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wages based on public assistance

Mon, 2015-04-13 02:00

A new report out today by the UC Berkeley Labor Center looks at the amount of money state and federal taxpayers spend on public assistance programs for low wage workers between 2009 and 2011 they cost nearly $153 billion per year, more than half of the total spent on public assistance. While the purpose of the social safety net to help low income families get by, the worry is that employers may be building their pay structure around this taxpayer support. 

Some companies like McDonald’s, GAP, Target and others have already instituted pay increases and some states are putting pressure on companies to pay more. California for example is going to publicly list the names of employers with more than 100 workers on Medicaid. Additionally, more than 20 state legislatures have passed minimum wage increases for 2015.



The Art of Selling

Mon, 2015-04-13 02:00

When museums face budget cuts, should they turn to their art works for income? For that, we consult Blake Gopnik, critic at large at Artnet News and contributor to the NY Times. We talk about the valuation of art, opportunity cost of selling, and what this means for the next generation. 

For more works by Gopnik, visit 

Click on the multimedia player above to hear more. 

A crafty IPO

Mon, 2015-04-13 02:00
Etsy, the quirky e-commerce site goes public very soon. Last year, the online retail platform generated revenues approaching $200 million, a jump of about 56 percent over the year before, according to SEC filings. But to raise the cash  from this week’s IPO,,Etsy is reportedly focusing on small investors.    Wendy Liebmann, CEO of WSL Strategic Retail, says as Etsy grows, the company wants to show it’s not selling out.  Etsy sellers are reportedly among its target investors. Kirthi Kalyanam, who teaches marketing at Santa Clara University, says that’s a good way to avoid tensions down the road.   “It becomes easier from a corporate governance point of view, because all the decisions you make are pretty well aligned,” he says.    Kalyanam says without that alignment, the company is more susceptible to pressure from big outside investors who couldn’t care less about vintage bath towels if stock prices are in the toilet.

Tallying the return investments in medical records

Mon, 2015-04-13 02:00

Let's face it, a lot of government reports tend to suffer the indignity of dust -- they get set aside, forgotten about. 

But some health experts think a new report from the Office of the National Coordinator for Health Information Technology may force a change. That’s because after taxpayers have spent around $30 billion in part to share patient data, the government has said it’s not getting enough for its money.

And hospitals and software IT vendors all share some of that blame. This report has done something that’s been a long time coming; it’s named a pernicious problem in health IT.

It’s called data blocking, says Michigan’s Julia Adler-Milstein. “This is a strong statement of who they believe is engaging in bad behavior,” she says. 

Both software companies and hospitals have engaged in this bad behavior according to the report, which costs us billions in wasted care every year.

Adler-Milstein says today just 14 percent of doctors share patient data, and only a third of hospitals because some companies have put their own financial interests before the common good. Former Washington health IT chief Farzad Mostashari says the report put people on notice this won’t be tolerated anymore.

“The lens is focusing on you. You could have thought that no one is able to see me, but now comes it comes into clear focus, “he says.

Software vendors says they have gotten the message.

“This is a clear case where the perception becomes reality and it has to be addressed seriously,” says Mark Segal, chair of the Electronic Health Records Association, an industry trade group.

Segal says this is an important step towards building standards so more patient data flows freely.

Atlanta is a new hub for video game developers

Mon, 2015-04-13 02:00




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Asante Bradford promotes video game development for Georgia. Eight years ago, he says, there were only about six gaming companies in all of metro-Atlanta. Now, there are more than 70.

“Every time we put together a list, it changes that quickly," Bradford says. 

He says one reason may be that there are more gaming conventions being held in Atlanta, giving the city more exposure. And there’s a lot of local talent. The Savannah College of Art & Design and Georgia Tech are ranked among the top schools for game design.

Nikhil Deshpande teaches game development at SCAD in Atlanta. He says alumni of these schools are the ones who help create a strong network in the city.

“Retaining talent has helped the overall gaming landscape here," Deshpande says. 

So when it comes time to finding a job, it’s not that hard, he says.

