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Teri Bernstein, MBA, CPA has been teaching full time in the Business Department of Santa Monica College since 1985.  Prior to that, she worked in Internal Audit and Special Financial Projects for the 1984 Los Angeles Olympics, CBS, Inc., and Coopers & Lybrand (which is now part of PricewaterhouseCoopers).  She attended the University of Michigan and Wayne State University.


  • Major U.S. retailers refuse to sign Bangladesh safety agreement

    [View:http://community.cengage.com/GECResource/themes/gew/utility/ :550:0] MSNBC clip posted on YouTube May 17, 2013 " We are not even talking about wages here. We are just making sure that a building doesn't fall on top of you...and kill you...There is an obvious and irrefutable moral case for these companies to do that ." image from www.demotix.com In response to the outrage in the face of the recent Rana Plaza tragedy (notwithstanding many previous accidents due to a lack of safety controls), several retailers, led by Swedish-based H&M, have signed on to a five year contract to improve safety conditions in Bangladesh. According to the New York Times , "The plan requires companies to have rigorous independent inspections and to help pay for fire safety upgrades, like adding fire escapes, which many factories still lack." These are the retailers who HAVE signed the pledge (it looks as though these are mostly foreign-based): Benetton H&M Zara (Inditex) Tesco Marks & Spencer PVH (Phillips-Van Heusen, USA), owners of Calvin Klein and Tommy Hilfiger These are some of the retailers who have refused to sign the pledge as of May 19, 2013: GAP Target Walmart Macy's Sears JC Penney The North Face Kohl's Made In The Shade OshKosh Nordstrom's American Eagle Outfitters FootLocker Retailers refusing to sign the pledge have cited the risk of lawsuits. There are also concerns that participation may result in higher clothing prices for U.S. consumers. Sources: " GAP, Target Walmart: American Retailers snub Safety Agreement for Bangladesh ," reported by Chris Hayes, MSNBC , May 17, 2013. " As Firms Line Up on Factories, Walmart Plans Solo Effort ," by Stephen Greenhouse, The New York Times , May 14, 2013. " H&M, Zara, and other Brands Pledge to Help Bangladesh ," by Julie Ma, New York Magazine , May 13, 2013. " Bangladesh Factory Accord: At Least 14 Major North American Retailers Refuse to Sign, " Huffington Post , May 17, 2013 and May 20, 2013. Follow up: Is this a serious business dilemma, or a no-brainer, as the broadcaster seems to assert? What are the issues? How many people were killed in the Rana Plaza factory, according to the video story? What would be the public reaction if that tragedy happened in the USA? Would you pay more money for a pair of jeans if you knew they were produced in a safe factory? That is, would you be more likely, knowing about this agreement, to purchase clothes from H&M rather than the GAP? Why or why not?

  • Cyber bank robbery

    [View:http://community.cengage.com/GECResource/themes/gew/utility/ Visit NBCNews.com for breaking news , world news , and news about the economy :550:0] Seven sophisticated cyber criminals, part of a global network, recently stole $45 million from multiple locations in a matter of hours. Here is the basic overview of how investigators are imagining the perpetrators pulled if off: "hackers" invaded global bank information systems; they stole prepaid debit card numbers; they removed the restrictions on the maximum amounts that could be withdrawn; they spread the information to others in their worldwide network; across the world, these criminals coded the account information onto the magnetic strips that are on ATM cards; the thieves began withdrawing money from as many ATMs as possible, before the accounts could be cut off; they operated like a "virtual criminal flash mob"--at coordinated times; the criminal network's trial run was on December 21, 2012 [4500 ATMs, $5,000,000]; on February 19, 2013 they hit 36,000 ATMs, stealing $40,000,000. Arrests have been made, and the suspected ringleader was found murdered in the Dominican Republic between the robbery dates, but the investigation is not yet complete. Bank robbers hold a special fascination in the American psyche. Willie Sutton , who stole (only) $2 million from banks over an infamous 40 year "career" as a bank robber, is credited (perhaps apocryphally ) as answering the question, "Why do you rob banks?" with " Because that's where the money is." It seems as though these modern crooks have the same motivation...but use far more efficient methods. Sources: " In Hours, Thieves Took $45 Million in ATM Scheme ," by Marc Santora, New York Times, May 9, 2013. " $45 million stolen in cyber bank heist ," (video embedded above) reported by Tom Costello and Brian Williams, NBC News Nightly Newscast , May 9, 2013. Follow up: What precautions do you take on a daily, weekly, monthly or yearly basis to ensure that your internet financial presence is secure? What might this instance of cyber-crime mean for business and technology as we move into the future? Research what Willie Sutton really said in his autobiography about why he robbed banks. Do you think that these modern criminals would be influenced by the same feelings? Why or why not?

