Marketplace - American Public Media

Pixar: From 'Toy Story' to today

Mon, 2014-04-07 11:56

In 1995, a relatively unknown company called Pixar released the first animated movie made entirely on a computer. The movie was called "Toy Story" and one of the guys at the head of that company was Ed Catmull.

But Catmull downplays the importance of the computer in "Toy Story's" success.

“It’s not about the technology,” he says.  “We use the technology, we develop it, we love it, [but] it’s about the story.”

Catmull’s new book, “Creativity Inc: Overcoming the Unseen Forces That Stand in the Way of True Inspiration” takes a look at the company’s history and their creative process.

The key, says Catmull, is being prepared to deviate from the plan: "Every one of our films, when we start off, they suck... our job is to take it from something that sucks to something that doesn’t suck. That’s the hard part.”

Sometimes, those "deviations" are more like "overhauls": “Almost half our movies have gone through complete restarts.”

He cites "Ratatouille" as an example where of a dramtic reboot. The original version follows a rat who wants to be a chef -- and it also followed the rat’s mentor, a French chef whose star has faded in the culinary world. The Pixar team found themselves stuck. Who was the story really about? The rat or the chef? They brought in Brad Bird of “The Incredibles” who killed the chef. Literally. Catmull credits Bird with saving the film.

“The trick is, in everything we do, there are things we love. And sometimes the things we love get us stuck. And it’s only if we let go of some of those things that we free the movie up to become greater.”

External forces also helped make Pixar successful – including Steve Jobs and the sale of Pixar to Disney, their longtime partner.

“As we developed, we needed to have other resources,” says Catmull, about how Disney got involved. Jobs at this point knew he had cancer, and was trying to set Pixar up for long term success.

Jobs already had a good relationship with Disney’s Bob Iger. Catmull says he felt Iger “was the right guy to go with” after Disney and Apple made a groundbreaking deal to release episodes of "Lost" and "Desperate Housewives" on iTunes, back when most people felt uneasy about putting their content on the web. Catmull says he realized Iger was someone who could take risks – something he values at Pixar.

When asked to summarize Pixar's theory on innovation, Catmull says: “Everything’s interconnected. That’s the way life is.”

Delayed foreclosures: drawing out the agony?

Mon, 2014-04-07 10:56

The townhouse where Robert Witherspoon and his eight-year-old son live is in a quiet cul-de-sac in Prince George’s County, Maryland. Witherspoon greets me as I drive up, telling me he’s lived here for 10 years. 

The brick townhouse is solidly built, like Witherspoon, a 52-year-old Navy veteran who now manages a small IT company and works from home.

This house is lived in, but it was sold in a foreclosure auction last September. Witherspoon says his bank bought the house, and that he hasn’t paid his mortgage in a couple of years. 

Witherspoon first fell behind on his mortgage payments when he was laid off in 2009. Now, he’s squatting – not so unusual in Maryland, which has the second-highest foreclosure rate in the country, the forefront of a second wave of foreclosures across the U.S.

Approximately one out of every 540 homes is in foreclosure in Maryland, says Marceline White, the executive director of the Maryland Consumer Rights Coalition. 

She says it’s not that unusual for people to keep living in foreclosed homes, since the foreclosure process takes so long. On a recent afternoon in Prince George’s County, she pointed to one example.

“It’s clearly occupied,” she said, pointing out a jet ski. “There are cars in the driveway.“

At one point, while banks were negotiating a national settlement, they stopped foreclosing in some states. And still, the average foreclosure in Maryland takes almost two years. That’s because Maryland requires foreclosures to be approved by a judge. And new laws slowed things down even more by allowing things like mediation.

Opinions vary on whether that's helpful for homeowners.

“The longer process has definitely helped,” says Lisa Butler-McDougal, executive director of Sowing Empowerment and Economic Development, a group that helps homeowners avoid foreclosure.

Butler-McDougal says foreclosures in Maryland used to be rushed.

“Some people’s homes were being foreclosed in 15 days, 30 days," she says. "Where before they could even understand the notice of intent to foreclose, they were receiving notice of a sheriff’s sale.”

But there's a flip side.

“There’s so many people that come in here that have medical issues as a result of the stress of trying to hold onto a house, that isn’t worth it,” says Manny Montero, an attorney who represents homeowners in foreclosures.

