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Updated: 43 min 13 sec ago

Chicken of the sea is nothing to squawk at

Fri, 2014-12-19 02:00
34 percent

That's how much profits fell for BlackBerry Ltd., as shown in their third-quarter revenue report. As reported by Bloomberg, the $793 million in revenue is well below analysts' expectations. 

58 percent

That's how much value Bitcoin lost in 2014. The online currency has somehow tanked even harder than the ruble, Quartz reported, which is down 47 percent this year.

1 in 5

1 in 5 Europeans ages 16 to 74 has never used the internet. But you already knew that, didn't you? So test your knowledge of tech news over at Silicon Tally, Marketplace Tech's Friday round-up quiz.

2

That's how many minutes of film "The Hobbit: Battle of the Five Armies" gets from each page of its slim source material. That's very high when compared to other blockbuster adaptations, FiveThirtyEight reported, and it's even more mind-boggling to consider its just one of three movies adapted from a 293-page book.

300 men

That's how many men have signed up as test subjects for a childbirth simulator since the trial began in November. The Jinan Aima Maternity Hospital in Jinan, China, offers expectant fathers the chance to sympathize — and we mean really sympathize — with their spouses in what it calls the "Pain Experience Camp." Four electrodes are attached to the subject's stomach, sending electric shocks that simulate labor contractions. Head over to the WSJ to read more.

$1.5 billion

That's how much Thai Union Frozen Products PCL will pay for Bumble Bee Seafoods (think Tuna). They are effectively purchasing the big tuna of seafood in the U.S., as Bumble Bee is the number one producer of canned tuna and sardines in North America, as reported by Reuters

Silicon Tally: Our romance is off the Hinges

Fri, 2014-12-19 02:00

It's time for Silicon Tally! How well have you kept up with the week in tech news?

This week, we're joined by digital dating consultant Laurie Davis. She's the founder of eFlirt, a service that helps clients polish their online dating profiles, decode text messages from dates, and improve their online chatting.

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An oilman bets prices will rise, and loses big

Fri, 2014-12-19 02:00

The oil price bust has left lots of people licking their financial wounds. Perhaps the biggest one-way bet in the wrong direction came from the oilpatch itself, by a company and its founder at the center of the U.S. oil revolution. Harold Hamm is the $8 billion dollar oilman; the man behind the biggest drilling company in North Dakota, Continental Resources.

In an earnings call five weeks ago, he said, "We're at the bottom rung here on prices and we'll see them recover pretty drastically pretty quick. Given our belief the recent pullback in oil prices will be short-lived, we made changes to our existing hedge book by monetizing practically all of our oil contracts."

That's oilspeak for: we're betting on prices to rise. Continental had locked in nice, high-selling prices by what's called hedging. Until it stopped doing that. The company has lost half its value in four months.

To Gregory Zuckerman, author of "The Frackers: The Outrageous Inside Story of The New Billionaire Wildcatters," this bet goes hand-in-hand with Hamm's astonishing success story. The son of Oklahoma sharecroppers, Hamm started with nothing and made an early, crazy bet on North Dakota oil. He was stubborn.

"You need that self-confidence," Zuckerman says. "But it can bite you on the way down by making you a little too sure of yourself. And I would argue that when he took off those hedges, he showed signs of that."

In a recent interview, Hamm says he still thinks oil prices could rise. He may well be right. But his timing was off.

How an oil rush made LA the city it is today

Thu, 2014-12-18 14:25

Marketplace host Kai Ryssdal talks to oil historian Char Miller about Los Angeles' role in greasing America's economy with oil.

In 1892, the first oil well in Los Angeles was drilled and started an oil rush that first launched the city.

“I think the oil industry has really faded in Los Angeles in terms of its presence. You look up at old photos of Huntington and Seal Beach, up Santa Monica beaches until the '50s… they were littered with oil derricks," Miller says. "It was the symbol of the city and that’s all disappeared.”

Oil drilling is still going on though. About 3,000 densely placed pumps are still working underground, but the landscape of the city makes the oil industry invisible.