  • Hospital price survey shows unconscionable price differences

    The recent publication of the Medicare survey of hospital prices shows that there really is no semblance of a fair market for medical services. The existence of insurance companies as go-betweens makes it impossible for the consumer to make any provider decision with respect to price. There is no consistency, no fairness, no rationale and no transparency with respect to hospital charges...even within the same market. Medicare and insurance companies only pay a small portion of the prices charged, because they negotiate prices. They have the clout to negotiate because of their size...the bigger the insurer, the more power they have in negotiations. That is one reason that individual consumers are at such a disadvantage. Here is also a place that individuals--even with insurance--can get surprised by costs, or even cheated. Let's say the insurance plan pays 80% of costs negotiated, and the consumer pays 20%. The insurer may have made an overall deal with a hospital, based on surgeries that are very popular. But a surgery that is unusual may have a very high price relative to other hospitals. The patient needing the unusual surgery might end up paying 20% of a $200,000 bill--or $40,000 out-of-pocket. But, the way things are now--another hospital outside of the plan might only be charging $50,000 for the surgery. Even at out-of-plan reimbursement rates of 40% co-payment, the patient would end up with "only" $20,000 in out-of-pocket costs--half of what they are stuck with by going with the hospital their insurance provider recommends. There is no way for the customer/patient to "shop around" because he has been led to believe that the co-payment amount of 20% will produce the lower price for him. When the insurance company is selling the policies, there is no disclosure about individual surgeries, and no disclosure about the real out-of-pocket costs to the patient. This violates the basic integrity of the marketplace. Let's apply the situation to a different arena: shopping for an apartment. Let's say that a person could shop for an apartment on her own (= uninsured), or could hire a broker to find an apartment for her (= insured). Various brokers would have relationships with different real estate management companies or consortiums. This reality exists in the rental real estate marketplace now. But let's say that rental prices were not regulated (as it is,the same rate is quoted to all potential apartment renters; price discrimination is illegal). Let's change the reality for the sake of making an analogy with the health insurance industry: once the renter signs up with at broker, the renter is stuck with that broker in the search to get an apartment. One broker might be quoted a $1200/month rate; another broker might be quoted a $3500 per month rate for the same apartment. When the wanna-be renter signed up with the broker, the potential price differences would not have been disclosed. Would this be fair? There would be no relationship between price and value, and the renter would be powerless to make a choice at the decision point where the real costs would be revealed. ...just like the patient dealing with hospital costs. Since medical costs are the a leading factor in over 60% of personal bankruptcies in the U.S., the real costs of medical care are a life-changing issue for consumers. Some observers think that this publication of the wide discrepancies in price is the first step to fixing the problems...but maybe the system is too broken to be fixed. A " zero-based thinking " approach might be needed. Sources: " U.S. releases data showing striking differences in hospital prices " by Dan Gorenstein, Marketplace, American Public Media , May 8, 2013. " Hospital prices diverge wildly, U.S. data show ," by Chad Terhune and Ben Poston, Los Angeles Times , May 8, 2013. Follow up: What is "zero based thinking"? Can you think of--or research--three possible solutions to this pricing dilemma? Who would benefit and who would be hurt in each situation? How would you remedy the downsides of each of your scenarios? What is your personal experience with hospital costs and insurance coverage?

