LA Biz Observed archive

Mark Lacter covered business, the economy and more here from 2006 until his death on Nov. 13, 2013.
The entire LA Biz Observed archive — more than 10,000 blog posts by Mark — remains online and available.
July 2010

Somebody get this guy a tranquilizer!

This tirade is getting quite a bit of play this afternoon. I shudder to think what would happen if really got angry.

*The LAX concessions mess

HMS Host has had most of the business since 1965, but its main competition, SSP America, was selected by the airport staff.

Dump the house, buy an iPad

ipad.jpg We're becoming a nation of schizophrenic consumers, folks who walk away from their mortgage, and then take a fancy vacation.

Let's pray for Social Security

retire.jpg If anything should happen to the government retirement program, an awful lot of folks are going to be stuck.

Ron Sugar's cushy exit deal

Former Northrop CEO Ronald Sugar will stay on as a consultant and make that much per month.

Richard Branson goes Hollywood

The billionaire entrepreneur is launching a film and television development company called Virgin Produced.

Friday morning headlines

Growth slows in second quarter, American Apparel's auditing firm quits, Miramax deal is finally done, and flying from L.A. to Istanbul.

Hyping the oil spill?

More and more experts are saying that the Gulf Coast mess isn't turning out to be nearly the disaster that everybody had thought.

Traffic gains at LAX

The June passenger count was up almost 4 percent from a year earlier, but the domestic side only saw a 1.4 percent increase.

Any pushback on CA munis?

Wall Street investors are showing little hesitation about buying into a state with such serious deficit woes.

Understated luxury

Gucci2.jpg You can tell a lot about people by the logos on their handbags, cars, and shoes, according to a study by from the USC Marshall School of Business. For instance: Patricians: "Wealthy consumers low in need for status" who "pay a premium for quiet goods, products that only their fellow patricians can recognize"; Parvenus: "Wealthy consumers high in need for status" who "use loud luxury goods to signal to the less affluent that they are...

New forecast on mid-terms

Cook Political Report sees a 32 to 42 seat net gain for Republicans in the House and a 5 to 7 seat net gain for Republicans in the Senate.

Gender divide on economy

Citigroup survey shows women are more optimistic about business conditions improving than men.

Citi settles case for $75 million

This one had to do with federal allegations that the banking giant failed to disclose its holdings of subprime mortgage investments.

Why is California unemployment rate so high?

Seems to boil down to the construction, which took a licking during the recession.

Thursday morning headlines

Cutting back on doctor visits, state furloughs are baaack, no overtime for farm workers, and new Kindle sells for $139.

Refis with a difference

More refinancing these days involves borrowers paying down their mortgage principal.

Trying to downsize oil crisis

if this hadn't been such a strikingly visual story, coverage would not have been one tenth of what it's turned out to be.

Bill Gross talking toilets

Gross is right - the founder of Newport Beach-based bond giant PIMCO devotes the first half of his newsletter to the automatic flush in public toilets.

No wonder bizguys are hated

hate.gif They're making too much, everyone else is making too little (or nothing at all).

CPK closer to sale?

Shares are up almost 10 percent following a report that the L.A.-based restaurant chain was in advanced talks with a private equity firm.

Big jump in local car sales

New vehicle registrations in L.A. County were up 43.1 percent in June, a somewhat surprising sign of increased spending.

Judge blocks key parts of immigration law

Bolton's rulings are sure to be appealed, and could well end up in the ultra-conservative Supreme Court.

Wednesday morning headlines

Federal intervention saved economy, state pols nowhere close on budget, ABC to announce new programming chief, and Farmers cuts auto insurance rates.

Examining Bell

California Controller John Chiang's office will spend six weeks looking at the city's finances, including federal and state funds.

Robert Shiller sees double-dip

The Yale economics professor puts the odds of another recession coming on the heels of the recent downturn at more than 50 percent.

CNBC losing lots of viewers

Numbers were down in every hour block from 3 a.m. to 4 p.m., according to Nielsen.