“The culture of the United States is driven by oil. The built landscape is created because of petroleum," Miller says. "And so Los Angeles, at once in its sprawl and its density is the perfect example of the petrol economy.”  

How an oil rush made LA

Thu, 2014-12-18 14:25

Marketplace host Kai Ryssdal talks to oil historian Char Miller about Los Angeles' role in greasing America's economy with oil.

In 1892, the first oil well in Los Angeles was drilled and started an oil rush which launched the beginnings of the city.

“I think the oil industry has really faded in Los Angeles in terms of its presence. You look up at old photos of Huntington and Seal Beach, up Santa Monica beaches until the 50s… they were littered with oil derricks," Miller says. "It was the symbol of the city and that’s all disappeared.”

Oil drilling is still going on though. There are 3,000 densely placed pumps still working underground, but the landscape of the city makes the oil industry invisible.

“The culture of the United States is driven by oil. The built landscape is created because of petroleum," Miller says. "And so Los Angeles, at once in its sprawl and its density is the perfect example of the petrol economy.”  

Lower gas prices, but spending stuck in neutral

Thu, 2014-12-18 12:28

The average two-car household is saving about $50 a month on gasoline, according to Bankrate.com. So where is that extra money going? Not as much is flowing into malls and restaurants as you might think.

“Consumers are very quick to pull back on spending when gas prices rise, but very slow to ramp up spending when they fall,” says Greg McBride, chief financial analyst with Bankrate.

At an Oceanic gas station in Baltimore, Maryland, cab driver Waylen Hawkes estimates he’s pocketing an extra $1,000 a month, thanks to lower prices. He’s saving it, he says, “because it’s not going to stay this way.”

“I do worry about them going back up,” says Margurite Copper, a human resource manager with a security company. “I wish that I could take some gas and just store it somewhere in my house, but it would be unethical.”

Still, Copper was on her way to the mall after filling up, where she planned to spend a little extra on Christmas presents. 

Where your extra gas money goes

Thu, 2014-12-18 12:28

The average two-car household is saving about $50 a month on gasoline, according to Bankrate.com. So where is that extra money going? Not as much is flowing into malls and restaurants as you might think.

“Consumers are very quick to pull back on spending when gas prices rise, but very slow to ramp up spending when they fall,” says Greg McBride, chief financial analyst with Bankrate.

At an Oceanic gas station in Baltimore, Maryland, cab driver Waylen Hawkes guesses he’s pocketing an extra $1,000 a month, thanks to lower prices. He’s saving it, he says, “because it’s not going to stay this way.”

“I do worry about them going back up,” says Margurite Copper, a human resource manager with a security company. “I wish that I could take some gas and just store it somewhere in my house, but it would be unethical.”

Still, Copper was on her way to the mall after filling up, where she planned to spend a little extra on Christmas presents. 

The future of oil and gas after the boom

Thu, 2014-12-18 12:20

What effects will oil have on the global economy?

“If there’s too much oil in the world, we can have low prices for a while. That could be the problem," Marketplace Sustainability Correspondent Scott Tong says. "There’s a lag in the effect in the oil patch, but each day already brings another announcement of a company cutting back on their drilling because prices are too low.”

If prices stay below $60 a barrel, Goldman Sachs estimates producers could lose a trillion dollars. But Janet Yellen, chair of the Federal Reserve Board, says she thinks low oil prices are a net good for the global economy.

The contrast reflects what a lot of people think – in the short term, it is an absolute economic stimulus. Longer term, there are a lot of questions. If you’re an investor, the financial market is taking a big hit, particularly stocks that are exposed to energy and the bond market. Different parts of the economy could end up feeling the pain.

And, if we look farther into the future, the question of climate change comes up.  There have been demands for a carbon tax, but Tong says: “Cheap oil is basically a carbon subsidy.”

