Exploring Asian Business
The NBA is looking to expand sales by reaching out to the Hispanic community See p. 11
International Business examines economic happenings in See p. 16 China, Japan, India and South Korea
Recently an insurance company has refused coverage for a See p. 8 four-month-old child, is it going too far?
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The Official Business Publication of Seton Hall University
TUESDAY, OCTOBER 27, 2009 - VOL. 6 NO. 4
Made possible by the generous support of the O’Brien Family
China Reaches Out to ASEAN Through Economic Relief
Halloween Offers Plenty of Treats for Candy Companies
By Jenny Jing Zhang The Southeast Asian countries in economic straits will be offered a $120 billion fund by the end of the year, Chinese officials said in Beijing on October 21. The Association of Southeast Asian Nations (ASEAN), along with China, Japan and South Korea, plan to establish the fund as a means to providing financing to members in economic difficulties. The fund can “offer loans to poorer countries in the region if another crisis happens,” Zheng Xiaosong, DirectorGeneral for International Affairs at the Ministry of Finance, said.
By Li Duan
China is a major contributor to this plan. The ten ASEAN nations plus China, Japan and South Korea reached a consensus that the creation of a network of currency-swap arrangements is aimed at providing emergency funds in the event of a financial crisis. Japan and China will each contribute $38.4 billion, and South Korea will provide $19.2 billion. ASEAN nations will contribute the rest. Continued on page 16...
INDEX Money & Investing.............. 2 Stillman News...................... 6 Ethics ................................... 8 Editorials ............................. 9 Sports................................... 10 Domestic News..................... 13 International News.............. 15 International Business........ 16 Photo courtesy of the AFP Front cover image designed by Ian Mehok
As the crisp fall air and infinite shades of ochre and crimson transform the landscape, excited children and adventurous teens transform into ghoulish monsters, charming princesses and those fabulous Power Rangers. What could be better than creeping through the misty streets of jack-olanterns, scarecrows and that terrifying neighborhood witch? There are of course the voluminous piles of treats, whether you enjoy those delicious candy apples or the ever-sweet candy corn, there is a special indulgence for everyone’s taste. Who can resist all that wonderful goodness after a delightful night of trick-ortreating! No other holiday gives children as much freedom to devour bags of M&M’s,
UK Economy Stalled in Record Recession By Nastassia Weber Preliminary official data released Friday morning reveals that the United Kingdom economy is still in the midst of a recession. The Office for National Statistics (ONS) reported that the UK economy has contracted by 0.4 percent between July and September, despite predicted growth. This contraction of UK
Snickers, Hershey’s Kisses and Reese’s Peanut Butter Cups so as to not need any meals, or sleep, for days to come. Children delve into all that sugary goodness, collected through a long night’s adventure, as a much-deserved reward for all their efforts. Who can blame them? It is a time of thrill, exploration and provocative alter egos that bring out the pleasures of life. Its participants are not the only ones feeling the wonderful exhilaration of Halloween. All those costumes, decorations and candy create marvelous economic spending. Even during a national recession, Halloween-related sales came in at a monstrous $5.77 billion last year. Particularly, candy sales achieve glowing success during the Halloween season. With projections of close to $2 billion of candy bought for the fall festivities this year,
gross domestic product marking the longest consecutive retrenchment since the data was first recorded in 1955. Initial predictions estimated 0.2 percent quarterly growth from signs of a strengthening luxury housing market in London and more competitive exports due to a weakening pound. However, stalled September retail sales, a heavy debt burden on consumers, and a downturn in the service sector, particularly in hotels and restaurants, proved the contraction inevitable. The UK economy shrank 5.2 percent compared with the previous year and has contracted 5.9 percent since the beginning of the recession.
it is by far the most lucrative time for candy companies. Even with a sluggish economy, the growth of Halloween’s increasingly popular celebrations has led to its continued commercial success. According to industry analysts at IBISWorld, the average person is expected to spend an astonishing $22.50 on Halloween treats this year. No matter how tight people’s spending limits are, they can still feel the joy of lavishing themselves with a delicious bar of chocolate. Although last year’s consumer spending estimates were poor, total Halloween sales crushed all projections by actually increasing by 5.1 percent. This year’s outlook looks promising and is expected to be the best year yet.
These figures are particularly startling as euro-zone countries begin to see recovery. While the UK remains mired in recession, Germany and France have come out of recession in the past six months and are experiencing growth. Most startling is the continued narrowing despite efforts of stimulus and recovery efforts from UK government and the Bank of England. The Bank of England is expected to continue its policy of quantitative easing, or printing money to buy bonds from banks to spur growth in the economy. However, it is likely the Bank will spend all of its allotted £175 billion reserve for the quantitative easing policy this week.
Continued on page 4...
Chief economist at the British Chambers of Commerce, David Kern warns, “Continued intervention - including help for businesses to access finance, and incentives to promote investment - is still needed”. The release of this quarter’s GDP, unfortunately, leaves many pondering the effectiveness of continued intervention. Although these preliminary numbers of contraction are due for revision, for now all signs indicate that it will be an extensive path to recovery as the UK economy tries to bring itself out of the downturn.
Contact Nastassia at email@example.com
TUESDAY, OCTOBER 27, 2009
Money & Investing
Stillman Exchange Still-Frame real market insights by Kathryn Green
• President Obama made a statement on Saturday that he wants banks to lend more money to small businesses since the banks received bail out money. The President feels that it would help keep small businesses alive and create more jobs.
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This Week’s poll question Poll Question: Windows 7 is supposedly going to be better than Windows Vista; would you buy it? A: Yes B: Yes, but not now C: No D: Maybe
Last Week’s poll results • The number of failed banks reached over 100 on Friday, October 23. The day ended with a total of 106 failed banks.
Poll Question: Will there be an additional amount of money placed on the current gasoline tax?
• Auto recyclers had six months to dismantle the cars from the cash for clunkers program, but now are asking for an additional six months because of the volume of cars.
A: Yes, the tax will increase 31% B: Yes, but probably next year 42% C: No, no tax will be imposed 15% D: Maybe 12%
• The Federal Reserve has a plan to police banks; take charge of what employees are being paid. But the general opinion is that it will be a short term solution, and will not be able to fix the problems.
To submit your answer, visit www.stillmanexchange.com under “Money & Investing”
Two Weeks in Earnings
Earnings Stock to Watch
Air Carriers Look to Cut Costs By Cutting Free Offerings By Bryan Murawski, Assistant Editor Can you remember a time where you’d board an airplane, sit down, and receive complimentary peanuts, drinks, or even a meal? One thing is for certain, those times are gone. Airlines have changed the way they do business from the food they give you, up to the bags they let you bring onboard. With all these changes, one can only ask, what does the future hold for airlines? Approximately three million people use airline transportation a day. Considering how large that number is, you would think airlines wouldn’t be in trouble. After all, the average cost of a round trip ticket from New York City’s JFK airport to Orlando is between $300 to $400. But believe it or not, airlines are still finding additional ways to charge their beloved customers for more than just a ticket. In recent years airlines such as Northwest Airlines (NYSE: NWA) made the decision to get rid of the ever popular peanuts and pretzels. Instead of giving them out for free, they began to charge for onboard snacks. They also increased the fees for overweight bags. The biggest reason for these changes has been the surge in gas prices
over the last few years. Boeing (NYSE: BA) has announced its new 787 Dreamliner which operates with 20 percent less fuel consumption to predecessors of similar size. There is a good possibility that once it’s released, the new jet will become the most common plane for Photo courtesy of Southwest Airlines customers in years to come. Airlines have continued to remove free elements from their flights, and Gas is only one low-cost carriers like Southwest have benefitted with increased traffic. contributing factor of the fees that airThere are a lot of predictions to how lines have been charging. Along with this daunting recession means more people are pricing might be worked out in the near staying at home instead of traveling. The future. Airlines have been talking about seat money that would usually find its way into location effecting ticket price. A possibility the airline industries pocket has begun to would be aisle seats selling for full-fare. slow down to a crawl. Not only are the cus- While middle seats would be for the bargain tomers feeling the effects, but so are the hunters, window seats somewhere in the between, and emergency exit row aisle seat employees. Job cuts have been staggering since the would most likely command a premier price recession has hit. The fewer flights means because of the extra space that it offers. All the fewer employees the companies need to of the changes in profit margins have the airline industry thinking on its feet. keep business running. Mergers have taken place recently.
Northwest Airlines merged with Delta Airlines in 2008 for a reported $2.6 billion. The merger made the company a global giant. Predictions say more mergers might take place in the future meaning less competition and a rise in prices. Jeff Katz, the former chief executive of Orbitz.com believes airlines will soon give customers the option for a special check-in line, as well as express security lines at many airports. Katz believes customers would gladly pay the fee to bypass the normal lines. Delta Airlines (NYSE: DAL) as of October 2007 was trading at around $20 a share. As of October 2009 its stock is currently averaging at a meager $8 a share. The recession has changed the way business is done in the airline industry. Ticket prices, bag check-in prices, some airlines have even gone as far as removing entertainment systems and microwaves from some planes to lose weight and increase fuel efficiency. With all the new technology and ideas the industry will come up with in the coming years, the airline industry might not look nearly the same a decade from now. Contact Bryan at firstname.lastname@example.org
All information contained in this publication is not intended to substitute for the advice of a professional financial planner. It is meant only for informational purposes. The Stillman Exchange assumes no liability for any investment losses incurred as a result of information provided in this publication. Readers should consult a professional financial planner.
Money & Investing
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TUESDAY, OCTOBER 27, 2009
Real Estate Battle: South Orange vs. Maplewood By Scott Giveans, Money & Investing Writer As the Federal Tax Credit for first time homebuyers begins to dry up, the news gets worst for homeowners as lenders are saying so long to short sales and hello to foreclosures. Now instead of getting relief, some homeowners are being forced to pay additional money at closings or satisfy their mortgages through promissory notes. In an effort to increase lending and to unload “bad” loans from their balance sheets, banks have been accepting a balance on a home that is less than the mortgage is worth. However, banks are now changing their stance and are resorting to foreclosures to get back as much of their money as they can. Short sales and foreclosures are very similar as they both result from a homeowner’s inability to pay off their monthly mortgage rate. As a result many homeowners will look to sell their property in order to find a more suitable priced home. In short sale, the lender will agree
to accept less than what is owned on the mortgage and will be responsible for the difference between the sales price and the amount owned. In a foreclosure, on the other hand, the homeowner loses all rights in the transaction process. The property is turned over to the lending institution and the sale of the house is at their absolute discretion. Short sales have always been the preferred option for homeowners and lenders alike. For homeowners, the short sale process is less damaging to their credit. Typically, lenders receive a greater return on homes in short sale than foreclosed properties because of the negative connation associated with a “distressed” property. Also, short sales allow banks to be, well banks. Lenders are not real estate agents and do not specialize in selling homes, so often times they will jump at an opportunity to have the house sold for them. Nevertheless, after having millions of their assets being written off, banks are taking matters into their own hands and trying to recover every dollar they can. Lenders have become less lenient and are
Homeowner & Lender
Homeowner or real estate agent
Responsible for sale of property
Bank or hired managment group
Damage to credit rating
Borrower Short Sale
Protects credit rating
May have to pay off portion of mortgage through promissory note or at closing
Partial control of sale of house
Lender Short Sale
Less maintenance and legal expenses
Sole control of the resale of the home
avoid negative connotation of distressed home
can require borrowers to satisfy additional payments
governments may buy “bad” loans
are not responsible for selling the home choosing to have homeowners go into foreclosure and pay off the rest of their mortgage at a later date. As if the loss of jobs was not enough, former homeowners are being forced to pay out of the pocket money in order to satisfy their loan. According to BusinessWeek, at OneWest Bank, if the sale of a home does not satisfy a mortgage then the borrowers are required to pay a portion of the difference. Lending institutions have also been struggling to survive through the worst housing market in recent history. Banks across the United States have gone under because of their huge write offs and those that are still left want the money they are owned. The unfortunate shift in mentality
from short sales to foreclosures will only make matters worse. In an already struggling economy, increased numbers of foreclosures means housing values will continue to fall. Efforts of the banks to recoup their assets will only put more homeowners underwater anchored down with homes that cost more than their market value. This recent trend comes as the housing market has begun to experience progress. Banks have said so long to short sales at they try to retain as much of their assets as possible and homeowners are left running for cover. Contact Scott at email@example.com
U.S. Dollar vs. Euro Graph courtsey of Yahoo! Finance
U.S. Dollar vs. Japanese Yen
In this case, the grass really is greener.
Graph courtsey of Yahoo! Finance
As a Northwestern Mutual Financial Representative, you'll have the backing of a leading financial organization that truly values the entrepreneurial spirit - one that's earned the top ranking in its industry in Selling Power magazine* - to help you go as far as your potential can take you.
Danielle Miller Campus Recruiter The Olson Financial Group (908) 918 - 0510 www.nmfn.com/olsonfinancialgroup
Graph courtsey of Yahoo! Finance
05-2831 The Northwestern Mutual Life Insurance Company, Milwaukee, WI (Northwestern Mutual). "50 Best Companies to Sell For" November/December 2008.
