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Marketplace with host Kai Ryssdal produced and distributed by American Public Media focuses on the latest business news both nationally and internationally, the global economy, and wider events linked to the financial markets.
The only national daily business news program originating from the West Coast, Marketplace is noted for its timely, relevant and accessible coverage of business, economics and personal finance.
Monday, May 25, 2015 1:24pm
During the course of writing his book, “Bourbon Empire: The Past and Future of American Whiskey,” Reid Mitenbuler learned a lot about “America’s native spirit,” as it’s known.
According to Mitenbuler — contrary to what you might assume from looking at bottle labels — today’s bourbons aren’t all made by bearded men wearing overalls.
“By the year 2000 you have eight companies, 13 plants, and they make about 99 percent of all the whiskey in America,” Mitebuler says.
Today, even with what Mitenbuler calls a craft distillery boom, smaller distillers only make about five percent of the bourbon in America.
But Mitenbuler says bourbon made by a big company isn’t necessarily bad bourbon.
“This is, for me, where the story really began, because those corporations, they actually do a very good job,” says Mitenbuler. “And they’re sort of an outlier in the food world and a lot of the popular conceptions we have about food where small is best.”
So, as a bourbon expert, what’s Mitenbuler’s advice for bourbon novices?
“… It doesn’t have to be expensive to be good. Older isn’t necessarily better. It really kind of finds its sweet spot in the middle somewhere, where it's accessible, affordable and easy to find,” Mitenbuler says.
To hear Reid Mitenbuler take Marketplace’s Adriene Hill through a bourbon tasting (and to hear a couple of his recommendations) click play on the Soundcloud player below.
Monday, May 25, 2015 7:00am
Every year, the Federal Trade Commission conducts an undercover investigation to make sure funeral homes are following the FTC’s funeral rule to give customers a price list immediately and to not sell unnecessary, unwanted services.
The idea is for consumers “to be able to take a deep breath and look at a document that says, 'This is what I’m going to pay,' " says Lois Greisman, who heads the FTC’s funeral enforcement. " 'Can I really afford this?' ”
Greisman says in 2014, about a quarter of the funeral homes the FTC investigated broke the rule.
“It’s certainly higher than we would like to see it,” says T. Scott Gilligan, general counsel for the National Funeral Directors Association. “It’s a complicated rule. It’s very easy to slip up. And the problem is, you’re only as good as your worst staff member.”
Funeral homes face fines of up to $16,000 per rule violation, but they can avoid fines by enrolling in a training program run by the funeral directors association.
Monday, May 25, 2015 7:00am
Asian stocks spring while most of the world's stock takes a breather. More on that. Plus, lower fuel prices have translated into huge savings for airline companies. Very little of those savings are being passed along to customers. So, what are the airlines doing with all of that money? And on a quest to invent a smart smoker, a Harvard engineering class is partnering with Williams Sonoma. We check in on their results.
Monday, May 25, 2015 6:00am
A gallon of jet fuel will cost you around $1.66 a gallon these days. That’s down 40 percent from what it was this time last year.
For airlines, which bought more than 16 billion gallons of fuel in 2014, we're talking about a savings of possibly around $22 billion, says Samuel Engel, who manages the aviation practice at ICF International. In 2012, fuel represented 31 percent of global airline costs, and this year it’s around 25 percent. Fuel isn’t the airlines’ only cost, but it’s their largest.
If you were hoping to see some of that savings in the form of cheaper tickets, get in line. Your group isn’t boarding yet.
“There are some complicating factors to consider,” says Sanjay Nanda, senior vice president at Sabre Airline Solutions. “Many airlines hedge on fuel.”
That is, they buy it in advance at locked-in prices. It saves them from rapid spikes in fuel, but also keeps them from taking full advantage of price declines. About 25 percent of airline fuel was hedged this way, according IFC International. “So I’d say most airlines have benefitted but some more than others,” says Nanda.
Still, they’re clearly saving billions. Where is it going?
“They’re putting that money back into the business in the form of new planes, new services – larger bins, new wifi,” says Jean Medina with Airlines for America, an airline industry group. “Our members will be taking effectively one new airline delivery every day.” U.S. airlines also have $60 billion in debt that needs servicing as well, says Medina.