Montero says many homeowners don’t realize that living rent-free in a foreclosed house could eventually cost them, because it makes it much tougher for them to file for bankruptcy and wipe out their debts. 

The pace of foreclosure proceedings in Maryland appears to be picking up, says Daren Blomquist, vice president at RealtyTrac. 

“I would guess sometime this year Maryland would turn the corner and we’d see the numbers go back down,”

Back in his townhouse, Robert Witherspoon says he doesn’t want to file for bankruptcy, and he says he’s tried to start making mortgage payments again. He couldn’t because the bank wanted a lump sum up front, which he didn’t have. Witherspoon’s bank, JP Morgan Chase, wouldn’t comment other than to say it made several attempts to reach out to him. Now, Witherspoon is afraid he’ll get an eviction notice.

Witherspoon says he plans to move after the end of the school year, but he’s hoping to avoid being evicted – something that happened to him as a teenager.

“When you’re in high school and you come home and you see your bed outside the house and not in the house – I was totally embarrassed by that,” he says.

Of course, Witherspoon says his current situation is embarrassing, too. But even after the pain of foreclosure, he still wants to – someday – buy again.

Coal country starts to ask 'What comes after coal?'

Mon, 2014-04-07 10:20

It’s no secret that coal is on the outs in the United States. The country’s natural gas boom and environmental regulations are dethroning King Coal after decades of rule in the electricity market. That should be good for the climate, but the transition to natural gas and renewables has human costs. Right now Central Appalachians are taking the hit, forcing communities there to contemplate a future beyond coal.

In eastern Kentucky, coal mining has been the lifeblood of the economy for well over a century. Now it's facing what might be termed a “low coal” future. Much of the easy-to-get coal has already been mined out. What’s left is harder to get, so production costs are higher. “The coal seams, they’re getting smaller,” says 30-year-old Ryan Trent, a laid-off miner who started at age 19. “You’ve got strata in between it, which is not full coal. So the more rock you cut,  the less coal you’re getting.”

That’s partly why Appalachian coal is having a hard time competing, not just against cheap and cleaner natural gas, but against newer, more efficient coal mines in the West’s Powder River Basin and the Midwest’s Illinois Basin. Coal companies also blame stricter EPA water quality standards, which they argue has effectively halted permits for Appalachian strip mining. 

The overall effect has been a wave of production slowdowns, mine closures and rising unemployment in the last two years. The median unemployment rate for eastern Kentucky’s top 10 coal-producing counties is 15.05 percent. That statistic includes Trent, who was earning $24.50 an hour, non-union, and says coal mining “is in his blood.” He’s been looking for another mining job since he was laid off in December 2012. “I’ve got the softest hands in eastern Kentucky, I’ve been doing so many dishes,” he jokes.

Trent and other miners are used to the ups and downs of the coal business, but Justin Maxson, president of the Mountain Association for Community Economic Development, says this time is different. “To lose almost 7,000 jobs in almost 18 months is a catastrophe,” he says. “It’s a huge economic collapse. Folks to some degree feel like they’re under cultural assault.”

The realization that this could be a permanent decline in what’s been the lifeblood of the region is just now beginning to settle in, after years of warnings and, some would say, denial. John Haywood, owner of a tattoo parlor in Whitesburg, called The Parlor Room, says some of his more regular customers were coal miners, but many have stopped coming in.  “They used to come in once a month, even twice a month,” Haywood says. “Tattoo collectors that were willing to sit for a long time and get covered up.”

“Coal miners are our middle class.” That’s a common refrain in eastern Kentucky, where more than a quarter of the people live in poverty. According to Bill Bissett, president of the Kentucky Coal Association, starting salaries in the mines average $65,000 and the jobs don’t require a high school education.

Communities are just now beginning to seriously discuss economic alternatives. Some blame the slow start on the “War on Coal” rhetoric, saying it’s distracted attention from preparing for a “low coal” future. Others say political leaders have spent coal severance tax money on basic services instead of diversifying the economy. 

Regional leaders who gathered in the mining town of Hazard to talk to Marketplace stressed they didn’t believe there was one single thing that could “replace” coal. They hope a new bi-partisan effort called SOAR (Shaping Our Appalachian Region) will come up with some alternatives. The region has already been targeted for special assistance from the federal and state government, but residents fear the money won’t be enough.  