TUESDAY, OCTOBER 27, 2009
Money & Investing
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Moving from Wall Street to Main Street By Francesco Muoio, Money & Investing Writer There is something out of the ordinary taking place on Wall Street that is beginning to catch the attention of Wall Street insiders as well as those familiar with the banking industry. While the aftermath of the credit crisis has produced many changes on Wall Street, one apparent trend that is taking hold involves the growing number of research analysts at large banks who are leaving their jobs in order to venture out on their own and start up boutique research firms. With such a difficult job market, it is puzzling why analysts at banks on Wall Street would choose to quit and start-up on their own. Edward Robinson of Bloomberg News, in a recent article in the Star Ledger, shed light on this emerging trend on Wall Street. The research industry is a vital component to every major investment bank on Wall Street. Investment banks employ research teams, who conduct rigorous analysis on areas of the market, such as individual stocks and broader market sectors. Research teams are responsible for issuing reports and providing ratings (buy,
sell, hold) which serve to help their banks’ institutional clients make accurate investment decisions. In his article, Robinson points out the pressure placed on research analysts to please their sales team counterparts at banks by issuing “buy” recommendations on stocks or particular sectors of which the sales team is trying to pitch to clients. While this is an Photo courtesy of Goldman Sachs extreme case, and in reality Research teams, like the one above from Goldman Sachs, are open debate between sales and research teams at becoming more independent, breaking off in favor of their own boutiques rather than being under a company’s umbrella banks is the norm in order to maintain integrity in the decision-making process, research analysts money by selling their research to large are growing increasingly tired of the pres- institutional investors, such as hedge funds sures they feel at big banks and are opting to and other money management firms, who then use the research to help assist them in leave and start out on their own. In fact, the number of independent making investment decisions. While quality research remains in high research firms in the United States has grown from 1,012 in 2006 to 2,667 current- demand, it is not certain how many of the boutique research firms will be able to comly. Independent research firms make their pete with the large banks on Wall Street,
who enjoy substantial advantages over their smaller counterparts. As Jay Bennett, a consultant with Greenwich Associates, a Stamford, Connecticut-based firm that advises institutional investors, pointed out, institutional investors are likely to remain with the large banks because they offer significantly more services than the smaller outfits have the resources to supply, particularly underwriting and allocation of equity offerings. Despite the overwhelming odds, boutique firms do hold a profound advantage over their counterparts at large banks. While analysts at large banks tend to offer similar recommendations, the boutique firms can offer clients calls and opinions that differ from the norm. With the ability to offer opinions free from pressures, analysts at boutique firms can focus on providing good investment advice. If a growing number of them prove to be correct, institutional clients may start venturing outside Wall Street more for market research. Contact Francesco at firstname.lastname@example.org
Halloween Offers Plenty of Treats for Candy Companies ...continued from page 1 Large companies such as Hershey Foods (NYSE: HSY), known as one of the largest and oldest chocolate companies in the world, have entire websites dedicated to the marketing of their Halloween products. They have even developed delicious holiday recipes such as Kisses Candy Corn Cheesecake Squares and Chocolate GrabBag Brownies. Higher-end candy companies such as Rocky Mountain Chocolate Factory (NASDAQ: RMCF) are offering unique products such as its delicious Cocoa Cauldrons for the aspiring young wizard and Oreo Pumpkin Pails for all your children’s trick-
Photo courtesy of Bloomberg Consumers are expected to spend more than $20 per person on candy this Halloween season.
or-treating needs. There is even a selection of specialty apples dipped in caramel, crushed pecans, cheesecake and toffee among other tasty possibilities. Mars Inc., known for its popular array of candy bars, has launched a $1 million Halloween mansion sweepstakes. Can you imagine the piles of M&M’s you can buy with those winnings? Tootsie Roll Industries (NYSE: TR) has even inspired a series of Tootsie Roll costumes to promote its iconic chewy candies that are sold by retailers across the country. These outfits come in baby, kid and adult sizes for the enjoyment of the whole family. The Halloween season is big fun for candy companies and even bigger fun for
everyone else. No other holiday creates as much devilish excitement at such a low cost to its participants. It is a time that all children will remember, and one for which candy companies dream. How can you not think back and feel the exhilaration of that first knock on the ghastly neighborhood door with your mask securely fastened and candy bag in tow, ready to cause havoc if satisfactory treats are not delivered? Throw a party, have some cheer, break some rules and enjoy life as the delights of Halloween are once again upon us. Contact Li at email@example.com
Windows 7 Releases With; Consumers Worry About Vista Repeat By Andrea Alarcon Money & Investing Writer October 22, 2009, marked the release of Windows 7 and a new start for Microsoft after the humiliation of Vista. Fortunately for computer users and for the sake of the
Photo courtesy of Microsoft Windows 7 looks to shed the stigma created form the poor launch of Windows Vista
company as well, Microsoft has created a new operating system that is sure to erase any downbeat notions about Microsoft and its past works. In a recent article on FoxNews.com, about Windows 7, the author writes “if you've been holding off on buying a new computer, Microsoft Windows 7 will be a
good excuse to get back into the game. And if you've been weighing a Mac versus a Windows PC, then you should know that "7" pushes the scales on the Windows side. Windows is now easier to use and better looking than it was before, while maintaining its core advantage of cheaper, more diverse hardware.” According to Matt Warman, from Telegraph Media Group, Windows 7 now has many new features which enhance the program, including a new task bar, better organized file folders, “bigger icons that don’t look patronizing”, and longer battery life as well as quicker Wi-Fi connection; all at a low cost. Best of all, Windows 7, which is set to cost at least $120 to consumers, is now accessible to college students for just $30. Microsoft has been doing some major marketing for the hopefully triumphant program, one of them being through Best Buy. Best Buy and Microsoft have teamed up to offer recent computer purchasers with the opportunity to upgrade to Windows 7 at a reasonable price of $39.99. Since Microsoft’s official release of Windows Vista on January 30, 2007, it has received countless poor reviews. From the maddening and unnecessary advice about downloading software, to ridiculous warning signs requesting authorization to change fonts, the interface seemed to only make
users upset. Additionally, the software has had a reputation to have screen “blackouts”, as well as renaming, and relocating old features; making it all the more complicated for consumers to use. A week after Microsoft had released the software worldwide, the price for shares soared to its highest in more than five years to $30.16. Shortly thereafter, the stock began to plumPhoto courtesy of Microsoft met as a result of the ongoing flaws that were Bill Gates and company are adament that their product, Windows 7, being detected. The will be able to stop the market share drain coming from the innovative price in two weeks tumMac and Apple Inc. bled lower than it had been when Vista was originally released, at than it did to the billion dollar company. Perhaps Microsoft has not sufficiently proa not-so-shocking 11.4 percent crash. The day before Windows 7 was set to duced a new operating system to satisfy the release, Wednesday the 21, Microsoft had needs and expectations of Americans today. closed at approximately $ 26.58. While Microsoft did not fluctuate much during the Contact Andrea at days pre-Windows 7 and post-Windows 7, andrea.alarcon.@student.shu.edu many were under the impression that Windows 7 would create a bigger impact
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Money & Investing
Google Android Takes Different Approach By Christine Wotton, Assistant Editor
pizza that is two states over. The other big thing that the Android platform introduces is the first “augmentCupcakes, Donuts, and now Éclair ed reality” app by Wikitude. It uses GPS Google’s bakery of platforms is and the camera to give the user informaadding a new sweet to the shelves and is tion about their surroundings. For examgaining ground in the smart phone race. ple a tourist might use the app to identify Up until this point the iPhone has the landmarks that they visit. Apple found been the front runner in the smart phone out about it, and needless to say but it is race. Other competitors are Nokia, and now available to the iPhone. When reading the customer reviews, the same comment keeps coming up. People find that the popular apps like Facebook are integrated in the platform in a way that the user can pick up the phone and use it without any previous knowledge. Google was able to cut out many of the unnecessary prompt screens that are so common on other popular platforms. Until this October, TMobile was the only service provider that was carrying smart phones that supported Android. But now almost all of the other top companies are going to be offering phones that use Android. Eric Schmidt, Google chief executive said, “This new generation of phones have so Photo courtesy of Google much power in them, so many activities, they've got so much Google’s new Android phone is set to enter the smart information on them that it is phone market, although it may focus efforts in the defining new category for untapped areas. our industry “. RIM. But Google has been able to make The most shocking thing is the fact strides and very fast. Android is approach- that Google was able to get so far in the ing its second birthday and is shaping up race so fast. to be the next big thing in smart phones. People at Apple must be worried The Android platform from Google because if this is what Google can do in a debuts many new apps and features. short time, what can it accomplish in the These features include a new way to next version of Android. Google despite search. The search engine on the home the hard times have had great year so far screen searches both the internet and the with stock rising from $282.75 in January local phone. to $554.09 as of October 22. With the So when “P” is entered in, the search overwhelming success of Android and engine will return the contact information Google, you can bet it is going to take the for cousin Pete and the local pizza places platform as far as they can. in the neighborhood. It is intuitive. So when there is a search for pizza, it figures Contact Christine at that the user needs the numbers and firstname.lastname@example.org tions for local pizza, not for the chain
TUESDAY, OCTOBER 27, 2009
Caterpillar Climbing Back Up By Brett Morse, Money & Investing Writer Caterpillar Inc., the world’s largest producer of construction and mining equipment, has expanded considerably in recent years driven by a sudden increase of building in developing countries and elevating commodity prices. Since the world economic slowdown, Caterpillar has suffered a harsh blow. There has been less demand for Caterpillar’s bulldozers, excavators and other machines because of the collapse of the real estate markets, sinking commodity prices, and the tightening of credit markets. Caterpillar is reacting to this harsh blow by planning to cut more than 22,000 jobs, which makes up almost 20 percent of its work force, reduce costs, and significantly scale back production. The most recent announcement from Caterpillar is the planned retirement of 63year-old CEO Jim Owens this fall, who will be replaced by 56-year-old Douglas Oberhelman on July 1, 2010. Owens will stay on as chairman until he retires October 31, due to a mandatory retirement policy Owens became Caterpillar’s top executive in 2004. He has been working over the past year with the company’s board of directors to develop a succession plan. W. Frank Blount, presiding director and chairman of the Caterpillar board's governance committee, gave credit to Owens for leading the company through "its most significant period of growth," as well as the global recession. Oberhelman has been with Caterpillar for 34 years and is currently the company’s group president. His responsibilities include the engine and gas turbine businesses, human services, rail services, and the remanufacturing division. Before Oberhelman was the group president for Caterpillar he was the CFO for the company in South America and Japan. According to Jeff Windau, an analyst at Edward Jones, the choice of Oberhelman as the next company leader was “a pretty typical Caterpillar pick.” Oberhelman has been with Caterpillar for over 30 years and "Investors should probably expect more of the same from a management-style perspective.” Jeff Windau later stated that under Oberhelman’s leadership Caterpillar will most likely maintain the company’s focus on
photo courtesy of Caterpillar
Despite the recession, Caterpillar has been moving forward its business model in recent months. expanding in emerging markets, streamlining operations and improving its services business, which includes helping customers and rebuilding worn-out machines. Oberhelman, who is 56 years old, will have a considerable amount of time, about 9 years, before he is required to retire from the company under its retirement guidelines, which will provide consistency that might help Caterpillar. Lawrence T. De Maria, a Sterne Agee analyst, stated that it is palpable that the incoming CEO, Oberhelman, will continue to expand Caterpillar's presence in emerging countries, along with its services business and mining industry sales. "He was the internal candidate that investors expected to be named," though the precise timing of the succession had been unclear, Lawrence T. De Maria said. Oberhelman will "continue to push ahead globally, to look for incremental growth opportunities outside of just the developed markets." This week Caterpillar posted third-quarter earnings that beat analysts’ estimates and issues a full-year forecast that surpassed the highest prediction. Caterpillar predicted the United States recession in October 2007, which triggered a 2.6 percent one-day decline in the S&P’s 500 stock index, two months before the economic slowdown officially began. Caterpillar’s revenue decline of 44 percent was worse than expected, but its bottom line was aided by major cost cuts, LIFO, and tax benefits. The stock had climbed 31.5 percent this year. Contact Brett at email@example.com
Galleon Caught Making Fool’s Gold With Insider Trades By Danielle Hudson, Money & Investing Writer In an effort to reassert themselves against white collar crimes, The Securities and Exchange Commission arrested the mastermind of what is being called, “one of the biggest insider trading schemes of this generation.” As the work week drew to a close, the SEC and FBI arrested Raj Rajaratnam, the founder of Galleon Group, and his many accomplices. Galleon Group, founded in 1977, was renowned as one of the largest and most profitable hedge funds in New York City investing primarily in technology companies. It is believed that Rajaratnam was involved in inside trading of stocks of many companies including, Advanced Micro Devices, Clearwire, Akami, Hilton Hotels, and Google. Federal prosecutors are claiming that Rajaratnam was illegally obtaining information and trading on various tech stocks in order to boost the return on his funds. According to the New York Times, he is being charged with four counts of conspiracy and nine counts of securities fraud. The U.S. attorney for the Southern District of New York said that, “This case should serve
as a wake-up call to Wall Street and to every hedge fund manager. These people were privy to inside information, but they didn’t know one secret, that we were listening.” The case against the founder was built with the help of an unnamed cooperating witness, who has also agreed to plead guilty for her involvement. This nameless witness said that she went to Mr. Rajaratnam about his disclosure of nonpublic information, which, in turn, led to the scheme that lasted over a year involving three companies: Polycom, Hilton, and Google. In 2007, the witness decided to turn to the authorities and helped them to record multiple conversations between herself and Rajaratnam about the different companies. These conversations allowed the authorities to build their case against Mr. Rajaratnam. It is estimated that Rajaratnam’s insider information about these three companies netted a profit of $12.7 million. The interesting point in this particular circumstance, and the point that may in fact play into Rajaratnam’s favor in court is that, overall, he lost millions from his insider trading information. Authorities said that he garnered a profit of $20million, but that fails to take into account the almost $30 million that he cost Galleon. Still, the