100 uses for petroleum – and counting

Thu, 2014-12-18 11:00

One 42-gallon barrel of oil produces about 19.4 gallons of gas. But according to a list put out by the oil and gas firm Ranken Energy, gasoline isn't the only thing that comes from a barrel of oil. Some highlights from the 6,000 items on the list:

  1. Ink
  2. Upholstery
  3. Bicycle Tires
  4. Dresses
  5. Motorcycle Helmet
  6. Curtains
  7. Dashboards
  8. Percolators
  9. Skis
  10. Mops
  11. Umbrellas
  12. Roofing
  13. Denture Adhesive
  14. Speakers
  15. Tennis Rackets
  16. Water Pipes
  17. Shampoo
  18. Guitar Strings
  19. Antifreeze
  20. Combs
  21. Vaporizers
  22. Heart Valves
  23. Anesthetics
  24. Cold cream
  25. Fan Belts
  26. Refrigerators
  27. Diesel fuel
  28. Floor Wax
  29. Sweaters
  30. Tires
  31. Food Preservatives
  32. Antihistamines
  33. Cortisone
  34. Dyes
  35. Life Jackets
  36. TV Cabinets
  37. Car Battery Cases
  38. Toilet Seats
  39. Linoleum
  40. Candles
  41. Hand Lotion
  42. Luggage
  43. Football Helmets
  44. Toothbrushes
  45. Balloons
  46. Crayons
  47. Pillows
  48. Artificial Turf
  49. Movie film
  50. Golf Balls
  51. Motor Oil
  52. Ballpoint Pens
  53. Boats
  54. Nail Polish
  55. Golf Bags
  56. Basketballs
  57. Purses
  58. Deodorant
  59. Panty Hose
  60. Rubbing Alcohol
  61. Insect Repellent
  62. Fertilizers
  63. Fishing Rods
  64. Ice Cube Trays
  65. Electric Blankets
  66. Fishing Boots
  67. Trash Bags
  68. Roller Skates
  69. Paint Rollers
  70. Aspirin
  71. Ice Chests
  72. Paint Brushes
  73. Sun Glasses
  74. Parachutes
  75. Artificial limbs
  76. Shaving Cream
  77. Toothpaste
  78. Bearing Grease
  79. Football Cleats
  80. Insecticides
  81. Fishing lures
  82. Perfumes
  83. Shoe Polish
  84. Transparent Tape
  85. Soap
  86. Shoes
  87. Paint
  88. Oil Filters
  89. Lipstick
  90. Dice
  91. Surf Boards
  92. Shower Curtains
  93. Safety Glasses
  94. Eyeglasses
  95. Footballs
  96. Tents
  97. Cameras
  98. Bandages
  99. Hair Curlers
  100. Ammonia

6,000 uses for petroleum – and counting

Thu, 2014-12-18 11:00

One 42-gallon barrel of oil produces about 19.4 gallons of gas. But according to a list put out by the oil and gas firm Ranken Energy, gasoline isn't the only thing that comes from a barrel of oil. Some highlights from the 6,000 items on the list:

  • Deodorant
  • Yarn
  • Floor wax
  • Crayons
  • Aspirin
  • Umbrellas
  • Shampoo
  • Balloons
  • Insect repellent
  • Nail polish
  • Footballs

 

6,000 uses for petroleum – and counting

Thu, 2014-12-18 11:00

One 42-gallon barrel of oil produces about 19.4 gallons of gas. But according to a list put out by the oil and gas firm Ranken Energy, gasoline isn't the only thing that comes from a barrel of oil. Some highlights from the 6,000 items on the list:

  • Deodorant
  • Yarn
  • Floor wax
  • Crayons
  • Aspirin
  • Umbrellas
  • Shampoo
  • Balloons
  • Insect repellent
  • Nail polish
  • Footballs

 

Cuba's open doors don't mean open for business

Thu, 2014-12-18 11:00

President Obama’s announcement regarding normalizing diplomatic relations with Cuba also had a few economic goodies. 

Travelers to Cuba can bring back up to $400 worth of goods to the U.S. ... but only $100 worth of tobacco and cigars. 