  • Industrial terrorism...or just an another accident?

    image from nydailynews.com The tragedy in the fertilizer plant in West, Texas killed 12 people and injured 200 in a fire that turned into a blazing explosion that trapped workers. These statistics are worse than the statistics from the bombing at the Boston Marathon. Both events injured innocent people, who were occupied with tasks that had no political significance. Yet the Boston tragedy was immediately labeled "terrorism"; the tragedy in Texas was headlined as an "accident." Bruce Machart recalls his own grisly experiences with foreseeable industrial accidents, from 18 years ago when he was working in a factory. In industrial management, these accidents are called "LTAs"--"lost time accidents," a phrase which seems to belie their life-altering severity. Nevertheless, Mr. Machart points out that the devastation to families in Boston and families in Texas are not different. They both feel like terror. Yet, the media has spun the results a little differently. " Lives have been 'lost' in Texas," notes Machart , "but in Boston, by God--lives have been 'taken'." image from news.yahoo.com One thing for certain, "spin" has been a major player in the communication about these tragedies. Politicians have used the events to gain political capital. Barney Frank said that increased regulation--bigger government--might have prevented the tragedy in Texas. Commentators on the other side countered that small businesses can't afford the costs of increased safety and regulation. I don't know. Could more safety precautions have been taken? Or was the accident inevitable, as Machart implies was the case in the industrial setting with which he was experienced? Clearly, the language we use to talk about events can change the way we feel about them, and can influence the way we deal with the underlying causes of destructive events. There is debate about the ethical obligations that business have to maintain safety standards when regulations are not in place or are not enforced. Perhaps talking about these events as equally tragic is a way to influence corporate behavior regarding safety. Source: " Only an Accident ," by Bruce Machart, New York Times , April 23, 2013. " Democrats Invoke Boston, West To Defend Government's Role ," radio story by Ari Shapiro, National Public Radio, April 26, 2013. Follow up: Do you think that the bombing in Boston and the explosion in Texas should both be labled "terrorism"? Why or why not? What are the downsides of using inflammatory labels? Are there any positive effects?

  • Consumer relations: Top ten complaints

    image from www.funnyjunk.com Complaints. We all have experienced unfair treatment or poor products. Sometimes the situations are so egregious that consumers take their complaints to a higher level. The Federal Trade Commission (FTC) keeps track of the complaints it receives involving businesses. Last year, the FTC received over two million complaints, and they recently published the top ten categories into which those complaints fell: Identity Theft Debt collection Banks and Lenders Shop-at-Home and Catalog Sales Prizes, Sweepstakes and Lotteries Impostor Scams Internet Services Auto-Related Complaints Telephone and Mobile Services Credit Cards Some of these complaints involve real fraud, but some result from poor communication and unskillful customer relations. Dealing with complaints that escalate can be costly for businesses...and in the current environment of immediate social networking, business mistakes can be instantly (and unilaterally) publicized. Businesses can also adopt a pro-active approach to customer relations that is positive and effective. Real-life complaint outcomes are delineated in columns written by The Haggler , David Segal, published in the New York Times . These tell the stories of consumer complaints that have gone unresolved, and the various strategies that are employed--with the added pressure of a published outcome--to achieve a fair outcome for both sides. The world is not perfect. Mistakes happen. Miscommunications can lead to consumer disappointment. How businesses handle these imperfections may be more important than what actually happens. No legitimate business wants a complaint to escalate to the FTC. Source: " Top Ten Consumer Complaint Categories ," source: Federal Trade Commission, published in Insurance Journal , March 29, 2013. Follow up: What management techniques can be used to avoid mistakes before they happen? What kind of "complaint department" does your business have? If you are going to school, what are the avenues for complaints about grades, instructors, or worse? How well does the complaint management system work? Describe your experience with complaining to a business, or filing an official complaint with a government agency. Were you successful? What techniques worked well and what failed?

