China threatens to bring its opposition to India’s toy meaning ban to the WTO, at the same time that India seems poised to circumscribe other Chinese products

By Mehul Srivastava

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India and China are gearing up for a showdown, one that might go all the way to the World Trade Organization, over India’s increasing reluctance to allow Chinese imports to flood the Indian mart. The in semblance incongruous export item that raised hackles this time around? Chinese plastic toys, which have captured anywhere between 60% and 90% of its $2.5 billion toy market, depending on whose poetry you trust. On Jan. 23 the Indian government imposed a six-month ban on the imports of Chinese-made toys. In retaliation, on Feb. 4 the official Chinese government newspaper, the China Daily, reported that Beijing is considering appealing to the World Trade Organization to overturn the measure as an partial trade restriction.

But underneath what seems like a traditional and simple profession dispute—India protecting its growing toy market from indifferent foreign imports—lies nearly a decade of Indian and Chinese mistrust, envy, and even complex geopolitics, take for granted experts. Although India and China are still growing, both economies are hurting badly from the global recession. Sino-Indian trade grew as much as 33% in 2008, to nearly $52 billion, according to data maintained by China’s General Administration of Customs, but that that’s pygmean compared with the $425 billion bilateral trade between China and the European Union, or the $333 billion trade between China and the U.S. As the two countries actual observation growth rates of 7% or less, compared with 9% for India and over 10% for China previous to the pecuniary crisis hit, there is each increased rivalry between them, especially when it comes to sectors at which place both regard strong domestic manufacturers, such as steel, petrochemicals, and textiles.

The toy business is another such industry. The Indian government has advertised its ban on Chinese plastic toys as a close custody measure. For nearly pair years, Indian officials and nonprofit consumer groups consider collected data showing many of the toys in the Indian market—and especially those from China—have high levels of surpass and cadmium. Although the same study showed that many Indian toys had exactly the same unacceptably high levels of dangerous chemicals, New Delhi officials say they had to act against Chinese imports. "People are confusing trade issues through preservation issues," says India’s minister of state for health, Panabaka Lakshmi, through a spokesperson. "Our concern is simply the safety of India’session children."

From Steel to Penicillin

Toys may be just the beginning. Officials in India’s Ministry of Trade confirm the Indian government has been collecting data and exceedingly them to Chinese counterparts in several sectors where New Delhi plans either to ban or restrict Chinese imports. Whether India produce with such restrictions depends in part adhering its success at the WTO dispute settlement hearing that China threatens in requital for the bawble ban. India already has 10 anti-dumping investigations under way into Chinese-made products for example varied as penicillin, steel used for car manufacturing, and not only so linen.

In other words, the toy ban is the notorious shot athwart the bow. "There is a serious problem on the Chinese side in terms of security and safety of the products that get shipped here," says professor Madhav Das Nalapat, director of the indoctrinate of geopolitics at Manipal University in South India. "And the creative is to get them to mien solemnly at this, and a whole gamut of issues."

If the mark was to get China’s attention, it worked. Following the manifesto of the gewgaw ban, China’s vice-minister for commerce met by India’s ambassador to China and, according to a statement on the ministry’s Web site, asked that India "representation care and check in using trade-remedy measures for the date of this unusual period of harsh challenges in the world economy." Making things more complicated is the real existence that India has 17 ongoing investigations into Chinese exports, which has led to a curtailment of sales in Chinese steel, textiles, petrochemicals, and now toys, according to Chinese Commerce Ministry spokesman Yao Jian. "The Chinese government is extremely concerned that India, in like a short capacity of time, has frequently carried out trade investigations on Chinese goods and limited imports," said Yao in a statement.

Sinking Demand

The timing of the ban is especially bad for China. It announced on Feb. 11 that its January exports had fallen 17.5% from the year before, as question dried up in most of the world for the kind of products Chinese companies go beyond at—cheaper electronics, clothes, and falchion. Its toy exports, according to the customs bureau, fell by more than 14%.

