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Consumer spending in U.S. sinks for first time in year

Written By Unknown on Sabtu, 31 Mei 2014 | 18.38

Consumer spending dropped for the first time in a year as shoppers kept their wallets in their pockets in April, leaving experts split on whether the economy is headed for a rebound.

The Commerce Department said yesterday that consumer spending dropped 0.1 percent in April after rising 1 percent the month before. Consumer spending accounts for 
70 percent of overall economic activity.

Economists laid much of the blame for the unexpected drop on a surprisingly strong March.

"There was a strong surge in March, said Chris Christopher, director of consumer economics at IHS Global Insight. "(Consumers) came out swinging and now have to take a breather."

Christopher said consumer spending will likely bounce back in May.

"Whatever negative we had in April was due to a very strong March," he said.

Lindsay Piezga, chief economist of Sterne Agee, agreed that March took the wind out of April's sails, but said there may not be another pick-up.

"Despite hopes of pent-up demand driving consumption and overall growth through the second quarter — and the second half — it appears after just two months any lingering demand for goods leftover from the winter months at the start of the year has since been satisfied," she said.

Still, other economic indicators show cause for optimism, said Nigel Gault, co-chief economist of the Parthenon Group.

"Most signals are that the economy has some underlying pick-up," Gault said.


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Drinking past 2 a.m. has shot

Extended bar and restaurant hours in Boston — part of Mayor Martin J. Walsh's push to make the Hub a late-night city — could be piloted as soon as August if things go as planned, according to a co-chairman of the task force leading the effort.

Lobbying is underway for House members to approve a budget amendment — included in the Senate's proposed version at Walsh's request — that would allow cities and towns serviced by the MBTA's late-night routes to sell alcohol after 2 a.m.

"This provision is a great opportunity for the communities serviced by the MBTA's extended late-night service," Walsh said in a statement. "Incorporating this measure into the state's final budget would support Boston's efforts to pilot and foster a vibrant culture."

The proposed legislation requires the eligible communities' governing bodies — in Boston's case, the mayor and city council — to opt in.

"Right now, our intergovernmental team is doing outreach to the House," said task force co-chairman Rory Cuddyer, who is special assistant to the mayor's chief of staff.

If the measure is included in the state's final approved budget, the next step would be a City Council hearing and vote, optimistically in July, he said.

The task force is looking at mostly nonresidential areas, where demand for extended bar and restaurant hours already is present, for the pilot program. Those broached include South Boston's Seaport District, Faneuil Hall, Lansdowne Street and the Bulfinch Triangle near the TD Garden.

Participating restaurants and bars would need city Licensing Board approval for the extended hours.

Task force member Bob Lutz, CEO of the Massachusetts Restaurant Association, said the trade group's members are "curious" about the possibility of extended hours.

"They're in a wait-and-see mode," Lutz said. "At the end of the day, there has to be a financial gain for a business to get involved in something like that. Today, there's a lot of people who have 1 or 2 a.m. licenses who don't even stay open that late now. It's really driven by the business need."


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Yesterday’s mews: Ex-stable charms

This unique Bedford house was built in 1836 as a racehorse stable for a nearby track, but has been expanded into a four-bedroom home with sensitively added rear additions.

The fieldstone stable with a slate roof retains its original charm, and the current owners undertook a major barnboard-sided addition in 1992, which added a new vaulted-ceiling kitchen with skylights and a large arched window, cherrywood cabinets, black appliances and a center island. Two other wings hold four bedrooms, including a master suite with sliding-glass doors that open onto a rear wood deck.

The two-acre property, filled with large old trees, lots of grass and nicely tended gardens, sits at the end of a private lane lined by stone walls.

The original part of the house holds a family room with beamed and wood-lined walls and ceiling as well as a brick fireplace. There's also a ceramic-tiled dining room, a home office area with a 1992-added half bath, and a large living room with knotty pine floors and a Vermont Castings wood stove. A South-facing greenhouse is attached to the original stable.

Behind a stone wall is a pantry/kitchenette area, a workbench nook and a closet with a Maytag washer and dryer and sink.

The master bedroom in the 1992 wing has knotty-pine walls and carpet, and there's a walk-through closet with built-in wardrobe and a master bathroom with a whirlpool tub. The other three bedrooms are children-sized, and have folding-door closets. A second full bathroom has small ceramic tile floors and a one-piece Fiberglas shower.

The house has five-zoned forced gas heating system, but doesn't have central air conditioning.

A detached two-car garage sits at the end of the private lane and there's an unpaved area that holds two additional vehicles.