  • KPMG partner caught in insider trading "sting" by FBI

    Scott London, KPMG partner, at left, allegedly receiving a payoff from Bryan Shaw, in an FBI sting operation (photo, U.S. Attorney's office) Scott London threw away his personal integrity and a 30 year career at a Big Four accounting firm for about $50,000 in cash kickbacks and a Rolex watch. These were the "gifts" given to him by buddy Bryan Shaw, to whom London had given insider trading tips worth over $1.3 million over a three year period. London plans to plead guilty at his hearing on May 17th, 2013. London's position at KPMG gave him access to information that was not yet public. He passed on information to Shaw that enabled Shaw to execute stock transactions in advance of market-changing announcements. These resulted in major gains for Bryan Shaw. The transactions involving two companies in particular--Herbalife and Sketchers--drew the attention of regulators. Shaw was approached by the FBI to help in a sting operation that eventually caught London accepting a cash payoff. What were these guys thinking? One observer, Gene Murphy, a white-collar-crime defense attorney, remarked: " You got two knuckleheads who keep affirming each other's stupid ideas ." Scott London, especially, should have known better. He was the Southern California regional managing partner for Audits at KPMG. The only value that an auditing firm has is its integrity, and its ability to attest and affirm the integrity of its clients' financial reports. If a major auditing partner of one of the four biggest accounting firms in the world is cheating, what is an audit worth? These are questions that KPMG's clients, and those clients' investors, are probably asking themselves now. Source: " In KPMG insider trading case, crime and blunders alleged ," by Walter Hamilton, Andrea Chang, Tiffany Hsu, et. al., Los Angeles Times , April 13, 2013. Follow up: What were the immediate ramifications to KPMG when Scott London was charged by federal prosecutors? What action was taken by the New York Stock Exchange? Can a person cheat in his personal life, but be honest in his business life? Can a person be honest at home, but lying and cheating or stealing at work? What do you think? What are the risks of trying to live two different lives? What service do you think big auditing firms should be providing?

  • Method makes a Clean Merger

    image from methodlust.com When Eric Ryan and his childhood friend, Adam Lowry, started Method --a maker of ecologically-minded soap products--they had no idea they were starting a movement as well as a company. Their products' success caused industry leaders in cleaning products ( e.g . Proctor & Gamble) to develop their own lines of "green" products. Last year, Method was acquired by Ecover , a company based in Belgium that shares the sustainability values of the Method founders.They had been approached by the "usual suspects"--Big Soap--but they chose to go with a company that had a good chance of supporting the "methods" they'd set up. They hope to thrive and grow with the new partnership. Says Eric Ryan: "Everybody needs soap. It's a dirty world out there." Source: " A Soap Maker Sought Compatibility In A Merger Partner " by Rod Kurtz, New York Times , January 16, 2013. Follow up: Do ecological or sustainability factors have any impact on your decisions regarding cleaning products? Why or why not? What were Method's two choices as a growing entrepreneurial soap maker? What other entrepreneurial companies have taken Method's route? What companies have taken the other path? Can you assess which decision is better from a financial standpoint?

  • "Zero TV": problem or opportunity?

    image from cbsnews.com The woman in the image above is watching "TV." She isn't doing it in the traditional way--she is streaming a TV show on her computer. "Zero TV" refers to this type of TV viewer--not one who eschews television (banning it on intellectual or educational grounds). Nielsen , the rating statistics leader, began to look at the viewer category "Zero TV" in its quarterly report ending this past March. Nielsen plans to incorporate this category into its Fall analysis, so that these watchers can be factored into ad rates. But are these viewers watching the ads? Viewers like the young woman pictured worry creators of TV content. TV show producers can only make money through the sales of ad time, or licensing their cable product. How will usage be measured accurately and revenue streams accurately reflect usage? That is not the only way things are changing. David Brancaccio's piece on Marketplace reveals that some users are reversing this situation again. The new way of getting content? Mobile TV . Users download material directly from TV satellites, bypassing the internet. These users are also bypassing the living room, and watching on their smartphones, tablets or laptops. Behavior changes are already changing the marketplace, partly because watching living room TV today is such a hassle! I think that TV + cable box + DVR + DVD player + ROKU + OnDemand + remotes for all of them + surround sound can be too much to deal with. When is someone going to think of a way to make money to simplify all of this? Sources: " Broadcasters Worry about Zero TV Homes , " by Ryan Nakashima, PhysOrg News , originally copyrighted by The Associated Press ( AP ), April 7, 2013. " Why Go Through The Internet to Watch TV on the Go? " by David Brancaccio, Marketplace , April 8, 2013. Follow up: Do you watch any television? Do you do it through a TV set or on your computer? Even if you are using a TV, do you watch when the show is broadcast, or on some kind of record-and-time-delay? Do you skip commercials? Have you ever watched pay-for-view TV for free, "illegally"? Discuss the ethical issues involved. Discuss the revenue models for traditional television. Consider the demographic differences. Can you think of how content producers will have to change to accommodate new viewing habits? How is Antennas Direct different from either option discussed above, according to the AP article?