Take Hi-Rez Studios. Its 50 new jobs will help push out a new a mythology-themed video game SMITE on a new platform, XBOX One, and in a new market, China. They also plan to build a new studio so people can watch others play.


“People play video games, but over the last two years, it’s actually become quite popular for people to spectate video games," says Hi-Rez Studios Chief Operating Officer Todd Harris. 

Harris says it helps that Georgia’s popular film tax credit – which was just renewed for another three years – extends to digital entertainment, and that living in bigger markets, like San Francisco and Los Angeles, is becoming more difficult. 

“Georgia’s low cost of living has been very effective in recruiting experienced game developers, and then you combine that with really, really strong entry-level talent out of our universities and technical colleges,” Harris says. 

The average starting salary at Hi-Rez Studios is about $58,000 – in line with the national average.  







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The Art of Selling

Mon, 2015-04-13 02:00

When museums face budget cuts, should they turn to their art works for income? For that, we consult Blake Gopnik, art critic and contributor to the NY Times. We talk about the valuation of art, opportunity cost of selling, and what this means for the next generation. 

Click on the multimedia player above to hear more. 

Apple Watch: Day 1

Mon, 2015-04-13 02:00

The much-awaited Apple Watch was finally available for a preview on Friday. Customers could try on the smartwatch in Apple stores in nine countries, including the U.S., China and Japan.

As expected, people made appointments and lined up at Apple’s flagship store in Manhattan—the one on fifth avenue where you walk into a glass cube and down a spiral staircase to reach the store. What was the scene like?

“It was pretty subdued,” said Meg Cramer, producer at Marketplace Tech, who also made an appointment to check out the Apple Watch on the very first day. "There was a line of maybe a dozen people out front waiting to get in. Everyone had made an appointment already.”

What was unexpected was how they were greeted as they walked down the staircase. “This is the weirdest part,” said Cramer. “There were like a 100 apple store employees cheering and clapping.”

The applause continued until the store was full. They were cheering, Cramer suggested, because these customers had been waiting for the Apple Watch for a long time.

“I think if you’re there for the very first appointment on the very first day, you already know more about the Apple Watch than any Apple store employee could tell you,” said Cramer.

Some of the visitors had already pre-ordered the Watch, meaning they had woken up at 3 am to make the appointment just so they could go to the store and try on the smartwatch. Kelvin Hall was one of the lucky few to nab an appointment.

“It definitely does look like something you would wear on your wrist anyway,” said Hall. “I am sure it will take me a little while to get used to using it, but I definitely bought into it with my money as well as my fashion.” 

People might be surprised at how the Appel Watch actually looks, said Cramer, because most similar wearable devices look like “a mix between a watch and a smartphone.”

“The Apple Watch looks cool, it looks fashionable, and I think it looks better than any other smartwatch out there right now,” added Cramer.

But why would someone want to try it on if they had already decided to buy it?    

“It’s just fun to be there,” said Cramer. “I have been following the Apple Watch since the fall, and I am not going to buy one, but I got a little excited holding this piece of technology that one of the most important technology companies in the world has been working on for years and years.”

It's the final elections

Mon, 2015-04-13 01:00
More than 70

That's how many video game companies are headquartered in Atlanta. Eight years ago, there were just six. Thanks to a bill that renewed Georgia's tax credit for video game companies, the state can expect more gamers to relocate to the metro-Atlanta area. More and more gaming conventions are held in Atlanta, in addition to a lot of local talent from technical schools. 

$200 million

That's the revenues Etsy generated in 2014, a jump of about 56 percent from the year before, according to SEC filings. The online retail platform is going pubic this week. To raise cash from this week's IPO, Etsy is reportedly eyeing smaller, individual investors. 

$153 billion

A new report out Monday by the UC Berkeley Labor Center looks at the amount of money state and federal taxpayers spend on public assistance programs for low wage workers between 2009 and 2011 they cost nearly $153 billion per year, more than half of the total spent on public assistance. While the purpose of the social safety net to help low income families get by, the worry is that employers may be building their pay structure around this taxpayer support.  


