National News

Same-day delivery gains traction

Marketplace - American Public Media - Mon, 2014-07-21 11:23

Online shopping's convenience can be tripped up by long shipping times, keeping retailers like Amazon from being the go-to place to pick up ice cream or deodorant.

That's why the online retail giant is experimenting with same-day delivery in a few cities, says Marcus Wohlsen, senior staff writer at Wired. These new trucks would come pre-loaded with items just waiting to be ordered.

"You've got this fleet of trucks that's constantly combing through city neighbords," Wohlsen says. "Lo and behold, somebody orders something that Amazon predicted they or someone in that general vicinity would order and it's already on that truck ready to bring to that person's door."

Amazon's recent interest in drone delivery has also attracted attention recently. Though those trucks "aren't nearly as sexy as a drone," Wohlsen says, they're much more efficent, and give Amazon control over more of the buying process. But filling those trucks and sending them out presents a big logistical problem.

"You can't virtualize that tube of toothpaste; you still have to figure out how to get it there," Wohlsen says. "That said, I think that companies like Amazon and Google are in the best position to make advances in the field of logistics because logistics is a very, very complicated math problem. That's what these companies prioritize. It's how they make money."

For Amazon, Wohlsen says, the move is all about trying to "overtake brick and mortar stores as the main way people buy things. Online retail is still a very small portion of commerce in the U.S. It's something like 6 percent of retail purchases. There's a lot of runway left for Amazon."

Summer fun for future Fed chiefs? Maybe.

Marketplace - American Public Media - Mon, 2014-07-21 10:52

If sprinklers, Slip'N Slides and the other joys of summer aren’t wonky enough for your kids, there’s always Fed camp. The Federal Reserve Bank of Richmond runs a summer program for kids in grades K-8. It’s a field-trip destination, with half-day workshops meant to boost children’s basic financial literacy.

Outreach specialist Angela Collier gathers a group of rising kindergarteners around her at the Richmond Fed. They’re four- and five-year-olds in bright orange T-shirts, visiting from Camp Primrose.

In her best ‘this-is-awesome’ voice she tells them, “We’re gonna be talking about goods. And services. And consumers and producers and spending and saving.”

Oh yeah, it’s Fed boot camp.

“Uh, I wouldn’t call it Fed boot camp,” Melanie Rose quickly corrects. She oversees the Richmond Fed’s economic education programs, including its Summer Camp Challenge.

Is she at least scouting for the next Janet Yellen? Or Ben Bernanke?

Well, if we happen to find one I’m sure we would take him,” she says. “But no.”

Really, this is more like Fed-lite. It’s a chance for almost a thousand kids to stop by, play games about personal finance, and build their economic knowledge. But let’s just say you were secretly grooming future Fed chairs. You’d start young, right?

Step One: Establish everyone’s weight in gold.

“Probably all of you weigh about … one and a half, maybe two gold bars,” Collier tells the 40-pound kindergarteners. They’re standing in front of a gold brick that weighs 401.75 troy ounces.

Now that they’ve got the gold standard down, it’s time for Step Two: Master the difference between a good and a service.

A good, Collier says, is “something you can touch and feel and take home. Can you think of anything that would be an example of a good?” she asks.

“Play dough?” suggests camper A.J. Salvatto.

“Play dough is a great example of a good!” Collier cries.

Well done, A.J. Save that kid a space on the Federal Open Market Committee.

Step Three: Practice. The kids turn over cards, with pictures of cars and clocks and waiters. They try to identify goods and services. There are a lot of question marks in their little voices.

“Uh, a service?” asks one.

“A good?” asks a bunch of them.

Camper Tony Cavero nails it. He holds up pictures of firefighters.

“Are they providing a good or a service?” Angela Callier asks.

“A service,” he replies.

Tony Cavero: destined for the Board of Governors.

Now, older kids come through the Fed summer camp challenge too. But these little guys showed so much promise, we asked them about the biggest lesson learned from their day at the Richmond Fed.

Like Skanda Athreya, whose dad is an economist there, they all mention the same thing: the bus ride.

“I learned on the bus, when the driver’s driving, don’t distract your driver, ‘cause it can make him get in a car crash,” Skanda says.

Which in the coded language of Fed-speak says a whole lot about how to manage the economy.

Dzhokhar Tsarnaev's Friend Convicted For Impeding Bombing Inquiry

NPR News - Mon, 2014-07-21 10:04

Azamat Tazhayakov has been found guilty on some obstruction of justice charges, and not guilty of others. He was accused of removing evidence from Dzhokhar Tsarnaev's dorm room.