actions that he took were illegal and will be punished. This information though gives the defense a glimmer of hope in possibly reducing the sentence that their client may receive. In this particular case, Rajaratnam along with Danielle Chiesi, an employee for New Castle Hedge Fund who was also arrested in connection with the insider trading, bought millions of shares each for their respective funds of Advanced Micro Devices, a computer chip company. Galleon and New Castle chose to purchase these shares because Rajaratnam and Chiesi received information from an I.B.M executive that this company would receive a large investment of billions of dollars from the government of Abu Dhabi in a deal that was to allow for Advanced Micro Devices to spin off its manufacturing facilities. According to the New York Times, Galleon spent $85 million on 16 million shares, but when the stock markets took a turn for the worst in September and October; these stocks also took a large hit, ultimately resulting in a loss for the funds. Upon arrest, Rajaratnam continues to maintain his innocence. He was arraigned in Federal Court Friday afternoon and released on $100 million bail, although the
prosecution thought he may prove to be a flight risk. On Monday, word of Galleon’s winding down began to spread as investors sought to withdraw their capital. They withdrew nearly $1.3 billion of the companies $3.7 billion in assets. In addition, both Bank of America and Merrill Lynch have told the Galleon group that they will no longer trade securities with the firm. Rajaratnam expressed his thoughts in a letter to employees and investors regarding the recent events. He said in his letter that, “I have decided that it is now in the best interest of our investors and employees to conduct an orderly wind down of Galleon’s funds while we explore various alternatives for our business”. According to the source, one of these viable alternatives is the selling of the firm and some of its assets to a yet to be named company. If anything is to be learned here it is that, the SEC and other governmental agencies will no longer stand by and allow for big time Wall Street hot shots to wheel and deal illegally. Wall Streeters beware, the SEC may be listening in. Contact Danielle at firstname.lastname@example.org
TUESDAY, OCTOBER 27, 2009
Goldman Sachs Presents Professional Panel Criticizing Crisis
THE STILLMAN EXCHANGE
Entertainment Accountant Entertains Students
By Richard Posluszny, Guest Contributor
By Alexander Betit, Stillman News Writer
Looking back at the past several years and the global macroeconomic downturn, there have been paradigm shifts in the financial services industry. The key is to learn from this historical event in order not to repeat it. And that is why we were there. Recently, Goldman Sachs and the Association of Latin Professionals in Finance and Accounting came together to host an event “The Changing Landscape of Financial Services.” To facilitate an insightful discussion, organizers brought together several senior-level executives from Goldman and a distinguished New York University professor. The panel was impressive and consisted of professionals holding a diverse skill set. It was composed of: Richard Sylla, an Economics professor from NYU’s Stern School of Business, David Simons, a Managing Director in Operations at GS, John Chartres, a Managing Director in Finance at GS, and Manda D’Agata a Managing Director in Finance at GS. Although the topic has been covered extensively, this seasoned panel was here to bring new elements to light. Starting off with the most fundamental question, why this happened, was Sylla. He said that modern financial systems have a tendency to “go off the rails,” and that there are five characteristics of a crisis: • Financial innovation • Plentiful credit creation • Regulators are napping • Preceded by expansion • Before a crisis hits, there is a “party” atmosphere Following this, Sylla boldly said that this is most likely the greatest downturn since the 1930s and unfortunately usually society does not remember these things. Then it was time for the GS employees to provide some insight into how it affected their operations and daily business at the firm. Simons led off by saying “I don’t think anyone was prepared,” for the series of cascading, catastrophic events. He spoke more in-depth about his sector, which he said had an overwhelming amount of data to scan through and compile. More importantly, however, was the escalation of data and ensuring that inconsistencies was given proper attention said Simons. Also backing this up was D’Agata who
Margot Bordas- Zafra has worked on the accounts of famous performers signed to Sony Music, Warner Music, Atlantic Records, Universal Republic, and Big Gates Records. On October 20, “Tips on Becoming an Entrepreneur”, an Association of Latino Professionals in Finance and Accounting event, invited Bordas to Seton Hall to talk to students about her entrepreneurship experiences. A former Seton Hall student, she discussed how her involvement in ALPFA has helped her get to where she is now. She joined the professional ALPFA board after starting her own club for CubanAmericans on campus named SHUCAS. Through ALPFA she was able to get a tax internship at Ernst and Young and that internship turned into a full time position within the tax department. She then moved to Miami to work in the international tax department after which, she felt the need to work for a smaller firm and accepted a position at a mid-sized Miami firm. After moving back to New Jersey with her husband Silvio Zafra, CEO of Unforgettable Music and Productions Inc, Margot began working with various artists, producers, publishers, personal friends and upcoming artists. As a result, she started her own entertainment management firm, Numila Inc. It is in acronym which stands for New York, Miami, and Los Angeles, the three most influential cities in the entertainment industry. When asked about the hardest part of getting the business started she simply answered, “Finding funding.” She travels weekly to her offices, mainly operating out of her Miami and New York offices. Receiving invites to important events, such as the Latin Grammys through her current clients, is where she does most of her networking. According to Bordas, having a personal relationship with the client is very important. “Never give away contacts, and always stay involved,” stated Bordas, when referring to having mutual contacts. It is important to stay connected with both parties in order to remain needed. Taking advantage to what was available to her at Seton Hall helped Bordas achieve the success she has now.
Photo courtesy of Constanza Lasso From left to right: Richard Posluszny, Constanza Lasso, Tiffany Dindial, Alexander Aiello were invited by Goldman Sachs and ALPFA to participate in “The Changing Landscape of Financial Services”
agreed that data is crucial in these sensitive times but it is more significant to elevate your findings. In addition, she said that it is key to ensure that your information flow is consistent while being correct. Essentially, you are only able to make good decisions with “A” quality data. Next, Chartres asserted that “many issues were faced at a time,” because the legendary “big bulge” bank went from being regulated by the Securities and Exchange Commission to the Federal Reserve. He said that the firm walked in on Monday with a huge task at hand and it had to “figure out what that [being regulated by the Fed] meant.” After some digging, it was realized that the firm’s year-end had to be modified. Although it seems as though it is a minor issue, the year-end is deeply embedded in all of the company’s systems. These examples are merely a sliver of what exactly was endured during the crisis over the past several years. Not just in terms of the “big bulge” banks but also relating to the government and its regulating bodies. Then the discussion turned back to Sylla who was asked why we did not wind up with another Great Depression. The professor claimed that because authorities were proactive in their actions, we sidestepped a more severe economic collapse. Sylla said it helped to fold Bear Stearns into JP Morgan but by allowing Lehman Brothers to fail was the start when “all hell broke loose.” He later said that this was one of two mistakes of the financial crisis, the other being running late stress tests on the banks. Interestingly enough, Simons disagreed with this sentiment saying that allowing
LEH to fail was good. He supported his reasoning by saying that risk is now scrutinized with a more watchful eye. Chartres agreed, hinting that risk metrics need to be overhauled and improved. Simons continued, saying that it is essential to remain vigilant with risk and thorough diligence must be carried out when becoming involved with various products and financial instruments. He pointed out that although blame can be transferred to the banks for not managing risk appropriately and the guys “who packaged the products,” ultimately the “guy at fault is the buyer.” After hearing the variety of profound statements and deep insight into what happened, the event paved the way for students and professionals to become better acquainted with Goldman Sachs and its employees. Although the panel discussion provided some flavor for students, it was important for students to speak with other employees first hand to gain a grasp of the ongoing events. This led to a brief networking event and small groupings that provided students with succinct information sessions. ALPFA is a leading professional organization consisting of 37 chapters in 37 cities and 23 states and the nation’s capital. ALPFA is dedicated to enhancing opportunities for Latinos in the accounting, finance and related professions. The organization is open to anyone who shares its beliefs, values, and principles.
Contact Richard at email@example.com
Contact Alexander at firstname.lastname@example.org
International Fair Offers a Taste of Different Cultures By Rory Manning, Stillman News Writer A variety of unique clubs and organizations collaborated to bring their culture to the International Fair held on Tuesday, October 20. With music, food and dances representing different cultures, there was a hub of activity on the green. Despite the few clubs that participated, every booth was filled with people lining up to try new and different foods and experience different cultures. October is known as International Month at Seton Hall University. The International Fair was one of the many events that SHU planned this month for the students to experience a taste of the world around them. The Greek booth was, as always, a hit offering authentic Greek food. A new organization, the Lusophone Student Association, had many different types of traditional foods from Portuguese speaking nations; and there was always a long line at their table.
Along with the food, there was cultural music and talk of international events such as soccer and the upcoming World Cup games. The President, Cintia Lopes, was very
Photo courtesy of Xin He Performers at the International Fair dressed in cultural costumes
happy with the turnout over the course of the day. She was actually surprised and excited at the amount of attention the group was getting. The South American flute ensemble, Eco Del Sur performed Latin American influenced music with a flare of Andean, an ancient cultural type of music. The Iskra Ukrainian Dance Ensemble performed at the event as well and was a smash. This performance gave students insight into the culture as the dancers wore traditional costumes. Overall, the International Fair, held on the Green, had impressive performers despite the low turnout of both clubs and students. However, the clubs that did participate made huge statements and brought a small piece of their culture to the Green and to Seton Hall. Contact Rory at rory.manning @student.shu.edu
THE STILLMAN EXCHANGE
TUESDAY, OCTOBER 27, 2009
Opportunities Abound For Senior Morse By Ryan Garrity, Stillman News Writer The senior chosen for this edition of The Stillman Exchange Interview is marketing and management major, Brett Morse. Heavily involved with a variety of clubs and organizations on campus, Brett has been able to translate the business skills he has acquired on campus into a variety of interesting opportunities off campus. In this interview, he lets The Stillman Exchange know about various internships he has held, as well as what he plans to do in the future. Ryan Garrity: What are you involved in on campus? Brett Morse: I am involved with the Marketing Club, Finance Club, The Stillman Exchange, and intramural sports. I am the President of the Marketing Club, on the E-Board of the Finance Club, a writer for the Money & Investing section of The Stillman Exchange. RG: What are your duties as marketing club president? BM:The duties as the Marketing Club president primarily include running all of the club meetings, supervising the budget with the treasurer, and help with club publicity and recruitment. This year the Marketing Club has been initiating co-sponsorships with other clubs on campus for events that can use help with marketing. Co-sponsoring events has required me to communicate
with other club leaders frequently and organize an adequate marketing plan for these events. Other important duties I have are the responsibility of leadership of the organization and decisionmaking on behalf of the executive board.
RG: What was it like to work with the International Fight League? BM: It was an interesting experience to work with the IFL. I worked in the marketing department but the company was small enough that I was able experience other departPhoto courtesy of Brett Morse ments. It was RG: What With several internships and on campus involvement under i n t e r e s t i n g i n t e r n s h i p s his belt, Morse is on his way to an extraordinary future because the have you held? employees of the BM: I have held several internships IFL were all really interested in mixed marthroughout college that range from market- tial arts and the fighters in the IFL’s league. ing to investment management. The sum- Eventually I developed a greater interest for mer after my freshman year I worked for the same things. I learned a lot from this S3, a brand management agency, located in internship because I was able to work under Boonton, NJ. In the fall 2007 semester I a very successful head marketing manager. worked for the Seton Hall University PR & Marketing department. The following RG: What are your duties at your cursemester, spring 2008, I worked for rent internship with Merrill Lynch? International Fight League, located in New BM: My duties at my current internship York, NY. In the summer of 2008 I worked with Merrill Lynch vary day to day. I primafor Clark Capital Management Group, Inc. rily assist Financial Advisors with day to located in Philadelphia, PA. day activities. Some of my duties include I currently hold an internship with Merrill doing touch up work for others, miscella-
Finance Advisory Board Draws Students to Discuss Careers in Finance By Beverly Makarios, Assistant Editor Students arrived professionally dressed and early to attend the Finance Advisory Board meeting, presented by the Finance/Economics Club, on Monday, October 19. It drew a number of students to discuss ideas and thoughts about work, the job market and ways that students can work with the Finance Club. Members of several financial companies as well as new finance faculty members spoke with the Finance Club in small interactive group sessions. They discussed job opportunities in finance and described what their jobs entailed. Howell McIntyre, the Managing Partner at Summit Group, and his management consulting firm deal with operations and technology in solving problems in the technological processing of investments. The Summit Group also works within the mid-office activities that begin after trade transactions by investors are made. When asked by a student on how he got to his leadership job, McIntyre said he first worked and managed tech groups for a number of years before deciding to start the Summit Group. As a Managing Partner, “you should know how your job affects jobs around you.” McIntyre also spoke of Summit Group’s newly introduced website called Investment Indicators, which was developed through support from the Stillman School of Business. The Investment Indicators website offers useful tools for both students and independent investors in studying the economic trends and making clear investment decisions. Edward G. Schreier, Managing Director at Deutsche Bank Securities Inc., graduated with a degree in history but still became a NYSE trader for 28 years before arriving at his current position. Schreier advised students to always ask themselves, “Where do I want to be or do in
Lynch, located in New York, NY.