Home Showcase

• Address: 278B Old Billerica Road, Bedford
• Bedrooms: Four
• Bathrooms: Two full, one half
• List price: $818,000
• Square feet: 2,844
• Price per square foot: $288
• Annual taxes: $8,962
• Location: Two miles to retail 
and restaurants along Great Road 
in Bedford
• Built in: 1836; major addition and upgrades in 1992
• Broker: Suzanne Koller of Keller Williams at 617-799-5913

Pros:

  • Two-acre property with old trees, grass and gardens
  • Large living area with wood stove and pine floors
  • Master bedroom suite has sliding glass doors to rear deck
  • Attached South-facing greenhouse

Cons:

  • Kitchen, bathrooms could use some upgrading
  • No central air conditioning

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Car Smart: Infiniti coupe puts you in loop of luxury

A coupe always catches my eye and is refreshing to spot among the more practical autos that clog the roads these days. It's the well-proportioned wheel base and the balance of only one door per side along with muscular lines that combine to give the two-door car a fast and fun-to-drive character.

The 2014 Infiniti Q60 embodies these attributes and with all-wheel drive, the Q60 provides an interesting option for the New England driver uninterested in practicality and not willing to compromise on appearance, luxury or performance. The low-to-the-ground Q60 may not be not be the best choice for an unplowed route during a nor'easter, but the Q60's snow-driving mode gives a driver the ability to confidently travel on snow-covered roads.

In addition to all-wheel-drive, our $52,055 tester included a sport package comprised of a sport-tuned suspension and steering. The Q60's suspension was smoother and more forgiving than its cousin, the Nissan 370Z. Handling was swift and athletic on windy secondary roads. However, the Q60's steering was excessively heavy.

Our tester's 330-hp 3.7-liter V-6 engine hustled the coupe off the line and provided a smooth flow of power as it shifted through a seven-speed automatic transmission. Magnesium paddle shifters located behind the steering wheel were also part of the sport package. Rear wheel drive is available on both the $42,000 base model and the more powerful, top shelf, Q60 IPL (Infiniti Performance Line), which is also available with a 6-speed manual transmission. Fuel economy for our AWD tester was 18 city, 25 highway and does improve slightly with the rear-wheel drive models.

Blue ambient lighting set the mood for the Q60's dark cockpit. High gloss maple accents around the center console, dash and doors, along with Infiniti's signature analog clock provided an upscale feel.

A 7-inch infotainment screen was well proportioned within the recess of the dashboard and was easy to use. A Bose sound system with a speed sensitive volume control virtually eliminated any road noise when I was cranking the tunes.

Leather front seats were large and comfortable with ample adjustability. Cramped rear seats had my four-year-old complaining about the lack of space. Ditto for the trunk, you must follow a diagram under the lid in order to cram two golf bags inside.

Our tester also included a $1,250 technology package highlighted by intelligent cruise control with brake assist and rain-sensing windshield wipers. The laser-based intelligent cruise control manages the Q60's speed and maintains a safe distance from the car in front. The brake assist also uses the laser to help the vehicle brake faster if an emergency arises.

While not the most practical with regard to traveling with more than one passenger, a coupe in my book is what a car should be and once you start adding doors, it's a compromise. Similar coupes to consider are the Audi A5, the BMW 428i or Mercedes Benz C-Class. The Infiniti Q60 is also available as a convertible.


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Venture group taps Jack Hart to push non-compete pact ban

Written By Unknown on Jumat, 30 Mei 2014 | 18.38

The New England Venture Capital Association has hired a former state senator as a lobbyist as it ramps up its effort to ban non-compete agreements and lawmakers take up Gov. Deval Patrick's proposal to eliminate the practice in Massachusetts.

Former Sen. Jack Hart has been working for about a month to guide the NEVCA through the legislative process, and has secured meetings with key lawmakers, said C.A. Webb, the association's executive director.

"He's helped open many doors," Webb said.

Yesterday, Webb and dozens of others testified before the Joint Committee for Economic Development and Emerging Technologies. Senate chairman Gale Candaras (D-Wilbraham) said their version of the bill will "certainly" include a change to the law governing non-compete agreements, although she was unsure what that would be.

There will be "some sort of modification if not elimination," she said. "I am very concerned about the impact on our economy."

Bijan Sabet, a venture capitalist with Spark Capital who has made early investments in companies including Twitter and Tumblr, told the committee that eliminating non-compete agreements is crucial for Boston's tech future.

"Every company has a connective tissue with companies before it. We've cut this off," he said.