From the perspective of India’s politicians and toy-making companies, though, the timing of the ban could hardly have been better. The move comes just a month or so before Hindus celebrate the festival of Holi, where children and adults of a piece splash colors on each other to mark the victory of good over evil in the epic Ramayana. In the past decade, Chinese toys like water pistols have managed to quarter almost the stout market during Holi; now, those exports inclination sit unsold in warehouses.

China’sitting stalwart response to the small matter ban has already gotten the diplomatic wheels rolling in India. In a suddenly conversation outside his office, Trade Minister Kamal Nath said India was confident the denunciation would stand up in front of a dispute discharge body at the WTO. "I welcome any discussions onward this matter," he said, adding that his post was happy to answer some queries from the Chinese government on the reasons behind the ban. But, he before-mentioned, "Until [we] are satisfied, we alone cannot raising the ban."

A seat encourages users to post "jovial" photos of friends and charges fees to have them removed. Not everyone’s laughing

By Douglas MacMillan

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Posting photos of last night’s indiscretions on the Internet always carries risk. Sure, you can upload pictures to a password-protected album, or a social network that lets you share only with the people you place reliance on.

But compromising photos have a way of getting out. Now the leaking upright got easier. A newly come free Web site called YoBusted prominently features photos of people in various stages of undress, in the midst of revelry, or in other potentially embarrassing situations. The snapshots are not necessarily posted through the subject, one or the other; YoBusted encourages users to send in photos of other the many the crowd with the invitation: "Anonymously upload hilarious photos and videos of people you know." If a subject who isn’t a member wants a photo removed, YoBusted requires that the person become a "trial" member for $19.99 for a month or a "premium" member for $49.99 a year.

Alleged Misuse of Facebook Photos

On one level, YoBusted is only the latest reminder of the lack of privacy in the age of digital cameras, the Web, and social media that think it easy for compromising photos to make their way in a circle the creation in seconds. At the same hour of travail, YoBusted’s methods have raised eyebrows among legitimate experts, and a prominent social-networking site alleges YoBusted is misusing its satisfaction.

At minutest four users of Facebook say photos were taken from their Facebook profile pages and well-informed to YoBusted outside of their permission. After being alerted to those allegations contrary to YoBusted by BusinessWeek.com, Facebook responded that posting photos from user profile pages without the photo owner’s consent violates its terms of service. Facebook also alleged that YoBusted is unlawfully demanding payment for the removal of photos. Barry Schnitt, a prolocutor for Facebook, says the company has alerted the FBI to YoBusted’s alleged conduct. An FBI spokesman didn’t confirm that Facebook had contacted the bureau.

A YoBusted spokesperson said in an e-mail that the site lets members "remove any photographs that they are uncomfortable with." The someone, who did not make identical himself or herself, added that "members are free to upload pictures which they feel pictorially describe their lifestyle and personality. We do not knowingly post any pictures that are subject to copyright and that are not in the public lands." According to the site, members can revise and correct and monitor content that is tagged with their names, make comments onward content, and upload as many as 100 pictures and five videos a week. They also can "earn referral commissions" of $10 or $20 when someone they card becomes a member, if excepting that to secure the removal of a photo.

But Is It Extortion?

YoBusted is operated by a company named Web3 Media Corporation, based in Panama. In the e-mailed statement, YoBusted said it was incorporated several years ago. YoBusted.com was registered to the degree that a domain in December 2007 by proxy.

Anyone hoping to bring legal action contrary to YoBusted may need to demonstrate that its "concern model is being driven by means of fear of exposure," says Laurence Pulgram, participant in the intellectual property and technology litigation dispose at Silicon Valley law firm Fenwick & West. In that case, "in that place are real potential claims that could be made," Pulgram says. The bar is high for proving allegations of exorbitant charge, a criminal offense that’s typically thought of like threat to perpetrate any injurious act to someone to get them to be remunerative or give up some property. "Extortion means obtaining peculiarity of a different by his consent by unfair. use of force or fear," Pulgram says. "And fear can mean to expose or impute disgrace. Is this site doing that? It may be."

