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Updated: 55 min 16 sec ago

Binge watching for 10 billion hours

Thu, 2015-04-16 01:00
10 billion

That's how many hours of content Netflix users streamed in the first quarter of this year, according to the company's most recent earnings report released Wednesday. Quartz points out that's about 55 hours per month, per person.

3 years

That's how long Toyota's self-imposed expansion freeze. The world's largest carmaker by volume has just ended the freeze by announcing plans to invest $1.4 billion to build new factories in Mexico and China. 

$16

This is how much Etsy, the online retailer platform, has been priced in its IPO. The deal raised about $267 million by selling 16.7 million shares and gives Etsy a valuation of $1.8 billion.

$6.6 billion

That's 10 percent of Google's annual sales, and the fine the tech giant could pay in an antitrust suit brought by the European Union Wednesday. The EU is accusing Google of privileging its own services in search results. New tech correspondent for Marketplace Molly Wood tells us how Google's mission makes this case somewhat inevitable, and how the company can adjust its model to get out of this.

$1.224 trillion

This is Japan’s total holding of US government debt. Now the third largest economy in the world has surpassed the second in U.S. bond holdings. According to the Financial Times, China pegs its currency to the dollar, which has recovered strongly this year. Meanwhile, growth in the Asian giant is slowing, leading it to reinvest more of its foreign earnings domestically. However, U.S. investors still remain the number one buyer of U.S. bond. 

$15 per hour

The starting wage for employees at the East Village restaurant Dirt Candy, three times New York's minimum wage for tipped employees. Dirt Candy has gotten rid of tipping entirely, instead adding a 20 percent "administrative fee" to every meal. It's something of a reaction to the way tipping habits have changed, the Washington Post reported, though it's not always easy to ditch the tradition without raising prices or sacrificing service.

China's growing at (just) 7 percent

Wed, 2015-04-15 11:29

The world's fastest-growing major economy is slowing its roll, just slightly. China's announced a 7 percent growth rate in the most recent quarter, on an annualized basis.

 And if you're saying to yourself right now, "I'd love to hear numbers like in the U.S., or in Europe," yes, you're right. Seven percent is huge. But compared to the past few decades, when China's growth seemed unstoppable.

 Lately, China-watchers have wanted it both ways: a more balanced and stable economy that continues to push global growth with its breakneck pace. 

 "It's probably an irrational expectation," says Matthews Asia investment strategist Andy Rothman. 

 Even at 7 percent, though, China is driving a third of global growth. That's more than the U.S. and Europe combined.  Constant economic growth has fostered a culture of entrepreneurship in the Communist state. 

 "When I started there in '84, there were no private companies at all. Today, 80 percent of employment is private, all the new job creation is private," Rothman says. "People starting up businesses in garages, just like the U.S."

 More than GDP figures, today Rothman focuses on the job market and income growth. China is doing well by those measures, he says. In his talks with small, private companies, he finds that businesses are having to give raises to both skilled workers and those on the factory floor alike, to hang on to the workforce they need. 

 While that's a good sign for China, the average person still can't buy a car or home. Despite massive urbanization, half of the population is in the countryside, where incomes are much lower. 

 As this all settles out, Rothman says, we should be prepared for the day when China's growth range matches other industrial nations: plus or minus 3 percent a year. 

 And as deceleration of Chinese growth continues, Rothman says we'll have to brace ourselves for the hyperbole.

 "Every quarter, people are going to be telling us, 'Hey, that was the slowest quarter since the Tang dynasty,'" Rothman says.

Diamonds: pricey, but not valuable

Wed, 2015-04-15 11:10

Jason and Kristen Sarata won a diamond at a charity raffle, but when the couple couldn’t agree on whether to sell the diamond or not, Jason hid it in the laundry room.

“The diamond became part of this vast repository of what I’ve learned is known as the overhang,” says “Freakonomics” author Stephen Dubner.  

According to diamond expert Edward Jay Epstein, “The overhang is every diamond ever sold in history that is on someone’s finger or in a bank vault, or in some drawer somewhere.”