Full-bodied expense account

David Brooks is accused of fraud, insider trading, and using corporate funds to support his lavish lifestyle. And what a lifestyle...

Fighting for cargo space

ports.jpg Retailers have been paying two to three times last year's freight rates - that is, when they can find space.

Health care cuts? Lots of luck

Big L.A. union is up and arms over a smaller city union working out a labor deal that addresses adjusts employee healthcare benefits.

Business Update on KPCC

A look at the ongoing battle between Mattel and MGA Entertainment over Bratz dolls, and the class-action suit filed against 99 Cents Only Stores.

Tuesday morning headlines

L.A. home prices edge higher, more long-term jobless in CA, new questions about Miramax deal, and wind project breaks ground.

The short man syndrome

Add downtown developer Barry Shy to the ranks of little guys who try to act tough.

Would you pay for Twitter?

Almost the 2,000 Web users who were asked that question, 0 percent answered in the affirmative.

Starting a business in L.A.

Never mind the naysayers, there are plenty of opportunities, as well as challenges.

Bratz is back

Van Nuys-based MGA Entertainment will begin distributing a somewhat tamer line of the dolls starting next month.

Downtown still deals with violence

Three recent shootings around the corner of 7th and Main are a reminder that the area remains subject to crime.

Gov. says no to majority-vote plan

He said that lowering the threshold from two-thirds would ensure "one party will make all the decisions."

Business travel picking up

There's considerable disagreement on how widespread the recovery will be. L.A. and SF are not likely to start improving until late in the year.

Monday morning headlines

BP CEO headed out, Madoff victims face lawsuits, L.A. to name new planning director, and Tribune CEO doesn't like paywall.

Hollywood strike averted

A deal was cut over the weekend by the studios and Teamsters Local 399, which represents drivers.

If at first you don't succeed...

Robot learns how to flip a pancake. Not the brightest flapjack in the stack.

Riordan: Cities need federal help

Cities and states are in terrible shape, and the only solution is help from Washington, the former L.A. mayor tells Bloomberg News.

Airline service like the old days?

Not all those days were so great. As Scott McCartney notes in the WSJ, a round-trip coach ticket from L.A. to NY cost $208 in 1958, which in today's dollars is $1,570. Put another way, the average price to fly one mile has fallen from 57 cents in 1949 to 14 cents in 2009. The piston-driven planes of [the 1940s and 1950s], like the Lockheed Constellation and Douglas DC-7, were noisy and often ferociously...

Shame on Social Security

The federal government does not allow Social Security benefits for the surviving spouses of gay and lesbian couples.

Waiting on rail ... and waiting

la-metro-rail-07.jpg What happens when 40 years goes by and the rail advocates are stuck having to say, "Oops"?

Friday morning headlines

Bell officials resign, Dodger Stadium no-shows, Univision scores in ratings, and Pink's comes to LAX.

L.A. gets NAACP

The group's 2011 conference will be at the Convention Center, and it's a big deal for downtown.

Milken on runaway production

The shame is that this report will be getting a good ride on the wires and on broadcast, based on the Milken name. And it's really just a bunch of hooey.

Market has big day

Nothing like encouraging earnings results from Caterpillar, United Parcel Service and 3M to get Wall Street's attention.

Mattel loses Bratz appeal

The El Segundo-based toy company was wrongly given ownership of the popular dolls, says the 9th U.S. Circuit Court of Appeals.

Comparing pay among cities

The SF-San Jose metro area is on top; the L.A. area is 8th highest. Brownsville-Harlingen, Texas is dead last.

Angelenos are staying home

travel.jpg The average L.A. household spent $1,622 on travel in 2009, which is slightly higher than the national average, but far lower than households in SF and NY.

Most U.S. cash is abroad

As much as two-thirds of the currency in circulation, according to Federal Reserve estimates.

