money.”

All of that rapid-fire computer-driven and -executed trading increases volatility and systemic financial risk, she says—not just for investors, but also for big banks.

“We are seeing flash crashes in the equity, treasury, foreign exchange and bond markets,” says Petrou. “We should be very scared. I know regulators are. But they’re not acting.”

A multi-agency plan conceived after the 2010 flash crash to monitor and prevent attempts to manipulate the markets has so far been mired in technological complexity, corporate rivalry and regulatory delays. 

 

 

Green burials

Marketplace - American Public Media - Wed, 2015-05-06 02:00

The “green” movement is headed underground—to the grave, that is. More and more cemeteries around the country are offering burial options that use fewer materials and less energy; some are landscaped with native plants and trees. These simplified burials can also be cheaper, but there’s often a catch.

At a dedication ceremony for the St. Kateri Preserve at Calvary Cemetery in Dayton, Marge Devito and her husband Bill watch as a priest blesses the site. Bill has a terminal illness—and they love the idea of burying him in a nature preserve.

“This is exactly what Bill wanted,” says Marge. He had been planning to be cremated and have his ashes scattered, because he wanted something simple, but their kids insisted that he should have a grave site they would be able to visit. When they came to Calvary and learned about the planned nature preserve, Marge Devito says they jumped on it and bought two plots. “It’s just perfect."

Right now the preserve actually looks like some bulldozed dirt on a construction site, but Judy Pavy, who sells plots for the cemetery, says she can picture it. “It’s going to have the wildflowers and native Ohio grasses, and I just envision butterflies and birds visiting.”

The preserve won’t require expensive vaults or underground liners—in fact, those will be forbidden, along with formaldehyde embalming, so the cemetery can get a certification from the Green Burial Council as a green cemetery. For those who want headstones, there will be boulders, as well as a stone wall near the path where people can have their names engraved.

But just like the conventional side of the cemetery, a green plot comes at a price—or a range of prices, actually. A meadow spot is the cheapest, but it gets no marker, and you can’t visit the exact grave site. For a spot by the path or the lake, patrons of the St. Kateri Preserve will pay more. A boulder or a stone engraving is another charge.

Of course, price differentials and upselling are standard in the funeral industry. What’s new is branding the options as “green.”

“What we call green burial is what our ancestors about 130 years ago called burial,” says Josh Slocum, the head of the Funeral Consumers Alliance, a national watchdog group. He’s concerned that green funerals will become an overpriced industry of their own—that people will be encouraged or even pressured to purchase natural embalming fluid and expensive biodegradable coffins as boutique items, showing a commitment to the environment. “Whereas really, it’s charging just as much money for fewer services and fewer products.”

Slocum’s not opposed to simplifying the burial process—if anything, he says pricing needs to be more transparent. Taboos around death sometimes make it hard to talk dollars and cents, especially in times of crisis. His advice to would-be funeral consumers? Do what feels right—and ask to see a price list. 

PICS: 3120 The St. Kateri Preserve at Calvary Cemetery in Dayton is dedicated to the Catholic church's first Native American saint.

 

3117 A stone wall under construction at a green burial site in Dayton will become a place for engraved names and memorials, in place of the traditional headstone.

For-profit prison companies adjust to new era

Marketplace - American Public Media - Wed, 2015-05-06 02:00

The factors that drove double-digit growth for prison companies are largely in the past — like the ever-harsher sentencing laws that bloomed in the 1980s and 1990s. 

The prison population has actually declined slightly since 2009, according to data compiled by The Sentencing Project.

"With the recession, it became quite clear to governors of both political parties that prisons had become very expensive items in state budgets," the project's director, Marc Mauer, says.

The Corrections Corporation of America has adjusted. Kevin McVeigh, managing director with Macquarie Research, watches the company.  "While it’s still a very healthy industry," he says, "the rate of growth isn’t what it had been historically. And as a result of that, they started to generate meaningful amounts of free cash flow."

Meaning: The company made money operating existing prisons, but it didn’t have new projects to invest that money into.

So, in 2013, it re-organized into a different kind of entity: A Real Estate Investment Trust— or REIT for short.    