The number of days to the 2016 presidential election. Hillary Clinton officially threw her hat in the ring Sunday, though to many, she's long been considered the inevitable Democratic nominee and even winner. Some measures this out, the Upshot notes, with Clinton polling about 20 points higher than she was at this time in 2008. That said, she's still facing several challenges and, of course, there's a lot of time left.

31.4 million

That's how many subscribers HBO had at the end of last year, according to SNL Kagan. That's a very solid customer base, but it's been overtaken by Netflix and new streaming competitors are popping up each day. The network's bid for cord-cutters, HBO Now, launched Sunday night, and the New York Times profiled chief executive Richard Plepler for the occasion. Meanwhile, the Wall Street Journal talked to the head of HBO-owning Time Warner, Jeff Bewkes, about pivoting a huge media conglomerate toward cord-cutters without alienating cable providers.


That's how many people ordered an Apple Watch in the U.S. when they went on sale Friday, according to projections from e-commerce intelligence firm Slice. Quartz notes the average Watch buyer paid about $504, and 62 percent opted for the cheaper, Sport model. There are a lot of different bands to choose from, but Slice projects a whopping 49 percent of first-day orders were for the black rubber "sport band."

Weekly Wrap: General Electric and Stock Market Highs

Fri, 2015-04-10 16:12

Joining Kai to talk about the week's business and economic news are Nela Richardson from Redfin and Sudeep Reddy  from the Wall Street Journal. The big topics this week: General Electric's plans to sell off most of GE Capital, the company's financial division, and the reasons behind some countries' current stock market highs.  


How film actors' pay gets calculated

Fri, 2015-04-10 13:41

When Sony Studios was hacked late last year in connection with the film "The Interview," a trove of internal documents was released online. One of the damaging revelations was that the studio was paying some of its actresses less than their male co-stars.

The revelation generated headlines about women's pay. But, it also brought to light the disparities in what actors are paid, and the complex calculations that go into determining those salaries.

"It's a calculus you go through on each film," says Peter Sealey, former head of marketing at Columbia Pictures, who now runs a marketing firm.

Amy Pascal, the former studio chief at Sony Pictures who was fired in the aftermath of the hack, spoke at a women's conference in San Francisco in February, and said one of the fundamental elements of what determines actors' salaries is, simply, negotiation.

"I run a business. People want to work for less money, I'll pay them less money," Pascal said in a public interview with audience. "I don't call them up and go: can I give you some more?"

Some actresses are definitely not working for less money. They are the rarefied few in the $20-million-and-up-club, like Angelina Jolie and Sandra Bullock. They both can command huge salaries and even percentages of movie profits or revenues.

But there are many other actors who do not have such clout. And yet, Pascal's advice was blunt.

"The truth is that what women have to do is not work for less money. They have to walk away. People shouldn't be so grateful for jobs. People should know what they're worth and say no," Pascal said.

But walking away may be less of an option for most actors, because the salary calculations studios do, Sealey says, which change their formulas based on recent trends.

The calculation of an actor's worth in a film "involves a lot of variables," Sealey says, "but principally it is: how much of a draw will that actor or actress be for your target audience?"

The bigger the audience the studio believes an actor can attract to movie theaters — especially during the all-important opening weekend, which can help determine the long-term earnings trajectory of a film - the higher that actor's salary might go.

But that correlation has a number of additional variables that can affect salary. Among them are the film's budget and what role that film plays for a studio's bottom line. If it's a tentpole film, Sealey says, "where it's important to a studio's long-term health... the price of the actor goes up."

A major tentpole, like the James Bond franchise, is supposed to make so much money that it covers the bombs the studio makes and boosts the bottom line. The last Bond film, "Skyfall," made $300 million in the U.S. and $1.1 billion globally. 

Conversely, non-tentpole films might have lower budgets and lower salaries — no matter an actor's star power. But for the big-budget fare, salaries can reach the heights which Daniel Craig reached in "Skyfall:" $17 million. The film itself reportedly cost $200 million to produce. Craig's salary probably also had something to do with the fact that he had been Bond before.