Thursday morning headlines

Bankruptcies keep climbing, why BP didn't cap the well sooner, Bell officials are set for life, and TV audiences get older.

They're suing over $0.01

99cents.jpg 99 Cents Only Stores is being taken to court because it has raised the price on some of its goods to 99.99 cents.

Jobless benefits bill is passed

Hallelujah - the Senate finally signs off on a $34-billion bill restoring unemployment benefits to millions of Americans.

Top Secret America

top secret.jpg In the L.A. area, there are 169 company locations and 64 government locations that are involved in some sort of classified activity.

Bernanke not so upbeat

The Fed chairman tells Congress that "the economic outlook remains uncertain" and that the unemployment rate is likely to stay high.

3D movies start to fade

3D.jpg They're being screened at lower light levels than 2D films - and moviegoers appear to be noticing.

Big drop in foreclosures

Second-quarter notices of default in L.A. County plunged 47 percent from a year ago and 17.4 percent from the previous three months.

Money-laundering on the rise

When credit is tight, organized crime will step in and provide investment money for legitimate businesses.

New Hollywood labor dispute?

This time it's the Teamsters who could walk off their jobs if a new contract isn't cut in the next couple of weeks.

Wednesday morning headlines

Good numbers for Wells Fargo, Liz Claiborne closes stores, Oakland approves pot growing, and court ends furlough days.

Is it a lawsuit or a script?

Lawsuit filed against two Vegas developers has plenty of theatrical flourishes. Case is being handled by an L.A. firm.

First Expo ride to Santa Monica

Cool video of a simulated ride along the old Pacific Electric right-of-way that's slated to become Phase 2 of the Expo Line.

Countrywide knew no bounds

Did the Calabasas mortgage lender ever consider the words "conflict of interest"?

Why tax cuts don't work

Republicans are rolling out their tired - and quite inaccurate - claims that tax cuts are the way to prosperity.

Takeover battle that would not die

Carl Icahn is back with another hostile takeover offer for Lions Gate. He already has a 38% stake in the company.

Business Update on KPCC

My weekly business chat with KPCC's Steve Julian looks at the improving jobs picture for Hollywood and Socal's two big ports.

Dirty old man in search of leak

The 87-year-old chairman of Viacom and CBS asks a business writer for the sources on a story about an all-girl group called the Electric Barbarellas.

Tuesday morning headlines

Workers bearish on Social Security, DVDs get a boost from "Avatar," no action on Bell salaries, and rolling out UltraViolet.

Jobless bill looks like a go

Looks like there are enough votes in the Senate to extend benefits through November for 2.5 million Americans. The two Republican senators from Maine have agreed to support the measure after Democrats agreed to drop unrelated items and trim the bill to $34 billion. From the WSJ: If the extension is approved, unemployed workers in the hardest-hit states would again be able to draw up to 99 weeks of aid. That includes 26 weeks of...

CA pension fund scores

The California State Teachers' Retirement System reported a 12.3 percent return, quite a turnaround from a 25 percent loss in its portfolio in 2009.

New milestone for e-books

Amazon says that second-quarter sales of electronic books on its Kindle outnumbered sales of hardcover books.

Looks do matter in workplace

In case you had any doubt, a Newsweek poll confirms the obvious: When it comes to getting hired in the first place, 57 percent of managers believe an unattractive (but qualified) job candidate will have a harder time getting hired; 68 percent believe that, once hired, looks will continue to affect the way managers rate job performance. It's a view that's reinforced among survey respondents from the general public, a third of whom are either...

Comparing now with the '30s

Seems to be all the rage among pundits - and indeed there are some eerie similarities.

Monday morning headlines

L.A. office market stays tough, Socal venture deals are up, big increase in small-business bankruptcies, and Schwarzenegger is not making many friends.

Stocks take big hit

Dow fell 261 points, to 10,097. A big drop in consumer confidence, disappointing earnings results - take your pick....

Steve Jobs eats crow

"We're not perfect," said the Apple CEO in announcing that, yes, the company screwed up in designing the antenna on its iPhone 4.