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Could The Conflict In Ukraine Turn Into A Regional War?

NPR News - Mon, 2014-07-21 09:53

Nearly 300 people died after a Malaysian Airlines plane crashed near the Russian-Ukrainian border. European security expert F. Stephen Larrabee explains what this might mean for the volatile region.

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Understanding The Basics Of the Conflict In Gaza

NPR News - Mon, 2014-07-21 09:53

Fighting between Israel and Hamas escalated over the weekend as Israeli forces shelled the town of Shejaia in Gaza. Host Michel Martin learns the latest from Zack Beauchamp of Vox.

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From Scratch Or Not? French Restaurant Law Stirs Controversy

NPR News - Mon, 2014-07-21 09:51

A French law requires restaurants that sell homemade food to display a label on their menu to distinguish them from places that use frozen or vacuum-packed food. But critics say the law is too vague.

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Afghan Veteran Who Held Off Taliban Attack On His Own Receives Medal Of Honor

NPR News - Mon, 2014-07-21 08:06

Army Sgt. Ryan Pitts is credited with holding off a brutal Taliban attack back in 2008. He was the only one left alive at an observation post in Afghanistan, and continued to attack despite injuries.

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Your Wallet: Kids are moving in with their parents

Marketplace - American Public Media - Mon, 2014-07-21 07:23

Have you ever had an extra bedroom or couch occupied by a loved one longer than you anticipated?

According to the Los Angeles Times, more homes than ever before have multiple generations under one roof:

A record 57 million Americans, or 18.1% of the population, lived in multigenerational arrangements in 2012, according to the Pew Research Center. That's more than double the 28 million people who lived in such households in 1980, the center said.

In the past, the elderly were the primary group moving in with family. But now, it's millennials:

About 23.6% of people age 25 to 34 live with their parents, grandparents or both, according to Pew. That’s up from 18.7% in 2007, just prior to the global financial crisis, and from 11% in 1980.

For the first time, a larger share of young people live in multigenerational arrangements than of Americans 85 and older.

If you've dealt with this situation, we want to hear how you made that sometimes difficult break. How did you help get that person out of the house and onto their feet? Email us, or let us know on Twitter.

Mapping the city, statistic by statistic

Marketplace - American Public Media - Mon, 2014-07-21 07:05

The map, one of the central elements of navigation, has expanded in capability since the form has been translated to digital. Case in point, the MIT Media Lab’s “You Are Here” project is a collection of maps that visualize a variety of datasets over space. Things from bike accidents to coffee shops, graffiti reports, and transit connectivity are all laid out, using a variety of open data and other online resources, such as Google’s map directions services API.

Sep Kamvar, one of the leaders of the MIT project, says he was prompted to start this project by noticing the subtle ways in which cities differed — often due to deliberate decisions.

“I realized that the cities are quite different, and they’re quite different because of lots of tiny little design decisions that were made, from the width of sidewalks, to the number of trees on the streets, to the proximity of independent coffee shops,” he says.

Kamvar goes on to argue that a typical map does not show these other factors that shape the city — all important, but often underestimated.

The goal of the maps, according to Kamvar, is to illuminate where things are happening in the city, not just how to get around.

“My hope is that each of these maps gives information on how to make the city a better place,” he says, citing as a partiuclar example a map that allows users to map where trees throughout the city are located. 

The MIT project is not the only initative using open data to illuminate cty-level statistics. Last week, another project visualized the distances travelled by by New York City taxicabs in a single day, using data obtained from the city's taxi regulator. Below is one of the project's "Fastest Mode of Transit" maps.

Check out this map of the fastest modes of transportation in Manhattan

Republicans have a birthday card for Dodd-Frank

Marketplace - American Public Media - Mon, 2014-07-21 06:00

Passed in the aftermath of the financial crisis, the Dodd-Frank Act sought both to prevent future economic disasters and create a better framework to deal with them, should they still arise. Monday marks its fourth birthday. How’s the toddler doing?

New criticisms

Many are still unhappy with these reforms, including Republicans in the House Financial Services Committee, who are marking the anniversary with a 100-page report criticizing the law for failing to prevent banks from becoming “too big to fail.” The report also expresses concern that some non-banks are labeled systemically important (which makes them subject to special regulations) and that label could act as a guarantee of sorts, signaling to investors that the government won’t let those companies fail if they get into trouble.

Implementation

There were about 400 different individual elements that made up Dodd-Frank. An analysis by the law firm Davis Polk found roughly half those rules have been finalized; another quarter are in the proposal phase and the last quarter still need government agencies to even come up with them.