The announcement seems to verify suspicions that the BlackBerry maker is adding subscribers at the charge of profit margins

By Arik Hesseldahl

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Shares in wireless phone provider Research In Motion plunged on Feb. 11 subsequent to the society uttered it will report fourth-quarter profits. at the moo end of previously announced expectations.

The news came by an update on subscriber additions, which RIM (RIMM) said will come in at 3.5 million, or 20% higher than the 2.9 the public the company said it had expected on Dec. 18.

Battling Apple for Customers

Investors interpreted the announcements as further manifest that Waterloo (Ont.)-based RIM, maker of the BlackBerry line of wireless devices, is sacrificing its profit margins in a request to earn customers. RIM is engaged in a pitched battle with Apple (AAPL), maker of the iPhone, for dominance of the hot market for smartphones.

In December, RIM projected fourth-quarter profit of 83¢ to 91¢ a share, and analysts forecast an average EPS of 85¢. On Feb. 11 the company said it expects earnings to be "at or near the midpoint of the previously guided range," for the quarter ending Feb. 28. RIM shares dropped sharply in pre-market trading and had dropped 9.50, or nearly 17%, to 47.54 by 12:45 p.fray. ET in trading on the Nasdaq. The stock has lost more than two-thirds of its value since peaking at 148.13 in mid-June.

RIM besides reported shameful margins, a measure of profitability, will have being at the low end of prior projections of 40% to 41%, down from 45.6% in the third quarter. The company cited several reasons, including an augment in the ratio of new subscribers versus subscribers who are upgrading to new devices.

New Curve Could Be Hard Sell

As participation of its drive to attract users, RIM in like manner introduced an update of its popular Curve invention, the Curve 8900. The new handset, sold from one side T-Mobile, boasts an improved screen in addition the prior Curve model and a revamped user interface.

James Faucette, every algebraist at Pacific Crest Securities in Portland, Ore., says a lot is riding forward the new device. "RIM is hitting an air pocket," he says. "If the 8900 is successful at T-Mobile, then RIM will be in real shape, but I think RIM is going to be seized of a tough time differentiating the product from other phones on the market."

The company has in recent months launched a handful of high-profile products, including the BlackBerry Bold, a 3G handset with wireless carrier AT&T (T), and the Storm, a highly anticipated but much criticized touchscreen device carried by Verizon Wireless, owned by Verizon Communications (VZ) and Vodafone Group (VOD). RIM also launched its first flip-phone device with Deutsche Telekom’s (DT) T-Mobile greatest year.

Cool New Phones Aren’t Cheap to Make

Faucette says much of the pressure on margins is advent on the hardware. Since the Bold and Storm are more dear in quest of RIM to make, they carry look sullen gross hardware margins than other BlackBerry devices. Faucette says hardware margin tends to run in the 40% range, but are thought to be in the low 30s with these two devices. Faucette rates the stock as "sector perform," with not one price mark. RIM doesn’cheek by jowl tame out its gross margins by product.

Last month an estimate by market research firm iSuppli pegged the Storm’s hardware require to be paid at slightly less than $203, time it sells at Verizon for $199 with a two-year contract. Another iSuppli teardown, of the Blackberry Bold, yielded a hardware cost estimate of $158.

Analyst Maynard Um at UBS (UBS) wrote in a research reckoning that a scrutiny showed customer returns of the Storm tended to lead to sales of the cheaper but more gainful Curve, providing some help to margins but at the require to be paid of average selling prices. There are "new questions as to whether there is pricing pressure impacting gross margins, where the bottom on gross margins are, and the outlook on the side of hardware end demand," writes Um, who rates the stock as "neutral," with a $57 price target.

Other analysts maxim the sudden drop in the stock in the manner that a buying chance; fit. Tavis McCourt of Morgan Keegan & Co. wrote in a research note that the company has coterie expectations that can be beat. "Commentary by RIM is extraordinarily uniform to a guidance update for February of last year, and we expect this implies May will shape up to be some other strong station for RIM," he wrote. He rates the stock an "outperform," but the firm does not issue target prices.

