Alison Meadows has a PHD in Economic Trends in Modern Times and is a known writer who focuses on hedge fund investments. Meadows, her husband, and three kids live in Boston, where she grew up and attended college. Contact Alison at alison[at]businessdistrict.com
View all posts by Alison Meadows →
High level talks are scheduled this Tuesday between President Obama and the up and coming leader of China, Vice President Xi Jinping. Xi is hoping that the talks will boost his international standing while he simultaneously tests Obama’s ability to balance diplomacy with China and his election-year pressures.
Xi’s visit has been carefully planned by his Chinese handlers so that it the once-every-ten-year Chinese transfer of power is accepted by Washington and the world as a significant rite of passage. Xi is expected to take the helm of the Communist Party, which leads China, later on in 2012, and then finally taking over the Chinese presidency in March of 2013.
The fifty-eight year old Xi arrived in Washington on Monday and was greeted with a dinner with veterans of US foreign policy, including former national security advisers Brent Scowcroft and Zbigniew Brzezinski. Former Secretary of State Madeleine Albright was also on hand.
Obama has been working on changing US economic policy toward Beijing quietly, trying to find new ways to get results on such touchy issues as improved market access and better currency practices with China which have historically been thorns in the sides of Obama as well as his predecessors.
Xi is the highest ranking Chinese official to visit the US since Obama began his new US leaning toward Asia, began in November. Obama would like to see a more balanced relationship with Asia, reducing China’s increasing assertiveness in the region.
On an otherwise quiet, ordinary street in a suburb of Los Angeles one house seems to have gone crazy. Painted in neon bright colors with several ads is the house of Scott and Beth Hostetler, a couple who are otherwise good neighbors, say their neighbors.
Tacky Look in Exchange for Bucks
Some neighbors were so shocked at the Hostetler’s home’s new look that they even considered calling the police; others were merely angry and confused, but the explanation, given the state of the country’s economy is really quite simple. In exchange for turning their house into a giant billboard the Hostetlers will receive $2,000 per month from the marketing company behind the scheme, Brainiacs From Mars.
Romeo Mendoza, the CEO and founder of Brainiacs explained that his goal is to turn at least 1,000 homes across America into gigantic ads for his marketing firm. For every one of his endeavors he will pay the mortgage, for up to one year.
"If we roll it out to scale and impact the foreclosure crisis, that would be amazing," Mendoza, 42, said.
Overwhelming Repsonse
In April 2011 Mendoza floated his idea on his website. Since that date ten months ago he has gotten 38,000 applications to participate, from even places as far away as Japan and Russia.
Mendoza says he picked the Hostetlers because they are nice people, and he decided to choose the most deserving families, even if their homes are not on the busiest streets. Mendoza checks all relevant zoning laws to be sure advertisements and brightly painted homes do not violate any local codes of law before he puts up his ads.
The majority of applicants are from Nevada, California and Florida, the three states in the US hardest hit by the housing crisis. Mendoza says his idea can help people who are struggling to keep their homes.
"The response has been overwhelming," Mendoza says. "People are hurting, and struggling to stay in their homes. If we can help some of them, that would be great."
Attracting Attention
Mendoza says his plan is to advertise his company’s name and social media marketing tools in front of people’s homes in the hopes of getting the attention of some big companies, who he hopes will hire him based on the originality and quirkiness of his scheme. Brainiacs, says Mendoza is indeed already negotiating with some large companies to run their ad campaigns.
The neighbors however are not happy. One neighbor is willing to put up with the new look of the house for one month, even though the Holstetlers want to keep the ads there for six. Another neighbor, 80-year-old Bob Pancoast, said: "All the neighbors were a little upset at first. We thought they had gone off their rocker. But I guess it's a good idea for them."
"I don't think the program will be a success. It will be akin to graffiti – that's how people are going to look at it. They are going to run into zoning problems everywhere," said housing industry finance expert Charles Mclaughlin.
Mendoza answers:
"There are definitely zoning issues in some cities, and we realize that. But we have really hit a nerve, and we can't let that stop us. Once people start seeing how it works, once they get it, the moment they realize it is paying people's mortgages, they are always on our side, because of this economy."
