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We're a cheat sheet on the news for women with big, awesome brains, who lack big, awesome time. Often paired with -- and consumed as quickly as -- a cocktail.

Politics. Social Issues. Business news. Delivered to your Inbox once a week. 

 

Strait Talk: Strait of Hormuz

Happy New Year. If you haven’t eaten any black-eyed peas yet this year, please try some. Seems the whole country could use an extra helping of good luck in 2012, and legend has it that these little beans can do the trick.

 

We certainly could use some good luck when it comes to the unemployment rate (clocking in at 8.5% on Friday, the lowest level in three years), both our economy and Europe’s economy, stability on the Iraq hand-off, the changing of the guard in North Korea, Egypt’s elections, and so on (pass the peas, please!).

 

I am surely hoping for the best, calm outcome when it comes to the Strait of Hormuz, three little words that have been ringing in my head since first hearing them a few weeks ago.

 

Tell me more

Seventeen million barrels of oil travel daily through the Strait of Hormuz, a waterway located between Iran and Oman. The U.S. Energy Information Administration calls it “by far the world's most important chokepoint” for oil transport. See map of SOH.

 

Iran--home to one of the four largest known oil reserves--is threatening to shut down the strait if the United States and Europe move ahead with threats to refuse to buy oil from Iran because of the country’s continued enrichment of uranium. Iran has long contended their uranium efforts are intended for civilian power use, while much of the outside world says they are building a nuclear bomb.

 

If the strait is closed, not only would oil prices spike--possibly by 50% according to some analysts--the situation could create world conflict (the U.K. signaled it would use military force to re-open the strait) and wreak economic turmoil globally, taking a big toll on the already weak European economy. The tensions have already tipped oil over the key $100 a barrel mark.

 

Ah, oil. Can’t live with you, can’t live without you.

Just to underscore that it’s oil that makes the world go round, U.S. car sales rose 8.7 percent in December, finishing the year on a high notefor Chrysler, Ford and General Motors. SUVs had a good year, too, as gas price stayed below the $4 mark.

 

For those looking for alternatives to traditional gas guzzlers, take note that sales of the electricChevy Volt popped 34% in December, despite warnings that the battery could catch fire (GM announced a fix) and despite little electric car infrastructure.

 

Putting it in perspective, there are approximately 10,000 each of the Nissan Leaf (also electric) and the Volt on U.S. roads, meaning they make up a mere fraction of the 13-plus million cars the big manufacturers each expect to sell in 2012.

 

Let’s leave it there

We could dive into a lot more on the energy front, starting with fracking (potentially causing earthquakes? yikes!). But you and I both know we like this email because it’s short :)

 

So be sure to eat some black-eyed peas. Tradition has it that you should eat them New Year’s Day, but I extend this to the first couple weeks of January. I put my recipe on the site if you need one. Goes great with Champagne, but what doesn’t?

Living it up with Black-Eyed Peas on New Year's

Growing up my mother made everyone in our house eat Black-Eyed Peas on New Year's Day, even the cats and dogs. She took it very seriously. Tradition has it that they bring prosperity. More on this here.

I love the sentiment that food can bring good luck so we do this in our house, too, washed back with Champagne. This year we paired it with Schramsburg Mirabelle, a rose sparkler that sells for about $20. My mom cooks hers with a ham bone -- we take a chicken approach in our house. Here's the recipe:

1 Bag Dried Beans (soak overnight and remove the bad beans)
2 Boxes of chicken broth (the 16 oz ones)
Carrots (I use the mini ones so there's no chopping necessary)
1 medium onion, chopped 
2-3 Sliced chicken sausages (the pre-cooked ones, choose your favorite) 

Great recipe for a slow cooker. Bring to a boil, then simmer all day. Same if you do it on the stove top, just simmer for a good four hours at least.

 

 

Andrea Jung and The List

Holiday prep and festivities are making me really late with this post--so apologies and Happy Wednesday!

Speaking of the holidays, thank goodness for online shopping and shipping. They’re saving me this year. And apparently I’m not alone: Shoppers spent almost $31 billion online between Nov. 1 and Dec. 16, 15% more than last year. That’s a lot of stuff bought... And WSJ reports retailers are extending the deadline for purchases that can still arrive by Dec. 25.

I’ve been ordering through Amazon Prime like a fiend, and love the new Slice app that alerts you when packages have shipped, are out for delivery, and delivered (full disclosure: my sister works there).

I’ve also become a user of Birchbox, a startup that lets you give monthly subscriptions of little makeup samples, a fun treat for all the girly girls out there.

I was thinking about Birchbox last week when Avon announced that Andrea Jung, who has been chief executive of the beauty and cosmetics company since 1999, would be stepping down. The company’s stock is off 45% for the year, and while a lot of factors are contributing to the pressures at Avon, it’s hard not to think about their door-to-door sales model versus the simplicity of an online Birchbox purchase (also run by women).

Separately, any time one of the precious few female leaders of Fortune 500 companies departs, I think about “the list” and how many that leaves. Turns out, the list is at a record high in 2011. There are 18 women in the top job, with a whopping 8 new additions this year (some will take the helm in 2012, and Jung’s departure will leave 17). Fortune called 2011 a “banner” year for women.