Socal good place for heart attacks

Medicare data finds 30-day mortality rate is lower among local hospitals than for the nation overall.

Mixed bag on L.A. employment

The county lost 15,000 payroll jobs between May and June, but several industries picked up positions. Unemployment rate unchanged at 12.2%.

How Anthem got caught

The errors were discovered by David Axene, a 60-year-old actuary who was doing the checking while seriously ill in a hospital bed.

Friday morning headlines

Consumer confidence sinks, Paul Allen will give away half his fortune, Whitman raises more money than Brown, and Tesla to work with Toyota on RAV4.

Judge throws out Dole award

Appellate judge rules that a $2.3-million verdict against the company was tainted by American and Nicaraguan attorneys.

Live Nation's 'buzz kill'

The most popular acts continue to sell out, but cancellations and postponements have hurt overall sales.

To put Goldman deal in context..

The $550-million settlement works out to 2 percent of the firm's $27 billion in cash and short-term securities as of March 31.

*Report: Goldman cuts deal with SEC

CNBC is reporting that a settlement has been reached that would resolve a fraud lawsuit against Goldman Sachs. Announcement is expected at 1:45. *WSJ reports that Goldman will pay $550 million to settle the SEC charges....

Oil flow has stopped

BP.png All valves have been shut on the new cap and oil stopped flowing into the Gulf of Mexico at 12:25 p.m. PT

Turnaround at Calpers

The improving numbers could complicate Gov. Arnold Schwarzenegger's campaign for pension reform.

Solving the olive oil riddle

Is it extra virgin or not? Is it exposed to too much heat or light? Has it been improperly stored?

Peter Guber buys Warriors

Purchase price is a record-high $450 million (previous record for an NBA franchise was $401 million for the Phoenix Suns).

Thursday morning headlines

Financial reform bill nears passage, CA foreclosures keep falling, builder of World Trade Center bought by L.A. firm, and nutty salaries in Bell.

Slow-go for CA tax credit program

The state is still taking applications despite having more than enough homebuyers to hit the $100 million allocation.

BP begins critical test

Valves have been closed on a the new cap and now it's just a question of whether the pressure can hold.

How does UC get more dough?

Simple - just increase the number of out-of-state students who will be shelling out more for tuition.

Older workers outnumber teen workers

teens.jpg That's apparently a first - 6.6 million people over 65 worked or looked for work in the first six months of the year, versus 5.9 million 16- to 19-year-olds.

Fed catches up with world

The central bank is revising downward its growth forecast for the year, and it expects the unemployment rate to stay at around 9.5%.

Hotel occupancy inches up

The county's busiest hotels were in West Hollywood and Marina del Rey. Daily rates fell a bit.

Wednesday morning headlines

More Californians kicked off jobless rolls, port traffic requires additional workers, ex-Indymac executives sued, and cruel irony for Schwarzenegger.

How not to work a BlackBerry

When responding to an email regarding the future of two employees, make sure you know who is on the other end.

Automation comes to Netflix

The movie rental company has figured out a way to have machines open its red envelopers - and it's costing 125 jobs.

*Port traffic keeps improving

That would suggest a bullishness by retailers about the back to school and holiday seasons.

Location shoots looking better

Activity in the second quarter was up 16 percent from a year earlier, according to FilmLA.

Are Toyota drivers at fault?

Turns out that some of the drivers who said their cars surged out of control were mistakenly flooring the accelerator.

L.A. home prices slip

But sales were up substantially from a year earlier. Some of that uptick might be due to the federal tax credit program, which is now over.

The wacky Miramax deal

Who knew that Disney's decision to unload the movie production company would turn out to be such a circus?

Business Update on KPCC

My weekly business chat with Susanne Whatley looks at weekly wages in L.A. compared with other cities.

Tuesday morning headlines

Financial reform nears passage, tough finding a job in L.A., airline fees boost the price of tickets, and magazine revenues are looking up.

