One business sector that has been turning out very strong earnings reports recently is the auto industry. Last month, Chrysler, GM and Ford had their best month of sales in 5 years.
But not everybody thinks the upturn is purely a good thing. Marketplace Economics Correspondent Chris Farrell joins Morning Report host Jeremy Hobson to explain why long-term auto loans, which are boosting sales, could be a bad deal for borrowers.
A big deal is brewing in the global coffee business. German investment group JAB is buying Dutch company D.E. Master Blenders for nearly $10 billion.
Marketplace's London bureau Chief Stephen Beard joins Morning Report host Jeremy Hobson to explain the companies, the deal and what it means for the global beverage industry.
Conventional wisdom says before you make a decision you should make a list of pros and cons, but Chip and Dan Heath say that's wrong. The brothers are co-authors of "Decisive: How To Make Better Choices in Life and Work."
"The pros and cons list is a good way of setting up a situation where you've got potentially one option that you're doing thumbs up and thumbs down on," says Chip. "Good decision-making starts with having multiple options available to you. Good decision-making involves collecting information that may contradict your initial opinions that you can sit at home with your pros and cons list and come up with a beautiful justification for whatever you wanted to do in the first place. What we're trying to do is widen out the process of making a good decision."
Dan Heath says one of the classic villains of decision making is what psychologists call "narrow framing" -- a temptation to get stuck in making decisions in a "whether or not" frame. Whether or not you should buy an iPad. Whether or not you should quit your job.
"What the research tells us is if we can just generation another option -- just one or two -- it greatly increases the chance we're going to make a good decision," says Dan.
Dan says one of the most important principals of decision-making is to trust the actual experiences of other people over our own instincts.
"We're always wise to trust the experience of other people over our own intuitions. For instance, if you're thinking of where you're going to go out to dinner tonight, you might be wise enough to go onto Yelp and look at the reviews and trust the place that has 100 good reviews over your own judgment about which menu looks good," says Dan. "When it comes to people's portfolios, they totally throw that logic out of the window."
The Heaths say part of being a good decision maker is knowing when not to trust yourself -- and figuring out how to not let your emotions get the best of you.
"Often the best thing we can do -- especially when it comes to something like retirement -- is get out of [your] emotional melee and create some distance," says Dan.
The electric car company Fisker Automotive has laid off three quarters of its employees and reports suggest a bankruptcy filing is near. The Fisker Karma sports car can toggle between electric and gasoline-assisted power, but the company hasn't made one since last summer. Fisker's financial troubles are especially controversial because the company received federal subsidies, money that -- in retrospect -- doesn't seem well spent to some.
Slate tech writer Will Oremus joins Marketplace Tech host David Brancaccio to discuss Fisker and why its different from Tesla Motors.
The last time the NRA sponsored a NASCAR race was in September, before the Sandy Hook Elementary shooting that brought the NRA to the forefront of the debate on gun control.
“I’m certain that somewhere down the line someone has to say let’s look at a particular sponsor and see whether it is good for the sport” says Jon Ackley, a professor at Virginia Commonwealth University who teaches a class called "The Business of NASCAR."
He says that these types of sponsorships are made between the owner of the race track, in this case Texas Motor Speedway, and the sponsor, but ultimately NASCAR has to approve the deal.
“But just because there may be people who don’t approve of something it doesn’t mean that it is detrimental to the overall sport,” says Ackley.
Ackley doesn’t think the sponsorship will cost NASCAR any fans. Sponsors typically pay upwards of $1 million to put their name on a race. NASCAR didn’t block the NRA deal, but said it would take a closer look at the sponsorship approval process in the future.
More than four million Americans will be watching their mailboxes over the next few weeks, and not just for their tax refunds. Starting today, checks are on the way to victims of wrongful foreclosures as part of a $3.6 billion settlement between banks and federal regulators. But for most of those borrowers, it won’t exactly be Christmas in April. More than 80 percent of people who are eligible for settlement money will get checks ranging from $300 to $1,000.
“Makes me laugh out loud," says Josh Escobedo, of Spanish Fork, Utah. "It’s kind of a punch in the face.”