Jung has been a fixture on this list (there the longest of any), and together these women control about a half trillion dollars in annual corporate sales across industries from tech to health care to retail, energy, food products and media. But as we see with Jung, it’s a list always in flux.

Already this year, Yahoo ousted Carol Bartz (in a story for the corporate ages, she was informed over the phone and then shot off a company-wide email telling everyone she was fired), while Hewlett-Packard brought in Meg Whitman (former eBay CEO) to run the huge but struggling company. 

On the whole, 2011 was a mixed bag for women in corporate life. Harvard and Wharton accepted the most women ever into their business schools -- 39% and 45%, respectively. But as the non-profit Catalyst noted last week, women in executive leadership positions held steady at 14%, so no progress there.  

 

Meryl Streep raised an interesting point about women in leadership in her appearance on “60 Minutes” this past Sunday, saying she took her latest role as Margaret Thatcher to have the opportunity “to deal with the deep, buried discomfort that people still have -- men and women -- with women in leadership positions.”

 
I’ve interviewed a number of female CEOs and many don’t think it’s helpful to call attention to the fact that they’re female in a sea of male CEOs. And they’re right on one level. But it seems to me the more there are, the more normal it seems, and that’s got to be a good thing when women make up 46.7% of the labor force. 

 
(Happy Holidays. We’ll see you NEXT week, just in time for the New Year.)

 

Baby it's cold outside

I’ve been downing a lot of peppermint mochas from Starbucks this week, trying to feel the holiday spirit when all the talk of “blocking” and “stopping” in Washington is leaving me cold. 

“Don’t be a Grinch,” President Obama wants you to tell Congress, where there’s major stalling on everything from political appointees to payroll tax cuts.

In the last two weeks alone, Congress:

• Rejected the nomination of Richard Cordray to run the Consumer Financial Protection Bureau, the anti-fraud agency that’s been in existence since July without a leader (Elizabeth Warren was an earlier nominee)
• Shot down a federal appeals court nominee for being too left leaning and “petty politics,” as noted in WSJ’s Law Blog
• Waved goodbye to the head of Medicare,Dr. Donald Berwick, a much respected former doctor and Harvard researcher turned businessman whose temporary appointment expired without approval
• Disagreed over plans for extending payroll tax cuts and unemployment benefits, set to expire at the end of the year

The payroll tax cuts are the hot point
Democrats want another year of 160 million Americans paying lower social security taxes, but want to offset that by adding a tax to Americans who make more than $1 million a year. 

Republicans oppose higher taxes on the wealthy but will support the extensions in exchange for building a controversial oil pipeline through the Midwest, which they say will create jobs (more on this another week!).

Stalling is typical when the party in control of Congress differs from the President’s 
Problem is, the “do nothing” approach to government seems like a cop out, and the consequences are real: There are close to 100 federal judge vacancies, about one-third of which have been declared emergencies with backlogs of at least 500-700 cases waiting to be heard. 

Obama could push judicial and other appointments through temporarily while Congress recesses, but he wants legislators to work through the holidays if they don’t pass the payroll tax cut extensions. Republicans say they may not break anyway to prevent the recess appointments. Yikes, my head is spinning over that one!

It may be coldest of all in Washington, but ultimately, we all feel the chill. I’m going to get another mocha...

 

The many flavors of Newt

All this talk about Newt Gingrich is somehow reminding me of Fig Newtons (a little odd, I know). You might remember both the cookie and the politician from years ago. And it depends on your taste buds and your political preferences if you remember either fondly. There’s been a landslide of news recently about the “surge” of Newt as a Republican presidential candidate. In the latest round of polls, Gingrich has pulled ahead of Mitt Romney (27% vs 20% on average). Newt’s also doubling down efforts in South Carolina, which has backed the eventual winner in every Republican presidential primary race since Reagan. So what should you know about Newt? He’s been on the public scene for a long, long time--here are some highlights:

Black Friday's Teaching Moment

It’s hard to know whether to cheer or cry over 9,000 people standing in line for the midnight opening at Macy’s in New York City on Thanksgiving night. 

The younger version of me thinks fun! Something wacky and active to burn off all that turkey and pumpkin pie - yeah! The older version of me was happily avoiding crowds with blow-out sales online.

But the Black Friday craziness is in part evidence of the large and growing wealth divide in America. As one NYT story noted, a family waiting in line at Toys “R” Us on Thursday night was there to take advantage of big savings on diapers. 

Let's all have some brie

 

If you know me at all, you know I live, breathe and sleep cheese. My husband once joked that in our house we put it out like other people put out candies in little bowls. It sounded like a good idea to me. 

Fittingly, I’ve been eating brie (Fromager d’Affinois, a double-cream brie from France that tastes like a triple-cream) while trying to wrap my brain around this European debt crisis that has the U.S. stock market in such turmoil--this week the Dow lost 2.9%. Here’s what I’ve learned:

1. Many of the European countries are like little dominoes, independent but financially interconnected on a game board called the euro zone, consisting of 17 countries (see list).