Carl Takei, an attorney with the ACLU’s National Prison Project, sums up the reasons: "It comes with a lot of tax advantages," .

A REIT pays out most of its earnings in dividends, which can result in a better tax deal for both investors and the company.

Typically, REITs own rental properties— the income comes from occupants. In CCA’s case, it's essentially still collecting rent— just not from the occupants themselves.

Takei thinks the arrangement may not last.  "Because mass incarceration and sentencing reform are major topics of discussion, the private prison industry's future is uncertain," he says. Criminal justice reform has become a rallying cry among Republicans as well as Democrats.

Panera Is The Latest To Drop Artificial Ingredients From Its Food

NPR News - Wed, 2015-05-06 01:03

Panera Bread says it's dropping artificial colors, preservatives and additives from many menu items. But while it says that includes artificial sweeteners, it's leaving sodas with them on the menu.

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Celebrating an infamous anniversary

Marketplace - American Public Media - Wed, 2015-05-06 01:00
5 years

 That's how long it's been since the infamous "Flash Crash" in the U.S. stock market. Regulators wanted to set up a monitoring system to prevent drastic market swings. Consolidated Audit Trail, or CAT, was conceived as a way to mitigate any crisis situation. However, organizations responsible for establishing CAT, including Nasdaq, have been slow to make real progress in building and funding the project, according to the Wall Street Journal. 

80 hours

Some high-powered lawyer, bankers, and consultants claim to clock this many hours each week, but it turns out that schedule doesn't mean the same thing to everyone. The Upshot reported on a study that found about 30 percent of men at one consulting firm set themselves up with a far less stressful schedule while letting others believe they were totally slammed. Turns out the "fakers" had about as much success as people who were actually putting in 80 or 90 hours a week. Women were more likely to ask for an easier schedule up front, the study found, and their performance reviews suffered.

999,000+

This is how many followers British Prime Minister David Cameron has on Twitter. Thursday is the British election, and according to the Guardian, this is the tightest race the country has experienced in years. The leader of the Conservative party faces off his Independent and Labour opponents in a final day of campaigning today. And all candidates have employed social media to reach out to their constituencies. 

$187.7 million

This is how much the Marvel film "The Avengers: Age of Ultron" took in over the weekend in North America. Riding the success of its superhero franchise, Walt Disney studio has been trying to boost its cut by taking a bigger share of the box office and restricting matinee hours. This move is only adding tension to the tug of war between studios and movie theaters. 

18 percent

The portion of Microsoft developers and engineers who are women, according to CEO Satya Nadella. Marketplace Tech's interview with Nadella, split up over two days, touched on the pay and representation gap facing women in tech, as well as Microsoft's cloud computing business and plans for expansion in Nadella's native India.

250

At least that many businesses were damaged or completely destroyed during riots in Baltimore last week. A few of them were CVS stores, which are now slated to reopen after, in some cases, being torched and looted. CVS and other drug stores fill an important role in low-income communities like West Baltimore, offering fresh produce and other healthy food in place of larger grocery stores, which have moved to the suburbs.

Huckabee Hopes Evangelical Voters Are Tying Yellow Ribbons For Him

NPR News - Wed, 2015-05-06 01:00

Mike Huckabee is back on the campaign trail after finishing second for the GOP nomination in 2008. In his latest run, he's hearkening back to an even earlier time, with 1970s icon Tony Orlando.

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Six Words: 'My Name Is Jamaal ... I'm White'

NPR News - Wed, 2015-05-06 00:32

Jamaal Allan is a high school teacher in Des Moines, Iowa. People make assumptions based on his name alone, and that's taken him on a lifelong odyssey of racial encounters.

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What Happens In Vegas Includes Crowded, Struggling Schools

NPR News - Wed, 2015-05-06 00:31

Teachers, students and administrators are stretched thin by serious overcrowding. The city could add 32 schools tomorrow and every one would be filled to capacity.

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Afghan Judge Sentences 4 To Death In Mob Killing Of Woman

NPR News - Tue, 2015-05-05 22:34

Judge Safiullah Mojadedi has convicted and sentenced four men to death for their role in the brutal mob killing of a woman in Kabul in March.