Escobedo fell behind on his mortgage payments after he lost his job as a realtor. He was denied a loan modification at first and says it cost him a lot to get one through an attorney.
“Somewhere in the $8,000 range, at least, not to mention all the time and energy and the stress on my family,” he explains. Escobedo says his check might cover a nice steak dinner for him and his wife.
The settlement is the result of a long push by federal regulators to compensate borrowers for mistakes or mistreatment by banks at the height of the housing crisis.
53 people lost their homes, but never actually defaulted on their mortgages, and banks took houses away from more than a thousand military service-members who were protected from foreclosure by law. Borrowers in those two groups will get up to $125,000 each, but most people will get a small fraction of that.
“Servicers are not paying anywhere close to the amount of harm they caused,” says Alys Cohen, an attorney with the National Consumer Law Center. “On the other hand, there’s still a chance for servicers to do the right thing and give people loan modifications when they qualify.”
In West Palm Beach, Florida, Claudia Fehribach fought to get a modification after her husband lost his job. They have a 10-year-old son, and in the end, they were able to keep their home, but she says the process took three years.
“I don’t know how many nights I lost sleep with my husband worrying what was going to happen,” says Fehribach. “I’m glad I’m getting something, don’t get me wrong, but it’s ridiculous. It really is.”
Federal regulators say borrowers should call Rust Consulting to find out if they’re eligible for the settlement. The company is distributing the money, and sent a postcard to every person who’ll get a check. Fehribach says the notice looks like junk mail, and she almost threw hers away.
This Sunday is the 10th anniversary of the completion of the Human Genome Project. Many believe genetics are the next big thing in medicine, but one question for this new era of personalized medicine is cost. In theory, DNA sequencing can make it a lot easier -- and cheaper -- to fight cancer.
"When you sequence all the genes in the genome, you have the opportunity to not just identify the genes driving the cancer, but genes that affect how this man is going to handle the drugs that you are going to give him," says Dr. Les Biesecker.
If that works, the guy avoids the cost and the physical toll it takes to basically experiment with other drugs. But -- and this is big -- the technology is so new, there is concern health providers will jump on test results that lead nowhere.
"You could go down the absolutely wrong avenue. You may start to do additional testing. Additional testing of family members. That's when costs could get out of control," says Dr. Leonard Sender, director of the Genomic Center at Children's Hospital of Orange County.
He says it's up to doctors to exercise restraint as they begin playing with this powerful, but risky, new tool.
Personal computer sales fell off a cliff early this year. Depending on the market research, the drop was nearly 14 percent, according to IDC, or about 11 percent using Gartner research. Analysts are blaming Europe's weak economy, as well as the transition to Microsoft's new operating system Windows 8.
But Al Hilwa of IDC has a different argument.
"When you go back 10 or 15 years ago, most of us bought PC's at home because we wanted to use the same tools that we used at work," Hilwa says. "The tablets of this world have adapted much more quickly to that demand -- a much safer, cheaper way for consumers to access these services."
To hear more about how individual PC makers are doing, click on the audio player above.
Facebook CEO Mark Zuckerberg is creating a nonprofit group of tech leaders who want to reform immigration. Unfortunately, the group sent out an email that Politico says is packed with errors, like giving out the wrong name for the organization, and using language that Facebook says is “poorly-chosen,” that could give a “misimpression of the views and aspirations of the group.” Facebook practically runs the world of social media -- so how does a blunder like this happen?
It’s supposed to go "Ready, aim, fire." But in Silicon Valley, there can be a rush to get out new technology. Luke Williams, who teaches innovation at NYU’s Stern School of Business, says that can cause problems.
“So what they’re really doing is just the firing and the aiming," he says. "And they’re forgetting about the ready part."
Williams says the slogan in the valley has been rearranged to read, "Ready, fire, aim" -- which means some crucial steps are missing.
“But you know it doesn’t replace thinking, vision and strategy. There’s still an absolute need to do that, particularly if you’re talking about doing something completely new.”
Like... a bunch of tech company CEOs staring a nonprofit.
Andrea Matwyshyn, a professor of legal studies and business ethics at Wharton, says Silicon Valley’s speed is also possible because legal protection is built into their products. Think about the web services you use. Matwyshyn notes that when you click yes on those agreements it means YOU are responsible for any problems and tech companies can comfortably skip some of the protections that, say, a toymaker, would have in place.