5 years? You can’t just say I want to make money. Look beyond the money perspective.” Students should “have good math skills,” he added. According to Schreier, the most important aspect of being a Managing Director at Deutsche Bank is “treasuring clients.” Dr. Tony Loviscek, once a Finance Advisor and Professor for the Stillman School of Business, now works as an Investment Advisor at Covington & Associates Inc. As an Investment Advisor, Dr. Loviscek said his job is very demanding and requires full dedication to his clients. Finance Club advisor, Christopher Kinslow, was present in directing the night’s event. The Finance Advisory Board was originally created by Dean Boroff and they meet three times a year and have historically had two meetings. According to Kinslow, these meetings are arranged to “help with recruiting PhD’s and give us [students] a sense of what goes on in the business world according to recruiters.” The Finance/Economics Club also takes the opportunity to discuss past and future events during the board meeting. A few upcoming events the Finance Club will be sponsoring includes a WellsFargo event on November 2 and a mustattend Beta Alpha Psi event scheduled for November 12, targeting students majoring in finance, accounting and related business fields. If you are a student interested in taking on a new leadership role within the Finance/Economics Club, be informed that the upcoming transition period for elections will begin in late March. The Finance/Economics Club presidents addressed that sophomores and juniors should take initiative in bringing in ideas for future events that the board can plan for the spring. Contact Beverly at email@example.com
neous tasks on excel and other programs, prospecting for new business, build and review portfolios, observe and experience the investment processes, research securities, and other daily functions. RG: What is S3 and what did you do as a summer executive with them? BM: S3 is an advertising, marketing, and public relations company that is more than a full-service agency. S3 is packed with creativity, professionalism, and responsiveness which set it apart from other agencies. As a summer executive at S3 I was able to experience almost every function of a branding agency. I was in charge of daily activities, market research, assisting account managers in strategic planning, focus groups, developing new client advertising, and implementing brand awareness. RG: What are your plans upon graduation? BM: I have always been interested in investment management, so I plan on working for a wealth management firm in New York City or Philadelphia. I have also been considering going into investment banking. My final decisions upon graduation depend on the offers on the table. My backup plan is to obtain my MBA from a university in the tri-state area. Contact Ryan at firstname.lastname@example.org
Thinking About A Career in New Jersey’s Pharmaceutical Industry? Many students at Seton Hall realize that New Jersey has long been known as the “medicine chest” of the US since many large pharmaceutical companies make the state their home. It is logical to think that this might be a good industry for career opportunities, and it is, but students need to be aware that over the past year, there have been a number of changes pending in the NJ pharmaceutical industry including mergers, acquisitions and new start- up companies in the field. All of this movement will impact the availability and types of jobs in this key NJ industry. Ongoing business challenges such as the global recession, slow growth, declining stock prices, the development of fewer major drugs, and the expiration of patents on some of the industry’s blockbuster drugs, have accelerated the long-standing trend towards mergers and acquisitions among the biggest pharmaceutical companies. By the end of 2009, three major mergers, those of Merck and Schering-Plough; Pfizer and Wyeth; and Roche and Genetech are planned (New Jersey Monthly, September, 2009). These will greatly change the identity of “Big Pharma” in NJ as these companies consolidate facilities, refocus their research, and merge their staffs in functions such as human resources, technology, finance, and marketing. While the big companies plan their mergers, they have also begun to rethink their research and development strategies which in the past have been towards producing blockbuster drugs that are geared to large markets. In some cases, the companies have been developing partnerships with acquiring firms that have marketable drugs in the development pipeline already. Johnson & Johnson’s acquisition of companies like Centocor in the 1990s and Cougar Biotechnologies this summer are
examples of this trend. Additionally, the larger firms have recently been driven towards an increasing emphasis on the development and marketing of specialty drugs which have more limited applications for a smaller number of patients. Small biotech firms like Medarex in Princeton, which Bristol Myers Squibb will soon acquire, as well as others such as PTC Therapeutics (in South Plainfield), Imclone Systems (in Branchburg), and Amicus Therapeutics (in Cranbury) are well positioned for possible future growth. However, with a scarcity of investment capital available, smaller biotech firms in existence today in NJ will have a harder time finding adequate funding, whether from venture capital, private equity, or state sources until the economy improves. So, what does this mean for the pharmaceutical industry and jobs in the industry in NJ? While the industry faces many challenges over the coming years with mergers, acquisitions, and new entrants into the field, NJ is still projected to have a sizable pharma/biotech identity going forward. Overall, with the large number of Fortune 500 companies in the state, its highly skilled, highly educated workforce, its wide network of legal firms, advertising and marketing agencies, research facilities, and strong regional consumer market, the state will continue to be an attractive area to the pharmaceutical industry as it continues to evolve. As a result, students who would like to be seriously considered for opportunities in the pharmaceutical industry would want to be knowledgeable about emerging issues in this industry as well as research current news and events impacting specific companies they may be interested in as changes will be ongoing for the foreseeable future. Regards, The Career Center
TUESDAY, OCTOBER 27, 2009
THE STILLMAN EXCHANGE
Rocky Mountain Slides Down Slippery Slope of Business Ethics “The Rocky Mountain Insurance Group has come under fire after denying a four-month-old child health insurance based on his weight. Alex, the four-month-old baby, weighs in at 17 pounds, which places him in the ninety-ninth percentile for his age. Is it the company’s right to assess Alex as a risk and refuse coverage or is it going too far to deem a four-month-old too obese to insure?” Though this issue aroused some questions, I think the insurance company’s response is natural. There are certain strict guidelines one must follow, and regardless of what age, height, Rules are made for a Reason health and weight one is, they should be Obesity has become almost a widespread enforced. Rules are there for a reason and there epidemic of in our country today. It is the gateshould be no altering them. By helping out one way problem to many other health issues that person, one could create a larger problem of may at times be fatal. People don’t die from a people asking why others got accepted versus high body mass index, which is determined by them who got denied. height and weight, but Insurance is there to from the additional Photo courtesy of the Denver Post cover unknown risks consequences that go that may come by along with the weight and since Alex’s parsuch as difficulty ents were aware of breathing, diabetes and his “pre-existing” even heart attacks. overweight condiIt’s a lack of cartion, they should ing for your body, conhave been prepared suming the wrong for the answer. foods and not being Alex’s weight will active or exercising not change over the that cause death. course of a day and Therefore, being obese his parents will not calls for the person to have him lose be a high risk patient, weight. which causes insurWith the economy ance companies to the way it is, insurers raise the amount of are also hesitant in money paid or even giving out plans with deny a patient help. high premiums, Because of what because people may the insurance company not be able to pay the lies down on the line high coverage that is for this person, these Baby Alex Lange poses with his mother asked, leaving the guidelines are strict. A company without current example of this money. situation in Denver, where baby Alex, at four Higher risks call for more money that peomonths, gets denied health insurance for his 17 ple do not have and money is obviously essenpounds on the scale and only 25 inches in tial for a company’s survival. People and comheight. panies do what they need to do in order to surWith strict guidelines, the Rocky Mountain vive in today’s economy and there are certain Health Plan stated they would not allow for things that have to be done even if it means disinsurance unless the baby was under the ninety appointing others. fifth percentile and in this case, Alex was not reaching into the ninety-ninth percentile thereContact David at fore being denied. email@example.com
David Guzik: Sophomore, Political Science Major
Kimberly Bolognini: Sophomore, Journalism Major
The Power of Publicity Four-month-old Alex Lange has been denied health insurance from Rocky Mountain Health because he weighs 17 pounds, which is considered obese for his age. Other than being considered obese, which he could most definitely grow out of, Alex is perfectly healthy. It is sad how an innocent baby can be deprived of health insurance. Babies don’t have any control over their bodies, they come into the world and their parents care for them until a certain age. It’s not like the Langes were being irresponsible parents by carelessly feeding Alex junk food, he has been given nothing but breast milk. I can’t even believe what health insurance has come to. What is a parent supposed to do in this situation? Give your baby drastically less food or make him or her go on a diet? There is nothing that can logically be done. According to the Denver Post, the baby’s father, Bernie Lange put it, “I could understand if we could control what he’s eating. But he’s four months old. He’s breast feeding. We can’t put him on the Atkins diet or on a treadmill.”
Some may wonder why Alex’s parents have not decided to switch to formula instead of breast milk, because it may help the weight issue. Although it could, it isn’t fair that a parent has to change entirely what the baby is used to eating, only because the baby has to lose weight to get health insurance; that’s just bizarre. I just can’t seem to understand how health insurance companies were able to get away with this. Thankfully, after the story went public because Bernie Lange is an anchor on local Colorado news station KKCO-TV, Rocky Mountain Health announced that they “will now provide health plan coverage for healthy infants, regardless of their weight.” If only more parents and infants could be that lucky. Not every parent in this situation has access to make the public aware. The only reason why Rocky Mountain Health decided to change the health plan was to save their reputation, not to help innocent infants. Hopefully, more health insurance companies will follow in their footsteps and do the right thing by providing coverage to healthy babies of any weight. Contact Kimberly at firstname.lastname@example.org
Stephanie Urban: Junior, Accounting Major
Stay True To Your Word Tucked away inside a tiny, greycolored text link titled “About Us” on Rocky Mountain Health Care Plan’s website one can find the company’s mission statement. The first sentence of the mission statement reads: “We take the initiative to improve the lives of our Members and the health of our communities by offering innovative health plans, providing excellence in service and care for our Members, and staying true to our tradition of putting people before profits.” If this sentiment still remains as the purpose, motivation, and driving force of Rocky Mountain, then it is certainly a good thing that the company reversed their original decision to deny insurance coverage to an overweight infant a few weeks ago. After all, it can be very reasonably assumed that the insurance company felt that providing coverage to the overweight baby posed potential risk to the company’s profits. This risk, though it may be understandable to anyone trying to run a profitable company, is confusing to a potential patient-customer, who is led to understand from the company’s mission statement that Rocky Mountain puts “people before profits”. According to the Denver Post, Mr. Bernie Lange, the child’s father, was told by Rocky Mountain that he, along with other members of his family, could obtain insurance from Rocky Mountain, but that his baby was too fat to qualify. When this news broke, it made headlines because not only is Mr. Lange an employee of an NBC-affiliate, according to Fox News, but also because people across the nation were appalled by what many believe is the incompetency of the underwriting in the health care industry. Underwriting by insurance companies is simply the practice of assessing who is eligible
for certain plans or services or how premiums for certain individuals should be calculated.
“This risk, although it may be understandable to anyone trying to run a profitable company, is confusing to a potential patient-customer, who is led to understand from the company’s mission statement that Rocky Mountain puts ‘people before profits’”.
I believe that it is okay for private businesses to deny services to certain people. If I was a rental-car provider, I would not lend a car to someone who comes into my lot and appears to be even just slightly intoxicated. Not only could a person influenced by drugs or alcohol destroy my property, but he would also be a serious threat to others on the road. Likewise, if I managed a day care center, I would not want to offer my business to a child who was uncontrollable and in the habit of punching other children, because his behavior might cause other children to leave my business, causing me to lose my income. Unlike the aforementioned examples, the case of Baby Lange is different because though overweight, the baby is otherwise very healthy. If the insurance company intends to deny coverage to fat infants in the future, they should only take weight into consideration when the problem is also accompanied by heart disease or dangerous cholesterol levels. In addition, such limitations should be made very obvious and specific. In my opinion, they ought to change their mission statement… or at least take out the part about “people before profits.” Contact Stephanie at email@example.com
In a recent poll of Seton Hall University students, 28 percent thought that the insurance company had the right to deny coverage and 72 percent thought that the baby should have been insured.
The Stillman Exchange proudly offers students, faculty, and administration the opportunity to write about their views on controversial topics. These opinions are to be read as the opinions of individuals and not the views of the newspaper as a whole.