Dubner says when people stash away their prized diamonds, it makes them more valuable. “All those unsold diamonds that people keep because they think of them as investments makes them valuable because they are constricted,” he says.

And the common belief that diamonds are inherently valuable? It’s just not true.

“[The diamond industry has] kept prices high over the years by constricting demand, kind of matching demand to the number of engagements, for instance, for engagement rings,” Dubner says.

In fact, reselling a diamond for top dollar isn’t all that easy. “The markup from a jeweler is huge, so you can’t expect to get all that much if you sell it back to a jeweler and you don’t have that many choices. It’s what economists call a thin market.”

Which is why the Saratas have decided to skip over the middleman and sell their diamond on eBay (they’ll also donate fifty percent of the sale back to the charity they won the jewel from).

“If you know anybody that wants to buy a diamond, not just any diamond, a diamond that was won at a raffle and fought over and hid in a laundry room and fought over some more, head over to eBay and search for 'Freakonomics Charity Diamond,'” Dubner says.

Fun facts from the Beige Book

Wed, 2015-04-15 11:00

The Federal Reserve was out with its eight-times-a-year regional look at the American economy on Wednesday. Sure, fine, call me a dork if you will — but I do love me some Beige Book.

The Wall Street Journal's Real Time Economics blog read it so we don't have to. The choicest nuggets...

  • First of all, the weather in the Northeast: restaurant revenues in the Boston area were down 30 to 40 percent with all that snow on the ground.
  • Apparently, it's been raining a lot in Mississippi and Alabama: really wet ground there means farmers are behind on their corn planting. They might switch 'em over to soybeans, in fact.
  • And, from the "yes, it is a tech bubble" category: backlogs for architectural companies in San Francisco are the biggest they've been since the recession.

Why it's hard to tell good monopolies from bad

Wed, 2015-04-15 11:00

On Wednesday, the European Union's antitrust division officially hit Google with an antitrust case, which could cost the search giant as much as $6.6 billion, according to Margrethe Vestager, the European Union competition commissioner. The accusation is that the search giant abused its power in the European market, by privileging its Google Shopping service in its Google Search results. 

But are monopolies always bad? Danny Sullivan, editor of Search Engine Land, says Google has been dominant in the European market for more than a decade.

"Having a big market share by itself is OK," says Nicholas Economides, Professor of Economics at NYU Stern School of Business. He says the problem is when companies abuse that market share by taking anticompetitive actions that hurt its competitors and its customers.

Determining when competitors and customers are harmed is hardly straightforward, according to Peter Passell editor of The Milken Institute Review.

But some say when you look at Google's business model, that debate is inevitable. Says Marketplace's Molly Wood, "Google's goal—and it's a mission-driven company—is to organize the world's information ... And if that means occasionally buying a company so that they can deliver results from a company they already own, so be it."

When asked if she thinks there is a possible happy ending in this situation, Wood points to the need for Google to return to filtering results, not owning them: "Let Yelp surface for restaurant reviews instead of having your own restaurant reviews."

And as far as the possibility of an outcome affecting policy in the states, Wood says, "The EU has had a different standard, but I will say, if they have solid findings, it could cross the pond."

Guilty conscience: the 1099 economy

Wed, 2015-04-15 06:44

Mat Honan is the San Francisco bureau chief for BuzzFeed News, and writes about the technology industry and its impact on society. Honan recently wrote about the guilt one may feel when taking part in the on-demand economy. The full article, "LOL Everything Matters When Everyone Is Connected,"can be found on BuzzFeed:

Our washing machine is broken. Or, at least, the pipe it drains into is. Despite all my attempts to fix it, crawling around on my belly with a pipe wrench and a plumber’s snake, all I have to show is a broken PVC pipe, a minor chemical burn, and a mountain of laundry that our family of four has piled up. So last night, I put in an order with Washio, an on-demand laundry service. And this morning, an extremely nice and highly professional woman showed up at our door, promptly at 7 a.m., took away our laundry, and left us with a chocolate pastry from a bakery in Oakland.