“Such as the legal department saying we need to run three types of checks on this product because we’re concerned about product liability concerns," Matwyshyn says.
Because some tech companies have gotten so good at shielding themselves from liability, hey’ve become sloppy with everyday operations. Louise Kehoe, director of reputation risk at Ogilvy Public Relations, helps train corporations to safeguard leadership from their own errors. She likes to tell her clients stories about other executives who’ve made mistakes.
“Without identifying them of course,” she says.
One corporate executive tweeted about having a great day -- on the last day of the quarter. Which got him a slap on the wrist from the Securities and Exchange commission. So Silicon Valley CEOs -- know that it could have been worse.
Moral of the story: Think before you tweet, and aim before you fire.
This story was produced by Youth Radio.
Seventeen-year-old Andrew is filling out a job application for a Jamba Juice in Oakland, Calif. He’s making his way through the basics, filling out his name and contact information. However, question five posed a challenge. It was a yes or no checkbox which read, “Have you ever been convicted of a crime?”
“I will check yes,” said Andrew, who requested anonymity for this story. When he was 14, a high school freshman, he took a gun to school. It is a shocking act for many, especially in the wake of the Newtown, Conn., shootings, but Andrew says he did it to be cool. Three years later, he is haunted by that decision.
In the space below the checkbox where it asks for specifics, Andrew scrawled “weapon charges.” It’s pretty easy to imagine what an employer would think reading those two words. Little did Andrew know, they are words he could have kept to himself. In California, and many other states, young people who are processed through the juvenile court system, are never “convicted.” Instead, they are “adjudicated.”
Rachel Johnson-Farias, a lawyer at the East Bay Community Law Center in Berkeley, said that adjudication is basically a fancy word for when a court finds allegations to be true. Johnson-Farias explained that while the difference between "adjudication" and "conviction" is slight, it matters when filling out job applications. When asked if you’ve been convicted of a crime, “If you don't have any adult convictions, you can say ‘no’,” said Johnson-Farias.
However, in some states, like Iowa, juvenile records are public, meaning that juvenile offenders should check “yes.” And even in California it could be a “yes,” if the application asks about arrests instead of convictions. Confused yet? Many places have eliminated this type of checkbox altogether with laws called Ban the Box.
“Essentially, it forbids employers asking about a person’s criminal record,” explained Newark, New Jersey City Council Member Ronald Rice. He wrote the city’s Ban the Box law, which prevents employers from asking about records until after they make a tentative job offer. Forty-three cities and counties and seven states have passed similar laws. Newark’s is the most sweeping.
A study in the journal Pediatrics finds that nearly a third of adults in this country have been arrested by age 23, and Rice argues that pre-screening applicants for criminal history creates a permanent underclass. “Continually penalizing people (without giving) them the opportunity to apply for work,” said Rice, “is really anti-American, but it’s also anti-business.” Anti-business because the whole economy suffers when people can’t find jobs, argued Councilmember Rice.
But imagine you’re an employer who learns at the very end of a hiring process that your top candidate committed rape or murder. “You look at that,” said George Allen from the Seattle Chamber of Commerce, “And you’re like, 'Oh my gosh could this be safe for my customers, or in some cases for my employees?'”
The Seattle Chamber of Commerce opposed early drafts of a citywide Ban the Box proposal, because of costs and risks. For example, what if an employer rescinded a job offer after learning about an applicant’s criminal record? Allen said, “That applicant could turn around and sue the employer for unlimited emotional distress, and we just felt that that was too heavy a hammer.”
After meeting with resistance, Seattle lawmakers released a new Ban the Box proposal, which Allen said strikes a better balance. If the law goes through, Seattle employers will have more control, and applicants with criminal records might have a better chance at starting over.
In Oakland, 17-year-old Andrew says it’s all about redemption.
“That never was really me,” said Andrew, “You can’t really hold a person’s past against them because the person could be different."
Recognizing people’s capacity for change may have something to do with why lawmakers in eight more states -- from California to New Jersey -- are considering statewide Ban the Box laws, trying to figure out how much a person’s past should affect their future.