THE STILLMAN EXCHANGE
TUESDAY, OCTOBER 27, 2009
Editorials Foreign Investment Hits U.S. Professional Sports By Alex Cohen, International Business Editor In September, the American sports world experienced a little Red October when Russian precious metals tycoon Mikhail Prokhorov purchased the New Jersey Nets of the NBA. For most American fans, this announcement would have been surprising to say the least. However, the move is not at all unprecedented in the global sports world. For instance, English soccer’s Premier League is full of foreign investment. Local rivals Chelsea and Fulham are owned by a Russian oil billionaire and an Egyptian business magnate respectively. They are just two examples in the league of twenty teams, exactly half of which are owned by outsiders, four of whom are American. One such American owner is Malcolm Glazer, who owns Manchester United, arguably the world’s most recognizable sports brand. Although his takeover was viciously opposed by traditionalists, who were worried by his personal debts and felt that he was corrupting the club’s image, his tenure has seen the team continue its history of success with three straight Premier League titles and a Champions League win in 2008. On the flip side is their local rival Manchester City, which last year changed hands from Thailand’s Thaksin Shinawatra to Sheikh Mansour bin Zayed Al Nahyan of
Abu Dhabi. While the deep pockets of some owners have helped level the playing field for some lower tier teams, fans of the sport feel that such quick transformations ruin their pastime. Instead of teams going through the whole rebuilding process to improve, big buyouts like these could set a precedent in which purchase by a billionaire helps a club sky-rocket to the top. Therefore, the question can be asked, is foreign investment beneficial for American sports? One immediate concern is one of tradition. How would a fan of the Green Bay Packers feel, for example, if his local team was suddenly purchased by an investor from Iceland or Saudi Arabia? On the other hand, whether or not the owners hail from abroad, there has always been a tradition of wealth backing the most successful teams, meaning that the situation would not be changed dramatically by wealthy foreigners. Major League Baseball, for example, has become accustomed to financial domination by the Yankees, Mets, Cubs, and Red Sox, the teams with the four highest payrolls in 2009. Their success, however, has been varied, with the Mets and Chicago missing out on playoff spots. Nonetheless, the discrepancy in funding is the reasoning behind the NFL’s salary cap, which could consequently prevent an influx of foreign investment. This fact brings up another question. Will there likely be a large migration of for-
eign owners into American sports? In addition to the limits of the salary cap policies, the relatively isolated nature of American sports could hamper international investment. Basketball does have some appeal in Europe and Asia, and it is therefore not shocking to see Prokhorov launch his takeover. He did, after all, already own CSKA Moscow, a sports club that competes in basketball in addition to soccer and hockey. Also the NHL, although the least profitable of the big four leagues, is another league with some global appeal but is only compatible with the colder climates of Northern and Eastern Europe. There is also baseball, which is popular in East Asia and Latin America, although firms in Latin America likely lack the capital to purchase a team. Finally, we have the NFL, which has tried desperately to spread its appeal worldwide with the failed NFL Europa League, as well as games in London, which began with the New York Giants victory over the Miami Dolphins in 2007 at Wembley Stadium. Despite some of the potential obstacles to global investment in American sports leagues, one thing is certain: Mikhail Prokhorov may have been the first foreigner to buy an American team, but he will not be the last.
The bold decision of the Nobel committee to award President Obama the Nobel Peace Prize appeared to catch most observers by surprise - including the recipient himself. The announcement has prompted a flurry of criticism based on the perception that he did not deserve the prize or that others were more deserving candidates. In the last issue of the Stillman, we heard the sentiments of an Assistant Editor who concluded “President Obama simply got the prize for his ability to stand in front of a big group of people and speak.” I found this to be a perfect starting point to share my views. The Bush years have been associated with cowboy diplomacy and U.S. unilateralism. We went to war in Iraq with neither a legal basis nor the backing of our traditional allies. In short, our foreign policy drastically undermined our standing in the world. And now we elected a leader who travels to Cairo, Egypt and directly addresses the Muslim World in a reconciliatory speech. Our President has taken the initiative to close down Guantanamo, reduce the world’s nuclear arsenals, send high-level officials to promote peace around the world, reform our ailing healthcare system, and join the rest of the world in combating the threat of climate change. Given these developments, we still have observers that state, “it has been 9 months so far and not one major step has been made towards anything, let alone peace.” This is because we have observers that either do not believe in the vision of our President or are too narrow-minded to see the measures he is undertaking. I thank God for what President Obama is attempting to do because he is addressing issues that have long been neglected. In regard to the claims that President Obama won the prize sim-
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Letter to the Editor: Obama’s Peace Prize By John Papaspanos, Guest Contributor
The Stillman Exchange
ply for his ability to speak, think about how Al Gore won a Nobel Prize. It was not just because he advocating the planting of trees, but instead that he furthered the advance of clean coal technology. Every person who is contributing to a cause serves a purpose. Yes, Barak Obama is the President of the United States and he is a gifted speaker. But that alone is not the reason he was awarded the prize. He has actively reached out and conveyed his message of strengthening international diplomacy and cooperation between peoples. The Former Finnish President has seen what the Republican conservatives and critics have not mentioned in their tirades—that the Nobel committee not necessarily wanted to award previous, concrete achievements, instead they wanted to encourage Obama on the issues he has been promoting on the world stage. Mother Theresa is a previous Nobel peace prize laureate but she did not end poverty. Likewise, President Obama is participating in an ongoing endeavor—he alone will not achieve world peace but his efforts will lead to a positive effect in international relations. We, the youth of the U.S., must realize that our country is no longer the sole superpower and cannot bully other countries around. Other countries are gaining power and confidence on the world stage. Our prosperity and success depends on working together to confront complex global problems. Let us respect the Nobel committee’s decision as a challenge for the next generation of U.S. citizens to be more open-minded and supportive. Only then will global peace become an achievable goal. Contact John at email@example.com
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TUESDAY, OCTOBER 27, 2009
THE STILLMAN EXCHANGE
McDaniels has turned Broncos into serious contenders line holding a clipboard, though. In high school, he played
By Robert Szeluga, Stillman Sports Writer Josh McDaniels is not Mike Shanahan, but he does have people wondering whether he will be the next great coach in the mile-high city of Denver. The 33-year-old coach is currently 6-0, as of press time, and is re-establishing the Broncos as one of the premier franchises in the NFL. He has turned the team, which was predicted to finish towards the bottom of the league in virtually every poll, into possible Super Bowl contenders. The defense also has been transformed into one of the top defenses, leading the league in points allowed. Though a coach can’t physically control the outcome of the game, McDaniels has prepared his team for every task at hand, and is one of the main reasons for his team’s success. Coaching is something that should come natural to McDaniels. His father, Thom, is considered an Ohio high school football coaching legend. McDaniels claims that he used to wake up early when he was just four years old to watch his father’s practice in Canton, Ohio. His biggest aspiration was to be a high school coach just like his father when he was younger. That dream obviously has been surpassed. McDaniels’ football career wasn’t always on the side-
In 2001, just two years later, McDaniels found his way as a personnel assistant for the New England Patriots. He Photo courtesy of SI.com was then promoted to defensive coaching assistant for the next two years and was promoted to quarterbacks coach by 2004. After the departure of Charlie Weis, he took over playcalling but was not officially named offensive coordinator until 2006. Since taking over the Broncos, McDaniels has dealt with two major controversies, Jay Cutler and Brandon Marshall. Cutler was unhappy with the selection of McDaniels and publicly stated that he did not trust his new coach. Fans were not happy with Cutler’s trade, and there were even “Fire Josh McDaniel” websites that were started because of it. Marshall’s off-field problems, notably his recent off-season arrest, were also viewed as a detriment to McDaniels has led the Denver to its best start since the Elway era. the team. However, the decision to trade Cutler and keep Marshall has paid off so far. quarterback and was his team’s kicker. He went on to play at You don’t win a Super Bowl in the first six weeks of the John Carroll University where he was beat out for the quar- season, but Josh McDaniel has his team heading in that terback position, but stayed on the team as a wide receiver. direction. After playing college football, he went on to become a graduate assistant at Michigan State under the head coach at the Contact Robert at Robert.Szeluga@student.shu.edu time, Nick Saban.
Stillman Sports A-Rod, CC fuel Yankees postseason resurgance Super Seven 7. Raider’s Head Coach Tom Cable will not be criminally charged after allegations came out that he assaulted Randy Hanson. Hanson, an assistant coach, accused Cable of assault after an altercation that occurred at their training camp hotel on August 5. 6. The torch relay for the 2010 Vancouver Olympics began on Thursday after the torch was lit by the sun’s rays in Greece. The torch will be lit during the Winter Games from February 12 through the 28. During the past three Winter Olympics bad weather caused a backup flame to be used. 5. NBA commissioner David Stern is optimistic that an agreement will be made with officials before the season starts. Replacement referees from the WNBA and D League have been used during the preseason and the NBA plans to incorporate these refs into the rotation during the regular season. 4. California Governor Arnold Schwarzenegger signed a bill that will allow a football stadium to be built in the Los Angeles area in order to lure an NFL team back to the city. The city hasn’t had a team since the Raiders moved back to Oakland and the Rams moved to St. Louis in 1994. 3. The NBA season tips off on October 27 when defending MVP LeBron James and the Cavaliers host the Celtics. The defending champion Los Angeles Lakers also open up their season that night against the Clippers, who selected Blake Griffin first overall in the past draft. 2. Connecticut cornerback Jasper Howard was killed in an on campus stabbing last weekend. He was stabbed outside of a dance the school hosted after their homecoming victory against Louisville. Connecticut players will wear stickers on their helmets with his initials on them. 1. Game 1 of the 2009 World Series will be played on October 28. MLB has announced they will only be using experienced umpires due to the questionable calls during the postseason so far. All games of the series will be broadcasted on FOX.
By Matt Bartel, Stillman Sports Writer
Despite having postseason struggles in the past, this year Yankees’ third baseman Alex Rodriguez has caught fire in October instead of cooling off alongside the autumn season. The Yankees have also seen huge contributions from high priced offseason acquisition CC Sabathia, who has also been marred with playoff struggles his entire career, as well. Rodriguez’s woes came as such a shock to both Yankees management and the fan base because he is one of the most productive players of his era, currently tied for eighth on the all time home run list, and is the owner of three most valuable player awards. In the American League Divisional Series from ‘05-’07, Rodriguez had very little success with batting averages of only .133, .071, and .267, respectively. This postseason Rodriguez batted .455 in the ALDS against the Twins. This performance includes a clutch game-tying homerun in the ninth inning of game two off of Twins’ star closer Joe Nathan. In the ALCS, Rodriguez has tied the major league record for consecutive postseason games with a run batted in, to complement his .450 on base percentage and solid play in the field. Another reason for the Yankees dominant postseason performance thus far is also due to excellent starting pitching from the ace of the staff, Sabathia. He has shut down the competition in game one of both series, which has allowed the Yankees to get off on the right foot, taking pressure off of fellow starters A.J. Burnett and Andy Pettite. Sabathia has had abysmal postseasons in 2007 and 2008 going 1-3 with an earned run average well over 10. Sabathia has turned that around in New York with a 3-0 record and a miniscule 1.19 earned run average in twenty-two and two thirds innings pitched this October. Both players have been big surprises and great successes that will have the Yankees back to their dominant postseason form for years to come.
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Photo courtesy of the AP Alex Rodriguez is a big reason why the New York Yankees have done this well in the playoffs so far.
Blazers have talent to compete for title By Anthony Holesworth, Stillman Sports Writer The Portland Trailblazers is arguably the most up-and-coming team in the NBA. The team tied for the second-best record in the Western Conference last year. With an improved squad and the addition of veteran point guard Andre Miller, the Blazers are expected to top last year’s performance and establish a greater level of dominance in the NBA, but are the Blazers NBA Championship ready? Throughout the late 1990’s and much of the 2000’s the Blazers went through a drought. With endless on and off-court problems, the team continuously came up short of expectations and fell into a multi-season slump. The turnaround started in the 2006-07 season when the team had finished with a record of 32-50. The next season, with a more developed squad and a greater level of leadership from team captain Brandon Roy, it finished an even 41-41. This concluded the team’s three-year streak of finishing with a losing record. Through the off-season, the Blazers kept much of the same squad together in order to develop and mesh. This strategy paid off as the young athletes continued to mature into solid NBA players. Last season, with the secondyoungest team in the NBA, the Blazers shocked the league by finishing with a
record of 54-28. This marked the team’s first winning season and playoff appearance in six seasons. The revived excitement surrounding Blazers basketball was soon shut down as the team’s lack of experience showed through and it lost to the Houston Rockets in the first round of the playoffs. In the months that have followed, the team has continued to develop and have added a veteran guard in Andre Miller. Although the Blazers have a top-notch squad and solid depth on its roster, the team isn’t championship ready at this point. Their lack of experience, which hurt them in last year’s playoffs, is still an issue, even if to a lesser extent. Additionally, teams such as the Los Angeles Lakers, Cleveland Cavaliers, and Boston Celtics are still too dominant and experienced for the Blazers to have a legitimate chance at defeating them in a playoff series. Nonetheless, the Blazers can be expected to be among the top Western Conference teams this season and go deeper into the playoffs than it has in almost a decade. Furthermore, if the team keeps its core group together and continues to improve at the same rate, Portland is sure to be a serious NBA championship contender within the next two to three years. Contact Anthony at firstname.lastname@example.org
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TUESDAY, OCTOBER 27, 2009
Red Sox combine with soccer’s Fulham FC for marketing deal By Kayla Mjaatvedt, Assistant Editor Fenway Sports Group has entered into a partnership with the English Premier League's Fulham Football Club to become its North American agency. Fulham, founded in 1879, is the oldest professional soccer team in London. The deal will allow Red Sox owners to promote the London club in the United States. Fenway Sports Group will set out to secure commercial partnerships for Fulham, beginning with a new sponsor for the team's jer-
seys. The group will also dedicate itself to raising revenue to augment and improve its historic stadium, Craven Cottage, one of the oldest in the league. More than any other club in the Premier League, Fulham has become one and the same with its home field. “We saw a lot of similarities between Craven Cottage and Fenway Park when reviewing this opportunity and are excited to work with one of the top football clubs in London,” said Fenway Sports Group President Sam Kennedy to nesn.com.
“Fulham and the English Premier League are leading sports brands and we are eager to speak with potential corporate partners about how they can achieve their global marketing objectives by partnering with Fulham.” Fenway Sports Group’s experience with the Red Sox and Fenway Park will be collaborated with Fullham at Craven Cottage in order to maximize revenue and enhance the fan experience at historic sporting venues. Fulham FC, which competes in the top
NBA reaches out to Hispanic fans in new upcoming advertising campaign
level of English football, entered the ‘09-‘10 season after having its best season ever in ‘08-‘09, finishing seventh in the Premier League and qualifying for the UEFA Europa League. The team has played at Craven Cottage since 1896. Fulham has longstanding ties to the United States, and now even more so with this deal taking place.