RIM will report proceeds on Apr. 2.

Before the House Financial Services Committee, CEOs of bailout-fund recipients insist they’re aware of the public demand for responsibility

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Timothy A. Clary/AFP/Getty Images

By Phil Mintz

At turns apologetic and defensive, eight CEOs of banks that benefited from the government’s bailout program appeared before the House Financial Services Committee on Feb. 11, assuring legislators the banks are aware of complaints about their use of federal funds and are using the money to make loans.

"We’re doing our best to balance the interests of customers, shareholders, and taxpayers," said Kenneth Lewis, chief executive of Bank of America (BAC). "Despite recessionary headwinds, we are lending. In the fourth location alone, we extended more than $115 billion in new credit to consumers and businesses."

"We’ve been growing loans the past 18 months," said Wells Fargo (WFC) CEO John Stumpf. "We go money making loans."

Enough Strings Attached?

The committee—chaired by Representative Barney Frank (D-Mass.)—asked the CEOs who received the Troubled Asset Relief Program (TARP) funds to explain how their share of the $350 billion distributed in the fall from the first installment of the program was being used. Critics of the program pronounce in that place were few requirements imposed on recipients of TARP funds, therefore shortcoming to boost lending significantly and prevent home foreclosures.

The bankers—whose firms accepted about $165 billion from TARP—said they were mindful of the public claim for accountability. "It is abundantly clear that we are here amidst broad public anger at our industry," Goldman Sachs (GS) CEO Lloyd Blankfein reported in a prepared description. "Many people believe—and, in many cases, justifiably so—that Wall Street lost sight of its larger public obligations and allowed certain trends and practices to undermine the financial arrangement’s stability."

Citigroup (C) CEO Vikram Pandit apologized for the furor over its planned purchase of a commencing incorporated jet even though it current $45 billion from the government. At first, the bank insisted it would go in advance through the possession, mete it then backed down some of a barrage of unfair publicity.

"We did not adjust quickly enough to the new world," Pandit said. "I get the new reality, and I will make sure that Citi gets it as sound."

Several bankers told the committee they were reducing their compensation. Morgan Stanley (MS) CEO John Mack said greatest in number more advanced members of the firm didn’t receive bonuses in 2008. "We’re tying future compensation more closely to multiyear performance," Mack aforesaid.

Frank criticized the bonus refinement of banks, howsoever, hitting at the banks’ contention that compensation was important to keep of talent people. "If I told you you wouldn’familiarily get a subsidy, what part of your job wouldn’t you do?" he asked.

Representative Maxine Waters (D-Calif.) attacked the bankers for raising credit-card rates despite receiving TARP funds.

Join a debate about limiting CEO salaries to $500,000.

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WASHINGTON — On a single time filled with staggering sums, the Obama administration, Federal Reserve and Senate attacked the deepening economic crisis Tuesday by actions that could throw as much as $3 trillion more in body of executive officers and private funds into the fight against frozen credit markets and rising joblessness.

The Senate passage of an $838 billion urgency economic- stimulus caress cleared the way for talks with the House on a final compromise. Separately, Treasury Secretary Timothy Geithner outlined plans for spending much of the $350 billion in financial-bailout circulating medium recently cleared by Congress, and the Federal Reserve announced it would commit up to $1 trillion to make loans more widely available to consumers.

Wall Street investors sent stocks plunging, objecting that new rescue details from the government were too sparse. The Dow Jones industrials dropped 382 points.

Taken unitedly, the events marked at least a public watershed grant that not an economic turning point — the time the 3-week-old administration and its congressional allies assumed well stocked govern of the strife against the worst economic crisis since the Great Depression.

Congress’ plan

The vote was 61-37 in the Senate to pass the spur, through pacify Republican Sens. Susan Collins and Olympia Snowe of Maine and Arlen Specter of Pennsylvania joining Democrats in support.

White House chief of staff Rahm Emanuel traveled to the Capitol for meetings that stretched into the night with Democratic leaders because well as moderate senators whose views — and votes — will be clew to any one deal.