Telecom companies can export more to Cuba, in an effort to open the country up to the outside world, and agricultural exports were made easier thanks to an easing of financing restrictions — but the embargo is still in place, and full-blown business opportunities are largely years away.

Click play above to hear more about Cuba's business impact

How the oil boom woke up a Texas town

Thu, 2014-12-18 11:00

Texas oil companies started tapping into the Eagle Ford shale deposit in 2008, and have since produced millions of barrels of oil. One Texas city affected by this boom is Carrizo Springs. Kai Ryssdal talked with Mayor Adrian DeLeon about the benefits and challenges that come with change.

“There’s a lot of good, and there’s a lot of bad … but when we’re talking about Eagle Ford shale, we’re talking about job creation, and it’s a good thing. It’s a blessing for us,” DeLeon said. “There’s around 60,000 jobs here. It’s lucrative for people who really want to work.”

The biggest change, since before the oil boom, is that local business is thriving.

“We’re just grateful to see so many people who were losing their houses and losing their cars, to [now] paying off their cars and paying off their houses…. It’s a great thing,” DeLeon said.

Benefits:

  • Thousands of new jobs and thriving business
  • Creating a city police department
  • Hiring developers and workers from around the country

Challenges:

  • Highways are not equipped for heavy truck traffic
  • Regulating oil and gas
  • Avoiding water pollution

A circular argument: How cheap oil affects tire prices

Thu, 2014-12-18 11:00

This is a busy time of year for the Goodyear tire store and garage in McLean, Virginia. People want a tune-up before heading out for the holidays, or maybe want to pick up a set of tires.

Store manager Eddie Adiyeh has been selling tires for almost 30 years, so he should know: Do tire prices normally go down, along with oil prices? 

“I don’t remember them going down when the prices went down," he says. "But I remember them going up a little bit when the oil went up.”

Goodyear owns Adiyeh’s store, and sets the prices. So I called a Goodyear spokesman, Keith Price, and asked: Will tires get cheaper?

His response: “I’m not able to comment or speculate on what might happen to the price of tires.”

But Price did say it takes a while for a tire to go from factory to warehouse to distributor to store. He figures tires being made now, with cheaper oil, should be in stores this spring. 

So will they be cheaper then?

“It’s not entirely black and white,” says Nicholas Mitchell, a senior vice president and research analyst at Northcoast Research who follows Goodyear. He says oil makes up about a quarter of the cost of synthetic tires, the kind most consumers buy. Mitchell thinks competition among tire manufacturers will push down prices.   

“Someone will move first and try to lower prices to drive market share,” he says.

But here’s why it’s not black and white: With gas prices down, we’re driving more, and wearing out our tires faster. If demand for tires rises, Mitchell says, prices won’t fall as much. 

Trickle down oil prices?

Thu, 2014-12-18 11:00

This is a busy time of year for the Goodyear tire store and garage in McLean, Virginia. People want a tune up before heading out for the holidays, maybe want to pick up a set of tires.

Store manager Eddie Adiyeh has been selling tires for almost 30 years, so he should know: Do tire prices normally go down, along with oil prices? 

“I don’t remember them going down when the prices went down," he says. "But I remember them going up a little bit when the oil went up.”

Goodyear owns Adiyeh’s store, and sets the prices. So I called a Goodyear spokesman, Keith Price, and asked him: will tires get cheaper?

His response: “I’m not able to comment or speculate on what might happen to the price of tires.”

But Price did say it takes a while for the tire to go from factory to warehouse to distributor to store. He figures tires being made now, with the cheaper oil, should be in stores this spring. 

So will they be cheaper then?

“It’s not entirely black and white,” says Nicholas Mitchell, a senior vice president and research analyst at Northcoast Research who follows Goodyear. He says oil makes up about a quarter of the cost of synthetic tires, the kind most consumers buy. Mitchell thinks competition among tire manufacturers will push down prices.   

“Someone will move first and try to lower prices to drive market share,” he says.