However, even finalized rules might require tweaking.

“There’s still a tremendous amount of work to do and even the work that has been done will have to be redone over time,” says Jeffrey Manns, a law professor at George Washington University. “It’s a process of trial and error in that rules will be implemented or are being finalized, but those rules will need to be changed.”

Like a large construction project, work can begin on day one,  Manns says, but you’re going to working and tinkering for many years to come. 

Reports: Texas Gov. Perry To Deploy 1,000 National Guardsmen To Border

NPR News - Mon, 2014-07-21 05:55

During an Iowa visit, Rick Perry said if the federal government did not act to curb the influx of immigrants along the southern U.S. border, he would take matters into his own hands.

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Dozens Killed As Libyan Militias Battle For Tripoli's Airport

NPR News - Mon, 2014-07-21 05:44

The fighting in the North African country is some of the worst since the ouster of Moammar Gadhafi in 2011.

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Straightening Sisay's Spine: A Twist Of Fate Saves A Boy's Life

NPR News - Mon, 2014-07-21 05:38

Thousands of children in Ethiopia suffer from scoliosis so severe that humps grow from their backs. After two spinal surgeries, one little boy now hopes he'll be able to play soccer with his friends.

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Putin: Tragedies Like MH17 Should 'Bring People Together'

NPR News - Mon, 2014-07-21 04:18

In a statement, Russian President Vladimir Putin said this tragedy wouldn't have happened if Ukraine had not restarted operations along its eastern border.

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Design: where dollars are scarce and need is great

Marketplace - American Public Media - Mon, 2014-07-21 04:00

In a Stanford classroom crowded with Post-it notes and duct tape, Dr. Shankar Rai, a plastic surgeon from Nepal, is wearing a hand splint made out of Popsicle sticks and pipe cleaners. He’s giving feedback on a prototype made by graduate students in a class called "Design for Extreme Affordability". Currently, the only splints available in Nepal cost upwards of $50. The students are aiming to do better.

Here in the U.S., we’ve got asthma inhalers at every doctor’s office, baby incubators at every hospital, and irrigation systems at most every farm that needs one. But in some places in the developing world, many of these technologies are just too expensive to use. American design schools are trying to change that by teaming up with NGOs around the world to get truly affordable products to market.

Rai works with the non-profit Resurge International to improve care for burn victims in Nepal. One of his main problems is the cost of supplies for the operating room: If a patient shows up at a government hospital, the surgery may be free, but “dressing materials, sutures, all those things will be bought by the family.”

When families can’t afford those supplies, Rai says burns turn into lifelong disabilities. So Resurge submitted a “wish list” to Stanford’s design school. Included on that list is a splint that could be made for less than $10.

“Small non-profits don’t have the luxury of having their own designers and their own R+D  teams,” says Jim Patell, who teaches the design class.

According to Patell, both NGOs and students are trying out ideas others might see as too risky. When publicly-traded companies come up with new products, they have to decide who their next customers will be: affluent consumers in the West, or people living on a few dollars a day in places like rural Nepal.

They can think about it very deeply,” says Patell, “and find out that, yeah, developing the next product for the Western world is the responsible thing to do for their investors.”

Universities don’t have to answer to investors, and initiatives like Patell’s class have sprouted at schools all over the country.

Amy Smith, who founded the D-Lab at MIT, says student designers sometimes benefit from their lack of expertise:They may come in with a very new way of doing things, because they’re not concerned that it can’t be done that way, and therefore they find a way to do it.”

Failure is part of the process too. And even though his students “get it right” less than half the time, Patell says, Design for Extreme Affordability counts 32 student projects that have found new life as NGOs or even for-profit companies.

PODCAST: Happy birthday Dodd-Frank

Marketplace - American Public Media - Mon, 2014-07-21 03:00

The Dodd-Frank Act turns four, just in time for strong critiques of its implementation. Plus, more on a new study showing that millennials tend to fear investment, instead opting to save money in cash. Also, in an incongruous pairing, Goldman Sachs will fund an educational program on Rikers Island. It's part of a social impact bond, where investors put money into social programs with the promise of profit if the program meets its goals.

In Effort To Forge Cease-Fire, Kerry Heads To Egypt

NPR News - Mon, 2014-07-21 03:00

The fighting between Israel and Hamas in Gaza has left more than 500 people dead. The State Department said it was deeply concerned about the risk of further escalation.

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SIB spells a way for financiers to do social good

Marketplace - American Public Media - Mon, 2014-07-21 02:00

Governments and non-profits struggle with shrinking tax revenues and donations, and the lack of funding puts social programs in jeopardy. A new movement tries to fill that gap with money from banks.