“I mean, what happened in Detroit when that industry was threatened,” says Jeff Whitehead, executive director of the Eastern Kentucky Concentrated Employment Program.  “There was a lot of government support. Lots of it.”

Jennifer Bergman, JobSight Services Director at the program, says the region should develop an “entrepreneurial” economy, “but we need people with money to spend to have that entrepreneurial base.”

Many here say the region should take advantage of its cultural distinctness and build an economy based on central Appalachian folk arts and crafts. Previous efforts to develop that have fallen victim to politics and lack of funding. Doug Naselroad, master artist in residence at the Appalachian Artisan Center in Hindman, says the incomes generated might not rival coal’s, but that’s not the point. “What we’re trying to create is something sustainable and that’s rooted in the culture and tradition of the people here, instead of something which just plunders the land and moves on.”

Dan Estep, 56, a former coal miner, is experimenting with that idea. He’s teaching blacksmithing and knife-making at the Kentucky School of Craft and selling his wares at craft fares. He doesn’t make much money, but says he’s happy to have a skill that’s “marketable.” “I’m grateful to live in this country,” Estep says.  “Every day’s an opportunity.”

Biofuels, beer and Boardwalk Empire

Mon, 2014-04-07 10:10

From the Marketplace datebook, here's what's coming up April 8:

Is this town the Luxembourg of Illinois sales tax?

Mon, 2014-04-07 08:06

The Chicago area’s public transit agency says it’s been bilked of hundreds of millions of dollars over the last 15 years, a penny or two at a time. The culprits: towns in outlying parts of Illinois. Like Kankakee, population 27,000. Channohan, population 13,000. Sycamore, population 17,000. The agency says dozens of companies, including Target, AT&T and American Airlines, have used the towns as tax havens.

MTS consulting keeps an office in a faceless little building off Schuyler Avenue in Kankakee, about an hour south of Chicago. When no one answers, I look in the mail slot. No lights are on. A desk is visible, but no computer or phone. Later, MTS CEO David Polush tells me both are just out of view.

Down the hall, I ask a woman at Pinnacle Opportunities about MTS: Have you ever met anybody who’s been there?

"I haven’t. Sorry."  She's been working there for more than a year.

 In a court filing, Chicago’s Regional Transportation Authority says MTS records significant sales here, on behalf of clients based in the Chicago area. It’s one of several companies with offices like this in towns like Kankakee.

They’re here to save on sales tax. Illinois sets a statewide sales tax, but in Chicago the tax is higher because it adds levies for the city, the county and the RTA.

Carol Portman, executive director of the Illinois Taxpayers Federation, says peculiarities in Illinois sales tax law forced the Department of Revenue to write rules about where sales take place. "In some instances," she says, "it led to some rather unexpected results."

That is, some companies have been able to run their business one place— like Chicago— but, for tax purposes, book their sales someplace with a lower rate— like Kankakee. In some cases, it’s consultants like MTS that book the sales.

Additionally, towns like Kankakee offer an extra incentive to companies. Under state law, Kankakee gets a penny of the sales tax it collects— and the village gives 85 percent of that penny back to these companies.

The remaining sliver adds up to $2.5 million dollars a year for Kankakee. Ten percent of the village’s budget.

Portman sees nothing unusual about the arrangement. "That really isn’t any different from the income tax credits, or the property tax abatements that we’re giving people to come here," she says.

For instance, Boeing got tens of millions of dollars in city and state tax breaks when it moved its headquarters from Seattle to Chicago in 2001.

Jordan Matyas, the RTA's chief of staff, sees things differently. He’s suing companies like MTS and towns like Kankakee.

He says there are reasons companies base their operations in Chicago: Amenities like transit make it easier for them to do business.

"If they want to move somewhere else that has less resources, that’s their decision," he says. "But as long as they’re taking advantage of all our government services, they need to be paying the appropriate sales tax."

Kankakee’s mayor, Nina Epstein, makes no apologies.  "There are other parts of the state than the RTA district," she says.

Epstein says some of these companies don’t have Chicago offices at all. Some are Internet companies with no other physical presence in the state. Others simply don’t need full time staff to fulfill orders.

"This has helped fund police and fire services, public works," she says. "But now, it’s going to be taken away."

Last fall, the Illinois Supreme Court ordered a rewrite of tax regulation, to eliminate some of these arrangements.  That’s underway.

Meanwhile, some companies have ended their presence in Kankakee, and Epstein has zeroed out income from the tax deals for her next budget.