It was amazing, and I feel conflicted about it.

It’s the same kind of feeling I have whenever I take an Uber, or Lyft, or use Instacart to pick up groceries, rather than going myself. I found myself apologizing to the woman who picked up our laundry. “Our washing machine is broken,” I explained. “Well that’s good business for us,” she countered. And it’s true, I guess. Why wouldn’t she be happy to have work? A job is a job when you need one.

And yet my guilt stems not from whatever her own personal experience is as much as it does the remaking of the great American economy into a vast labor market of contract workers — the 1099 economy — whose days are dictated by the whims of mobile software and whose job security is often determined by the numerical star rankings of a capricious and harried market.

Continue reading, "LOL Everything Matters When Everyone Is Connected"

Google accused of abusing its search engine dominance

Wed, 2015-04-15 03:00

Authorities in the European Union have filed a complaint against Google claiming the company violated anti-trust laws. 

More specifically, there's accusations that Google has abused its search-engine dominance to steer people to other Google products and services. Authorities have also announced an investigation into Google's Android operating system.

Click the media player above to hear Marketplace Tech guest host Adriene Hill in conversation with Marketplace's Molly Wood. 

PODCAST: IRS warns about a scam

Wed, 2015-04-15 03:00

Airing Wednesday, April 15, 2015: One week into the spring season for companies to reveal profits, losses and reveal plans for the future, we check in with our regular Brian Reynolds for the morning open. Plus, there is news today that the Chinese economy grew at its slowest rate in six year. The numbers are for January to March, and annualized it's down to a 7 percent growth rate. Magnificent by US standards but lackluster by China's standards which has to keep creating jobs for people pulled into the economy from the hinterlands. Finally, we can't go without talking about tax day. And while people across the country rush to meet the midnight deadline to file or to file for an extension, the Treasury department is warning about a phone scam - where the caller impersonates an IRS agent and demands money.

A deadline extension

Wed, 2015-04-15 03:00

It's the income tax deadline day, unless you filed for an extension. Turns out that is a popular course of action. If you're getting an extension, I'm on your side, in a world of just-in-time worker scheduling, juggling little league games, the babysitter and bosses sending you urgent action email at 10:47 at night. But Marketplace's explainer in chief, Paddy Hirsch is more hard core than I, and apparently sees a nation of procrastinator here. 

Click on the above multimedia player to hear more on just why people put it off until the big day. 

 

Ivy League schools key into online courses

Wed, 2015-04-15 02:03

Yale University’s School of Medicine is deciding whether to create an online version of its physician’s assistant master’s program. Its first attempt failed because it couldn't get accreditation.  Yale says it’s “reviewing the matter” and may try again.

Yale’s partner in all this is the education technology company 2U, which has plenty of other customers, many of them Ivy League schools.

“There’s a lot of demand for us right now,” says Chip Paucek, CEO of 2U. He says universities want to enroll students online to address shortages of workers in some fields. But online degrees also bring in more tuition dollars.

“A university needs to figure out how to pay its bills and be sustainable," he says. "Just like any enterprise.”

But some degrees lend themselves more to online learning than others.

“So learning statistics or data science online, certainly learning some of the computer sense, skills and knowledge,” says Andrew Kelly, education scholar at the American Enterprise Institute.

Kelly says degrees that require hands-on training, like physician’s assistant’s programs, are more difficult, because universities have to find hospitals where online students can train. 

IRS warns of sophisticated telephone scam

Wed, 2015-04-15 02:00

The Treasury department says thousands of people have fallen victim to a phone scam, where a caller impersonates an IRS agent, and threatens criminal penalties and other legal action if money isn't paid immediately.

The agency says it is the largest scam of its kind and has spanned more than a year and a half. Americans have been duped out of more than $14 million, and the calls have surged in recent months, authorities say.

"The clients that I've had inquiries from run the gamut," says David McKelvey, an accountant at Friedman LLP, "an elderly person... younger people, they're business owners, they're employees."

