Through the companies he hopes to set up, Saudi wants to introduce top foreign firms to the Libyan market, now that Qaddafi has handed over his weapons of mass destruction program to the U.S., welcomed back American oil companies, and even brought in Harvard Business School's Michael Porter as an adviser.
For Tuareg, it's still early days. "We're trying to iron everything out," Saudi says. "Libya is not an easy country to do this in, you know." Talk about a wealth gap: The Democratic takeover of Capitol Hill means two of the poorest men, by congressional standards, will control the committees that spend billions of taxpayer dollars. According to the Center for Responsive Politics, Robert Byrd (D-W.Va.), the likely new chairman of the Senate Appropriations Committee, is worth somewhere between $231,006 and $616,000, ranking 81st in the Senate. His counterpart on the House Appropriations Committee, Dave Obey (D-Wis.), ranks a lowly 358th in that chamber, with assets somewhere between $35,007 and $175,000.
"Somewhere between" because on their disclosure forms, Congress members estimate each of their assets by checking off 1 of 11 brackets: $1,001 to $15,000, the lowest, or $25 million to $50 million, the second highest, followed by "over $50 million." Democrats say legislators with less wealth relate well to the middle class. Conservative Grover Norquist, head of Americans for Tax Reform, grumbles that a lack of riches is no guarantee "that they'll treat your money with respect. These Democrats will amaze you with their feats of fiscal largesse."
Don't cry for the new majority just yet. Presumed Speaker of the House Nancy Pelosi (D-Calif.) is worth up to $55 million. Among her assets: stakes worth as much as $25 million in a California vineyard and $1 million in a golf course. Hip-hop artists have long mixed cuts from classic records or turned city walls into canvases for graffiti art. Now they're getting creative with corporate logos and ads, too. "We take the ad and flip it," says Erik White, who directed recent music videos by P. Diddy and rapper Chingy, "to influence the companies right back."
The parodies, in videos and on clothing, are as much Mad Magazine as Gangsta Rap, punning on brand names or making a wry commentary on the ads themselves. On a T-shirt sold by Tough City, a New York distributor, what looks like "Exxon" is actually "Ex-Con," with a muscled version of the Exxon tiger and the words "Welcome Back" and "Snitches Get Stitches."
In White's video for Chingy's Dem Jeans, shown on mtv and bet, the skinny white women seen in many of the iconic jeans ads from Gap and Calvin Klein are replaced with voluptuous black women. "It's showing how we would do it if it were a hip-hop ad," White says. (Twisting the Gap slogan, the video urges: "Fall into the hood.")
What do the brands make of this? Shown a photo of a T-shirt featuring a drug-dealing Pillsbury Doughboy in front of a pile of cash and cocaine, a General Mills spokesperson responded: "This is an unauthorized infringement on our trademark, and we will take appropriate action." ExxonMobil and Gap did not respond to calls for comment.
If companies like General Mills do fight back, the small designers face steep odds. Earlier this year, Congress expanded trademark laws to make it easier for brands to sue. Tough City's chief, known as Supreme, says that word of company threats led his designers to give up on the T-shirts. "It was big last summer, but we're moving on," he said. "Not everybody found it funny." Is automation dealing out the casino dealer? The makers of new, automated gaming tables say no, although the tables have buttons, cash slots, and video screens--dealers, chips, and cards aren't needed. International Game Technology's (IGT
) Multi-Player Series, for instance, lets up to 10 people place bets on touch screens while viewing images of baccarat hands or roulette wheels on a central screen.
The new tables will allow casinos to offer poker games popular online but not profitable with live dealers. The game makers also say the tables speed the pace of play. "There are fewer mistakes, so you get to play more poker," says CEO Lou White of PokerTek (PTEK
), which this year hopes to put 75 of its PokerProX series tables at joints like Hollywood Park Casino near Los Angeles and Seminole Hard Rock casinos in Tampa and Hollywood, Fla. The tables have yet to hit Las Vegas or Atlantic City, where state rules require extensive product trials.
For its line of poker and blackjack tables, gaming equipment supplier Shuffle Master (SHFL
) has even included cyberdealers: video images of actors who appear on screens. They're so popular at Dover Downs Hotel & Casino in Dover, Del., that the casino is using them in billboard ads--after digitally covering two of the women in evening dresses, out of concern that their original outfits revealed too much cleavage. A new Japanese confection line, Fuwarinka, promises to double as a perfume.
