Marketplace on WVTF, RADIO IQ & RADIO IQ w/BBC News
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, April 27, 2015 6:00am
A new report from InsuranceQuotes shows that North Carolina, Wisconsin, and Maine have at least one thing in common: drivers there pay the least for auto insurance. In North Carolina, insurance rates ran 41 percent less than the national average. Highest was Michigan, where drivers paid more the double the national average for car insurance. There is a method to all of this insurance madness.
Next time you're in your car driving down the road, take a look at the billboards. Do you see a lot of ads for what are known as ambulance chasers? That might explain a thing or two about your insurance rates.
Robert Hoyt, who teaches risk management and insurance at the University of Georgia, says your state's legal environment has a lot to do with it. In other words, how likely drivers are to sue each other. Hoyt says when they're setting rates, insurance companies track all of this, even how often juries decide to award for damages.
Also, state laws factor in.
"The states that have the highest auto insurance costs do happen to be the no-fault states," he says. No-fault means your insurance company covers your injuries.
Laura Adams, senior analyst with InsuranceQuotes, says often it's just a matter of population density.
"The more cars, the more accidents that happen," she says.
She says that's why people in urban areas pay a lot more for car insurance.
Monday, April 27, 2015 6:00am
The nation’s largest public utility is quietly scaling back expansion plans for nuclear power. Just eight years ago, the Tennessee Valley Authority was leading a nuclear renaissance, with plans to restart work on a handful of mothballed reactors. But splitting atoms to make electricity has become less attractive in the last few years.
The energy sector’s appetite for nuclear power has always ebbed and flowed. The plants are attractive because they create so much power in one place, but they’re also highly regulated by the federal government. They take many years to build and almost always cost more than anyone predicts.
And now there’s less demand for power.
“At least in the cases that we looked at, the need for a large base-load plant really doesn’t show up over time,” TVA vice president Joe Hoagland says of the utility’s new Integrated Resource Plan.
The new power predictions mean TVA will only finish Watts Bar Unit II, slated for completion later this year, after delays that span decades and cost overruns in the billions of dollars. Hoagland says demand just hasn’t picked up since the recession, and not just because big industrial customers went out of business—though they did. Consumers are more energy conscious, he says.
“The most obvious example of that would be the shift from incandescent lights to compact fluorescents,” Hoagland says.
Compounding the economic shift is the abundance of natural gas.
Richard Myers of the Nuclear Energy Institute says no one expected that the shale gas boom would be such a game changer.
“The volumes of gas that they found just truly blew everybody’s mind,” he says.
Utilities like TVA have been adding natural gas power plants, which are cheaper and more flexible than nuclear. But Myers figures nuclear’s time will still come.
“I think the new plants are going to get built when they’re needed, where they’re needed,” he says, noting that one in five U.S. households is powered by nuclear reactors.
Environmentalists who want to curtail the use of nuclear power in the U.S. agree with the assessment that the energy form will live on.
Don Safer of the Sierra Club says considering nuclear’s roller-coaster history, he figures it’s just a matter of time before the building boom resumes.
“It’s not over ‘til it’s over,” he says.
Friday, April 24, 2015 5:23pm
Joining Kai to talk about the week's business and economic news are Felix Salmon of Fusion and Jo Ling Kent of Fox Business News.
The big topics this week: Nasdaq's record high, Greece's meeting with eurozone finance ministers in Riga, Latvia and the collapse of the Time Warner Cable-Comcast merger.
Listen to the full conversation using the audio player above.
Friday, April 24, 2015 5:00pm
This story falls firmly in the categories of A: People having too much time on their hands and B: Stuff that's kind of interesting nonetheless.
Students at the University of Leicester over in the U.K. have figured out how much paper it would take to print the Internet. The whole Internet.
They started by figuring out what it would take to print Wikipedia. Turns out? Almost 71 million pieces of paper.
Then, using the generally accepted figure of 4.5 billion websites out there, and adjusting for font size, pictures and all that, they say it'd take 136 billion pieces of 8-by-11-inch paper to print the whole Internet.
Friday, April 24, 2015 5:00pm
Amazon released first-quarter earnings Thursday, and made it clear that, for now, it owns the cloud and it's raining profits.
Amazon Web Services, which offers data storage and other tech services, took in revenues of $1.57 billion during the first three months of the year. Profits topped $265 million.
“Yeah, I mean, [it's] really firing on all cylinders,” says Colin Sebastian, senior research analyst at Robert Baird.
Amazon's success in the cloud can be credited to one very smart move, says Sebastion. It got there first.
“The reason they dominate is they created this market,” he says
Amazon started as an online marketplace for everything. To be that marketplace, it had to build more and more servers. The company built to peak capacity, which means often times it was left with more capacity than it needed.
“They woke up one day and realized they could sell that same service to other companies.”
Amazon Web Service’s profit margin is 17 percent. The company's overall profit margin is 2 percent. "Think of it as accounting for a third of overall profits, a tremendous amount of operating income” says Gene Munster, senior research analyst at Piper Jaffray.
Cloud services are still a nascent industry. “There are literally tens if not hundreds of billions of dollars at stake,” says Sebastian.
And AWS is still seven times larger than Microsoft's cloud services — it's nearest competitor, says Munster. But Google, IBM and HP are all racing to catch up by offering more than simple data storage, which has become a commodity.
Munster says it’s going to be hard for competitors to gain market share. AWS already has more than a million customers including Netflix and NASA, “and now what we’re seeing now, is businesses are standardizing on Amazon Web Service, building applications that are optimized for AWS, that just creates more stickiness.”
Amazon CEO Jeff Bezos has said web services could one day outsize Amazon’s retail business. That day may not come soon enough. As it has done many times, the retail side posted a loss last quarter.
March 31, 2015