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Pacquiao Sued For Failing To Disclose Injury Before 'Fight Of The Century'

NPR News - Tue, 2015-05-05 14:57

The two plaintiffs are suing under laws meant to protect consumers. Pacquiao lost the highest-grossing boxing match in history to Floyd Mayweather Jr. It was later revealed he had a shoulder injury.

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Justice Dept. Criticizes Punishments For Agents Linked To Student's Detention

NPR News - Tue, 2015-05-05 14:05

In 2012, Daniel Chong spent more than four days in a cell without food and water because agents of the Drug Enforcement Administration forgot about him. The agents were suspended for up to seven days.

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Tea Tuesdays: Butter Up That Tea, Tibetan-Style

NPR News - Tue, 2015-05-05 13:55

Yak butter tea is often referred to as the national drink of Tibet. It's been consumed in the Himalayas for centuries and helped inspire the Bulletproof Coffee craze in the U.S.

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Clinton 'War Room' Pushback And The 'Invent Your Own' Media Campaign

NPR News - Tue, 2015-05-05 13:30

The Clinton campaign went into overdrive Tuesday trying to minimize the damage from a new book that delves into Clinton Foundation fundraising — and it's not using the typical channels to do so.

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In Baltimore, CVS plans to reopen its damaged stores

Marketplace - American Public Media - Tue, 2015-05-05 13:00

Most afternoons, Shauntria Davis sits on this street corner in front of a CVS in West Baltimore, waiting for the bus so she can pick up her kids at daycare. Today is no different, though the drugstore behind her is still boarded up and covered with fresh graffiti. If it weren’t, she’d probably stop in and buy something.

“I use this CVS just about every day,” Davis says.

By the latest tally, more than 250 businesses were damaged during the riots in Baltimore last week, which broke out amid protests following the death of Freddie Gray. But this CVS drugstore, which was looted and then set on fire, became something of a symbol of the turmoil in the city — and now, maybe, of its renewal.

City officials have confirmed that the store on North and Pennsylvania avenues will reopen, along with four others damaged in the violence. The pharmacy chain says it has a “long history” of serving inner city neighborhoods.

The area surrounding Pennsylvania and North is known as a food desert, a poor neighborhood without easy access to a lot of fresh produce and healthy food. Davis says she and her neighbors not only fill prescriptions at CVS, but buy staples like food and diapers.

“The chain drugstore has almost become the general store these days,” says Jim Hertel, a food retail consultant with Willard Bishop.

Decades ago, many supermarkets moved out of the inner cities for the abundant real estate and parking of the suburbs. Hertel says pharmacy chains like CVS, Walgreens and Rite Aid saw an opportunity to fill the void. In recent years, many of the stores have expanded their grocery aisles and added fresh produce.

“They've got almost a free run, with little competition in those neighborhoods,” Hertel says.

Still, the city had to fight to bring in the CVS at Pennsylvania and North more than two decades ago. More recently, city developers scored a big victory when a Target moved in not far away. It was also damaged during the riots last week.

“It took us at least three, maybe five years, to convince Target that this was a good place,” says Jay Brodie, former president of the Baltimore Development Corporation, which promotes business investment in the city. It also took $15 million in tax breaks to help redevelop the area.

CVS didn't get any incentives to rebuild its damaged stores, says Bill Cole, the current president of the Baltimore Development Corporation.

“Absolutely not,” Cole says, “And CVS hasn’t asked for anything either.”

Texas Instruments: from calculators to cars

Marketplace - American Public Media - Tue, 2015-05-05 13:00

In the 1980s, Texas Instruments was excited about its microchips in a hot toy called the Speak & Spell.

TI’s Speak & Spell used the first single-chip voice synthesizer, a tiny device that just a few years later gave the beloved alien E.T. a voice. 

E.T. took advantage of the microchip, and later so did some Chrysler vehicles. 

Despite its reputation for calculators, Texas Instruments isn’t new to the car business. TI’s automotive business is growing faster than the rest of the company, thanks to selling microprocessors and car technology.

“Most of the major car brands have TI tech inside of them that you don’t even know about," says Automotive Processors general manager Curt Moore.