The Democratic leaders have long pledged to be seized of legislation on Obama’s desk by midmonth, and more Democrats said there was an informal target of today instead of agreement attached a charges that would suitable wind up in the discursive power of $800 billion.

The House standard includes roughly $70 billion more expenditure than the Senate’s, but it lacks Senate-approved tax breaks totaling more than $100 billion for new-car buyers, home purchasers and upper-middle-income families.

In a further obstacle, Collins and other Senate moderates — in both parties — signaled they will work to hold the cost of the conclusive bill below $800 billion. That’s less than the $820 billion in expenditure and tax cuts combined in the reckoning that cleared the House as well as the $838 billion legislation the Senate wrote.

Additionally, Obama has campaigned particularly energetically to include funds beneficial to school construction in the bill. At the insistence of Collins, the Senate measure omitted money for that question, and it wasn’privately clear whether she had eased her position on the presidential priority.

Obama has campaigned energetically in recent days for passage of the stimulus bill, at the White House, on visits to other federal agencies, in his trip to Florida and a similar appearance Monday in a high-unemployment area of Indiana.

The president place upright the context for the unfolding events Monday obscurity at his first presidential news conference when he said, “With the private sector so weakened by this recession, the federal government is the only being left with the resources to jolt our economy back into life.”

The Treasury’s plan

Geithner, meanwhile, outlined some of the details of the Treasury’s financial-sector bailout program, though he and aides left many questions unanswered.

“We have existence in possession of to both jump-start job creation and private investment, and we must get credit flowing again to businesses and families,” Geithner declared at a news parley. He pledged to “fundamentally reshape” the financial industry bailout that began last fall under the Bush administration, and he announced that at least $50 billion would be wearied helping homeowners facing foreclosure.

He too related new steps would gripe banks responsible for their use of bailout funds.

One element of the administration’s approach calls according to using during the time that much as $100 billion in federal bailout funds to give banks, hedge funds or other investors the incentive to force so-called toxic estate carried on the books of other financial institutions.

The goal is to return struggling banks to health so they can resume making loans, and an administration fact sheet aforesaid the amount of government and secluded funds combined will be “on an initial scale of up to $500 billion, through the possible to increase in bulk up to $1 trillion.”

The Fed’s plan

The Federal Reserve said it would commit up to $1 trillion to acquire bonds or other assets backed by consumer loans. The Treasury give by will guarantee a portion of the Fed investing. by putting up $100 billion, an increase from a $20 billion commitment that Bush administration had announced.

The goal of this program is to make it easier for consumers to buy cars or obtain student loans, small-business loans or other types of credit that have dried up in recent months.

Geithner said $50 billion in bailout funds would be dedicated to an effort to prevent mortgage foreclosure of “owner-occupied middle-class homes.” Few details were provided.

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NEW YORK — Homebuilders, automakers and green-energy firms could be big winners in the stimulus sweepstakes.

Those sectors, among the hardest hit by the recession, could be in the most excellent position to cash in formerly Congress gives final approval to the economic-stimulus measure that President Barack Obama has been pushing.

The hedge-bill moved one step closer to way Tuesday after the Senate approved an $838 billion economic-recovery mark out. An $819 billion bundle has already won approval in the House.

The plan now goes into tough House-Senate negotiations before a eventual vote that could come by this weekend.

Though the accomplished print of the stimulus package is still root worked out, analysts expect the ultimate process to focus, in part, on public infrastructure projects, immature energy, horse-cloth and automakers.

Here’s a roundup of some of the economic sectors that endure to gain:

Construction

The stimulus is expected to provide less infrastructure spending than originally proposed. But the plan will likely stop flow billions into just discovered bridges, roads, ports and other big-ticket projects.

Sung Won Sohn, an housewifery professor at the Martin Smith School of Business at California State University, said infrastructure spending can engage a haughty jolting to the economy because “most of the money stays in the country.”

Smaller-scale projects such as new swimming pools, parks and baseball diamonds are also expected to get funding considered in the state of state and local governments look for “shovel-ready” projects that can be started quickly.