It seems fair to say that Democrats aren't quite sure how they feel about the budget President Barack Obama released on Wednesday, especially the bits where he targets the growing costs of Medicare and Social Security.
The proposal would shrink the growth of Social Security benefits for all but the most needy seniors. It would also raise Medicare premiums on wealthier Americans.
Once you get through the politicking and the posturing coming from both sides of the aisle over these approaches, there's a pretty fundamental question underlying the debate: Who should social safety net programs for the elderly protect — everybody, or just those in need?
Karen Campbell, a 68-year-old retiree who lives in Avon, Ohio, has mixed feelings about the question. She doesn’t like the reductions the president is proposing in her Social Security benefits, even though she and her husband have enough personal retirement savings that they don’t rely on Social Security to make ends meet.
Under Obama's proposal, which would go in to effect in 2015, the average person would get about $40 less per year in social security benefits, in the first year. Campbell says those reductions wouldn’t affect the quality of her life.
It's not so much the dollar amount of the reductions that bothers her. It’s the principle.
“I don't think it's fair to take things away from people when they counted on it,” she says. “To say ‘sorry, we changed the rules.’”
John Reay, 68, from Minneapolis, sees things differently. While Social Security helps him cover his mortgage, he, like the Campbells, mostly relies on personal retirement savings, not Social Security, to get by. He says even if he got no Social Security checks at all, he'd be ok.
“Social Security was put in place to help those who were in need,” Reah says. “And there are some of us who aren’t in need.”
What has traditionally made universal programs like Social Security and Medicare so popular is precisely the fact that they benefitted everyone, not just those in need, says Peter Beresford, professor of social policy at Brunel University in London.
Beresford warns if those sorts of benefits start to shrink for those who don't really need it, “the number of people who have a vested interest in protecting it, who might have the strength and skill and ability to protect it, diminishes.”
That could make programs like Social Security or Medicare more vulnerable, and more stigmatized. Of course, it could also make them less expensive.
Fast food isn’t called friendly food -- and for a reason.
"Welcome to King Burger where we can do it your way, but don't get crazy!" says Bon Qui Qui, a character in a "MADtv" skit. When a customer orders a "number five with a boneless skinless chicken that is slightly seasoned," Bon Qui Qui bellows: "SECURITY! NEXT."
Customer service can be an issue in real life too, as McDonald's is finding out. Company documents cited by The Wall Street Journal say that McDonald's customers are increasingly complaining about unfriendly service.
Mark Adler, coffee in hand, says his Manhattan McDonald's of choice is “usually...pretty good about taking the next guest and what not, but the people behind the register tend to get a little testy when there’s one long line.”
For Noelle Curbelo, it’s the long line that’s the issue, not the smiles. She says customer service is “not that great but you don’t really care. It’s all about speed.”
Unfortunately for McDonald's, customer complaints about speed are rising, too. The fast-food giant did well during the recession, when customers cared mostly about value, but times have changed and there’s pressure to do something about serving customers swiftly and with a smile.
Improving service is sort of a low-hanging fruit, according to Sam Ochis, editor of fast food industry magazine QSR.
“Customer service is something they can really get to right now,” he says. "New menu items take a long time to develop, a long time to test."
McDonald's also has to worry about its smiling competition, restaurants known as “fast casual,” such as Panera and Chipotle, or “better-burger-joints,” such as Five Guys and Smashburger.
“They’re stealing market share,” Ochis says, and Mcdonald's -- which he adds has long been at the forefront of the industry's evolution -- has not choice but to keep up. "Part of that's going to be in customer service."
McDonald's declined to comment on its plans, but the chain’s reportedly creating a new job of “runner.” That employee will hand out stuff like cups and condiments, so more time can be spent being polite to customers.
We decided to do some testing on McDonald's ordering time. Here's what happened when we asked some New Yorkers to time how long it took for their orders to come out.
Tristan Cohen ordered Chicken Nuggets, French fries and chocolate chip cookies.
Jennifer Mendoza ordered a salad at the busy McDonald's.
Jonathan Alerhand ordered a chicken sandwich and French fries, and felt hesitant about the time it took.