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BofA struggles with NFL over credit card sponsorship By Travis Tosoni, Assistant Editor
By David Rind, Sports Business Writer In a league with already significant international appeal, the NBA is searching for more, specifically a larger Hispanic following with their ene-b-ea project. On October 19, the NBA announced a $7-10 million ad campaign to draw in more Hispanic fans. The NBA has been praised for its ability to reach out to an international audience, as its initiatives in China and Europe have created large amounts of revenue for the league. Europeans have played in the league for some time now, and the Chinese are beginning to learn basketball at a very young age. Many of their physically gifted players have come to the U.S. in pursuit of an NBA career; most notably Chinese hero Yao Ming. The ene-b-ea campaign will be a diverse collection of media in an attempt to keep the interest of present Hispanic NBA fans and to draw in new ones. A series of TV spots will be shown featuring Spanish speaking NBA players on many Spanish outlets. In addition, a Spanish language website will feature a collection of NBA content to view. Furthermore, initiatives to improve basketball courts in Hispanic neighborhoods will look to spark interest in the game. The league already has agreements in place with ESPN Deportes to broadcast certain games in Spanish, and these new media outlets will only increase exposure. The NBA already has about 18 million hispanic fans, or roughly 15 percent of all their fans. This is possibly due to the small numbers of Hispanic players currently in the NBA, with only 19 players coming from Hispanic heritage. In a time of U.S. economic turmoil, this outreach program presents intriguing opportunities for the NBA. Ticket sales are declining in the U.S., and the NBA is desperate for fans to buy tickets. The NBA is realizing the large part that the Hispanic population plays in the U.S. economy, and wants to take advantage of it.
Mexico, and the more exhibition games played there, the more excitement, and thus more revenue. Despite the small numbers playing in the NBA, the Hispanic fans are being welcomed with open arms.
Bank of America is currently in talks with the NFL to renew the company’s sponsorship as the official credit card, banking, and mortgage sponsor of the league. Bank of America is lobbying for exclusive rights to use the logos of all 32 NFL teams on both its credit and debit cards. This new deal, if reached, would be a significant increase from the $10 million the NFL already receives from the banking company. This deal was supposed to be completed at the NFL’s fall meeting two weeks ago, but it is the addition of team-level copyrights that is causing the delay. Bank of America must secure the individual rights of each of the 32 teams before an agreement can be reached. Several teams in the league are not willing to agree with Bank of America sponsorship because they already have committed to other deals within the banking industry. These teams are hesitant to relinquish their exclusive rights of their logos for Bank of America debit cards. For the better part of this decade, the NFL has been trying to avoid permitting companies from using team logos individually; instead they are allowing companies such as Bank of America to advertise with the logo of the NFL shield. Bank of America must obtain the local rights of each individual team in order to reach a deal. Currently, only three NFL sponsors have the exclusive local rights: Gatorade, Motorola, and Reebok. Bank of America is looking to become the fourth. These three companies have the ability to use individual team logos on utheir products. This proposed deal would only allow Bank of America to advertise within their banks, not through national television commercials. A decision is said to come as early as November, when the owner’s will vote on the matter.
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Photo courtesy of Getty The San Antonio Spurs Manu Ginobili is one of the few Hispanic players, hailing from Argentina.
The statistics show it, as roughly 49.6 million Hispanics reside in the U.S. This program could be beneficial for cities with large Hispanic populations, such as San Antonio or Los Angeles. The Hispanic draw could really boost sales numbers, and for cities with minimal Hispanic population, opportunities exist abroad to boost overall NBA attendance. The NBA has had its 18th game in
New baseball bat dealer has quickly grown into star players’ favorite brand By Anthony Crisci, Assistant Editor Many people don’t realize that there are more baseball equipment companies out there besides the traditional Rawlings and Easton. Believe it or not, there are actually some private companies that are making big moves in the baseball world. As a matter of fact big names like Albert Pujols, Ryan Howard, David Wright, and Mark Teixeira are consumers for one of the fastest growing homemade bat companies in the majors— Marucci.
Jack Marucci started his company after making some homemade wood bats for his son to play with. After handing Barry Larkin one of these bats before he entered the batting cage in 2003, the business has produced bats for about 30 percent of major leaguers. “When he came out of the cage, he said, ‘There’s something to this bat, I don’t know what it is, but you have to do something with this,” Marucci says Larkin told him. Two years later Major League Baseball certified Marucci and by word of mouth alone the company skyrocketed. This year
alone the company as supplied over 5,000 bats to many major league players who typically go through 72 bats a season. The company has come a long way since its birth, as they moved to a 10,000 square foot warehouse where seven employees work around the clock to produce these bats. Marucci admits that when a big-time player hits a soaring homerun and the replay shows the logo, people notice and sales prove the reaction. The future of the company is very bright, but the owner hopes to expand. He
wishes to not expand the business through Major League Baseball but rather through the consumer market. Marucci as of now only works with wood bats, although over 90 percent of the bat industry lies in the business of metal. His newest idea to crack the industry is to develop an anti-vibration technology to create fewer stings when the metal meets the baseball. Contact Anthony at firstname.lastname@example.org
TUESDAY, OCTOBER 27, 2009
THE STILLMAN EXCHANGE
McHenry scores third place on save list; Pirates shoot Big East Tourny By Kayla Mjaatvedt, Assistant Editor The Seton Hall men’s soccer team is dealing with some tough times after losing three consecutive games to Villanova, Notre Dame, and Georgetown. However, on Saturday, October 10, the Pirates earned themselves a point in the BIG EAST standings after a 0-0 double overtime tilt against Marquette. The team dominated most of the first half, with a 5-4 shot advantage in the starting 45 minutes. Senior goalkeeper Paul McHenry made six total saves for the Pirates in the scoreless game, including a save in the 108- minute, the only attempt on goal for Marquette in the
second half. The Hall picked up another point in the BIG EAST standings on Saturday, October 17 after a 1-1 tie with Providence. Junior Andrew Welker scored his seventh goal of the season and put the team on the board in the 76- minute of the game. However, the Friars fired back with a goal when a penalty kick was awarded in the 86- minute. With a tie score, the game moved into double overtime, but neither team could break through. McHenry recorded six saves in the match, giving him 228 in his career, which puts him at a tie for third all-time at Seton Hall. The Pirates took an early lead at Maryland on Tuesday,
October 20, but couldn’t hang on as the Terrapins rallied for a 3-1 win. Thanks to a goal by sophomore Giovanni Zammiello, the Pirates were able to avoid a shutout against the number five ranked team. Maryland ended the game with a 6-5 advantage in shots over the Pirates. McHenry had three saves for the Hall, giving him sole possession of third place all-time on the school’s career list with 231. Later this week, the Pirates will face off against Pittsburgh and West Virginia, fighting hard for a spot in the BIG EAST Championship. Contact Kayla at email@example.com
Hoops ready for “Next Year” By Tony Cramond, SHU Sports Writer Is this the year that the Seton Hall Pirates make it to the NCAA Tournament? All signs as of now point to yes. The campus is buzzing with anticipation for this upcoming season that has been billed as “Next year is Now”. The Pirates have had its share of struggles throughout the years, but this year seems different. It looks as if this year will be the year, that Seton Hall will finally be able to get over the hump and make it into the Big Dance. Seton Hall has been picked to finish tenth in the Big East Preseason Standings. The Pirates are behind Villanova, West Virginia, Connecticut, Louisville, Georgetown, Syracuse, Cincinnati, Notre Dame, and Pittsburgh. Seton Hall will need to move up in the conference to make it to March Madness. The record for most teams in the NCAA Tournament by a conference is when the Big East in 2006 sent eight teams. Another piece of news that came out with the preseason standings was the preseason awards, and guard Jeremy Hazell was selected to the second team All-Big East. He was the second leading scorer, behind Notre Dame Forward Luke Harangody last season. Hazell looks poised to build off terrific freshman and sophomore seasons and help the Pirates compete. Along with Hazell, the Pirates return sophomore guard Jordan Theodore, senior center John Garcia, and senior forward Robert Mitchell. The Pirates also gain transfers Keon Lawrence, Herb Pope, Jeff Robinson, and the now eligible big man, Melvyn Oliver. Freshman Ferrakohn Hall will also strengthen this deep Seton Hall bench. With this deep bench, the Pirates should now be able to compete with the top teams in the Big East. Also, Bobby Gonzalez has a new three year extension and no longer has to worry about his job being in jeopardy. He now has a legitimate opportunity to prove that he is worth the new contract that he has been given. This is his first year with the entire team being players the he has recruited. The Pirates finally have the depth and the personnel that it takes to run the up-tempo style of play that Bobby Gonzalez likes to run. So, this season is really all on Gonzalez’s shoulders. He has the players that he wanted, and now he has to get them to come together and produce. Contact Tony at Anthony.firstname.lastname@example.org Photo courtesy of SHU Athletics Jeremy Hazell will lead a talented basketball squad this year that will look to make waves in the BE.
Seton Hall’s Buried Treasure California superstar Courtney Kilarski showed off her tennis skills as she qualified for the ITA East Regionals hosted by Yale. Kilarski also joined up with Lizzie Verow in the doubles bracket where the ladies competed at press time. Phyllis Mangina’s women’s basketball team was placed as 14 in the BIG EAST Preseason poll with 33 votes. Junior Ebonie Williams looks to step up for the ladies and continue the dominant force she brings to the court as she concluded last season with team high 13.2 points per game. Former Seton Hall Baseball infielder
Ray Navarrete earned the 2009 Atlantic League MVP honors for his tremendous play for the Independent League’s Long Island Ducks. Navarrete’s honor marks the first time in the franchise’s history to take the honor of Atlantic League’s MVP. Junior Kevin Webster showed his absolute dominance in the pool as he earned BIG EAST qualifying times in his victories for both the 100-yard breaststroke and 100yard freestyle against Howard last Friday. In an effort to allow the Men’s Basketball students section and fan base to experience the team before they start the season, Bobby Gonzalez and the Pirates will be hosting a “Meet the Team Party” on Sunday, November 1. The event will begin with a blue/white scrimmage presented by GEICO at noon, followed by a meet and greet with the team. Seton Hall Intramurals even makes its way into the hearts of students as the intramural flag football games become a major hit for the competitive nature of the Seton Hall athletic community. Fans of all different backgrounds come out every week to witness and play in highly competitive games out on Owen T. Carroll Field
Golf makes strides in recent tournaments By Anthony Crisci, Assistant Editor The Seton Hall Men’s golf team started off the 2009 season strong, collecting third place out of 13 teams in its first tournament of the year. Junior Colin Van Es shot a 2over-par for the tournament to help the Pirates push past ten other teams. Van Es also showed his ability individually as he finished third out of a field of 65 golfers. The golf team has shown strong performances in its first four tournaments, but has yet to seal the deal and capture a first place trophy. The team hosted the Lincoln Mercury Intercollegiate tournament at Fiddler’s Elbow Country Club on October 17 and 18. This is the first tournament hosted by the Pirates since the final Seton Hall Invitational in 1997. Despite some inclement weather the Pirates pulled off a total 609, 33 over par score for the tournament, falling only nine strokes behind first place Delaware. Seton Hall has been led by Seniors Ryan Castanet and JC Cardamone, with extraordinary play by Junior Colin Van Es in the first four matches. The Pirates are set to take a trip to North Carolina for Halloween to participate in The Match Play tournament. This will be
Photo courtesy of SHU Athletics
Junior Borga Faixat follows through on a shot.
their fifth tournament of the season and will put individual abilities together to try and spark its first top finish of the season. Contact Anthony at email@example.com
THE STILLMAN EXCHANGE
TUESDAY, OCTOBER 27, 2009
Bailout Expands to Include Small Businesses By Padmavathy Sonti, Domestic News Writer
condition a year ago need no new assistance from the government,” Obama insisted, “and so we are winding down that por-
lack of capital. According to the White House, this has caused small businesses to be forced to weather the “perfect storm”.