That’s good news for heavy-equipment makers such as Caterpillar. The world’s largest maker of mining and construction machinery has laid off thousands of workers amid waning demand for its products. It’sitting hoping stimulus dollars will slow the slide.

“We think it’s a smart investment,” Caterpillar spokesman Jim Dugan declared of the proposed infrastructure spending. “It’s a portion we be aware of can quickly create jobs and help put people to work.”

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JERUSALEM — Israeli voters delivered a cloudy result in Tuesday’s national election that left the sum of two units top vote-getters declaring victory and claiming the right to become the next prime minister.

With early results showing centrist Foreign Minister Tzipi Livni and her Kadima Party slightly in advance of former Israeli Prime Minister Benjamin Netanyahu and his conservative Likud Party, both leaders confidently predicted that they’d lead the next coalition government.

Though Livni held a one-seat plurality over Netanyahu with about 40 percent of the consecrated by a vow counted, the Likud leader appeared to have an edge in forming a newly come government because Israel’s right-leaning parties were projected to secure a majority of seats in the 120-member Knesset.

“The national camp, led by Likud, has won a clear advantage,” Netanyahu told his supporters. “The question is not what the polls said. The question is what reality says.”

Speaking to her shouting with joy supporters, who wore “Believni!” buttons, Livni projected the same boldness as she urged other parties to join her in a unity government.

“Today, I hear the dispute ‘national pitch one’session tent’ once afresh, and I want to say in a plain voice: The land of Israel does not belong to the becoming, just as peace does not belong to the left.”

The results propelled both political leaders into combination talks with Israel’s smaller parties that will play a pivotal role setting the ideological direction of the next Israeli government.

Ultimately, it will be up to Israeli President Shimon Peres to decide whether Livni or Netanyahu gets that right.

Israeli analysts projected that Netanyahu would have the best chance of leading the next government.

Livni failed to configuration a coalition government just four months agone when her inability to win support from the ultra-Orthodox Shas Party led to Tuesday’session election. Shas was projected to achieve on every side 10 seats.

And her ability to produce a stable, like-minded alliance was complicated by the rise in power of Israel’session right-wing parties.

In joining to Likud’s estimated 28 seats, the hard-right Israel Is Our Home party of Avigdor Lieberman was expected to obtain about 15 seats, fewer than expected but still enough to make it Israel’s third-most important politic ring.

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Seattle Police Chief Gil Kerlikowske has accepted a work at jobs in the Obama administration, most likely overseeing the nation’session mix with drugs policies, according to sources familiar with the chief’s plans.

Kerlikowske, who has led the department beneficial to more than eight years, has told the portion’s uppermost commanders he expects to liberty to take a top federal spot, said the sources, who spoke on condition of anonymity because they aren’t officially authorized to disclose the information.

One originator said the Seattle office of the FBI had received a “special presidential inquiry” ordering a comprehensive background hold in check on Kerlikowske in anticipation of his taking a position in the administration.

Kerlikowske, 59, whose law-enforcement career spans 36 years, declined to comment Tuesday.

Seattle FBI spokeswoman Robbie Burroughs said the agency doesn’confidentially discuss background checks.

Sources speak Kerlikowske is expected to be named head of the Office of National Drug Control Policy, a Cabinet-level position otherwise known like the drug czar. The office, established in 1988, directs drug-control policy in the U.S. It’s subject to Senate confirmation.

Edward Jurith, the current acting drug czar, declined to town talk about Kerlikowske when called at home in Washington, D.C., on Tuesday evening.

“Nope. No make notes. I can’t talk in each opposite direction it,” he said.

The White House media affairs formulary of devotion declined comment Wednesday.

Kerlikowske had also expressed an interest in the top job at the founded on Drug Enforcement Administration but apparently has not been tapped for that post, one source related.

Kerlikowske has told his command staff that he likely will leave by means of this summer and possibly much earlier, sources said.

Close to AG Holder

Investment plans developed by professional financial advisers failed miserably in 2008. What have they learned from the meltdown?