On Capitol Hill today, 68 members of the U.S. Senate, the world’s greatest deliberative body, voted “aye” on the question of whether it’s okay to talk about gun control.
The law on which debate will soon begin includes, among other things, an expansion of background checks for gun buyers.
Progress on anything in Washington lately has been incremental at best. On gun control in particular, states and cities are moving faster, and one thing they’re considering is taxing guns and ammunition.
Since April 1, Cook County, home to Chicago, has had what it calls a “violence tax.”
“It’s a $25 tax per firearm that we sell,” Fred Lutger explains. He owns Freddie Bear Sports, in Tinley Park, Ill.
Revenues go to the Cook County Health & Hospitals System. Last year, it treated more than 800 victims of gun violence, at an average cost of $52,000 per patient.
Lutger says he’s concerned about the level of gun violence in Chicago, but he points out Tinley Park is in the suburbs, a half hour from downtown.
“They gotta curb it,” he says. “But this isn’t the way to do it.”
Politicians in many cities and states think it is.
Nancy Staudt, the Edward G. Lewis Chair in Law and Public Policy at the University of Southern California, says a tax on firearms isn’t unlike other taxes on tobacco or alcohol.
“Individuals who want to own guns, that’s fine,” she says, noting many constitutional rights are not limitless. “The Second Amendment allows you to own guns, but there are certain costs to society of owning that gun, and you’ll need to help pay for those.”
The California State Assembly is considering a five-cent tax on each and every bullet, to pay for an early childhood mental health program. Next door, Nevada is considering its own tax -- on both ammunition and firearms, to pay for mental health services and to help crime victims.
“It sends a message to Washington that this is important to us,” says Nevada Assembly Majority Leader William Horne, who sponsored the bill.
Rep. Linda Sánchez (D-Calif.) has taken notice. She wants a 10 percent tax on all concealable firearms purchases. State, tribal and local governments, Sanchez says, could use that revenue “for antiviolence campaigns, gun safety campaigns, and firearm buyback programs.”
Sánchez says a tax is the only way to fund those programs. As of today, however, she’s failed to find a single Republican to cosponsor her bill.
Somewhere along the way, if you follow political headlines, we went from living in a poor economy to living in "an age of austerity." The argument that Washington has to spend less and reduce the deficit has become the starting point for any discussion of the federal budget. With millions of Americans still unemployed, where did austerity come from?
Economic historian Jason Taylor at Central Michigan University says a big moment for the budget discipline camp was post-World War II America.
"In 1946 we had a huge decrease in government spending," he says. "We went from running huge deficits to huge surpluses. And the unemployment rate was 3 percent."
Washington got out of the way, and the economy thrived.
Now, the war period itself makes a counterpoint: government spending stoked GDP. But Taylor reminds us that politicians can cherry-pick.
He says austerity's appeal is that it's simple. Discipline is good.
It makes for nice metaphors: an economy is a family, even if it may not be that simple, argues Brown University's Mark Blyth. He's written a new history of austerity.
"When the family spends too much, then you have to cut spending, so it's simple," he says. "Well, it's absolutely not like that at all. We don't get to import members of other families into the family in order to tax them for the next generation. We get to do that. It's called immigration.
Blyth says recent decades of prosperity further fueled the flame of markets are the answer, not state spending.
Then came the financial crash. Many governments slashed budgets, on advice of the International Monetary Fund. But top IMF economists now say whoa: austerity made things worse.
"Those states who did the most stimulus, their economies recovered the most," says economist Justin Wolfers, who teaches at the University of Michigan. "Those states who cut back the most, their economies underperformed the most."
Wolfers thinks the consensus of economists has moved toward government spending in a weak recovery...while politicians in general have gone the other way.
That's his history. The budget-cutters, they have theirs.
Eating gluten-free was once the domain of people with actual allergies -- people with celiac disease, for whom a bit of gluten can spell all sorts of unpleasant problems. But today, going gluten-free is all the rage for a whole lot of us.
And restaurants are piling on board.
One of the very early adopters of a gluten-free menu is Fresh Brothers Pizza in Southern California. It's been serving gluten-free pizza since 2008, the year Adam Goldberg started the business with his wife, Debbie. “It’s funny,” says Debbie, “when we first started offering the gluten-free menu, people were like, ‘what’s gluten’?”