But the Greater Boston Chamber of Commerce and Associated Industries of Massachusetts spoke in support of the agreements.

"We know from members that non-competes are used in a wide range of industries," said Jim Klocke, Chamber executive vice president. "If we were to ban them, we would put those industries at a competitive disadvantage."


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Panel sees nothing odd on casino vote

The state Gaming Commission yesterday brushed off concerns that Chairman Stephen P. Crosby's decision to recuse himself from discussions over the Boston area's sole casino license could result in a tie vote.

"We're not the first board to have an even number of members (without Crosby)," said Commissioner James F. McHugh. "It's inconceivable to me that we won't reach a decision."

Because of ties to an owner of the Everett land that's the site of Wynn Resorts' proposed casino and his attendance at an opening day party at Suffolk Downs, where Mohegan Sun wants to build, Crosby recused himself earlier this month, leaving the commission with only four members to vote on the Boston-area license.

Yesterday, the commission's general counsel, Catherine Blue, suggested those members discuss ground rules for deliberations and consider what questions they might have for staff and what additional information they might want from the applicants.

The commissioners may even say they have a preference, but still come to a consensus, McHugh said. If they don't, he said, they have the option of telling Wynn and Mohegan Sun to come back with their "best and final offer" to improve their applications.

Although host community hearings are scheduled for June 24 in Revere and June 25 in Everett, a vote on the Boston-area license is not expected until Aug. 29, unless the city goes to arbitration over how much money it's entitled to from Wynn and Mohegan Sun as a surrounding community. In that case, the license may not be awarded until Sept. 12.

A spokeswoman for Mayor Martin J. Walsh yesterday said he met this week with both casino developers, hoping to cut mitigation deals that would preempt a June 16 deadline, after which an arbitrator will decide what Boston deserves. However, she would not provide details of the discussions.

The full commission, including Crosby, expects to award the state's first casino license as early as June 13 in Western Massachusetts, where MGM has proposed an $800 million development in Springfield.

By July, the state's highest court is expected to rule on whether to allow a referendum to repeal the state's 2011 casino law on the November ballot. If the court does allow it, the commission "would have to cross that bridge," said spokeswoman Elaine Driscoll. "But at this point, our licensing process is proceeding."


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Gap filled in downtown

Gap Inc. is seeking workers for a new Gap Outlet that will open in Downtown Crossing — the latest evidence of a looming revival for the Boston shopping district.

The Gap is in talks to open the outlet on Washington Street, across from the Millennium Tower site, in the space previously occupied by the F.Y.E music and video store.

Downtown Crossing has seen heightened interest from retailers and investors in the wake of Millennium Partners starting work on the $630 million Millennium Tower and Filene's building redevelopment — particularly since it announced Arnold Worldwide will relocate its advertising headquarters there in September, and a 30,000-square-foot Roche Bros. supermarket and four-floor Primark store will open in 2015.

"There's clearly more interest," said Ron Druker, a major Downtown Crossing property owner with buildings on Winter, Washington and Bromfield streets, including the Corner Mall. "We get inquiries from brokers and from tenants as to whether or not we have space. We get interest from national and international (companies). It has picked up."

And retail lease prices will only go one way, Druker said — up.

The F.Y.E store closed in January 2012. Next door, the building that once housed a Barnes & Noble has been vacant since the bookseller moved out in the summer of 2006.

"In general, I think there's more activity than we've seen in recent years," said Robert Posner of Commonwealth Holding LP, which owns the former Barnes & Noble space at 395 Washington St.

Since 2010, 35 Downtown Crossing properties have changed hands. In the past year and a half alone, 17 buildings have sold, according to the Downtown Boston Business Improvement District.

"The real estate market is hot, and I think it means people are looking at the district and seeing that it has great value and great potential," BID president Rosemarie Sansone said.

As for retail interest, "there's a lot of movement," according to Sansone. "We see many more people showing spaces every day than we ever have before," she said.

San Francisco-based Gap Inc. did not respond to Herald inquiries.

"The Gap is a well-known brand, and that's exciting," Sansone said. "They have a loyal following."


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How Google got states to legalize driverless cars

MOUNTAIN VIEW, Calif. — About four years ago, the Google team trying to develop cars driven by computers — not people — became convinced that sooner than later, the technology would be ready for the masses. There was one big problem: Driverless cars were almost certainly illegal.

And yet this week, Google said it wants to give Californians access to a small fleet of prototypes it will make without a steering wheel or pedals.

The plan is possible because, by this time next year, driverless cars will be legal in the tech giant's home state.