and equipment) would increase to approximately $5 million. In addition, the SBA microloans would allow starting businesses President Obama asserted the to receive funds up to $50,000. importance of helping struggling small However, these changes are subbusinesses since they were the “backject to Congressional approval. bone of the American economy,” in a Sen. Olympia Snow (R-ME) supspeech on Wednesday, October 21. ported this measure by stating, “These President Obama’s proposal actions will help satisfy the capital includes the extension of $137 billion needs of small businesses looking to in unused Troubled Assets Relief start or expand their operations.” Program (TARP) funds to community However, Rep. Sam Graves (Rbanks and an increase in the size of MD) expressed his skepticism. “I am Small Business Association (SBA) not convinced the president still has a loans. clue what small businesses need. Their Prior to the event, Treasury announcement to assist banks in loanSecretary Timothy Geithner commenting to small firms does nothing to ed, “America will not recover until our incentivize a bank to issue a loan.” small businesses recover”. Since 2007, 7.2 million people Obama’s plan would allow smaller have lost their jobs as a result of the community banks with assets less than continuing recession. $1 billion to borrow at lower interest Geithner and SBA administrator rates from the TARP. In return, the Karen Mills were present as President banks would have to present quarterly Obama made his speech. reports detailing their lending activity “Over the past decade and a half, to small businesses. America's small businesses have creat“These are the community banks ed 65 percent of all new jobs in the Photo courtesy of Los Angeles Times who know their borrowers, who gave country,” the President stated hopefulthem their first loan, who have ly. Obama announces the expansion of the bailout at a small records storage business in Maryland alongside watched [the small businesses] grow “These companies are the engine Treasury Secretary Timothy Geithner and Karen Mills, administrator of the Small Business Association. from down the street, not from Wall of job growth in America. They fuel Street,” stated Obama. tion of the TARP program”. In addition, President Obama proposed our prosperity. And that's why they have to Of the 8,200 banks in the U.S., approxIn this recession, banks have carefully to increase the caps on three types of SBA be at the forefront of our recovery.” imately 7,200 banks are entitled to the reduced the number of loans they have loans. TARP funds. extended to small businesses. As a result, The cap on the 7a loan (used to expand Contact Padmavathy at “The major banks that were in critical small businesses have suffered due to a a business) and the 504 loan (used for land firstname.lastname@example.org
Fed Limits Pay for Execs of Bailed-Out Companies By Raphael Baseman, Domestic News Writer
from last year’s numbers. The cuts of 50 percent will affect 175 employees, at seven institutions: AIG, Bank On Thursday, October 22, the U.S. of America, Citigroup, General Motors Co., Treasury Department’s special master for GMAC Inc., Chrysler Group LLC and compensation, Kenneth Fienberg, Chrysler Financial. announced that pay for the highest-paid An additional 575 employees were also executives at seven Wall Street Companies under Fienberg’s jurisdiction, with their accepting federal aid will be cut in half salaries expected to be capped at $500 thousand with the most extreme, at AIG cutting off at $200 thousand. Although some executives at the regulated corporations will still receive large compensation packages, one executive expressed shock at the size of the cuts announced. “[The cuts] Photo courtesy of the New York Times were clearly much Photo courtesy of New York Times worse than what had Kenneth R. Feinberg, the Obama administration’s pay czar, faced been anticipated," he resistence from executives over compensation.
told the Wall Street Journal in an interview. The largest of the pay packages will be less than $10 million, far below the usual standard for star employees at Wall Street firms, according to the Wall Street Journal. The cuts do not, however, include noncash payments. This has motivated some of the companies to begin using stock options, untouchable for a minimum of four years, instead of cash payments, in compensating employees. These options have come to be known as “salary stock,” and will be mostly issued before the end of the year, as Fienberg has expressed wishes that they be distributed in 2009. Fienberg is also encouraging companies to return their federal bailout money, by allowing access to the options before the four-year period expires in exchange for its return. The position Fienberg fills was created by the Obama administration in order to more closely tie executive compensation to
Photo courtesy of the New York Times The Federal Reserve Chairman Ben S. Bernanke said some banks had “misaligned incentives”.
performance over the long-term, hoping this will prevent risk-taking for short-term gains, as they believe this was one cause of the financial crisis. Contact Raphael at email@example.com
News Briefs Obama Declares H1N1 Emergency President Obama declared a national emergency on October 23 to deal with the “rapid increase in illness” from the H1N1 influenza virus. “The 2009 H1N1 pandemic continues to evolve. The rates of illness continue to rise rapidly within many communities across the nation, and the potential exists for the pandemic to overburden health care resources in some localities,” Obama said in a statement. According to the CDC, since the H1N1 flu pandemic began in April, millions of people in the U.S. have been infected, at least 20,000 have been hospitalized and more
than 1,000 have died. The declaration will allow the Federal government to “waive or modify certain requirements” to help health care facilities deal with the pandemic. Bloomberg Sets Record for Spending NYC Mayor Michael Bloomberg has spent more of his own money than any other individual in U.S. history in the pursuit of public office. According to the New York Times, at the end of last week, he had spent $85 million on his latest campaign, and is projected to spend between $110 million and $140 million before the election on
Nov. 3. On Bloomberg’s collective three bids for major, he estimated to have spent more than $250 million. Janitor Charged with Killing Priest Jose Feliciano stabbed Rev. Ed Hinds 32 times with a knife after the two got in an argument at St. Patrick’s Church in Chatham Borough, New Jersey. The priest’s body was found in the church’s rectory on the morning of October 23. Feliciano, 64, had been employed with the curch for 17 years and the two were believed to be arguing over continued employment.
Northwest flight overshoots Minneapolis The flight originating from San Diego, California and intended for the Minneapolis, Minnesota overshot the airport by about 150 miles on October 21. The flight was carrying 147 passengers and an unknown number of crew. Communication was lost with the plane for a period of one hour, or 500 miles, and air traffic controllers feared the plane may have been hijacked. Crew members said they had become distracted after they were engaged in a “heated discussion”. An investigation has been initiated to see if the crew fell asleep while operating the aircraft.
TUESDAY, OCTOBER 27, 2009
THE STILLMAN EXCHANGE
Corzine Draws on Support from Obama By Kaitlin Tonti, Assistant Editor
Following two speeches, one from Weinberg and Kennedy, Corzine addressed As this year’s gubernatorial election an audience of over 3,000 people concernincreases in intensity between the three ing the reasons he should be re-elected on candidates, Democrat Jon Corzine, the third of November. Republican Chris Christie, and Independent Aside from building even more anticiChris Dagget, President Obama reaffirmed pation on behalf of Obama’s arrival, he his message that he will continue to support spoke on many issues imperative to his the incumbent Governor, Jon Corzine. campaign. With less than two weeks away until The Governor reminded the crowd on the people of New Jersey will choose their Christie’s position to eliminate health insurgovernor, President Obama made an ance mandates, and his opponent’s stateappearance at Fairleigh Dickinson ment regarding pre-school as another form University alongside Governor Corzine, of “babysitting.” candidate for Lieutenant Governor, Loretta Corzine also emphasized the signifiWeinberg, as well as author and attorney cance of maintaining a personal relationship with the President through his position Caroline Kennedy. as governor. Corzine has been finding several ways to associate himself with the President, in hopes of rejuvenating the same spirit among democrats that was evident during Obama’s campaign. The connection between the White House and Corzine’s position as governor is not only essential to Corzine, it is also essential to Obama. If the state of New Jersey elects a Republican governor, the media may Photo courtesy of Fox News view it as a defeat for the president’s Obama called Gov. Corzine a “partner” and the kind of current initiatives and future plans for leader New Jersey needs during difficult times. the country.
The event on Wednesday was the second instance of Obama publicly endorsing Corzine, the first of which was held at the PNC Bank Arts Center in July. During his 25 minute speech, he first praised the Governor on his success, including the preservation of funds for both education and health care, despite the severe economic downturn the country has been facing. Obama also referred to Corzine as one of the “best partners I have in the White House.” Although many people are being drawn to Photo courtesy of the AP the connection between Corzine’s campaign announced that Obama will return to the state on Obama and Corzine, November 1 to rally with Corzine in Camden and Newark. Chris Christie is still ahead in the polls with forty one percent isn’t moving in to run the state.” compared to Corzine’s thirty nine percent. Contact Kaitlin at Christie has also made it clear he is not firstname.lastname@example.org affected by Obama’s support of Corzine and does not believe voters should be either. “If they vote for Jon Corzine, Obama
Gitmo Detainees’ Fate to be Decided by Justices By Anthony Fratanduouno, Domestic News Writer
in question originally resided in the western part of China but fled and found refuge in Afghanistan. When the United States went
ly held under such name. This would not last however, as the federal appeals court reversed the decision.
believed that the nine Supreme Court Justices may rule based on whether or not the law forbids the releasing of foreign prisThe closing of the military prison oners on to American soil. However, in Guantanamo Bay, Cuba has been a according to lawyers familiar with the heated argument that has been disputed case, it is likely that the justices will by politicians for almost a year. rule on the broader question as to However, the fate of the prisoners whether or not judges have the authoriremaining at “Gitmo” has been shifted ty to rule in such cases. to the Supreme Court Justices once The case brings into question the again. checks and balances of the United On October 20, the same day that States and the decision will affect will Congress passed legislation which make the powers and jurisdiction of would allow detainees to have their each branch of government much more cases heard within the United States, clear. the Supreme Court agreed to decide if Susan Baker Manning, a federal courts have the power to release Washington lawyer speaking for the these detainees into the United States. Uighurs said, “I never thought we This is yet another obstacle the would be arguing in court whether the Obama Administration will have to government can lawfully imprison overcome because the January 22 Photo courtesy of The New York Times someone who was found to be innoadministration-imposed deadline for cent. And I never thought we would be the closure of the prison appears Protestors showed their support for members of a Chinese minority group, the Uighurs, who saught refuge in arguing against the Obama administraAfghanistan and were captured by U.S. forces. They are currently being held as enemy combatants. improbable since the Supreme Court tion”. case will most likely not be heard until into Afghanistan during a post 9/11 attack, Lawyers for the administration refute A decision should be made by no later February. the Uighurs were detained and labeled as this, arguing that it is beyond the judges’ than July of 2010. The case revolves around thirteen “enemy combatants”. jurisdiction stating, it is “outside of the Chinese Muslims who are part of a minoriFor a brief amount of time, the title was framework of the immigration laws”. Contact Anthony at ty group known as Uighurs. The individuals lifted and they were found to be wrongfulAccording to the New York Times, it is email@example.com
College Education Costs are Rising By Amanda Genabith and Rachel Ressler, Domestic News Writer, Assistant Editor College tuition prices have risen again this year despite the recession, according to a report released by the College Board issued on October 20. The cost of tuition and fees at a public, four-year college rose an average of 6.5 percent, while private four-year colleges, which are typically far more expensive, rose about 4.4 percent. The College Board, which owns the SAT and aims to make college admissions more accessible, stated in their report that tuition increases are generally, “really, really steep” in times of recession, and this year’s increases could have been far worse. Attendance at a four year public college now costs over $15,000 on average per
year. In addition, the one in five American college students who attend a private four year university now pay an average of almost $36,000 per year. When accounting for inflation, the total rise in college tuition and fee cost is closer
to 9 percent, the Chicago Tribune calculated, because the consumer price index dropped by 2.1 percent during the period covered by the College Board report. The president of the National Center for Public Policy and Higher Education, Patrick Callan, called the increases “simply astonishing” given the economic hardships of the last year. Though for most students, the cost of tuition and fees is lowered by roughly half through use of grants, scholarships, and loans, such practices are also changing, the New York Times reported. Private loans decreased by almost $11 billion in the last year while federal loans increased by $15 billion, causing a five percent increase in education borrowing. Calls for restructuring of the post-secondary education system were loud after
the release of the report. Jane Wellman, executive director of the Delta Project on Postsecondary Costs, Productivity and Accountability, told the New York Times that more permanent restructuring than budget cuts are needed by colleges and universities, and Lauren Asher, the president of the Institute for College Access and Success cited a need for more need-based aid. College Board’s report found that twothirds of grant money at public universities are given on the basis of merit. Contact Amanda at firstname.lastname@example.org and Rachel at email@example.com
THE STILLMAN EXCHANGE
TUESDAY, OCTOBER 27, 2009
India and China Discuss Climate Change By Amelia Snoblin, International News Writer On Wednesday October 21, China and India signed a memorandum to solidify the position of the G77 developing nations on climate change. This strategic alliance comes at a crucial time as world leaders will convene this December in Copenhagen to discuss global climate change initiatives. As China is currently the world’s leading producer of CO2 emissions and India is the fourth, the Copenhagen agenda stresses the necessity of addressing and creating a solution to this problem. India and China’s talks preemptively acknowledge this problem and establish general solutions.
Photo courtesy of The ChristianScience Monitor
Xie Zhenhua of China, right, shakes hands with Indian environment minister Jairam Ramesh after signing recent climate change memorandum.