Tax expert Carol Portman says this is how tax policy works:  There are winners and losers.

"It’s easy for someone like the RTA to feel like they’ve been the loser and they want changes that make them the winner," she says. "But the problem is: There’s a loser then."

PODCAST: Tech bubble bursting?

Mon, 2014-04-07 06:36

At the end of the first week of April, tech stocks had their worst day in two months with the technology-suffused Nasdaq Composite Index falling 2.6 percent. In early trading in the next week, they aren't doing much better. Carl Riccadonna is Senior U.S. Economist at Deutsche Bank Securities, and joined us to discuss,

President Barack Obama is expected to issue two executive orders this week, in an effort to close the pay gap between men and women. The first would prohibit federal contractors from retaliating against workers who talk about how much they are paid. The second would require federal contractors to give the government pay information broken down by race and gender. But it is unclear exactly how these orders will be meaningful.

The University of Baltimore is like a lot of urban, public campuses. Most students here work, and more than half need to take remedial courses. That's partly why just 12 to 15 percent of students graduate in four years. So starting in the fall, the University of Baltimore will offer new freshmen a deal. If they finish in four years, the last semester's tuition is on the house.

The best and worst states on closing the gender pay gap

Mon, 2014-04-07 04:00

President Barack Obama is expected to issue two executive orders this week, in an effort to close the pay gap between men and women. The first would prohibit federal contractors from retaliating against workers who talk about how much they are paid.  The second would require federal contractors to give the government pay information broken down by race and gender. 

"Federal contractors employee almost a quarter of the workforce, so it’s going to be a really meaningful thing for many workers around the country" - Fatima Goss Graves, with the National Women’s Law Center

But it is unclear exactly how these orders will be meaningful. "I think they are much more symbolic, to get us talking about the wage gap," Linda Barrington with the Institute for Compensation Studies at Cornell noted, adding that "if we don’t do that, we can’t reduce the wage gap."

The American Association of University Women estimates that women make 77% of what men do.  The median annual salary for men is $49,398.  The median annual salary for women is $37,791. 

However, there are significant variations in the wage gap between states. To get some more context around how states compare to each other, take a look at the states where the pay gap is lowest (as calculated by the earnings ratio between men and women, in parentheses): 

  1. Washington, D.C.  (90%)
  2. Maryland (85%)
  3. Nevada (85%)
  4. Vermont (85%)
  5. New York (84%)
  6. California (84%)
  7. Florida (84%)
  8. Hawaii (83%)
  9. Maine (83%)
  10. Arizona (82%)
  11. North Carolina (82%)

And here are the states where the the gap between what men and women earn compared to each other is the highest:

  1. Wyoming (64%)
  2. Louisiana (67%)
  3. West Virginia (70%)
  4. Utah (70%)
  5. Alabama (71%)
  6. Indiana (73%)
  7. Michigan (74%)
  8. North Dakota (74%)
  9. Alaska (74%)
  10. Idaho (75%)

 How does the legal system apply to equal pay standards? According to the National Conference of State Legislatures, 45 states have equal pay laws on the books.  Five states, including Alabama, Mississippi, South Carolina, Utah, and Wisconsin have none.

A free semester for finishing within four years

Mon, 2014-04-07 02:53

Samantha Peterson is what you might call a "typical student" at the University of Baltimore.

"I am a junior-ish," she says, in between bites of a sandwich at the student center. "That means that I've been in school for a very long time."

Peterson has been in school—studying criminal justice—five or six years now, she says. Because she works, full-time, at a school cafeteria.

The University of Baltimore is like a lot of urban, public campuses. Most students here work, and more than half need to take remedial courses. That's partly why just 12 to 15 percent of students graduate in four years.

"The longer it takes for students to complete college, the more life gets in the way, and the less likely they are to graduate," says Dominique Raymond with the advocacy group Complete College America.

So starting in the fall, the University of Baltimore will offer new freshmen a deal. If they finish in four years, the last semester's tuition is on the house. At today's prices that's worth about $3,300 for in-state students.

President Bob Bogomolny expects the university to save money by getting students through faster. It could also attract more full-time students.

"If we can motivate a few students to have the advantage of finishing in four, to have less loans, to get into the workforce sooner, it's worth it to us," he says.