"If you're trying to get somebody to repeat a past success, obviously you wind up paying them more," says Mike Medavoy, a film producer who headed up Orion and TriStar pictures in the '80s and '90s.

Repeating past successes, if done in a particular genre, can help actors establish a brand and help them boost their salaries, Medavoy says.

"Liam Neeson is a perfect example of that," he says. 

Neeson made $1 million for "Taken," but by the second sequel, with a track record of box office success behind him, Neeson raked in $20 million. The film itself made $300 million, most of it overseas.

"At this point, about 65 to 70 percent of the revenue comes out of foreign and not out of the domestic market," Medavoy says. Which means that an actor with strong appeal in foreign markets can demand a higher salary.

Actors' appeal is also calculated with other revenue streams in mind — home video, Internet, TV, etc. Even an actor's social media presence — whether they have a large Twitter following, for example — can help determine their salary, says entertainment lawyer Jonathan Handel.

"That's something that talent reps can use in arguing for a given salary," Handel says, "How that translates into dollars is probably a dark art." 

While actors can do a lot to boost their worth, Handel says there is a countervailing trend among studios. They're making fewer movies, and relying more on special effects and comic-book characters.

"You know if you're casting a Spider-Man movie, it's mostly about Spider-Man and not about the particular actor," Handel says.

Compare that to the 1990s, when movie budgets ballooned and actors' salaries went up along with those budgets. Handel says the decades since have seen a big shift and "the power that actors and their representatives used to have has diminished."

In aggregate, that's meant smaller salaries, except for the biggest of the big name actors, he says.

GE to sell most of its lending business

Fri, 2015-04-10 13:00

General Electric announced today that it’s getting out of the lending business, selling off most of its financial arm, GE Capital, over the next couple of years. First up is a big chunk of its real estate business, which it’s offloading to Blackstone. That leaves GE, the industrial company – a producer of jet engines and other things that go "vrroom."

Historically, GE’s lending business was a very small portion of the company, says Tom O’Boyle, author of “At Any Cost: Jack Welch, General Electric, and the Pursuit of Profit.” That changed when Jack Welch took the helm in the early ‘80s.

“Jack Welch saw bonanza in finance,” says Jeff Madrick, a senior fellow at the Century Foundation and the author of “Age of Greed: The Triumph of Finance and the Decline of America, 1970 to the Present.


He says the company realized it could make lots of money in finance with far fewer employees than manufacturing, eventually becoming "a full-fledged mortgage lender and a sub-prime mortgage lender.” Now, Madrick says GE’s getting out of a business it never fully understood. Moreover, the financial industry is more competitive now with lower profits.

It’s not that finance is dying, says Jim Wilcox, a professor at U.C. Berkeley’s Haas School of Business.

“Instead, I would say the bubble’s popped,” he says. “The damage was done, but now we’re going to have a financial sector that’s going to be sturdier, and it’s going to be sturdier because it’ll be the serious devoted firms that remain.” He adds that the remaining firms are also more heavily regulated. 

Designing watch apps that won't drive you nuts

Fri, 2015-04-10 13:00

Today is the day you can officially pre-order yourself an Apple Watch.

If you are weighing the decision to buy one, you might be asking yourself what, exactly is this thing going to do. It will no doubt be a new home for apps, very tiny apps . These apps will deliver notifications via a very small screen screen and by vibrating your wrist. The potential hazards of badly designed wach aps could drive a person mad. So how exactly do you go about making products for the new era of smart watches?


Your dollar goes a long way at the Masters

Fri, 2015-04-10 12:53

Twenty-one-year-old American Jordan Spieth is tearing it up at the Masters. He set a 36 hole record today: 14 under par 130 for the first two days.

Augusta National, the home of the Masters, certainly has its issues. But gouging spectators at the concession stands isn't one of them. 

A CBS sports producer took $100 out with him the other day to see how many golf fans he could buy lunch for at the tournament. He was able to feed 17.