Paul Gevertzman, a tax attorney at Anchin, Block & Anchin, says the scammers have increased the sophistication of their deception, making the calls seem legitimate.

"They're able to basically mimic an IRS address on your caller ID," says Gevertzman, "It gives a little more validity. And you think, 'this really is the IRS, because it says so on my phone.'"

The IRS says the agency will never make an initial contact with a taxpayer by phone. It will do so by certified mail.

If you have questions about your tax obligation, you can call the IRS at 1-800-829-1040.

And if you think you have been targeted by a phone scam, you can call the Inspector General for Tax Administration at the Department of Treasury to report the incident at 1-800-366-4484.

How to make a movie for $300

Wed, 2015-04-15 02:00

When Walter Woodman and Patrick Cederberg made Noah, a 17-minute film focusing on a young man’s relationship online, the intention was to shoot at least part of the film in the real world.

But they quickly realized how expensive it was to build a set or hire a crew, including actors.  

“We just basically thought, 'Ok, how could we just make all of this happen on a computer screen?'” said Walter Woodman, one of the directors. “He (Noah) has to see that his girlfriend breaks up with him. How are we going to do that? We could do that through a Facebook post.”

That was easier than it sounded. They tried making fake Facebook accounts but Facebook deleted them. So Woodman and Cederberg turned their own profiles into those of the film’s protagonists: Noah and Amy.

“We kept breaking up and getting back together,” said Woodman. “So our actual friends would mess up takes and we would be like 'No, don't comment on this!'”

The point of filming the entire movie online, Woodman said, was to “peel back the curtain of artifice that is these constructed media profiles.”

“I think the view that you get from Noah is a really voyeuristic view,” he added. “You get to see not only what people type but what they backspace.”

The biggest takeaway from this project? The fact that it cost $300. That, according to Woodman, is among technology's biggest contributions.

“There’s less barriers to tell stories and less barriers means you’re going to get people who are saying what they actually want because they don't need to go through the typical gatekeepers that once prevented really creative people from making stuff,” said Woodman.  

School lunch's food fight

Wed, 2015-04-15 02:00

The House Committee on Education and the Workforce will hold a hearing Wednesday on the reauthorization of the 2010 "Healthy and Hunger-Free Kids Act".

Proponents say the nutritional requirements in the law help address America's epidemic of childhood obesity. The School Nutrition Association supports the reauthorization of the act, but it opposes the full implementation of the nutritional rules. 

The SNA says the requirements, such as a gradual lowering of sodium levels and a mandate to increase whole grain content, turn students off of healthy food options. Research from the University of Connecticut came to the opposite conclusion.

The SNA has come under attack for its ties to food and beverage conglomerates, whose products could be pushed out of lunch rooms if the sodium rules were to go into full effect.

New Proposed Rules for Retirement Investments

Wed, 2015-04-15 02:00

Federal regulators are proposing new rules to protect retirement savings. As part of Obama’s stated plan to bolster the middle class, the Labor Department proposed changes to the Employee Retirement Income Security Act.

The rules are designed to protect retirees from investment brokers who put their own financial interests above their clients and eliminate conflicts of interest that encourage brokers to steer their clients into unsound investments.

Olivia Mitchell is director of the Pension Research Council at Wharton and she says these new rules will force brokers to be more transparent. “What that will mean is that if you do charge for your advice you have to disclose up front how you are charging and how that impacts the client.”

This is an issue now says Mitchell because there’s been a big shift away from pensions to individual retirement accounts. Regulators estimate that these new rules will save retirees $40 billion over the next 10 years. But that’s if they go into effect in their current form. As of today, the public and industry groups have 75 days to submit comments on the new rules to regulators.

The financial services industry has pushed back in the past on rules like these. In 2011 the labor department retracted its first proposal because the financial services industry thought the rules went too far.

IRS warns of sophisticated telephone scam

Wed, 2015-04-15 02:00

The Treasury department says thousands of people have fallen victim to a phone scam, where a caller impersonates an IRS agent, and threatens criminal penalties and other legal action if money isn't paid immediately.