Port workers return to work

An agreement has not been reached, but after 11 days clerical workers have returned to their jobs.

Customers can be such jerks

Some of the cons constitute outright fraud (not that the company will usually press charges).

Performance art, sushi style

h/t The Daily Dish...

Marilyn Monroe home on market

marilyn1.jpg The 1929 house has four bedrooms, three bathrooms, a pool - and a past. It's going for $3.595 million.

Irvine on top cities list

Money magazine ranks it 22nd on the list of best places to live, the best showing of any city in California. Yorba Linda was 38th.

Jobless misery loves company

economix-12oecdunemployment-custom1.jpg At least L.A. County's jobless rate of 12.3 percent in May is lower than that of Ireland, the Slovak Republic and Spain

Consumer Reports nixes iPhone 4

The testing service cites the much-reported reception problem when fingers or hands touch a spot on the phone's left side.

EBay gave to Brown campaign

Meg Whitman has been calling Jerry Brown's entire political career a failure, but the company she ran gave $5,000 to his 2006 campaign for attorney general.

Monday morning headlines

More Americans have lousy credit, stimulus money for California is running out, flight cancellations climb, and Hefner wants to take Playboy private.

Inside the McCourt muck

frank-and-jamie-mccourt.jpg At least the divorce filings are providing a little insight into the slimy empire.

One more post about Lebron

LeBron.PNG Wagers on the Cavs, Bulls, and Heat were bouncing all over the place until the last couple of days, when the smart money went to Miami.

No, Obama is not a socialist

But a majority of likely voters (55 percent) believe that the word "socialist" describes the president either "well" or "very well."

Wage gap for women gets smaller

economix-08gendergap2009-custom1.jpg Well, let's be clear: It's getting smaller for younger women, say in the 20-34 range. Women under 35 who work full time earn around 90 percent of what the guys are making, according to a Labor Department report. But for those over 35 it's down to 75 percent. From Economix: Older women may have entered the work force at a time when inequity in pay between the genders was more acceptable. Thus, even though more...

Insider trading probe draws in ex-Angels

Federal grand jury is looking into stock trades made in advance of the 2009 purchase of Advanced Medical Optics.

Friday morning headlines

Biggest defaulters are the rich, more talk of a double dip, good news for future California budgets, and Lebron gets big tax break in Florida.

Trouble at the Times

I'm hearing that the paper's computer system has been on the fritz much of the day.

Tribune going into Web consulting?

For a company that's not known for being at the forefront of most anything connected with the Internet, it's a pretty funny notion.

Miramax deal is done (we think)

Disney has agreed to sell the movie production company to a group led by L.A. billionaire Ron Tutor for $675 million, The Wrap is reporting.

So that's how you get into Sun Valley

Just be married to the CEO of Disney, that's all. Not only that, you get to ask Warren Buffett whether he does Facebook.

Good news for Pasadena Playhouse

Bankruptcy judge has approved the theater company's reorganization. Fall season is being planned.

*The betting on Lebron

lebron-james.jpg For what it's worth, the online betting market Intrade has Miami leading the pack of contenders for getting the superstar.

Thursday morning headlines

Retailers struggle in June, juries don't like Hollywood accounting, BP might or might not be ahead of schedule, and near-misses causing concern.

How much do you make?

L.A. has a relatively low weekly wage ($1,099) because of its large and diverse employment base.

Lebron the showrunner

There's a lot of tut-tutting by journalism profs about the arrangement, which I'm sure has James in a panic.

Let's kill all the 'experts'

The only thing worse than an economist mimicking the conventional wisdom is a reporter who quotes the economist.

Big day on Wall Street

Naysayers might call this a short-term snap-back; optimists say that it points to strong second-quarter earnings. Your choice.

Legalizing pot would slash prices

By as much as 80 percent, according to a new Rand study. That could bring down prices to as low as $38 an ounce.