Nationally, just over half of college students finish in six years. Other schools are trying incentives like scholarships and loan forgiveness to encourage more students to attend full-time. The University of North Texas just approved a plan that gives students a fixed tuition rate and $4,000 discount if they finish in four years.

At the University of Baltimore, junior Blair Lee wishes the free semester deal had been around when he started.

"I was actually kind of excited when I heard that—a little jealous," he says. "I think it will give more people an incentive to finish faster and go on to possibly pursue graduate studies."

Lee is proof that money can be a powerful motivator. He's one of the rare students who expects to finish in four years—while working full time. He wants to avoid paying out-of-state tuition any longer than he has to.

In Kentucky, who's to blame for coal's decline?

Mon, 2014-04-07 02:17

An official with the Federal Reserve recently made this rosy prediction: the jobless rate could dip below six percent this year. But there are still pockets of double-digit unemployment around the country. Take eastern Kentucky, where layoffs in the coal industry have helped push the jobless rate to 16 percent in some places. 

Some point the finger at what they call President Obama’s “War on Coal.” “I blame him for trying to regulate coal fired power plants,” says 30-year-old Ryan Trent, a laid-off underground miner from Busy, Kentucky. “Because if it weren’t for that, we’d still have jobs.”

Certainly, the EPA’s crackdown on power plant emissions and mountaintop removal means fewer coal jobs in eastern Kentucky. The area has lost 40 percent of its coal-related jobs in just the last two years, acccording to Jason Bailey, director of the Kentucky Center for Economic Policy.

Yet Appalachian coal would still be at a disadvantage, according to Michael Dudas, managing director at Sterne, Agee in New York. “The cost to mine the coal in Wyoming is $10 a ton," he says. “The cost to mine that coal in eastern Kentucky can range from the low to mid-40s to upwards of $70 a ton.”

One reason it costs more to mine in eastern Kentucky is that coal companies have mined the mountains there for well over a century. They’ve already exhausted the easy coal. What’s left takes more work to get at.

“I don’t hardly see how there can be any more coal in these mountains," says Lee Sexton, 86, a legendary banjo player who retired from mining decades ago because of black lung. "There been so much of it took out, y’know.”

East Kentucky coal is also now competing against higher-sulfur coal from the Illinois Basin. That cheaper coal was a problem for utilities trying to meet federal clean air standards, but once many power plants invested in expensive scrubbers to “clean” the sulfur out,  it gained a foothold in the marketplace. 

Greg Pauley, president and COO of Kentucky Power, says his company will be burning less coal in the future, wherever it comes from. “As the cost of using coal continues to rise, we go away from that," he says. "And what do we go away to? Right now we go to gas.”

The EPA’s upcoming carbon pollution standards mean burning coal will cost more. Bill Bissett, president of the Kentucky Coal Association,  believes eastern Kentucky coal will “continued to be mined for generations to come,” but the industry will play a smaller role in the region’s economy.

"Chances are," he says, "companies will be more privately owned,  less multinational in footprint, and they’ll likely be taking more advantage of the spot markets than long term contracts, which can create uncertainty but I think at the same time it still provides livelihoods and puts food on people’s tables.”

Dee Davis, founder of the Center for Rural Strategies in Whitesburg, Kentucky,  says it’s now up to east Kentuckians to figure out an economy beyond coal. “Coal is our history.  Coal is our heritage. It’s been one pathway into the middle class for a lot of families. It’s been a friend, but it’s not our future.”

A weaker earnings season for banks

Mon, 2014-04-07 02:00

Later this week, the nation's big banks begin releasing profit reports for the latest quarter, and expectations are not high.

"I expect that earnings are going to be fairly lackluster," says Nancy Bush with NAB Research, which focuses on the banking industry. "This doesn't imply that we're back to 2007. It's just that earnings have stopped going up on a year-over-year basis."

Banks that have focused on borrowing and lending are expected to outperform firms that have been "a little more involved in Wall Street-type activities," says Morningstar analyst Jim Sinegal.

That includes banks like Wells Fargo.

Still, some analysts anticipate a bump in economic activity this spring, with an increase in home and car loans. That could boost the bottom line at banks in the months ahead.

Bitcoin ATM in the halls of Congress

Mon, 2014-04-07 02:00

If you’re tired of hearing of about Bitcoin and tired of hearing about Congress, we’ve got great news for you: Congress gets its first Bitcoin ATM this week.