But here’s why it’s not black and white: With gas prices down, we’re driving more, and wearing out our tires faster. If demand for tires rises, Mitchell says, prices won’t fall as much. 

Farmers feel ripple effects of the oil boom

Thu, 2014-12-18 11:00

The oil boom in Texas has ripple effects that go beyond the cost of gasoline. Kai Ryssdal talked with commercial grain farmer Curt Mowery of Mowery Farms in Rosharon, Texas, to find out how oil is reflected in his business.

As a commercial grain farmer, Mowery estimates that 50 percent of his costs circle around oil. Some examples include the chemical costs on some of the crop protectants, containers and transportation from getting grain from the field to the processor. “Everything’s tied to oil that we do in our business,” he says.

As the cost of oil goes down, Mowery might see savings in 2016, but he doesn’t believe the consumer will see savings for a while. “The price will go down a lot slower than the price will go up," he says.

Oil prices scrape bottom of the barrel

Thu, 2014-12-18 11:00

Crude oil prices fell to 5½ -year lows on Thursday. The price of Brent Crude closed at $59.27 a barrel, and West Texas Intermediate Crude closed at $54.11 a barrel.

A barrel of crude oil is a “convenient measure,” says Eric Smith, associate director of Tulane University’s Energy Institute. “It’s 42 gallons because that’s what John D. Rockefeller put it in – old beer barrels, back in the 1890s.” Today, oil moves in pipelines, tanker ships, barges and railcars to get from the oil fields – whether in Saudi Arabia, Nigeria or North Dakota – to the refineries.

Transportation only constitutes a small fraction of the barrel’s cost, according to economist Rayola Dougher of the American Petroleum Institute, the industry trade group. Most of the cost of oil can be attributed to exploration, drilling and pumping.

“Finding the oil is a very involved process,” says Dougher. “Onshore it can take $19 to $20 a barrel, but it could be twice to three times as much offshore.”

In the Bakken shale oil fields in North Dakota, which are pumping out a lot of high-quality light sweet crude (a similar grade to the benchmark West Texas Intermediate), producers can still make a small profit with crude in the $55-a-barrel range, after subtracting the costs of exploration, production and transportation, Smith says.

“You’d probably go down to $30 before somebody shuts in a well. They might not drill a new one. But they wouldn’t stop producing the old one until the price got below that cost.”

Quiz: The art of the academic turnaround

Thu, 2014-12-18 07:18

Low-performing schools reported how they are trying to improve in an Education Department survey of administrators whose schools are eligible for School Improvement Grants funds.

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PODCAST: The Sony cancellation

Thu, 2014-12-18 03:00

The day after the guardians of interest rates at the Federal Reserve issued a statement that would get demerits for vagueness from any freshman English professor. And we could see more information from the U.S. government as early as today about who hacked the computers of Sony Pictures, leading to the mass release of internal company emaisl and, now, the cancellation of the release of the movie at the center of this. That movie, titlted The Interview, is a comedy about a plot against the North Korean leader. In the last 24 hours, a unnamed U.S. official has been suggesting the hack may have started in North Korea. Plus, when you think of negotiating for higher pay, the people who work hard picking apples and cherries aren't the first folks who come to mind with the clout to drive up compensation. Individual farmworkers don't control much about their work environment. But in Washington's Yakima Valley, growers and workers alike say the growing use of cell phones has shaken up the labor market.

Leading indicators released for the month

Thu, 2014-12-18 02:00

The Conference Board will release its monthly index of leading indicators Thursday: a collection of data from different pieces of the economy, including building permits, stock prices, consumer expectations, among others, all rolled into one tidy snapshot.

Chances are, the U.S. will look pretty as a picture, especially compared to other countries, says Bernie Baumohl, with the Economic Outlook Group. Europe and Japan are sluggish; China’s growth is slowing; and Russia’s in the midst of a currency crisis.

But so far, the U.S. is shrugging off the rest of the world’s economic woes, says Guy Berger, a U.S. economist at RBS Securities. 

Click the media player to hear more.

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