Explaining Southern California's economy

Facebook: The worst thing that's ever happened to humanity

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Facebook founder and CEO Mark Zuckerberg speaks during a news conference at Facebook headquarters on October 6, 2010 in Palo Alto, California.

OK, maybe not the worst thing. But according to Harvard Business Review blogger Daniel Gulati, not exactly a force for happiness:

When Facebook was founded in 2004, it began with a seemingly innocuous mission: to connect friends. Some seven years and 800 million users later, the social network has taken over most aspects of our personal and professional lives, and is fast becoming the dominant communication platform of the future.

But this new world of ubiquitous connections has a dark side. In my last post, I noted that Facebook and social media are major contributors to career anxiety. After seeing some of the comments and reactions to the post, it's clear that Facebook in particular takes it a step further: It's actually making us miserable.

He goes on. This is my favorite part:

[Facebook is] creating a den of comparison. Since our Facebook profiles are self-curated, users have a strong bias toward sharing positive milestones and avoid mentioning the more humdrum, negative parts of their lives. Accomplishments like, "Hey, I just got promoted!" or "Take a look at my new sports car," trump sharing the intricacies of our daily commute or a life-shattering divorce. This creates an online culture of competition and comparison. One interviewee even remarked, "I'm pretty competitive by nature, so when my close friends post good news, I always try and one-up them."

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California's underground economy: The cost of doing business in the state

Cleaning services are vulnerable to the underground economy and price competition.

How much does the "underground economy" cost California every year in lost tax revenue? A whopping $7 billion, according to LA Times

A recent review of records from nearly 1,500 employers revealed that nearly a third lacked legally required workers' compensation insurance coverage to pay the medical bills of employees hurt on the job, Baker said.

Many of those workers seek treatment at hospital emergency rooms, a burden that ultimately falls on insured patients and taxpayers. They also seek benefits from state workers' compensation courts and money that comes from a special state fund that passes the costs along to law-abiding employers. Off-the-books laborers likewise don't pay income taxes, while their employers avoid payroll taxes to fund unemployment insurance benefits.

Bottom line: Tax-paying companies, consumers and taxpayers are stuck paying the bill for cheats.

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Wine Report: Whole Foods sells a better Two-Buck Chuck

UPDATE: A commenter has me thinking that Three Wishes may be produced by...the same people who make the Chuck (The Bronco Wine Company)! A bit of an interesting "conspiracy" in the ultra-cheap wine world? It would create an interesting wrinkle in Whole Foods' "chuck the Chuck" argument. I'll see what I can learn...

A little more than a month ago, Whole Foods rolled out an alternative to Trader Joe's "Two Buck Chuck," the lineup of $1.99 Charles Shaw wines that have been wildly successful for the retailer. Whole Foods isn't kidding around: "chuck the Chuck" is its sales pitch.

I've always believed that Two-Buck Chuck is among the most imporant wines every introduced. The wines aren't very good. But they have made it possible for people to load up on wine and drink it more frequently. Brilliant. Plus, the brand has become an institution and eliminated much of an anxiety that wine seems to induce. It comes in a premium-type wine bottle and it has a cork. It's not a jug wine. It's not a box wine. It's not rotgut.

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MF Global CEO Corzine was 'rusty'

Maybe this should be his nickname, henceforth: Jon "Rusty" Corzine. The former Senator and New Jersey governor — not to mention former Goldman Sachs CEO — marched up to Capitol Hill today to explain how his most recent firm, MF Global, was plunged into bankruptcy, taking $1 billion in supposedly protected client funds with it.

MF Global was no Goldman Sachs, and various theories have been offered about how that's a significant difference. Like, Corzine wasn't being dogged by the crack, risk-assessment pros he dealt with at Goldman. He could make bets on European sovereign debt based on his own sense that Europe would solve its financial mess. 

But I like Marketplace's Heidi N. Moore's take, which is that Corzine had been out of the Wall Street action for too long. His ambition was to take MF Global, a respectable broker-dealer but hardly a Goldman-level investment bank, and turn it into a junior Goldman. It was a bold move. But maybe he wasn't up to the job.

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California economy: When is a recovery not a recovery?

The UCLA Anderson Forecast, covering the fourth quarter of 2011 and looking forward through the fourth quarter of 2013, came out yesterday. KPCC's Brian Watt provided a report on air, and now I've had a chance to dig into at least some of the forecast. I'll start with the California section, presented by Anderson Forecast economist Jerry Nickelsburg. 

You'll remember that in the previous Anderson Forecast, Nickelsburg explained that California has broken into two distinctive economic regions: a recovering coast and a stagnating inland zone. Here's how I put it in the post I wrote back in September:

Since the financial crisis, two California economies have emerged. On the coast, there's growth. Inland, there's near-stagnation. You can easily see this expressed in the Los Angeles region's unemployment numbers. LA is bad, at at 12.7 percent. But Riverside and San Bernadino counties are far worse, at 15.1 and 14.3, respectively.

The industries that are creating jobs in California are also disproportionately located on the coast. Inland, the blast wave of the the housing bust is still being felt, with industries like construction shedding jobs.

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