Okay, it’s just a demonstration from the company Robocoin, but it highlights some of the changes virtual currency has to go through in the non-virtual world. For one thing, registering securely with Robocoin to use the Bitcoin ATM involves setting aside the pseudonymity Bitcoin users love online – phone number, photo ID, and palm-scan required.

Bitcoin: How Washington is reacting

By Marc Sollinger

Those demanding a ban

It’s safe to say that Senator Joe Manchin (D-W. Va) doesn’t like bitcoins. He thinks they are disruptive to the economy and have allowed users to participate in illegal activity. So he wrote a letter to federal regulators demanding bitcoins be banned. Unfortunately for him, Federal Reserve chair Janet Yellen told a congressional committee that the Fed can’t really impose rules on Bitcoin, as it’s outside their purview. In response, Manchin has backed off, though just slightly.  

Holding hearings

Even though Bitcoin is more than five years old, lawmakers are still trying to get a handle on it. So, they’ve held hearings. In a meeting the Committee on Homeland Security and Governmental Affairs held last year, Ben Bernanke, then the Fed chair, said virtual currencies like Bitcoin might hold promise. At a hearing last month, lawmakers heard about the benefits and drawbacks bitcoins might have for small businesses. So far, none of these hearings have resulted in any legislation to regulate cryptocurrencies.

Proposing legislation

Though no national Bitcoin regulations have passed, that doesn’t mean that there hasn’t been talk about rules, both at the federal and state level. U.S. Senator Tom Carper (D-Del) recently urged the U.S. to lead the way in virtual currency regulation. The IRS is classifying Bitcoin as property for tax purposes and saying that people who successfully mine bitcoins have to report that in their gross income. Lawmakers in California are trying to pass legislation expressly declaring bitcoins are legal.  State regulators are also getting in on the action. The Texas State Securities Board issued an emergency cease and desist order against a company using bitcoins. And New York’s Department of Financial Services will require Bitcoin exchanges to get ‘BitLicenses’ if they want to operate in the state.

Andy Warhol's 'fame' quotation may not have been his own

Mon, 2014-04-07 01:03

"In the future, everyone will be world-famous for 15 minutes." You've heard the quote, but who said it? Long-attributed to Andy Warhol, the line and its provenance are actually not so simple.

Art-critic Blake Gopnik joins Marketplace Morning Report host David Brancaccio to explain the history of the quote, who said it, and why -- as a matter of branding -- it doesn't really matter. Read more of Blake Gopnik's research on the subject and everything else Andy Warhol over at Warholiana.com

Full audio for this story to be posted soon. 

 

Taking national security to the cloud

Mon, 2014-04-07 00:02

Over the past few months, there has been growing evidence that online surveillance conducted by the U.S. government is impacting the tech industry.

One area in particular? Cloud Storage. Tech companies have started to move some of their facilities overseas under pressure from foreign governments. Some of those governments have even considered building their own infrastructure, so that their citizens information won't be stored in the U.S.

Germany, in particular, is talking about a so-called "bundescloud."

But Jonathan Zittrain, founder of Harvard University's Berkman Center for Internet and Society, says these attempts are misguided. He thinks we should  stop worrying about where data is physically in the world. People will be held accountable by the legal system, but data should be free to roam the clouds. 

"The ultimate goal would be to make it what the goal may be for electricity generation on a grid," says Zittrain. "And you could see at some point, people with extra storage would offer it up as a commodity to the overall web ... or they might need extra storage."

Raising the minimum wage: Good idea or bad idea?

Fri, 2014-04-04 16:21
Friday, April 4, 2014 - 16:57 RODRIGO ARANGUA/AFP/Getty Images

Eight states raised the minimum wage on Jan. 1. For one worker on the receiving end, it's the difference of being able to buy toothpaste.

On an earlier show, we heard from guests who supported raising the federal minimum wage.

It now stands at $7.25. There's a proposal in Congress to raise it to $10.10.

Gene Barr, President and CEO of the Pennsylvania Chamber of Business and Industry, which represents businesses in that state, doesn't think that's a great idea.

"What we believe is ... that the minimum wage increase proposed is not only highly inefficent, but is also even harmful to those people who most need these entry-level jobs," Barr says. "If you think about it, a much better way trying to help these people, would be for example increasing the Earned Income Tax Credit at the federal side, because in that way we're all participating a little bit, and trying to make things better for the people who truly need it."