  • April Fools' pranks that can get you in trouble...

    image from article linked below It is always a little risky in the workplace to use humor of any kind. But "pranks" can be particularly risky...even on a day devoted to pranks: April Fools' Day. Forbes published an article last year listing 8 rules for using humor in the workplace. One of them was using humor to make people feel more comfortable, rather than less comfortable. Pranks seem counterproductive to that aim. The local newspaper daily in my town, the Santa Monica Daily Press , runs an annual April Fools' Day issue. The lead article is always one that is surprising, but reasonably plausible. On each page the articles become more and more absurd--the Letters to the Editor and the Daily Horoscopes being the absolute "give-aways" that something is afoul. But being fooled at all means feeling "foolish"...and that might not be a great way to be seen at work. The Marketplace article mentions three pranks that definitely don't work in the workplace: Plastic on the toilet seat Pretending to cut off one's finger, leaving fake blood everywhere Pulling the fire alarm (this prank is also illegal) I'm not so sure how the fake crime scene pictured above would play out, either. The prank they "recommend" is linked below. Source: " 3 April Fools' Pranks You Shouldn't Pull At The Office (and 1 You Should), " by Adam Allington, Marketplace , American Public Media, April 1, 2013. Follow up: What April Fools' pranks were pulled in your workplace this year? What kind of humor is allowed in the corporate (or school) culture you work in? If you belong to a fraternity, how are things different there? Have you ever gotten into "hot water" by using humor inappropriately? List five rules that you would observe to maintain a good reputation--check out the Forbes article if you want some suggestions. Any comment about the stapler in jello prank from the TV show The Office , mentioned in the Marketplace article? I don't know if I would recommend that one either...what do you think?

  • Faux "faux fur" causes hair to stand on end

    image from caninescorner.org: a Raccoon Dog What is a company to do if they can't get control of their supply chain? The demand for "faux fur"--high quality synthetic furry material--has been higher than supplies. Some companies have made a surprising substitute: the Real Thing. The retailer Nieman Marcus was recently caught advertising Burberry coats trimmed in "faux fur"...which turned out to be raccoon dog , an East Asian canine that looks like a raccoon. image from www.niemanmarcus.com The marketing problem is also a legal problem: some individuals have allergies to real fur, and others just prefer not to wear it for ethical or other reasons. A company can't advertise a product as "fake fur" and just substitute real fur. The Humane Society tested the suspected products , and reported their findings to the Federal Trade Commission (FTC). FTC officials reported that Nieman Marcus and the other retailers agreed to follow the law. Source: " A Faux Faux Fur Kerfuffle at Nieman Marcus ,"by David Weinberg, Marketplace, American Public Media , March 20, 2013. Follow up: Recently there was another case where substitutions had been made: horse meat had been substituted for beef. Research this substitution. Summarize who was involved in that case and what consequences occurred and were imposed. What are other alternatives manufacturers have (besides substitution) when they have problems getting supplies needed for production? What are the consequences of these alternatives? If you were the purchaser of a product in which there had been a substitution from what was advertised, what remedies would you expect would be fair?