Another priority group for fuel savings, at least for some airlines, is labor. “Delta, a couple months ago, made the largest profit-sharing payout in history to their workers,” says IFC International’s Samuel Engel. Any labor union with a contract to renegotiate will also likely take a keen interest in fuel cost savings if they’re sustained.
So what about those fare prices?
“As fuel prices come down, it starts to allow airlines to operate more routes, and it allows them to compete against each other and offer discounts,” says Engel. “But it’s not immediate. It doesn’t happen until the competitive dynamic plays out.”
And oil prices come and go, says Sabre’s Nanda. So for airlines, “prices are more tied to supply and demand,” he says.
Supply has increased, according to the Airlines Reporting Corp. “There’s been a 6 percent rise in available seats,” says Chuck Thackston, a managing director at ARC. Airlines are managing to fit more people on each plane, whether by increasing the number of seats or purchasing larger capacity models. “Airlines are competing to fill those additional seats,” he says.
ARC says it’s this supply increase that is affecting fares. “Travel within the United States is largely flat year over year,” says Thackston. “The past several years have seen airfares increasing, and we now see those fares leveling off and going down very slightly for summer travel.”
Summer airfare to Europe has declined by about 3 percent, with some destinations seeing particularly stark drops. Fares to Kona, Hawaii, fell 12.7 percent. Trips to Belgrade, Serbia, are 24.3 percent lower on average.
Airfare to New York as a domestic destination increased 9.3 percent, and international fares to Berlin increased 10.2 percent.
So, no, lower fuel prices won't mean a big dip in airfare just yet.
Monday, May 25, 2015 6:00am
On a quest to invent a smart smoker, a junior-year Harvard engineering class partnering with Williams-Sonoma has smoked more than 200 pounds of brisket over the last few months.
It isn't hard to find the class — the mesquite aroma leads right to teaching assistant Peyton Nesmith. The Alabama native is tending a 300-pound, black hour-glass-shaped ceramic smoker. The contraption is covered with wires, gadgets and gizmos.
An up-close look at the brisket Nesmith is cooking. (Eliza Grinnell/Harvard SEAS)
“This brisket’s been cooking since 3 a.m.," Nesmith says. "We probably have a few hours left on it. This is our typical routine. Our cadence of our battle rhythm as our adviser would say.”
That adviser is professor Kevin Kit Parker. He’s not just an academic. He’s a towering Army lieutenant colonel in the reserves with, he says, a Southerner's passion for barbecue.
“I was walking around the parking lot of the Memphis Liberty Bowl looking at all these contraptions that people were smoking barbecue in. And I'm thinking, 'None of these things looks the same.' And that means we haven't reduced our knowledge of barbecue down to a fundamental set of laws about how to do barbecue right.”
Parker proudly displays the Harvard smoker. (Eliza Grinnell/Harvard SEAS)
Parker says he vetted his ideas with culinary experts.
“I talked to some classically trained chefs. They said no one’s done this. No one’s ever taken a scientific approach to barbecue, to smoking."
Parker teaches bioengineering and applied physics at Harvard. So he decided to give his students a real-world assignment. First, he introduced them to a client, the high-end consumer retailer Williams-Sonoma. The job: come up with the perfect smoker. After five long, snowy months, the data is in. It’s game day.
Students present the design and physics of the Harvard smoker to class-client Williams-Sonoma. (Eliza Grinnell/Harvard SEAS)
The students work up to the last minute to showcase the final product. A parade of guests checks it out in a fancy auditorium in one of Harvard’s engineering buildings. Professors, chefs and top brass from Williams-Sonoma pack the room.
The students rock.
All 16 play a part in explaining the smoker’s intricacies, from the unusual shape of the smoker to a smartphone app that tells you meat temperature, using Parker’s mantra: design, build and test. As he chews, Pat Connolly, Williams-Sonoma executive vice president, rates the Harvard smoker against others.
“If you look at the color, you get a much more consistent color here. If you look at the moisture, the moisture is fantastic compared to the competition.”
Connolly says the trademarked, patent-pending, app-wielding, BBIQ smart smoker just might have the right stuff and make the leap from the classroom to a future Memorial Day celebration.
Members of the Harvard community, representatives from Williams-Sonoma and local celebrity chefs enjoy brisket prepared in the Harvard smoker by students of the class "Engineering Problem Solving and Design Project." (Eliza Grinnell/Harvard SEAS)