The twist? The people providing this money aren't donors; they're investors, and they stand to make a profit on social services. That’s why the first attempt at what’s called a social impact bond in America is being closely watched by scholars, bankers, and politicians alike.

The bond involves the incongruous pairing of one of the world’s best-known banks with one of New York's most notorious prisons. Goldman Sachs is lending $9.6 million to fund an educational program on Rikers Island for 16-18 year old offenders.

The program aims to change the young inmates' way of thinking, with the goal of enabling them to make the choices that will ensure they don’t get locked up again. But they face grim statistics -- About half are likely to be back in prison within a year after getting out.

This high recidivism rate carries high costs for the young offenders, their families, and their communities. It’s also alarmingly expensive for New York City to keep them in prison. That’s where the social impact bond comes in, becoming profitable only if the city saves substantial money through a reduction in re-incarceration attributable to the education program.

If the program leads to a 10 percent reduction in recidivism, Goldman recoups its investment. If the reduction in recidivism is greater than 10 percent, Goldman profits.

“Goldman doesn’t earn any return unless the city reaps significant savings on the decrease in recidivism,” explains Andrea Phillips, a vice president at the bank’s Urban Investment Group. (Not all of Goldman’s money is technically at risk. Bloomberg Philanthropies is kicking in $7.2 million to guarantee part of the loan. That has drawn critics, who say it prevents this social impact bond from being a pure test of using private capital for social good.)

The basic case for social impact bonds is they risk bank money instead of taxpayer dollars. A key worry is that it’s a bad and untested idea to mingle services for the poor with bank profits. 

“I understand the discomfort with that,” says Susan Gottesfeld, associate executive director at the Osborne Association, a non-profit operating the program at Rikers. “But I feel that it’s not only government’s job, not only non-profit’s job to make sure that our society’s working. And if banks who make lots of money are interested in using that money to make something possible that otherwise would not be, we’re very open to that.”

Gottesfeld says she often hears from other non-profits asking for advice on how they can strike bank deals of their own.

This program will ultimately be judged by what it can do for young people like Louis Rivera. He now works near Coney Island, far better waters than those around Rikers Island, where he did time for attempted burglary. He says the program helped him turn himself around, and what he learned showed him how to give his two year old son Landon a better future.

“I wanna teach him that life doesn’t have to be that for him,” Rivera says. “Regardless of where you come from, because life’s not about the things you go through it’s about the choices you make when you go through them.”

Independent analysts are evaluating the program’s impact, with a report expected next year. If it’s a success for the city and Goldman, expect to see many more banks, governments, and charities buying in to social impact bonds.

Young adults choose to save cash instead of investing

Marketplace - American Public Media - Mon, 2014-07-21 02:00

Amanda Moffitt is 30, so she was just getting settled when the economy tanked.  

“It was 2008, so there was a lot of concern about the stock market and what could possibly happen to your money when you invest it,” Moffitt says. 

And, it turns out, that attitude has stuck among young adults.  

“They are the most risk-averse group,” says Greg McBride, vice president and chief financial analyst at Bankrate. Its new survey shows that once those under 30 actually have some money to save, they’re very cautious.  

“They prefer cash by a 3-to-1 margin over the stock market, for money they’re not going to need for at least 10 years,” he says. 

That could be too conservative of a strategy, since savings accounts don’t keep up with inflation. 

“Kind of gets us back to that Depression mindset of hiding cash under the mattress,” says David Weliver, editor of moneyunder30.com. Part of the whole problem is choice overload. 

“The thousands of investment choices, and all the conflicting advice out there. A lot of it is they sit tight and do nothing,” Weliver says. 

As for Amanda Moffitt, she’s wised up. She’s working to become a financial planner.

So where should millennials be investing?

We've heard the mattress is not the way to go, and saving accounts aren't much better. Young people may also simply be intimidated by the vast array of choices, or worried they don't have enough money on hand to make investing worth it. Nonsense.

We've dug back into the Marketplace archives to find some of the best advice we can offer for young (or otherwise new) investors. To start, here's a quick personal finance cheat sheet.

    • More on mutual funds: Many mutual funds offer "quick and easy" plans aimed at first-time investors, but easy doesn't always equal better. Marketplace Money explains.
    • What if I have a bunch of retirement funds? If you have a few different retirement plans, we have some tips to juggle them all.

Finally, if you're sick of reading, your mate Paddy Hirsch has a number of "Whiteboard" videos explaining index funds, ETFs, compounding and more.

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