And for that, Google can thank Google, and an unorthodox lobbying campaign to shape the road rules of the future in car-obsessed California — and maybe even the rest of the nation — that began with a game-changing conversation in Las Vegas.

The campaign was based on a principle that businesses rarely embrace: ask for regulation.

The journey to a law in California began in January 2011 at the Consumer Electronics Show in Las Vegas, where Nevada legislator-turned-lobbyist David Goldwater began chatting up Anthony Levandowski, one of the self-driving car project's leaders. When talk drifted to the legal hurdles, Goldwater suggested that rather than entering California's potentially bruising political process, Google should start small.

Here, in neighboring Nevada, he said, where the Legislature famously has an impulse to regulate lightly.

It made sense to Google, which hired Goldwater.

"The good thing about laws is if they don't exist and you want one — or if they exist and you don't like them — you can change them," Levandowski told students at the University of California, Berkeley in December. "And so in Nevada, we did our first bill."

Up to that point, Google had quietly sent early versions of the car, with a "safety driver" behind the wheel, more than 100,000 miles in California. Eventually, government would catch up, just as stop signs began appearing well after cars rolled onto America's roads a century ago.

If the trigger to act was a bad accident, lawmakers could set the technology back years.

Feeling some urgency, Google bet it could legalize a technology that though still experimental had the potential to save thousands of lives and generate millions in profits.

The cars were their own best salesmen. Nevada's governor and other key policy makers emerged enthusiastic after test rides. The bill passed quickly enough that potential opponents — primarily automakers — were unable to influence its outcome.

Next, Nevada's Department of Motor Vehicles had to write rules implementing the law.

At the DMV, Google had an enthusiastic supporter in Bruce Breslow, then the agency's leader.

Breslow had been fascinated by driverless cars since seeing an exhibit at the 1964 New York World's Fair. Seeing a career-defining opportunity, Breslow shelved other projects and shifted money so he wouldn't have to ask for the $200,000 needed to research and write the rules.

At first, DMV staff panicked — they only had several months to write unprecedented rules on a technology they didn't know. But Google knew the technology, and was eager to help.

"Very few people deeply understand" driverless car technology, said Chris Urmson, the self-driving car pioneer lured from academia who now leads Google's project. Offering policymakers information "to make informed decisions ... is really important to us."

The task fell primarily to David Estrada, at the time the legal director for Google X, the secretive part of the tech giant that houses ambitious, cutting-edge projects. Estrada would trek from San Francisco to Nevada's capital, Carson City, for meetings hosted by DMV staff.

Breslow credited Estrada with making suggestions that made the regulations far shorter, and less onerous, than they would have been. "We quickly jumped in ... to help figure out what the regulation should look like," recalled Estrada.

While others attended the meetings, Google seemed to have a special seat at the table.

Bryant Walker Smith, who teaches the law of self-driving cars as a fellow at Stanford University, described one rule-drafting session where Google — not the DMV — responded to suggestions from auto industry representatives.

"It wasn't always clear who was leading," Smith said. It seemed to him that both Google and the DMV felt ownership of the rules.

By the end of 2011, Nevada welcomed the testing of driverless cars on its roads. Google, however, was focused on its home state, where its Priuses and Lexuses outfitted with radar, cameras and a spinning tower of laser sensors were a regular feature on freeways.

In many ways, Google replicated its Nevada playbook: Frame the debate. Wow potential allies with joy rides. Argue that driverless cars would make roads safer and create jobs.

In January 2012, Google met with state Sen. Alex Padilla, a Massachusetts Institute of Technology engineering graduate. Padilla was intrigued, and agreed to push a bill. Padilla said Nevada's law helped him sell colleagues on the need to act.

"California is home to two things. Number one is the hotbed of innovation and technology. And second, we love our cars. So it only made even more sense to say, 'OK we need to catch up and try and lead the nation,'" Padilla said.

Nevada's swift action, he said, "sent the signal to a lot of colleagues that, 'No, this is not one we want to overthink and study for five years before we take action.'" After all, who in California government wanted a flagship company moving jobs out of the state.

In March 2012, Padilla rode in the driver's seat of a Google car with Levandowski riding shotgun to the news conference announcing his legislation.

In the months that followed, various groups tried to shape Padilla's bill.

One was the Alliance of Automobile Manufacturers, which objected that automakers would be liable for the failure of Google technology strapped onto one of their cars. Trial lawyers, a powerful constituency in the state, successfully lobbied to keep automakers on the hook.

Some inside the Capitol concluded that Padilla was most attuned to Google.