(For those of you wondering the same thing, gluten is a protein found in wheat and other grains. So eating gluten-free means no flour or regular crust.)
A gluten-free pizza is an idea that strikes some pizza fans as a little off. “They just can’t comprehend the concept of a pizza without flour,” says Adam. But flourless pizza is, every day, a little less incomprehensible, even when it costs a few bucks more than regular pizza. “Since 2008,” says Adam, “we’ve seen gluten free sales literally grow on a weekly to monthly basis.”
And more and more restaurants are catching on. Going gluten-free is going mainstream. Domino's has a gluten-free pizza. Dunkin Donuts is testing gluten-free baked goods.
“What we’ve seen from a trend perspective is that some Hollywood stars had decided to cut gluten or even wheat out of their diet and they’ve lost weight,” says Joy Dubost, the director of nutrition at the National Restaurant Association, “and it has sort of become a buzz as a way to lose weight.”
The gluten-free “diet” is hot. On the list of top restaurant trends, “gluten free items” is number one with the fast food industry. “People are equating gluten-free with being nutritious,” says Dubost, “and I’m a registered dietician and I do not advocate for a gluten-free diet unless you have a reason to be on that diet.”
But Dubost’s advice doesn’t seem to be stopping much of anyone. “In our latest data, which takes us up to the end of January, we have 30 percent of all adults saying they are trying to cut out or remove gluten from their diet,” says Harry Balzer, chief industry analyst at the consumer research firm NPD Group.
That’s one in three of us.
Balzer stresses that doesn’t mean that all those people are actually eating gluten-free. But, he says, “their interest in this has been growing.”
All that flirting with gluten-free makes it attractive for restaurants.
But it can be a bit of a rub for people like Amy Phillips, who has celiac disease, and has to avoid gluten for medical reasons. “It’s mostly a blessing that it’s more popular,” says Phillips. More trendy means more choices.
But not everyone takes it quite as seriously as Fresh Brother Pizza does, where Amy is sharing a gluten-free pizza with her son. When she tells waiters at some other restaurants that she has to eat gluten free, she can sense skepticism, she says. “Sometimes you can tell they really think it’s something like a low-carb diet, that it’s kind of a trend. And I have to stress that I’m very allergic.”
Domino's “gluten-free” free pizza for example -- is for the trend followers. Not Amy. The company makes clear that people with celiac disease NOT chow down. It is cashing in on the fad, rather than any allergy need.
Have you changed how you eat? If so, which lifestyle choice made/makes you feel your best? Vote in our poll here.
Restaurants have figured out that if they can offer diverse menus, with something to meet everyone’s needs, it’s better for their bottom line. Money aside, some of these diets lifestyle changes do you make you feel better than just eating without discretion.
Have you changed how you eat? If so, which lifestyle choice made/makes you feel your best? Vote in our poll below!
A quick look at some of the more common lifestyle and diet changes we're seeing:
Includes four “phases,” starting with very few carbs and eating progressively more until you get to your desired weight.
A diet that excludes foods containing gluten. Gluten is a protein complex found in wheat (including kamut and spelt), barley, rye and triticale.
On a raw foods diet, you only eat foods that haven’t been cooked, processed, microwaved, irradiated, genetically engineered, or exposed to pesticides or herbicides. It includes fresh fruits, berries, vegetables, nuts, seeds, and herbs in their whole, natural state. Some folks include seafood and raw animal products (like milk) from time to time.
This diet is based on eating wholesome, contemporary foods from the food groups that our hunter-gatherer ancestors would have thrived on during the Paleolithic era, or Stone Age.
The South Beach Diet is relatively simple in principle. It replaces "bad carbs" and "bad fats" with "good carbs" and "good fats." It is often confused with the Atkins Diet, another low-carb diet.
Vegetarianism is the practice of abstaining from the consumption of meat – red meat, poultry, seafood and the flesh of any other animal. Some vegetarians also limit or completely stop eating by-products of animal slaughter, such as animal-derived rennet and gelatin.