Microprocessors created by TI are in lots of cars, including Fords and BMWs, where they help control everything from car windows to power steering.

Still, it’s no surprise the average driver isn’t familiar with the company’s car accessories. The names don't exactly roll off the tip of your tongue: There's the DRA7XX and the integrated C66X digital signal processor—all part of the Jacinto family of processors.

But break through the technology jargon and you’ll find a multi-billion dollar industry shaping your driving experience.

Infotainment And Heads-Up Displays

Inside TI’s Dallas showroom, music blasts from a new car infotainment system.

"The way people now differentiate cars is via infotainment and active safety," Moore says. "So all the car companies are looking at how you create that unique experience using electronics that are going to be safer, greener and more fun to drive.”

Moore says car companies are turning to chipmakers like TI and demanding newer, faster microprocessors to build safer, more autonomous cars. One feature that's taken off is the heads-up display.

These displays are a sort of alert system for drivers. Cameras outfitted on the car monitor the surroundings and then project images in a corner of the windshield.

In one display car in the showroom, the windshield shows a traffic sign and two pedestrians up ahead. Both are outlined in neon green.

"So the system would recognize this is a caution sign, would recognize there’s two pedestrians in front of you, and then it could automatically help the car stop and prevent an accident,” Moore says.

In 2013, just two percent of cars used heads-up displays, most of them in luxury vehicles. Now, automakers are taking advantage of cheaper cameras and processors from chipmakers, and they’re outfitting more affordable cars with collision avoidance technology and fancy dashboards.

“So for the chip makers it’s an extraordinary opportunity,” says David Sedgewick, a senior writer for Automotive News. He says chipmakers are all fighting to get their silicon in your car first.

"It’s going to be a dog fight because it’s a tremendous growth industry. No one can do this right yet, but they feel they can’t wait,” Sedgwick says.

The largest chipmakers are drawing in billions of dollars from automotive sales. So for TI, investing in smart car technology was easy math—no calculator required.

Why the secrecy behind trade talks?

Marketplace - American Public Media - Tue, 2015-05-05 13:00

Negotiations are a lot like chess — you’ve probably heard that one before. But in trade negotiations, instead of two players, there are potentially a dozen, each thinking about their best move, each trying to minimize the threat other pieces on the board may pose to them.

 

“It’s a long, drawn-out process,” says Eswar Prasad, a trade policy professor at Cornell University, adding that working out these deals can take years.

 

“Typically, the final points of negotiation are not made public,” he says, though generally, “there is awareness of what the big issues are.”

 

The closed-door nature of the negotiation process has become one of the major stumbling blocks to advancing trade deals currently in the works, such as the Trans-Pacific Partnership, a free-trade deal between the U.S., Japan and 10 other countries.

 

However, there’s a reason the details are private, says Gary Hufbauer, a former trade negotiator with the Peterson Institute for International Economics.

 

“To reach an agreement, one party or the other, has to be seen and reported to be giving up, making a concession,” Hufbauer says. “And since negotiations are all about compromise, that really makes compromise much harder.”

 

Hufbauer thinks pending legislation could open up parts of the process, but he says making negotiations public in real time would essentially kill these kind of agreements.

 

Senator Sherrod Brown, a Democrat from Ohio, thinks the public should know what’s in the deals, especially as they become closer to being finalized.

 

“I can read the deal and go in and see it, as long as there’s a U.S. trade representative sitting there,” Brown says. “I can’t take notes and take them out of the room. When I’m back in Ohio, my staff can’t go in there, even though she has all the clearance necessary to get access to CIA and Department of the Defense documents.”

 

He says controls like this make him question what there is to hide.

Microsoft put a new emoji in Windows 10

Marketplace - American Public Media - Tue, 2015-05-05 13:00

While this particular final note might not be suitable for younger audience members, it does kind of give you a whole other level of respect for Microsoft.

According to the emoji-tracking website Emojipedia — yes, that's a real thing — the software company that everybody loves to hate is going to introduce a new emoji when it rolls out Windows 10 later this year.

It's technically called: "Reversed hand with middle finger extended."

You can call it what you like.

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