Pimento cheese sandwiches — whatever they are — and soda are available for $1.50 each.

Quick update to this story: Dozens of people wrote in to explain what pimento cheese is, and how allegedly good it is.

Okay, now that I know what pimento cheese actually'll pass.

— Kai Ryssdal (@kairyssdal) April 10, 2015

Philadelphia 76ers: worst or best NBA strategy?

Fri, 2015-04-10 12:42

The Philadelphia 76ers are one of the marquee franchises of the National Basketball Association. They've won three championships, and some of basketball's greats have worn the uniform: Allen Iverson, Charles Barkley and Wilt Chamberlain. 


But this season they're just terrible. They won just 18 games, while losing 61. Home attendance hovers around 14,000, the worst in the league. 


While every team has rebuilding years, not every front office trades out its veteran players for younger prospects and higher draft picks, banking on an uncertain future.


As Philly native Michael Sokolove put it in the New York Times Magazine, this year's Sixers are "the least capable assemblage of basketball players ever." 


That's by design, he says. While the players work hard for every shot and loose ball, the front office is cycling through the roster as quickly as possible. It's a gamble designed to — eventually — propel the Sixers directly from the lowest ranks to a championship team, rather than steadily building from middling to good. So, are they tanking on purpose?


"It depends on what you consider tank mode," Sokolove said. "The players surely are not tanking. They're trying very hard. Management is certainly tanking. There's not a move that they have made, last year or this year, that has had the intent of giving them a better chance to win the next game."


Sokolove went on the road with the Sixers and found an earnest and loveable group of players, led by a cynical front office. He had quite a few off-the-record conversations with the Wall Street-trained, MBA wielding stats wizards. But, they wouldn't speak about their strategy outright. 


"I think we can intuit the philosophy is, 'We've got a better plan. The rest of y'all out there trying to win right now, and trying to win gradually... look at us,'" Sokolove said. "We've got a plan that's going to work, just wait and see."


Management's pursuit of a calculating strategy for making big leaps is a bit reminiscent of Oakland A's coach Billy Beane, as profiled in Michael Lewis's book, "Moneyball." But that's not exactly right, Sokolove said. 


"If you remember Moneyball, you know, Billy Beane is pacing and going crazy. He's living and dying with each game's result. He's trying to win, and he's trying to win soon." 


Whereas the Sixers don't seem to care about short-term wins. 


"If there's such a thing as sports ethics," Sokolove said, " I think you're supposed to go out there and try to win, and they're clearly not in that mode."


Returning to the players, Sokolove found that winning was the goal, even if not a likely reality. 


"I absolutely love the players because no more than 2 or 3 of them have an assured NBA career," Sokolove said."So these guys are desperate... If they have a bad shooting night, they're in the gym that night, past midnight, practicing their shots. So you want to root for these guys."

Florida takes steps to limit standardized testing

Fri, 2015-04-10 11:07

The movement to curb standardized testing in schools scored a small victory this week. The Florida legislature passed a bill limiting the number of hours students can spend on state and district testing to 45 per school year. 

Even some advocates of standardized testing welcomed the legislation. Two years ago, the Foundation for Excellence in Education looked into how many standardized tests students were taking in Florida. The group was founded by former Florida governor Jeb Bush, who expanded the use of testing in the state.

“Some school districts were requiring as few as eight tests on top of what the state required, and some districts were requiring up to 200 additional tests,” says Patricia Levesque, CEO of the foundation. “There is such a thing as too many tests.”

If signed into law by Governor Rick Scott, the bill would also eliminate an 11th grade English test, and schools would no longer have to give final exams in every subject not covered by state tests. 

That’s progress, says Bob Schaeffer, who often speaks for the growing test resistance movement as public education director of the group FairTest. But, not enough.

“The vast amount of time devoted to testing in public schools is not administering the exams themselves, but the huge amounts of time spent by teachers and students getting ready for the tests,” he says.

