Marketplace - American Public Media

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.

Jon Ronson on the renaissance of public shaming

Tue, 2015-04-14 11:06

There was a time when trolls were just scary fairy tale creatures under bridges harassing billy goats. These days? Trolls are everywhere.

Journalist Jon Ronson documents this public shaming renaissance in his new book, "So You've Been Publicly Shamed."

He highlights the recipients of some recent high-profile, public shamings: a joke on Twitter that came out badly and went viral, a brand compelled to offer compensation to unhappy customers. He says where once there was public humiliation you actually had to show up for, now there are subtweets and anonymous YouTube comments. 

"We've created this system for ourselves ... this kind of weird surveillance system, where the only way to survive is to either be bland or silent," Ronsen says.

More often than not, Ronsen says, public shaming stems from good people just trying to do good:

"It was nice people like us wanting to show that we're proper, and ethical, and empathetic and we're attacking—we're punching up, we're attacking people misusing their privilege. It's good people like us that are creating the most destruction."

Ronson himself has recently received a fair amount of Internet backlash surrounding the book release, for a (now cut) line comparing the way men feel about getting fired to the way women feel about rape.

Listen to the full interview in the audio player above to hear more, including Ronson's take on Trevor Noah, the new (publicly shamed) host of "The Daily Show."

The intersection of food, sustainability and politics

Tue, 2015-04-14 11:00

The Dietary Guidelines Advisory Committee isn't usually a group that stirs up great controversy in Washington, but its 2015 draft report shocked policymakers because it desecrated the sacred cow. Or at least, it suggested that the average American's 113 pounds of red meat consumed per year could have a negative health and environmental impact. 

It even suggested that a vegan diet could result in ideal health and environmental outcomes. "Sustainability is not something that's within the purview of the Dietary Guidelines Advisory Committee," says Eric Mittenthal, of the North American Meat Institute. "That should be looked at by experts in sustainability."

Alice Lichtenstein, a professor of nutrition at Tufts University and vice chair of the committee, said they didn't consider politics — just science.

"The...report did indicate that lean red meat could be a perfectly acceptable component of the diet," she says. "Lean" is the only category of red meat the committee recommends.

Marion Nestle, a New York University nutrition professor and author of "Food Politics," said she thinks it's about time the committee consider the American diet's impact on the world. Calling the draft guidelines "groundbreaking," Nestle said they were scientifically sound. 

"The committee said the healthiest diet has a lot of plant foods in it," Nestle says. "And guess what? The most sustainable diet you can possibly eat is exactly the same."

Tapping Watson's computing power for health

Tue, 2015-04-14 11:00

There is a new push into the potentially lucrative world of health data analytics. In collaboration with Apple, Johnson & Johnson and Medtronic, IBM has launched what it calls the "Watson Health Cloud," a service it believes will help you and me be healthier.

Let’s face it, when it comes to data, healthcare – as an industry – is still in the crawling stage.

“When you go to your doctor today, you see computers on the tables, in the exam rooms,” says Dr. Atul Butte, who's at the University of California San Francisco. “And doctors and nurses are entering a lot of data about patients, but the average amount of data is probably never looked at again.”

Butte says the Watson Health Cloud is an effort to mine the gold in that data that’s currently just sitting around. The promise is to gather distinct data threads, from heart rates measured by Apple Watches to blood pressure levels in the ICU, and weave them all together. That, says Dr. Kyu Rhee, IBM’s chief health officer, will give insurers, doctors and patients something illusive: a clearer picture of one person’s health. “The extraordinary opportunity we have with the data available, the knowledge that exists, to be able to connect that, that’s what this is fundamentally about,” he says.

IBM hopes to work with hospitals and insurers. Apple wants a seat at the adult’s healthcare table. And for Johnson & Johnson and Medtronic, it’s a chance to gauge product performance in the field. Industry analyst Tim Barjarin of Creative Strategies says other companies are offering similar services, but these behemoths are well positioned.

“The belief right now is that Apple could sell anywhere from 15 to 20 million smart watches in just the first year," he says, meaning Apple and IBM could create the "gold standard" in this sector.

Barjarin says if these guys can pull it off, healthcare’s use of data may finally be ready to graduate to the walking stage.

A look at the gender wage gap across the US

Tue, 2015-04-14 11:00

Tuesday is Equal Pay Day, a  day designed to draw attention to the unequal pay men and women get in this economy.  

There are lots of caveats and warnings about the pay gap data, but the generally accepted number is that women make about 78 cents for every buck a man earns.  The folks over at FiveThirtyEight have aggregated some state by state data, and came out with -- what else in data journalism today, but a chart.

Washington, D.C. is the closest to pay parity. Women there make 90 cents to every man's dollar.

Wyoming's dead last: 63 cents there.

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