One thing that troubled Howard Posner, then the staffer on the Assembly Transportation Committee responsible for analyzing the bill and suggesting improvements, was that Padilla's legislation would let cars operate without a human present.

Posner argued that lawmakers shouldn't authorize this last step until the technology could handle it. The response, he said, was that Padilla didn't want to do that — "which in my mind meant Google was not willing to do that."

Padilla said that while Google's high profile helped the bill succeed, his office made the decisions. "We're always going to have the final say," he said.

In September 2012, Gov. Jerry Brown went to Google's headquarters and signed Padilla's bill.

Now, California's motor vehicles officials face an end-of-year deadline to write regulations that will allow driverless cars to go from testing to use by the public in June 2015.

At a DMV hearing in March, two Google representatives sat next to DMV staff at the head tables. Their message: Now that self-driving cars were legal, the state should not regulate them too strictly.

___

Follow Justin Pritchard at https://twitter.com/lalanewsman


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The Ticker

Written By Unknown on Kamis, 29 Mei 2014 | 18.38

Apple aims for street cred with $3B Beats buy

Apple is striking a new chord with a $3 billion acquisition of Beats Electronics, a headphone and music streaming specialist that also brings the swagger of rapper Dr. Dre and recording impresario Jimmy Iovine.

Yesterday's announcement comes nearly three weeks after deal negotiations were leaked to the media. It's by far the most expensive acquisition in Apple's 38-year history, a price the company is paying to counter a threat posed to its iTunes store.

The price consists of $2.6 billion in cash and $400 million in Apple stock that will vest over an unspecified time period. The deal is expected to close before October.

World Cup lifts winning country's stocks

Winning the soccer World Cup can bring rewards to the winning nation's stock market investors. But they better be quick as the post-victory rally doesn't last long.

That's the conclusion of investment bank Goldman Sachs, which published a wide-ranging report on the World Cup and its economic impact.

Goldman Sachs analysts found "a clear pattern of outperformance by the winning team in the weeks after the World Cup final." On average, the victorious country's stocks outperform the global market by 3.5 percent in the first month, the investment bank's strategy team said.

Media execs top CEO pay lists

Once again, media company CEOs are among the highest paid executives in the nation, with six of the top 10 earning spots in an Associated Press/Equilar study.

Compensation experts say a variety of factors are at play, including the gain in media stocks, the intangible value of talent in a hit-or-miss business, the control of shareholder power in very few hands and the decline of the financial sector.

TODAY

  • Labor Department releases weekly jobless claims.
  • Commerce Department releases first-quarter gross domestic product.
  • Freddie Mac, the mortgage company, releases weekly mortgage rates.
  • National Association of Realtors releases pending home sales index for April.

TOMORROW

  • Commerce Department releases personal income and spending for April.
  • Harvard Pilgrim Health Care has named Mary Ann Tocio, left, as chairwoman of its board of directors. Tocio is president and chief operating officer of Bright Horizons Family Solutions, a provider of employer-sponsored childcare, early education and work/life solutions.
  • TheLocker, a social media community and e-commerce platform, announced three additions to its employee roster with marketing director Jesse Morgan, marketing manager Kristin Robinson and social media director Melanie Thompson.

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Target tests same-day delivery

Target Corp. will pilot same-day delivery in Boston next month as the latest retailer to enter the online shipping fray.

The retailer's test of "rush delivery" in select parts of Boston, its hometown of Minneapolis and Miami will allow customers to order eligible items online by 1:30 p.m. and receive them between 6 and 9 p.m. that same day for an extra $10 charge.

A Target spokesman declined to reveal the pilot's start date, which parts of Boston will be able to get the deliveries, or how deliveries would be made. "This is all about delivering products and services more flexibly — and serving­ guests on their terms by providing more options," Jason­ Goldberger, senior vice president of Target.com and mobile, said in a Target blog post.

But Norwell retail analyst Michael Tesler said he believes same-day delivery makes more sense for a luxury retailer such as Neiman Marcus than discounter Target, where many customers shop just for the basics.

"Ten dollars additional on a Neiman Marcus item isn't very significant," Tesler said. "And that cus­tomer, for an important event or an important meeting or their lifestyle, expects every­thing exactly when they want it, and they're willing to pay for that."

Same-day delivery likely will be practical for Target only in urban centers, where customers have money, but no cars, he said.

Target also plans to add standard shipping from 135 stores in 38 markets later this year, a move that would allow for faster, one- to two-day delivery and give online shoppers access to store-only merchandise that can't be found on its 
e-commerce site.


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