  • Tech company "tax dodgers" avoid tax on $225 Billion

    image from PUNCH , March 10, 1982 There is a fine line between tax avoidance and tax evasion. The line that divides the two is drawn by the "letter of the law." Nevertheless, those laws have been influenced by corporations lobbying for benefits that they can legally take. And, according to research done recently, it looks as though several very profitable Silicon Valley firms are benefiting from laws that allow them to avoid taxes by "permanently reinvesting" cash overseas: This arrangement seems to some observes to be a lose-lose deal for middle class American taxpayers. Not only is part of the nation's potential revenue foregone by this law, the reinvestment in foreign countries prevents growth investment in American jobs and communities. None of the tech companies agreed to comment for the researchers or the follow-up press reports. Sources: " Apple's not the only US Giant Dodging Taxes: Report " by David Brancaccio, audio interview, Marketplace Tech Report , American Public Media, February 25, 2013. " Silicon Valley Firms Shelter Assets Overseas; Slash US Tax Bill ," by Matt Drange, The Bay Citizen , February 13, 2013. Follow up: How does the concept of "business ethics" play into aggressive tax practices such as shifting income overseas to avoid taxes? Check out the definitions of "tax avoidance" and "tax evasion" using the internet or other resources. According to the Bay Citizen article, what other tax benefit did tech companies get as a result of the "fiscal cliff" deal?

  • Bribe inquiry involves Chinese film industry and Americans

    image from chinafilmbiz.com The film industry in China is booming--and American production companies, studios and other investors want to partner with this huge market. What stifles the partnerships, however, are ongoing investigations by the Securities and Exchange Commission (SEC) involving bribery. The SEC investigations involve violations of the Foreign Corrupt Practices Act. More specifically, because there is an import quota on films from the USA and other countries--and because blockbusters routinely sell over $50 million in tickets in the Chinese market--there is an incentive, and apparently some evidence, to bribe Chinese officials to ensure that an import slot goes to the company that pays (illegally) for the privilege. Recently, the situation has changed a bit. Because Chinese film-goers are showing a new interest in Chinese-produced films, American studio investors want to get involved at the production level as well as the distribution level. This increased involvement has expanded the SEC's interest in investigating exactly what payments are made to whom. Few insiders have been willing to comment "on the record," because of the ongoing inquiries and the huge sums of money that may be involved. Sources: " Inquiry into China Film Trade Unnerves Hollywood ," by Michael Cieply, New York Times Business, February 17, 2013. " To Bribe or Not To Bribe: Is That Really a Question? " by Robert Cain for China Film Biz , April 29, 2012. Follow up: What American film is alluded to in the words of the captioned photo above? Do internet research if necessary to identify the quote. What ethical issue is under scrutiny in THAT film? The photo, by the way, is taken out of context. To what bribery scandal does the Hu Jintao photo refer? Can you determine the current status of that dilemma? What do you think about bribery as a way to ensure market share, if bribery seems to be a common practice in a certain situation? What are the reasonable penalties for violation of bribery laws?

  • If your watch was a computer, would you wear it?

    image from businessinsider.com This is NOT the Apple prototype... I'm from a generation that wears watches. I have owned successive Seiko watches from the time I got my first full-time job. But my young adult daughters? No way! They use their smartphones to tell time. ...but they also lose their smartphones, because they are not strapped (conveniently) on their wrists. All this might change. Apple is currently "experimenting with wristwatch-like devices made of curved glass," according to sources who wish to remain anonymous, due to confidentiality agreements. It is definitely possible: last year Corning Incorporated solved the engineering problems around the development of bendable glass. This product, called Willow Glass , would be a major component of the technology used in the wristwatch computer. Willow Glass by Corning The idea of a wristwatch computer has been around for a long time--from the comics of my youth to James Bond movies. Google's take on a wearable computer is different: the Google eyeglasses . But it seems as though Apple's take would involve the special Willow Glass that could be form-fit around a human wrist. We'll see. Of course, observers are already calling it the iWatch . Source: " Disruptions: Where Apple and D Tracy May Converge " by Nick Bilton,, New York Times BITs , February 10, 2013. Follow up: Do you wear a watch? If your smartphone were styled to be worn on your wrist, would you do it? How would you market a wrist-mounted smartphone? Do you think your potential market is more with watch-wearers like me, or with younger folks? How might a wrist-mounted computer be used differently? Do you think the people who leaked the information about this potential product acted unethically in disclosing this information? Why or why not?