Homeboy Industries helps former gang member start over

Fri, 2015-04-10 11:04

Javier Chavez was only eight years old when he began getting into trouble. By the time he was 11, he was involved in a gang in Los Angeles.

He's been arrested multiple times, on charges ranging from selling drugs to weapon possession.

Chavez's longest stint in prison was for four years. He's 33 now, and says he's getting a second chance at life.

Chavez works as a mentor, navigator, and recovery group facilitator at Homeboy Industries. Homeboy provides job training positions and free social services for formerly gang-involved, and previously incarcerated, men and women.

How hard is it to start over? Listen to the full story in the audio player above.

What happens when two bank accounts get married

Fri, 2015-04-10 11:02

It's officially wedding season. It's a romantic time of year, but it can be a pricey one too, whether you're dressing up and shelling out for a hotel and a gift, hosting a bridal shower or bachelor party, or planning (and paying for) the wedding itself. 

"I do" also means ka-ching — for venues, flower ships, bakers, caterers, the list goes on and on and on. 

Money isn't the most romantic topic of conversations, and some couples may want to put off the financial talk until after the honeymoon. But is that the best bet? Probably not, according to Louis Barajas. He's a certified financial planner who works with many couples as they approach marriage. Barajas stresses the importance of transparency — from financial history, debt and credit scores to goals for a financial future. He says it's important to have these conversations early and often, to keep things open.

That's exactly what Rob Luchow and Jessie Rosen did before they got married almost a year ago. For Rob and Jessie, talking money before tying the knot was a natural part of the process; they already lived together and had been splitting their expenses pretty evenly, but as Jessie changed career paths to become a full time writer, Rob took on more of the financial burden.

The couple decided to meet with a financial planner shortly before they got married to help ease the process. Keeping the business talk separate from the emotional part of their relationship (and mediated by an objective third party) was a relief for Rob and Jessie. 

A year into marriage, they've settled into a rhythm with their finances, keeping their money active in savings and investments, and working together to work out their priorities in the short term and the long term.

That's meant sacrificing a little bit now to invest in the future — Luchow and Rosen put off their elaborate honeymoon and a potential move to a new apartment in order to save. That means they can maintain their current standard of living without a strain and also save up for their future house. And according to their financial planner, stasis at the beginning of a marriage can be good, at least when it comes to spending. 

Hear Jessie and Rob's full story, and more advice from Louis Barajas, in the audio player above.

Putting a price tag on looking pretty

Fri, 2015-04-10 11:01

Plastic surgery is nothing new, but the trend has been on the rise again in the last few years. According to the American Academy of Facial Plastic and Reconstructive Surgery, 13 percent of facial plastic surgeons surveyed saw an increase in requests for celebrity look-a-like procedures in 2014.

 Nearly 16 million people went under the knife last year alone, up 3 percent from the year before.

 To ask for a Rob Lowe-nose of his own, guest host David Lazarus (left) paid a visit to Dr. Lloyd Kreiger, a plastic surgeon on Rodeo Drive in Beverly Hills.

He sat for a consultation in Dr. Krieger's exam room, exploring the big picture trend but also seeing what can be done to improve his own looks.


Scoring a home run with a spring renovation

Fri, 2015-04-10 11:00

With warmer weather and flowers in bloom, it's time for a fresh start — for your home?

Yes, it's remodeling season, and spending on everything from new kitchens to complete domicile makeovers is on the upswing, as shown by a recent surge in mortgage refinancing.

A brand new bathroom or even just a fresh coat of paint can be costly, but can also be a smart investment whether you're staying put or looking to sell.

What happens when your dream home needs a little sprucing up? Tom Silva, general contractor with "This Old House," passes on some words of wisdom. Plus, Shawn Kravitch, a public interest lawyer in Los Angeles, tells us how he went about his own DIY remodel in East Hollywood. 

To hear their stories, tune in using the player above.

Your Wallet: Fast money

Fri, 2015-04-10 09:00

What's the fastest money you've ever made? 100 bucks in under a minute? More?

Tell us your story of making fast cash. Write to us, or tweet us — we're at @MarketplaceWKND.