The 50th anniversary of the start of the economic boycott on Cuba took place on Tuesday. Since February 7th, 1962 there has been a nearly hermetic seal on trade with communist-led Cuba.
Yes or No to Embargo
Supporters of the embargo say it is an appropriate response to a repressive government that has been a relentless “thorn in the side” of the Unites States for all these years. Opponents of the embargo say the policy is a failed one, which has hurt ordinary Cuban citizens, and not the government against which the embargo is directed.
Failed its Main Goal
Both sides agree, however, that the embargo failed in its most central goal, to oust Cuba’s leaders, Fidel and Raul Castro.
Wayne Smith, who was a young US diplomat in Havana, Cuba in 1961 when relations between the US and Cuba were cut. Smith returned to Cuba as the head American diplomat when relations were partially re-established under the administration of President Jimmy Carter.
“All this time has gone by, and yet we keep it (the embargo) in place,” Smith said.
“We talk to the Russians, we talk to the Chinese, we have normal relations even with Vietnam. We trade with all of them,” Smith added. “So why not with Cuba?”
President Kennedy announced the embargo on February 3rd, 1962, saying that “the subversive offensive of Sino-Soviet communism with which the government of Cuba is publicly aligned,” and it went into effect four days later.
Outdated Policy?
Those were the days when the cold war was at its height, but critics of the embargo say that many of the reasons the embargo was begun no longer exist, such as the struggle to halt the spread of Soviet influence and the exportation of communism by Fidel Castro to the rest of Latin America.
But supporters cite other justifications, such as the need to pressure Cuba to give more personal and political freedom to its citizens, and the confiscation of US property in Cuba.
“We have a hemispheric commitment to freedom and democracy and respect for human rights,” said Jose Cardenas, a former National Security Council staffer on Cuba under President George W. Bush. “I still think that those are worthy aspirations.”
The Nasdaq rose to its highest point in eleven years as optimism is mounting that the US economy is well on its way to recovery. The good news that fueled the Nasdaq rally was last month’s surge in the number of people hired, paving the way for what many analysts believe is a clear road to economic stability and growth.
The Nasdaq rose by 1.60 percent, reaching 2,905.34 on an increase of 45.66 points. Standard & Poor’s 500 Index grew to 1,344.66 as it surged by 19.12 points, or 1.44 percent. The Dow Jones industrial average climbed by 153.49 points to 12,858.90, which represents an increase of 1.21 percent.
Improved Economy Brings Higher Car Prices
The National Automobile Dealers Association is predicting that consumers are ready to pay more for new and used cars this coming year as the economy shows definite signs of improvement.
Used Cars in Demand with Low Supply
The NADA forecasts a rise of 6 percent for the average car to $30,000. An even higher price increase of 8 percent is expected for used cars, especially for SUVs and pickup trucks. For small second hand cars the price rise will be significantly lower, climbing by only 1 percent to an average price of $9,475.
More People Ready to Splurge
Luxury cars will most likely be in greater demand than in previous years as the economy keeps pushing forward, allowing people the confidence to splurge on more expensive cars. Used cars are in tight supply now because so few people purchased new cars during the years of the recession.
Paul Taylor, NADA chief economist, believes that US car sales will go up by 9 percent to 13.9 million in the year ahead. Low interest rates and enticing new products will most likely boost sales, according to Taylor.
As January ended yesterday Wall Street celebrated what investors there are saying was their best month since October, 2011. The optimistic attitude was maintained despite the disappointing weaker-than-expected performance which was reported in Tuesday’s economic reports, which surprised investors after a receiving a series of positive data about the economy in recent months.
According to the most recent data available, the Dow Jones Industrial average closed the session at 12,633.89, down 19.83 points or 0.16 percent. The Standard & Poor’s 500 Index was also down by 0.55 points, 0.04 percent to close at 1,312.46. The Nasdaq Composite Index finished up, however, by 1.46 points, or 0.05 percent, at 2,813.40.
The month of January ended up, with the Dow up by 3.4 percent, the S&P 500 up by 4.4 percent, and the Nasdaq finished in the black by a cool 8 percent.