According to Barr, raising the minimum wage at the federal level wouldn't help the people who need a raise in wages the most. 

"Most people who work minimum wage jobs are part-time, about 80% do not have kids," he says. "More than half of them are in households where the household income is above $50,000, which is a crucial number because that's the average take-home [pay] for a small-business person."

So, if raising the minimum wage isn't the best plan for building wealth in low-income communities and unexperienced workers, what would be the best method? Barr says the answer lies in education.

"Looking at how we get these people the job skills, the training that they need, in order to advance themselves in. Because in reality, the people who are most hurt by minimum wage are the people trying to get their foot in the door," Barr says. "We need to do a better job, as a society, of getting these people in the talents, the skills, the abilities so they can get that foot in the door. That's how we're going to move things forward."

Marketplace Money for Friday, April 04, 2014Interview by Lizzie O'LearyStory Type: InterviewSyndication: SlackerSoundcloudStitcherSwellPMPApp Respond: No

When being cheap isn't worth it

Fri, 2014-04-04 14:53
Friday, April 4, 2014 - 15:16 Justin Sullivan/Getty Images

A customer pushes his shopping cart through a Costco store in San Francisco, Calif. Costco hopes getting a mortgage through the big box retailer will bring more customers into the store for the things they'll need to furnish those homes.

TLC's reality show ,"Extreme Cheapskates," showcases people who go to, well, extremes to save money. There's the woman who refuses to spend money doing laundry, so she uses a free sample of detergent and  her time in the shower to give her clothes a cleaning of sorts. And then, theress the couple who, as self-described cheapskates, decided to bestow a crib found in a dumpster unto their unborn daughter. 

There is quite a difference between cheap and frugal, according to Daryl Paranada, a reporter for MyBankTracker.com, the differences are pretty clear. 

"Frugality means you're conscious about how you use and spend your hard-earned money," Paranada says. "Being cheap means you want to spend the least amount of money possible, no matter what. And that's not always the best approach to spending money. There are times when being cheap just isn't smart."

Many people try to save money when making home improvements by doing it themselves,  but Paranada says that when undertaking home improvement projects, going the cheap route is not the way to go. 

"Before you take out the hammers and you start a DIY project for your house, you should ask yourself three questions," he says. "First, do I know what I'm doing? Could I hurt myself or my house? And finally, is it worth my time?" 

Paranada also says that there are some things that are worth the money you pay for them. 

"If you think about it, you spend half your time in a mattress and half your time in shoes. A good mattress might cost you about $1000, but it's worth it because in the end it's all about value. What kind of things do you value? What kinds of things might improve your quality of life ," he says. 

For more tips on how to save money without being a miser, see Daryl Paranada's article, "13 Instances When Being Cheap Doesn't Pay Off."

Marketplace Money for Friday, April 04, 201413 Ways Being Cheap Doesn't Pay Offby Candace ManriquezPodcast Title: When being cheap isn't worth itStory Type: InterviewSyndication: SlackerSoundcloudStitcherSwellPMPApp Respond: No

Weekly Wrap: The slow, grinding recovery

Fri, 2014-04-04 14:23
Friday, April 4, 2014 - 17:19 Keystone/Getty Images

The New York Stock Exchange on Broad Street and Wall Street in New York.

With the March unemployment numbers out, there are plenty of questions about pay and how many people are employed right now. That's what we're tackling this week on the Weekly Wrap.

Joining us are Felix Salmon from Reuters and Catherine Rampell, columnist at the Washington Post.

Click play on the audio player above to hear more.

Marketplace for Friday April 4, 2014Interview by David GuraPodcast Title: Weekly Wrap: Story Type: InterviewSyndication: PMPApp Respond: No

Buying bonds instead of Final Four tickets

Fri, 2014-04-04 14:21
Friday, April 4, 2014 - 16:36 Elsa/Getty Images

The Connecticut Huskies band performs during the regional semifinal of the 2014 NCAA Men's Basketball Tournament at Madison Square Garden on March 28, 2014.