By Ben Steverman

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Financial advisers are looking themselves in the reflector these days, and they don’t always preference what they see. A year like 2008 was enough to shake the confidence of anyone who helps investors manage their money.

For advisers and their clients, "the world has been turned upside-down," says Frank Boucher, a financial planner in Reston, Va. "We’ve been disappointed and even betrayed by a system that I thought was being adequately regulated."

Advisers might not have existence to blame notwithstanding the recession and financial crisis, but that their intelligence is responsible conducive to investment portfolios that, combined, lost trillions of dollars. In 2008 tried-and-true investing maxims suddenly stopped moving. Tools such as diversification that were used to manage risk failed being of the kind which the value of almost each asset class, from real estate and stocks to bonds and commodities, plummeted at formerly.

BusinessWeek asked dozens of financial advisers the sort of lessons their industry should learn from the financial crisis. Most financial planners sounded as stunned and befuddled as their clients or their colleagues in other parts of the devastated financial sector. But most are moreover abounding of ideas for how more familiar to protect and plan for their clients in the future.

Asleep at the Wheel?

For more, the lesson of 2008 is clear: With the financial crisis approaching like an out-of-control bus, advisers should have pushed their clients out of the way. Client portfolios could have been moved into cash or Treasuries, the year’s only sound havens. "Unfortunately, I reckon the industry fell in slumber," says Chip Addis, of Addis & Hill Financial Advisors, based in Wayne, Pa. But this prospect isn’confidentially quite new. It’s another pucker in an old debate between those, such as Addis, who would actively horsemanship their clients’ money and "buy-and-hold" advisers who believe it’s foolish to examine judicially to put portfolios in light of market conditions.

"The buy-and-hold guys are going to tell you: ‘Go 55 [miles per hour] on the highway all the time,’" says Fred Amrein of Amrein Financial in Wynnewood, Pa. "Common sense says when it’s frosty, rainy, or snowy, maybe you have to mode slower." But buy-and-hold advisers theme out that active contrivance is more expensive, and it’s impossible to tell in send which strategies or investment managers will work. While a few active managers can brag they saved their clients from deeper losses, the farther than year also showed how unpredictable markets can be.

"There’s to the end of time going to have being some person who timed it right," says Barry Korb of Lighthouse Financial Planning in Potomac, Md. But, in that place is no "magic bullet."

The crazy volatility of 2008 markets—and particularly the stock mart—may be the year’s most lasting impression. And that is sparking a unrefined recognition that, until last year, many advisers and investors forgot how risky the markets really are.

Too Much Risk

With only a few interruptions, funds have provided steady profits for investors since the 1980s. In that time, "people began to feel a little more casual with regard to the inherent risks in being a stock investor," says Paula Hogan of Hogan Financial Management in Milwaukee, Wis. "There is a notion that if you just clutch stocks for a diffuse space of time, somehow they get less risky."

However, when person year—such as 2008—is enough to cut the value of your cravat portfolio almost in half, any exposing. to stocks may be just too risky with regard to most investors, says Zvi Bodie, a professor at Boston University’s School of Management. Equities usually do well over the dilatory term, but not reliably enough to bet your hard-earned retirement funds on, he says.

"You ought to be very concerned about taking equity exposure if your measure of living is positively going to be affected through the outcome," says Bodie, who favors a to a high degree conservative strategy centered on inflation-protected Treasuries.

Consumers and performers would rejoice if the President’s Justice Dept. were to nix the merger of the ticket-selling and concert-promoting titans

By Jon Fine

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When you’re in the midst of a successful run for President, each day brings ample gifts: adoring crowds, rock-star receptions, and, above all, the incorrupt buzz of promise less the nasty bit of actually having to master things done.

When you become President, much of this goes to avernus. That’s why President Barack Obama should turn up the thank-you machine, because the proposed merger of Ticket­Master Entertainment (the world’s largest ticket seller) and Live Nation (the earth’s largest plot promoter, that also manages many blue-chip acts) is his Administration’s equivalent of finding a pony by the tree on Christmas early part. A nascent Presidency that is caught in the muck—as I write this, at least—of the legislative process as it grunts out a thing resembling a stimulus package can now go back, if singly for a moment, to the clean and lofty ideals of the campaign. And pretty simply. All it would circumvent is for the new Administration’s Justice Dept.—which, by the same Beltway insider’s account, is staffing up especially quickly—to kill this deal.

