Retirement Reality Check
U.S. News & World Report featured a cover story on the realities of retirement. Articles on various facts, figures and advice for those currently in retirement and for others planning retirement included information from the RETIRE Report produced by retired professor Bruce Palmer and AON Consulting. "Perhaps the most encouraging fact is that you can probably get by on less than you think or than is often proclaimedŠaccording to research by Georgia State University's Center for Risk Management and Insurance Research."
Earnings Numbers
BusinessWeek magazine printed a letter to the editor written by Lawrence Brown, Distinguished Professor of Accounting, about a previous article they had published entitled, "Earnings: A Cleaner Look." Brown cites results from one of his studies to respond to the question raised in the article about the usefulness of Standard & Poor's new definition of operating earnings.
The Economy
The economy continues to capture headlines. Rajeev Dhawan, director of Robinson's Economic Forecasting Center, talked to The Wall Street Journal about how corporate scandals were affecting consumers. "People are feeling the pinch in their (stock) portfolios and retirement accounts."
Dhawan was quoted in another article in The Wall Street Journal about the housing bubble that is hitting many of the country's major cities. According to Dhawan, in Atlanta, the number of homes for sale priced at $750,000 and above now
stands at more than a 20-month supply compared with a four- or five-month supply in a more healthy market.
Corporate Pressure Cooker
Vincent Giovinazzo, accounting professor, talked to the Associated Press about the WorldCom situation. "I don't see how one could draw any other conclusion but that there was an aspect of desperation here. It appears to me that under those circumstances... they entered into all these questionable accounting interpretations."
Ethics in Business
The scandals at Enron, Arthur Andersen, WorldCom and other corporate giants have put a spotlight on ethics in today's corporate environment. Ellwood Oakley, associate professor of legal studies, talked about the lack of ethics and the effect on society to audiences of National Public Radio and the international audiences of the Voice of America radio network.
The RICO Act was created to bring down the likes of Vito Corleone. But should it be used against today's corporate crooks? Investor's Business Daily tapped Robinson's own Ellwood Oakley for his opinion. "By using RICO, criminal prosecutors have a tougher case because it's more difficult to put together all the predicate acts," said Oakley, an associate professor of law and ethics. "But if they can do it, they can get the big sentences."
SALES UP, CONFIDENCE DOWN
While reports that consumer spending was up in June, there was concern over consumer confidence. Rajeev Dhawan, director of the Economic Forecasting Center, told Investor's Business Daily that consumer confidence is falling to levels where a change in behavior might be seen. "It's not super low, but it's low."
Bush on Wall Street
When President Bush first announced his plan to attack corporate fraud, many felt it was a step in the right direction in an effort that needed to go much further. Lawrence Brown, Distinguished Professor of Accounting, told the New York daily Newsday that only sending corrupt executives to prison will curb financial abuses. "Look what happened in EnronŠnothing. Until people start going to jail, it's just cheap talk."
In the Movies
Naveen Donthu, Katherine S. Bernhardt Research Professor of Marketing, was interviewed by CNN for a story on product placements in movies. This story was run by CNN to coincide with the release of Men in Black II, which has several prominent product placements. According to Donthu, "product placement is a very cost-effective and credible way of getting publicity for a product. Some examples of product placements include Ray Ban in Top Gun, BMW in James Bond's GoldenEye, AOL in You've Got Mail, Apple Computers in Independence Day, Reese's Pieces in ET and Mercedes-Benz in Men in Black II."
Fund of Information
Jason Greene, associate professor of finance recently published a paper on the dilution impact of some international mutual funds that was the topic of an article in Barron's. According to Greene, an estimated $1 billion is transferred annually from passive, long-term shareholders to active traders.