The agency says it is the largest scam of its kind and has spanned more than a year and a half. Americans have been duped out of more than $14 million, and the calls have surged in recent months, authorities say.

"The clients that I've had inquiries from run the gamut," says David McKelvey, an accountant at Friedman LLP, "an elderly person... younger people, they're business owners, they're employees."

Paul Gevertzman, a tax attorney at Anchin, Block & Anchin, says the scammers have increased the sophistication of their deception, making the calls seem legitimate.

"They're able to basically mimic an IRS address on your caller ID," says Gevertzman, "It gives a little more validity. And you think, 'this really is the IRS, because it says so on my phone.'"

The IRS says the agency will never make an initial contact with a taxpayer by phone. It will do so by certified mail.

If you have questions about your tax obligation, you can call the IRS at 1-800-829-1040.

And if you think you have been targeted by a phone scam, you can call the Inspector General for Tax Administration at the Department of Treasury to report the incident at 1-800-366-4484.

A conversation with director of the U.S. Patent Office

Wed, 2015-04-15 02:00

Over at US Patent and Trademarks, they don't use the word "troll." This is kind of patent holder who is less interested in using a patent and more interested in holding up other people for licensing money even if they haven't actually infringed. With the patents and trademarks people celebrating the 225th anniversary of the Patents Act this month, we reached Michelle Lee, the newly confirmed Director. We discussed the her preferred term "abusive litigation," intellectual property, and how to encourage innovation. 

Click on the multimedia player above to hear more.

School lunch's food fight

Wed, 2015-04-15 02:00

The House Committee on Education and the Workforce will hold a hearing Wednesday on the reauthorization of the 2010 "Healthy and Hunger-Free Kids Act".

Proponents say the nutritional requirements in the law help address America's epidemic of childhood obesity. The School Nutrition Association supports the reauthorization of the act, but it opposes the full implementation of the nutritional rules. 

The SNA says the requirements, such as a gradual lowering of sodium levels and a mandate to increase whole grain content, turn students off of healthy food options. Research from the University of Connecticut came to the opposite conclusion.

The SNA has come under attack for its ties to food and beverage conglomerates, whose products could be pushed out of lunch rooms if the sodium rules were to go into full effect.

I'm a Barbie girl, in an Instagram world

Wed, 2015-04-15 01:00
7 percent

That's China's latest growth rate. The numbers cover January to March, and annualized it's down from previous growth rates. While that's magnificent by U.S. standards, it's a lackluster figure for China, which has to keep creating jobs for people pulled into the economy from the hinterlands.

700,000 followers

That's how many followers (and counting) Barbie (yes, the doll) has on Instagram. @BarbieStyle is meticulously managed by vice president of design Kim Culmone, director of design Robert Best, and the main creative thinker for the account Zlatan Zukanovic. Modeled after popular style blog Instagram accounts, Barbie's photos include selfies, closeups of accessories, and outfit of the day shots. Racked has the origin story of what it's like to photograph a Barbie girl living in a Barbie world.

2.9 billion miles

That's about how many miles NASA's New Horizons probe has traveled thus far on its journey to Pluto. When it does reach the dwarf planet in July, it will be the first time a spacecraft will have visited. In the meantime, VOX has the first color photos sent back from the probe.

225th

This month marks the 225th anniversary of the Patent Act, celebrated by the patents and trademarks industry nationwide. In honor of this landmark, Marketplace Morning Report talked with Michelle Lee, newly confirmed director of the U.S. Patent and Trade Office. The former Google attorney prefers the term "abusive litigation" to instead of "patent trolls." She also talked about how women in STEM field can encourage innovation for companies and society. 

11:59:59PM

This is your income tax deadline today...unless you filed for an extension. Turns out, it's a popular course of action. Listen to our resident explainer Paddy Hirsh on why we have a nation of procrastinators here in the U.S. 

25 percent

That's the percentage of part-time college faculty that receive public assistance. And as Slate points out, that's a lot of highly educated individuals—most hold Ph.D degrees and Master's degrees—needing help to provide for themselves and their families.

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