  • AIG shareholders sue the US government; the AIG Board declines to join them

    View:http://community.cengage.com/GECResource/themes/gew/utility/ :550:0] video from CBC player Lang & O'Leary Exchange, Big AIG shareholders (American International Group, an insurance multinational) are suing the US government for not making adequate profits, and for mismanaging AIG assets when the US government bailed out AIG in 2008. The AIG Board of Directors voted this week on whether the company should join the $25 billion lawsuit. (The video precedes the vote.) Although the Board may risk an additional lawsuit from the litigious and greedy AIG shareholders as a result of this week's action, the Board voted not to join the lawsuit. The Board was in a "lose-lose" position--if they joined the lawsuit, they may have been viewed as "soulless bloodsuckers" (see the Borowitz link below), but not joining the lawsuit may be viewed as not upholding their fiduciary responsibility to their shareholders to make as much money as possible, no matter what. Hank Greenberg , a major player in the 2008 fiscal debacle, is a lead figure in the shareholders' lawsuit. Sources: " CBC Player: Big 3 stories ", January 8, 2013. [video embedded above] " Satire: 'A letter from AIG' ," by Andy Borowitz, The Borowitz Report via BeforeItsNews.com, January 8, 2013. "Soulless bloodsuckers" is a quote from this piece. " As public fumes, AIG says will not sue U.S. over bailout ," by Ben Berkowitz, Chicago Tribune , January 9, 2013. Follow up: Comment on the tone of the news broadcast. What American newscasts is it similar to, if any? Listen to all three of the stories covered before you comment. Does the tone of the newscast enhance your perception of objectivity and accuracy, or detract from it? What do you think about the AIG shareholders' lawsuit? Do you buy the assertion that joining the lawsuit is "required" as part of the AIG Board's fiduciary responsibility to shareholders? What are the legal responsibilities of the AIG Board of Directors? What are the ethical responsibilities of the Board of Directors? The satiric piece by Andy Borowitz communicates some of the sentiments elucidated in the CBC broadcast. Which do you think was more effective and why? Comment on the irony of the message on the AIG homepage, in light of this lawsuit.

  • Gun sales are up...

    photo from the December 18 Fox News article Shortly before the tragic shooting at the Sandy Hook Elementary School in Newtown, Connecticut, Fox News reported that gun sales were up during this holiday season. Commentators speculated that increased sales were due to Obama's re-election (and the possibility that it might mean future implementation of gun controls) and fears regarding "the apocalypse" (presumably the Mayan calendar issue). Said interviewee Tim Strunk, of the sports outfitting store, Dunkelberger's, in Stroud, Pennsylvania: "It is through the roof, absolutely," he says. "Assault rifle-style guns, the black guns, are doing especially well." The article (posted prior to the shooting tragedy) focused on the surge in gun ownership and concealed-weapon carry permits by women. Ironically, the guns involved in the elementary school tragedy were owned by an outspoken female gun enthusiast. Another spike in gun sales has occurred since the Newtown killing spree. Many fear that there will be a crackdown on gun sales, particularly of assault weapons, and are buying now. In addition, sales of ammunition are up. Some gun owners think that it would be easier to crack down on ammunition sales than gun sales, and fear that ammunition will be in short supply, so they are buying in anticipation of short supply later. There are gun enthusiasts, and there are those who eschew weapons... but there is no convincing another to change their position on gun possession . That said, are there business opportunities to be exploited in this environment? Certainly. Every person has to make their own decision. My pension plan, STRS, is invested in the maker of the gun that was used to kill most of the kids at Sandy Hook. They stand to benefit for increased sales of the " Bushmaster, " and, ironically, so do I--a person who promised my dying father I would never own a gun. But I might benefit from a pension plan who does own the maker of guns. I'm not sure what I should do about this. Sources: " After Obama re-election, gun owners clinging to Second Amendment ," by Peter Boyer, Fox News, December 6, 2012. " Gun Sales Surge After Connecticut Massacre ," by William La Jeunesse, FoxNews.com, December 18, 2012. Follow up: One way to make investment decisions is to look at current events and make stock market "bets" based on what is current in the news. What investment decisions might you make in the light of the information in these articles? Given my promise to my dying father, what should I do with respect to the benefits I might receive due to my pension plan's investment in assault weapons? Tracking Terrorist Assets : if you are interested in a long, philosophical paper about the relationship between terrorism and financial gain, check out this link. It is a little unnerving to see the link between business and terrorism. After reading it, what are your thoughts?
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