Tomorrow, the Wisconsin Badgers take on the Kentucky Wildcats, and the Florida Gators play the UConn Huskies. UConn's women's team is also in the running for a national championship.   So it's a big week for the University in Storrs, Connecticut -- because these games coincide with a major bond offering. The city is selling $220 million worth of municipal bonds to fund campus construction.   According to Bloomberg, bond buyers also hoped this might lead to some good seats at this weekend's games.   Sorry, the school says, it's not going to happen. Marketplace for Friday April 4, 2014by David GuraPodcast Title: Buying bonds instead of Final Four ticketsStory Type: News StorySyndication: SlackerSoundcloudStitcherSwellPMPApp Respond: No

Weekly Wrap: The slow, grinding recovery

Fri, 2014-04-04 14:19

With the March unemployment numbers out, there are plenty of questions about pay and how many people are employed right now. That's what we're tackling this week on the Weekly Wrap.

Joining us are Felix Salmon from Reuters and Catherine Rampell, columnist at the Washington Post.

Click play on the audio player above to hear more.

Raising the minimum wage: Good idea or bad idea?

Fri, 2014-04-04 13:57

On an earlier show, we heard from guests who supported raising the federal minimum wage.

It now stands at $7.25. There's a proposal in Congress to raise it to $10.10.

Gene Barr, President and CEO of the Pennsylvania Chamber of Business and Industry, which represents businesses in that state, doesn't think that's a great idea.

"What we believe is ... that the minimum wage increase proposed is not only highly inefficent, but is also even harmful to those people who most need these entry-level jobs," Barr says. "If you think about it, a much better way trying to help these people, would be for example increasing the Earned Income Tax Credit at the federal side, because in that way we're all participating a little bit, and trying to make things better for the people who truly need it."

According to Barr, raising the minimum wage at the federal level wouldn't help the people who need a raise in wages the most. 

"Most people who work minimum wage jobs are part-time, about 80% do not have kids," he says. "More than half of them are in households where the household income is above $50,000, which is a crucial number because that's the average take-home [pay] for a small-business person."

So, if raising the minimum wage isn't the best plan for building wealth in low-income communities and unexperienced workers, what would be the best method? Barr says the answer lies in education.

"Looking at how we get these people the job skills, the training that they need, in order to advance themselves in. Because in reality, the people who are most hurt by minimum wage are the people trying to get their foot in the door," Barr says. "We need to do a better job, as a society, of getting these people in the talents, the skills, the abilities so they can get that foot in the door. That's how we're going to move things forward."

Why the 'Internet of Things' is still fragile

Fri, 2014-04-04 13:56

In the world of the Internet of Things, every device from your refrigerator to your thermostat seems smart. The idea is, we humans don’t have to set temperatures or see if we’ve run out of milk because the devices will do it for us.

It’s all supposed to be seamless. Until it’s not.

And that brings us to Nest, which is halting sales of its Nest Protect fire alarm and smoke detector. The company said the fire alarm's “wave function,” which allows you to turn off false alarms, can, under certain circumstances, delay an alarm going off in a real fire. 

It appears that the "Internet of Things" isn’t making devices as smart or as seamless as promised. The reason is simple: It's still the early days for the Internet of Things, said Jeremey Jaech, the CEO of SNUPI technologies. He said right now, the business landscape is like the wild west.

"And it’s not at all clear who’s going to win," Jaech said. 

Jaech said there are lots of different start-ups producing almost as many varieties of software and hardware to power the Internet of Things. But these products don’t always speak the same language. And that often means you have to start dealing with a human being in customer support.

"What I would expect to happen, because it’s happened in virtually every other industry, is that you start to see consolidation occur, and standardization will come," Jaech said. 

When winners emerge, everyone in the industry starts speaking the same languages. The technology becomes more seamless, and so the help line becomes less necessary -- maybe.

"There’s a gap between the promise of the technology and the reality of the messiness of our lives," said Jonathan Gaw, an an analyst at IDC. He points to the Nest thermometer, which he owns.

"The promise of the Nest is that it recognizes movements in the household so it can adjust the temperature accordingly," Gaw said. 

But Gaw’s thermostat is hidden behind his big screen TV and so it can't monitor movements. Tony Costa is an analyst at Forrester and he said companies need to start adjusting expectations.

"Consumer electronic companies are used developing devices if something goes wrong with them, it’ll ruin your day," Costa said. "You know if your iphone crashes, it’s kind of a bummer."

But if your fire alarm crashes, that could be fatal. Costa said, these companies are known for pushing the envelope. But when it comes to wiring our lives, they might want something less glitzy but more dependable ... or maybe just a human who can help them out.

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