March 3, 2008 Issue Posted February 21, 2008, 5:00PM EST

News You Need to Know

Same Old Crisis?

With its esoteric instruments—CDOs, SIVs, credit default swaps—the first major financial crisis of the 21st century may look like a brand new kind of bust. But a pair of economists, Carmen Reinhart and Kenneth Rogoff, have discovered striking similarities between this debacle and 18 others in the postwar era. In most cases, harbingers included a runup in housing and equity prices, falling output, and rising public debt. As to the damage done, per capita growth on average fell more than two percentage points and took two years to recover. (National Bureau of Economic Research)

—Edited by Harry Maurer & Cristina Linblad

Tax Crackdown

Germans don't have a term for "perp walk," but they may soon need one. After the national intelligence agency paid an informant more than $6 million for confidential bank records, according to press reports, authorities conducted dozens of raids in a crackdown on people suspected of hiding assets in Liechtenstein. The most prominent alleged tax dodger was Klaus Zumwinkel, who resigned as CEO of Deutsche Post, parent company of parcel service DHL, after cops hauled him from his home on Feb. 15 as TV cameras rolled. He was released hours later after posting bail.

—Edited by Harry Maurer & Cristina Linblad

Obama Wins Again

Now it's up to a nice round number, 10 straight. Senator Barack Obama once again thumped Senator Hillary Clinton in a Democratic primary in Wisconsin and in Hawaii's caucuses on Feb. 19. Over on the Republican side, Senator John McCain continued to sew up his claim to the nomination with wins over former Arkansas Governor Mike Huckabee in Wisconsin and Washington State.

—Edited by Harry Maurer & Cristina Linblad

They're Mad as Hell

Unsatisfied? You've got company. More consumers are finding ways to take complaints into their own hands when traditional channels don't work. They're hunting direct numbers to executive customer support teams, cc'ing top management, and, of course, filling blogs and YouTube videos with their rants. But the news isn't all bad: Many companies, including our 2008 Customer Service Champs, know just how to make consumers feel like kings.

—Edited by Harry Maurer & Cristina Linblad

RIM vs. Motorola

The tech patent wars have broken out on a new front: Research In Motion (RIMM), maker of the BlackBerry, and Motorola (MOT) sued each other on Feb. 16. RIM alleges that Motorola is infringing on its patents and demanding "exorbitant" licensing fees. Motorola responded in two suits challenging RIM's patents and arguing that RIM is, in fact, infringing on Motorola technology. The battle is but one more burden for Motorola's new CEO, Greg Brown, as he ponders whether to sell, spin out, or find a partner for the company's fizzling handset business.

—Edited by Harry Maurer & Cristina Linblad

Toshiba Faces Reality

Feb. 19 was a big day for Blu-ray. That's when Toshiba (TOSBF) conceded defeat, announcing it would stop making video players, recorders, and high-tech PC parts in the HD DVD format next month. Blu-ray, which is backed by Sony (SNE) and dozens of high-tech companies, now becomes the de facto standard for new DVDs. Toshiba CEO Atsutoshi Nishida said the turning point was a decision by Warner Bros. (TWX) last month to abandon HD DVD and release movies only on Blu-ray discs. By mid-February retailer Best Buy (BBY), online movie rental king Netflix (NFLX), and Wal-Mart (WMT) followed suit, forcing Toshiba's retreat.

See "R.I.P, HD DVD"

—Edited by Harry Maurer & Cristina Linblad

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