Get set for Santa Monica Place

santamonica.jpg The overhauled shopping center is nearing its Aug. 6 debut, and I've come across several curtain raisers on the open-air venue (media tour was given last week). Macerich, the SM-based real estate company behind the rehab, says that the mall will be 75 percent occupied come ribbon cutting day. A few of the higher-end tenants, notably Nordstrom, will open later in the month. From the Lookout News: The 550,000-square-foot open-air mall stands three stories high...

Earning more than your parents?

economix-07generationpay-custom1.jpg Only if you have a bachelor's degree or higher. For those with only a limited education, the going has never been tougher.

Wednesday morning headlines

Governor's race dead even, CPK sale efforts may be fading, Time erects pay wall, and Tesla stock keeps falling.

Price on movie star home takes dip

Jameshouse31.jpg The oceanfront house in OC that had been home to Sandra Bullock and Jesse James is now listed at $4,995,000, down $1.7 million

Socal venture funding bumps up

The April-June quarter brought investments of about $1.6 billion in Southern California.

Who cares about Lindsey Lohan?

In case you missed it, a Bev Hills judge ruled that the actress violated the terms of her probation.

Riordan chats it up with unions

L.A.'s former mayor has been making his case for pension reform and health costs, two areas he sees as crippling L.A.'s fiscal outlook.

Reviving the American Dream

More start-ups mean more jobs - simple as that. But not nearly enough is being done to encourage those start-ups.

Summing up economy

It's all about jobs and a lack of leadership. Sigh....

Older + educated = toast

Some depressing news: The more education someone has, the longer the average length of unemployment.

NY more expensive than L.A.?

losangeles2.jpg When considering a transfer from one city to the next, just look at the weekly promotions at Ralphs.

Tuesday morning headlines

More vacant office space, no progress in port talks, Miramax sale might be at hand, and LAX to reopen observation deck.

Tesla's rise and fall

Moral of the story: Be careful about getting in on the ground floor of an IPO. Weird stuff has a way of happening.

*Plight of low-educated worker

June jobless numbers show they're doing a lot worse than folks who have a Bachelor's degree or higher.

L.A. struggles to borrow money

The sale of $1.2 billion in short term notes, normally a non-event, was a struggle this time around.

Charting the dismal jobs picture

jobs.jpg The current upturn pales next to every other post-World War II recession - and it's even worse if you exclude the Census hiring.

Is a carless L.A. possible?

map.png CicLAvia first "open street festival" will be happening on Sept. 12 when seven miles of streets will be closed off.

Friday morning headlines

Port workers to resume contract talks, state workers may go on minimum wage, farmworker OT bill reaches governor, and Paul Allen buys $25 million Malibu home.

Sour news on jobs

Companies only added 83,000 jobs, a strong indication that the economy slowed down in June.

*Collecting on parking tickets

parking.jpg The city could do a much better job of collecting all the money that it's owed, but there's a limit to what's possible.

Auto sales yet another worry

AutoSalesShortJune2010.jpg When consumer confidence takes a fall, it shouldn't come as a big surprise that fewer people are going to buy cars..

LAX janitors avert strike

The deal maintains current hourly wages of $10 to $11 and health benefits.

Latest on Newsweek bids

Final bids for the newsmagazine are due in three hours. A look at those still in contention.

Port traffic moving

The strike by clerical workers at the Ports of L.A. and Long Beach does not appear to be impacting the loading and unloading of cargo - so far.

Figuring out jobless benefits

With the Senate still unable to extend jobless benefits, lots of folks in California are starting to lose coverage. But how many?

Credit union under-reported losses

Arrowhead Credit Union, which was seized because of its weakening financial condition, apparently filed inaccurate loan data.

Kudos for City National

L.A.-based bank is recognized for reining in various perks and protections for its CEO.

Thursday morning headlines

Port clerks go on strike, layoff reprieve plan fails in council, feds seize movie Web sites, and the latest "Twilight" breaks midnight box office records.