Dietary vegans refrain from consuming animal products, not only meat and fish but, in contrast to ovo-lacto vegetarians, also eggs, dairy products and other animal-derived substances.
Other (explain in the comments below)
Which lifestyle change works for you?
Hear more on the gluten-free diet, and how it's growing in popularity, here.
The Egyptian economy is teetering. Since the revolution two years ago, the main-stay tourism industry has struggled, and the amount of foreign currency in the country is drying up. Egypt relies on foreign currency, particularly the U.S. dollar, to subsidize cheap fuel and bread for its people. So now the Egyptian government is telling banks they can no longer sell dollars.
Before the revolution, when there were still lots of tourists and investors in Egypt, the country's foreign reserves were $36 billion. Today they are less than $13.5 billion. So dollars are scarce in the traditional places, but on the street, it's a different story.
Just blocks from the Cairo stock exchange, you see men looking back and forth nervously, repeating one word under their breath to passers-by: "Zarafa, zarafa, zarafa…”
Exchange, exchange, exchange, they say. If you have dollars they will buy and sell them, for a premium. My friend Hossam Minnea has 1,000 bucks to exchange and within minutes of us walking onto the street, Hossam is handed 7,200 Egyptian pounds -- about a 6 percent premium over the official exchange rate.
I ask Hossam if he got a good deal. He sighs, "It’s a good under the table, but in general, for my country -- it’s not a good deal!"
Hossam says the fact he can get this deal so easily on the street is a sign of just how bad things are in Egypt. Everyone I spoke to for this story knows someone who is going into the gray economy to get dollars.
The guy buying Hossam’s dollars isn’t some shady crook. He’s an importer of toys from China and he needs dollars to get his shipments. He started working the informal exchanges on the streets a month ago.
In a wealthy neighborhood on the other side of town, the Genghiskhan Chinese Restaurant now has big sign on the wall announcing, “We are buying USD!” Yu Shikuh’s family owns the restaurant. She says they’re paying a premium of about 3 percent over the official exchange rate.
Yu needs the dollars to send to her mom in China. Her mom is using the cash to buy food and supplies for a new restaurant in Cairo, including a new karaoke machine. Yu says at the same time her family needs to pay extra for dollars, they’re make less profit on the restaurant because rising inflation has pushed food price higher.
While I was talking to Yu the power went out in the restaurant. It’s part of rolling black outs the government is staging because it doesn’t have the foreign currency to buy enough imported fuel for power stations.
Yu gathers some candles and starts putting them on the tables.
Despite all the problems Yu says she and her family plan to stay in the country, but like many Egyptians, she wonders how much worse it will get, before it gets better.
The drought has dried up water supplies in some parts of the country -- and water wars are heating up, between farmers and cities. In New Mexico, farmers have kicked off what could be a long-running fight by making a “priority call” on water resources.
Biogen Idec, a Massachusetts-based biotech company, is hoping its new multiple sclerosis drug Tecfidera will eventually bring in the hundreds of millions of dollars it cost to develop -- at least before a generic comes along and copies it. CEO George Scangos joined Marketplace Morning Report host Jeremy Hobson to discuss his company's development process and pricing strategy.
Baseball, with its passion for tradition, is more tech-savvy than you think. Major League Baseball is now working with wireless engineering company Qualcomm to let people have a better smartphone experience while crammed together at the ballpark. The company has also worked over the last decade to insure that things go smoothly for people who pay to watch games online.
MLB.com CEO Bob Bowman says things were different in the early, herky-jerky days of streaming.
"Way back when in 2002 when we first started streaming, our fans got herky-jerky, buffering, dark minutes, and they were paying subscriptions so they weren't really happy about that," Bowman says.
Thanks to breakthroughs in the years since, fans can now stream live baseball on their computer, cellphone, or tablet without all the bumps and breaks.
"It look[s] just like a High-Def game that you get through your cable operator," Bowman says.
To hear more about MLB.com's mobile strategy and plans for the off-season, click on the audio player above.
Gold prices are down this morning after falling a 1.5 percent yesterday, nearing a two-year low.
Diane Swonk, chief economist with Mesirow Financial, joins Marketplace Morning Report host Jeremy Hobson to discuss the drop off and whether there is such a thing as a safe haven anymore.