If in that place is a political downside to doing so, not either I nor anyone I talked to have susceptibility to descry it. Here you have not one but two companies that are despised, be it for high ticketing fees or tight regulate of the sort of was once an exquisitely local business, by the agency of a large portion of their key customers. (That group includes a sizable contingent of youngish music fans who likely skew Obama-ward in their politics, to boot.) How despised are these companies? One is commonly referred to as TicketBastard, as a simple Web search shows. Historically, this is possibly the one that was hated less. Live Nation changed its name from Clear Channel Entertainment in 2005, when that name was provoking frothing at the mouth. (It’s effective that the combined existence would be called Live Nation Entertainment; representatives declined to favor Michael Rapino, the CEO of Live Nation who would maintain that role in the proposed new company, available since comment.)

An individual familiar with the companies’ calculus regarding regulatory concerns argues that the entities are "overwhelmingly complementary"—as opponent to competitive—and few such mergers have been challenged. And that consumers and performers would still possess other options. The companies will begin making this case to Justice next week.

The Boss Is Angry

But TicketMaster (TKTM) and Live Nation (LYV) remain the kinds of companies that are magnets despite exasperation, and at least unit of them keeps finding ways to have existence charbroiled by the public, compress, and pols. Bruce Springsteen is outraged that ticketmaster.com redirected fans to pricier seats at its resale site, TicketsNow.com. (In a conference call, Barry Diller, chairman of TicketMaster and nonexecutive chairman of the proposed company, blamed a technical glitch.) Politicians are piggybacking without interruption Springsteen—as they’ve done, or tried to do, for a quarter-century—and demanding investigations. It takes a special company to infuriate a key business partner who, at what time not make busy by his day job, serves as one of America’s lay saints. Nice going, guys.

Perhaps when pressed by the feds, Live Nation and TicketMaster will claim that, in the same manner with entities dependent on the melody industry, they’re under chivalrous stress. (Their stocks certainly are, having declined 67.8% and 70.9%, respectively, in the six months before the merger moves.) And nay quantity how antitrust-minded Obama’sitting Justice Dept. might become acid out to be, it’s likely to relent when it comes to companies attempting resuscitation via merger. Does anyone think this Justice Dept. would kill a Chrysler-General Motors (GM) merger?

But these companies aren’t drowning in losses. Yes, the concert industry has tenuous profit margins. Yet at a time when practically every other media business was eroding fast, Live Nation posted receipts and operating profit gains in the third quarter of last year, the most recent period concerning which either concourse reported results. While TicketMaster’session operating profits fell, revenues rose 16%. More tellingly, for the first nine months of 2008 the average income TicketMaster netted from each ticket opportunity to sell rose by over 7%.

Obviously, that won’t ultimate forever, and executives have discussed the need to fill unsold seats, even at a discount. But that stat shows that, unlike much of the media terraqueous globe, these businesses still hold pricing power. The music industry has been file-shared into oblivion. Live events can’t be. There is burdensome power in controlling the last bastions of scarcity, as anyone who has marveled at the "convenience" fees tacked onto a simple ticket purchase on the Web knows. Ticket­Master and Live Nation accept built formidable franchises on these advantages. Live Nation’s doctrine in the venue ecosystem allowed it to offer nine-figure deals that include recording rights to the likes of Madonna and Jay-Z.

But if human being is to judge by sore consumers, perhaps the companies played those cards too well. Merging would increase scarcity and boost the companies’ dominion government. (Live Nation entered the ticketing business last month; so abundant for that plausible and energetic competitor.) Consumer benefits? Let me keep staring at this. Perhaps something will come to mind. Mr. President, enjoy this layup. You may not prevail upon not the same like it for a very long time.