All the rage in Japan and now available internationally, the gum and candies contain chemicals derived from roses and vanilla beans--compounds that are secreted through the skin one to two hours after chewing the gum and three to four hours after eating one of the sweets. The confections come in both "fruity rose" and "fresh citrus" flavors. But because the chemicals responsible for taste differ from those for smell, researchers say, the gum always produces a rose perfume, the candies, a vanilla scent. Consumer-products giant Kanebo developed the line with a former chemistry professor at Nagoya Institute of Technology. Since the August, 2005, debut, Kanebo has sold 2 million units at the equivalent of $1 a pop. A rose menthol gum for men introduced in July, 2006, has sold out faster than stock can be replenished, Kanebo says. Compactimpact.com, which offers hot-ticket Asian items to Americans, says Fuwarinka sells well on its Web site. Mortgage applicants with scanty credit histories, "thin files" in banker lingo, are typically shunted into subprime, or riskier, loans with superhigh interest rates. The hefty monthly payments can leave these homebuyers so strapped that they wind up in default.
Now a corporate partnership is building on the work of a nonprofit housing group to help more thin-file families get lower-priced loans. The idea is to grant mortgages based on credit factors that are currently ignored--a history of on-time payments for rent, utilities, insurance, or child care.
The nonprofit Neighborhood Housing Services of America has arranged such loans for about 25 years. But its program has been small: The process wasn't automated, and the costs were high. Enter First American Corp. (FAF
), which recently distilled NHSA's lending practices to create Anthem, a fast, automated credit-scoring system for thin-file applicants. Already, the company says, it has compiled a directory of more than 200 certified loan officers that use Anthem in granting mortgages.
On Oct. 24, State Farm Group announced it would buy up to $100 million worth of such mortgages. The hope is that once the new system shows thin-file loans to be good business, mainstream lenders and mortgage buyers like Fannie Mae and Freddie Mac will dive in. It's easy to forget that Albuquerque was an early PC hot spot, home to Microsoft and MITS (creator of one of the first "microcomputers") in the 1970s. But a permanent interactive exhibit opening at the New Mexico Museum of Natural History & Science, conceived of and funded by Microsoft co-founder Paul Allen (first row, far right, above) should help the city reclaim its place in computing history. "STARTUP: Albuquerque and the Personal Computer Revolution" opens on Nov. 18 with plenty of geek artifacts: iconic computers (the Altair 8800), video games (Space Wars), and a replica of Apple co-founder Steve Wozniak's hobbyist desk, for instance. The gallery is a quick hop from the building that first housed Microsoft. IT'S AN old story in the video game business: Sell the console at a loss, and make up the difference on games. An analysis by market research firm iSuppli, based on the cost of components, estimates that, for its new PlayStation 3, Sony is losing as much as $307 on every $499 model it sells. (The estimated loss on the $599 model is $241.) Meanwhile, iSuppli says, Sony's main gaming rival, Microsoft, will probably be turning a profit on sales of its Xbox 360 by next year. The cost of building an Xbox 360 has dropped to $323, from $470 a year ago, providing a gross margin of $76 per unit instead of last year's $71 loss. Brice Marden's Couplet IV hangs at New York's Museum of Modern Art (MoMA), where it's part of an exhibit of Marden's work that will run through Jan. 15. Lehman Brothers (LEH
) Chief Executive Officer Richard Fuld and his wife, Kathy, have the right to display the painting on their walls, too. When they acquired it, they agreed to gradually transfer ownership to MoMA in installments, or "fractional" increments.
Now a little-noticed section of the newly passed Pension Protection Act threatens to dry up such donations by ending an attractive tax break, and museums and donors are raising a fuss. "Many of our most important works come through fractional gifts," says Glenn Lowry, director of MoMA, where such gifts typically make up 20% to 40% of annual contributions.
Museums, increasingly priced out of the lofty acquisitions market, like fractional gifts. While they must share possession of a work for an agreed amount of time, they eventually become sole owners. Under the old law, donors were happy, too. They often got generous display rights--and a tax deduction covering the fraction of the market value donated in any given year.
Under the new rule, deductions are capped at the art's value at the time of the first fractional gift. And if the art appreciates, donors will owe the IRS a gift tax of up to 46% of the gain given away in a fractional donation. The new law also requires museums to take full possession within 10 years or at a donor's death, whichever comes first. Otherwise, all past tax deductions are forfeited.
Backers of the new law contend some wealthy donors have abused fractional gifts by getting inflated appraisals to maximize tax benefits and by failing to share custody. "It isn't right for a donor to get a big tax break for supposedly donating a painting that hangs in his living room," says Senate Finance Committee Chairman Chuck Grassley (R-Iowa).
The museums, which helped to overturn a 1986 law that reduced tax breaks for art donations, are lobbying again, with some success. Senator Charles Schumer (D-N.Y.) is already on board: "This bill will have a huge negative impact on donations, all to stop phantom abuses. We must find a better solution in the new Congress." The Joint Committee on Taxation of the 109th Congress had estimated the rule change would increase tax revenues by about $77 million by 2015.