Within the agreement, India and China clearly outline their common stance on climate change. Both nations are anticipating to cut CO2 emissions by increasing energy efficiency, improving “afforestation” techniques, working on “clean coal” technology, and furthering the use of renewable energy sources. At this time, neither country is willing to be internationally monitored. Both countries are reluctant to create fixed targets and dates for emissions reduction because history has shown that reduction is costly and may hinder industrialization. As representatives of the developing world, India and China have both made their messages clear: their development will not be hindered by environmental efforts. In an interview with the Associated Press, India’s Prime Minister, Manmohan Singh, addressed the issue of responsibility for environmental changes, stating, “Developing countries cannot and will not compromise on development”. In every debate on climate, there is yet to be a consensus as to which states are responsible to bear the costs and major repercussions of global warming. Because developed countries were the creators of most harmful greenhouse gases, the developing world persistently argues that industrialized countries must bear the brunt of these costs. On the other hand, the developed world focuses on past blame and future prevention. Their mantra includes a need for all countries to reduce emissions and be subject to similar targets and monitoring. In response, there is a push for the industrialized world to provide technologies and funding in order to make emissions reductions affordable for developing nations. India has particularly been at the forefront of the discussions involving the sharing of green technologies, more popularly referred to as “global public goods”. The distribution of these technologies must be expedited in order to curb the rise of CO2 levels. As Singh stated in his address, “The key issue before us is that of developing the appropriate technologies and then collapsing the time from their first commercialization to their large-scale adoption in poorer developing countries”. While the news of India and China’s deal has caused concern in the developed world, experts stress that this bilateral agreement has no intention of undermining multilateral negotiation. Rather, the deal represents an attempt to find common ground in order to make international negotiations easier and more cohesive. Recognizing that China and India contribute to most of Asia’s pollution, the formulation of a realistic plan for CO2 emission reduction is a step in the right direction. This regional pact may serve as a launching point for greater international cooperation in climate change discussions. Contact Amelia at firstname.lastname@example.org
Vatican Invites Anglican Conversion By Maggie Dougherty, International News Writer A week ago the Catholic Church extended a global invitation to all Anglicans to be reconciled with Catholicism under an Anglicanized liturgy. Because this decision was made secretly by a select group of Catholic leaders, many were shocked by the announcement. The Most Rev. Rowan Williams, the Archbishop of Canterbury and the spiritual head of the global Anglican Church, was first informed of the new liturgy a few short hours before the official announcement was made. In response to the announcement, the New York Times reported Rev. Williams’ statement: “I don’t see it as an affront to the Anglican Church, but I’m puzzled by what it means and by the timing of it,” he said. “I think some Anglicans will feel affronted.” This announcement comes at a time of uncertainty within the Anglican Church. Over the last several years tensions have arisen over theological stances. More specifically, there are divisions regarding the ordination of homosexuals and women as well as the consecration of same sex marriages. Additionally, the presiding Bishop of the American Episcopal church Rev Katharine Jefferts Schori, has denounced the trinity leading to the establishment of the North American Anglican church. As the
American Anglican church is currently undergoing reform and development, and in fact does allow the ordination of women, few believe that American Anglicans will join the Catholic Church. There are great expectations that the fusing of Catholicism and Anglican traditions will reshape Anglicanism in Western Europe and Australia. There are probable speculations that entire Anglican parishes and even dioceses will request to leave the Church of England and be folded into the Catholic Church. According to the agreement, Anglicans can join the Roman Catholic Church as full members but still retain many of their traditions and practices. However, the deeper meaning of this ambiguous statement is yet to be fully developed. In fact, Archbishop J. Augustine Di Noia, the Vatican’s deputy chief liturgical officer commented in the New York Times, Anglicans will be able to retain “intangible elements” of their tradition. Under the new provisions, Anglicans will be able to join newly formed parishes headed by former Anglican prelates. There is also talk of retaining the Anglican prayer book. Additionally, married male Anglican priests may continue to pastor congregations but may not become Catholic Bishops. Throughouthistory, Anglicans
have been converting to the Catholic Church on an individual basis. As noted by the BBC, this is the first occasion in which a “special section of the Roman Catholic Church, backed up by church law,” will be developed for converting Anglicans. Currently the Anglican Church has an estimated 80 million members worldwide and the Roman Catholic Church has 1.15 billion members. This announcement could lead to a significant number of conversions. The head of Kenya’s Anglican Church, Archbishop Eliud Wabukala, does not believe that the conversion of Anglicans to the Catholic Church will be as simple as the Catholics believe. He cites that there are too many differences in doctrines between the two faiths. Many other Anglican and Catholic priests share this sentiment and in fact, since Tuesday, many parishioners are beginning to think more critically about the notable differences between the denominations. For Pope Benedict XVI, this official invitation marks a momentous event in his dream of Christian unity. For years, he has worked to establish strong bonds between the two faiths and now partial reconciliation may be insight. Contact Maggie at email@example.com
Devastating Drought in the Horn of Africa May be Ended by Torrential Rains By Danielle Storm, International News Editor
hindered from reaching those in need. In war torn Somalia, internally displaced peoples camps, originally set up for those fleeing conflict, have been overrun by those affected Drastic weather changes could mean new problems by drought and famine. The dual concerns call for an for East African countries. Currently, agricultural industries increase of aid. InsideSomalia reports, “The persistent vioacross the Horn of Africa have been devastated by a pro- lence and the current drought have plunged the Horn of longed drought, but the latest reports suggest that heavy Africa country into its worst humanitarian crisis since civil rains may be on their way, bringing “mudslides, crop war erupted two decades ago”. destruction, waterborne diseases and disrupted road netEthiopia and Somalia are just two of many East works”. As these two African nations stumextremes are occurring bling from the repercussimultaneously, the effects sions of insufficient rain. are drastically heightened. John Holmes, the While the land is arid and under- secretary general desolate from drought, the for Humanitarian aid, region is susceptible to captured the broader aggravated damages from implications of the potential flooding. changing weather patSevere weather patterns in the region in the terns are particularly devfollowing statement to astating as most East CNN, “More than 23 African countries are ecomillion people in pasnomically dependent on toral, agricultural and Photo Courtesy of agriculture in both domessuburban communities, AFP/Getty Images tic production and trade as well as internally disAfter months of drought demolished East African crops, people exports. Ethiopia is one placed people and are in dire need of foreign aid. Above, a hungry Kenyan child such country. refugees in the region, holds out an empty cup begging for more food. More than 80 percent are reeling from the of the Ethiopian population is dependent on subsistence impact of water and food shortages, pasture scarcity, confarming. Over the last several years, Ethiopia has been par- flict and insecurity”. ticularly victimized by famines due to geography and outHolmes further indicated that the United States dated, insufficient farming techniques. Government is taking preventative measures to ensure that On Thursday October 22, the Ethiopian government potential effects of El Nino weather patterns are mitigated requested more than $121 million in emergency food aid. and that needed supplies are on hand. Infrastructure is Of Ethiopia’s 85 million people, the government estimates being tested for stability and the population is being sensithat 6.2 million people are in need of emergency food aid. tized to ways of protecting themselves and their property. Much of the famine is secluded to the eastern Ethiopian Aid organizations have expressed concerns as their conflict zone. Due to the dangers of insurgents in this resources and funding have been depleted from the past region, outside observers are unable to confirm these esti- months of famine. mates but many suspect that the need is far greater than the government predicts. Contact Danielle at With famine occurring in conflict zones, aid is often firstname.lastname@example.org
TUESDAY, OCTOBER 27, 2009
THE STILLMAN EXCHANGE
Japan: Luxury Brands Step Down, Cheap-Chic Steps Up By Meg Reilly, Assistant Editor This month, Versace has closed all three directly-owned shops in Japan and is expected to shut down its Tokyo business office at the end of the month after 30 years of operating in Japan. However, Japan’s Uniqlo has announced record annual profits and is driven to become the world’s top retailer of cheap-chic clothing. Versace is not alone. Louis Vuitton also saw a decrease in sales in Japan; a plummet of 20 percent was recorded for the first half of the year. As a result, the firm has canceled plans to open a 12-story showcase store in the heart of Tokyo’s Ginza shopping district. French Connection also joined the luxury drop-out with the announcement of closing nine stores in Japan by the end of the year. Foreign luxury brands are not the only ones suffering—Japan’s very own Yohji Yamamoto recently filed for bankruptcy days after exhibiting its spring collection in Paris. The current recession in Japan is certainly not the ideal environment for luxury brands. Last year, the Japanese market for top-end luxury goods fell nearly 11 percent. At the same time, consumers’ main connec-
tion to luxury goods, department stores, have suffered a sales decline in Japan for 18 consecutive months. Meanwhile, Uniqlo, operated under Fast Retailing, has catered to the tightening budgets of consumers as spendthrift fashion-lovers flock to Uniqlo stores to snatch
ny is increasingly looking overseas due to a rapidly graying population at home. Tadashi Yanai, the Japanese billionaire who founded Fast Retailing, stated earlier this month, “In Europe and North America, we will buy companies that will provide a platform for Uniqlo. We won't be able to expand on a global scale unless we have mergers and acquisitions.” Dotting the Tokyo streets, budget stores such as H&M, Zara, Diesel, and Uniqlo are located steps from more traditional luxury stores offering comparable merchandise at prices 10 to 20 times higher. Another factor taking away from luxury stores is the increasing popularity among Photo courtesy of apike.ca young Japanese of second-hand clothing. Hanjiro, one such The Uniqlo in Ginza shopping district attracts a plethora of 'vintage' chain, now has 19 budget-minded consumers stores, up from just one in 1992. 10 dollar jeans or 60 dollar cashmere Currently, luxury brands are shifting sweaters. sales strategies to target the Chinese market Uniqlo is not shutting down stores like which has boasted an increase in demand its luxury brand rivals; in fact, they are for luxury goods. opening a new flagship store in Paris and adding to stores in New York and London. With nearly 90 percent of its 875 Contact Meg at Uniqlo stores located in Japan, the email@example.com
China Reaches Out to ASEAN Through Economic Relief ...continued from page 1 China’s participation in funding ASEAN is said to strengthen the ties with ASEAN as the financial crisis makes the member countries become more reliant on the East Asian nations like China and Japan. The fund is therefore established as a supplement to the International Monetary Fund (IMF). Beijing, accordingly, views it as the most important strategic direction in its cooperation with the East Asia Region. Meanwhile, Chinese officials also announced that the China-ASEAN Free
Trade Area (CAFTA) will be established by early next year. The announcement came two days ahead of Prime Minister Wen Jiabao’s trip to Hua Hin, Thailand to attend the 15th ASEAN summit. According to the CAFTA agreement, China and six ASEAN nations (Brunei, Indonesia, Malaysia, the Philippines, Singapore and Thailand) would charge no tariff on 93 percent of goods exchanged among them. “Tariffs will no longer be a barrier” for China’s trade with ASEAN countries and the CAFTA would be “the biggest” free
trade zone by developing countries, said Zhang Kening, counselor from the International Department of the Commerce Ministry. The first part of China’s $10 billion fund will be disbursed by China ImportExport Bank to help Southeast Asia develop infrastructure and promote balanced development as early as it can.
Contact Jenny at firstname.lastname@example.org
South Korea and EU Finalize Trade Agreement for Bi-lateral Benefit By Rachel Rosenstrock, International Business Writer On October 15, South Korea and the European Union finalized their first free trade agreement, estimated to be worth 19 billion Euros (approximately $28.5 billion). This treaty will eliminate most trade tariffs and non-tariff barriers between these two economies. The EU claims that this deal is the largest and “most important free trade agreement [they] ever negotiated [with] a third world country.” With a GDP of $18.7 trillion, the EU holds the position as the world’s largest economy. South Korea ranks 15th in economic size by holding a GDP of $976 billion. Ultimately, this treaty will provide greater incentive for expansion in service-based industries such as the financial, legal, and telecommunications sectors. South Korea has Photo courtesy of AFP agreed to extensive liberalization in these areas. South Korean Trade Minister Kim Additionally, this deal Jong-Hoon meets with EU Trade would lift the 1.6 billion Commisioner Catherine Ashton
Euros the EU annually pays to South Korea for exports. By creating more opportunities for foreign investment, these partners aim to strengthen their previously established relationship. Currently, the European Union is South Korea’s largest investor and second largest export market. The Korea Institute for International Economic Policy estimates that this deal will eventually increase trade by up to 20 percent. EU Trade Commissioner Catherine Ashton sees this partnership as a way to expand the respective economies, particularly in the economic downturn: “Korea imports about 25 billion Euros from the EU and 6 billion Euros of services each year - this is a really good opportunity, lowering barriers to enable markets to grow.” This agreement comes at the end of more than two years of bilateral discussions as disagreements had occurred over duty drawbacks and rules origin. Contained within a 1,000 page document, the treaty is expected to be enacted in the second half of 2010, pending ratification from the EU parliament. With the signing of this trade deal, additional pressure has been placed on the United States. While the United States has signed a similar document two years ago with South Korea, the deal has yet to be approved due to concerns from the auto and beef industries. President Barack Obama plans to visit South Korea in November where he and other Korean officials hope to gain approval for the implementation of their agreement. Contact Rachel at email@example.com
Insider Trading Scandal Rocks Mumbai By Laura Russo, International Business Writer The center of finance, technology, and business, Mumbai is the Manhattan of India. It is India’s financial capital, home to the country’s advanced technology and financial industries. Over 500 software companies are located there, contributing to the rapid growth of the Indian economy. With the nation quickly on the rise in the worldwide technology sector, their business is vital to the world’s business. McKinsey & Company is one of the world’s leading management firms, with 90 offices in over 50 countries. Anil Kumar was a leading partner at McKinsey, and was greatly involved in its mission of building relationships with the technology industry and Indian businesses. Despite his valuable contributions, he was put under investigation on October 16 by U.S. federal prosecutors for securities fraud and conspiracy. His involvement with insider-trading is linked to leaking information to Galleon Group, a team of portfolio managers and analysts with $4 billion in management assets. The group consisted of executives from IBM, Intel, and Bear Stearns, and was led by Raj Rajaratnam, the 559th richest person in the world with a net worth of $1.3 billion and a graduate of the University of Pennsylvania’s Wharton School. He too faces charges, with 13 counts of fraud and conspiracy. The insider-trading scheme dealt with more than $20 million, and Galleon Group announced that it will consider all options in order to save its management teams. Offers have already been made to buy the company. Both Kumar and Rajaratnam were prominent in integrating upcoming Indian businesses into the global economy. This controversy has brought embarrassment to the Indian School of Business, which Kumar had cofounded. Administrators announced his leave of absence in the midst of the controversy. This scandal affects business in both the United States and India, since McKinsey and the Galleon Group were liaisons for Indian business. Both executives have worked for prominent American companies such as Bank of America in San Francisco and Metropolitan Life in New York. Now those that helped them climb the corporate ladder are left to clean up the mess and shame of their scandal. Contact Laura at firstname.lastname@example.org Photo courtesy of The Guardian
Raj Rajaratnam has been charged with thirteen counts of fraud and conspiracy
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