Polka dot optimism

(photo credit Andrew Noyes)

Thank goodness for the Fall polka dot trend to invoke a little whimsy in an otherwise serious state of affairs.

I’ve been wearing them all week. And it’s not just me. I’m seeing them everywhere--polka dots paired with polka dots. And why not? Who couldn’t use a little cheer sprinkled in with the news these days.

Reviewing the week...
It began Monday with Obama’s speech on how to fix the deficit--raise taxes on the wealthy, cut spending. More specifically, meet the proposed “Buffett Rule,” named for uber-billionaire Warren Buffett who keeps saying it’s crazy that he pays less in taxes than his secretary (17.4% rate vs an average of 36%).

Under the Obama administration’s proposal, taxes would rise (or come more in line with what middle income earners pay) for the top one percent--people who earn over $1 million a year. The New York Times looked at Treasury Department data and said 238,000 households filed taxes with over one million in income in 2009. About 60,000 of those households paid less than 15% in taxes on that income.

Cue the “class warfare” rhetoric: Republicans say the wealthy are job creators who already pay more than their fair share in taxes. Obama responds: “This isn’t class warfare. It’s math.” Rather than “gut” education and medical research spending, it’s time to prioritize, make tough choices and have those who can afford it pay more. And if we do nothing...

Moving on, a few more highlights from the week...

• U.S. hikers imprisoned in Iran for two years are freed. Maybe soon we’ll understand exactly why they felt the need to hike along the border of Iran and Iraq, but we’re glad they are free. WSJ commenters were tough on these two.
• The United Nations met in New York where Palestinian leader Abbas lobbied for a seat in the United Nations, asking to be recognized globally as an individual state.
• Hewlett-Packard named former eBay CEO and California gubernatorial candidate Meg Whitman as CEO. Her appointment brings the number of women running Fortune 500 companies back to 12, which had dropped when Yahoo fired Carol Bartz a few weeks ago.

And finally...
On Thursday, Facebook rolled out changes to its site, introducing Timeline, a feature that lets you enhance your personal profile--to tell the story of your life and connect the dots. I covered the event, dressed in my polka-dot shirt, happy to be working in the excited, super-charged atmosphere created by the developers there. Silicon Valley these days feels like it exists in a carefree bubble, but the Facebook event was a welcome distraction from troubles brewing elsewhere in the world. Even as people partied it up, the Dow dropped a terrifying 500 points on worries that Europe’s debt crisis threatens a global recession.

Here’s hoping the polka dot optimism will see us through to the holidays.

 

When the news is this bad, sip Chardonnay

• 
• 

Excuse me, but where did summer go? 

Since 2008 (when the mortgage mess began to show its teeth), August--once a sleepy, beachy month when Washington and Wall Street cleared out of town to recharge--has become a 24-7 news-manic month. Think debt ceiling. Think credit-rating downgrade. Think stock market mania. What a week...

By the numbers

• Rather amazingly, the Dow ended the week down just 179 points (-1.5%) from where it began; the S&P 500 lost 1.7%--not terrible given the wild, hair-pulling 500-point swings up and down. (See interactive tracking Dow in 5-minute intervals since Aug.1.)
• The SEC says it’s checking the mathStandard & Poor’s used to make the downgrade call, given the U.S. Treasury’s accusation that there’s a $2 trillion error.
• As the markets zigged and zagged, concern turned to another recession (a double-dip). One survey says 29% ofeconomists say we’re headed in that direction.

And briefly, in other news

• Apple briefly surpassed Exxon Mobil as the largest company in market cap (what investors think you're worth). By the end of the week, they were neck and neck with Exxon slightly ahead ($350 billion vs $349.5 billion).
• Republican presidential nominees flocked to Iowa for the Ames Straw Poll. Texas Gov. Rick Perry threw his hat in the ring, bringing the total number of Republican candidates so far to 12 (that doesn’t include will-she or won’t-she Sarah Palin). Michele Bachmann won the straw poll--we wrote about her recently.
• A bat on a plane caused a lot of commotion (video) before it was trapped in the bathroom. Now the CDC is looking for the people on the plane so they can test them for rabies. Yikes.

Enter the Chardonnay 
Of course for me, all news--good and bad--goes best with wine. Apparently most of America agrees with me--Americans now drink more wine than the French.

So what kind of wine goes well with this stressful August week? I’ve been sipping a French Chardonnay called Domaine de Bernier. At $6.99, it’s perfect for a bad economy--heavy enough to stand up to the weight of the moment, light enough to lift the mood. Cheers to summer.

 

 

What the heck is a debt ceiling?

Is it just me or is it a little counterintuitive to be talking about raising the “ceiling” on something--like debt--that is otherwise dragging you down? 

Of course in the case of the U.S. debt ceiling, which is dominating the news these days, we’re talking about “lifting” the amount the government is allowed to borrow in order to pay its bills. Congress sets a limit (or ceiling) on how much can be borrowed--currently $14.2 trillion--and that limit was reached on May 16.

Since then, the government has not contributed to government employee’s retirement benefits, as a way to have enough cash flow to meet other debt obligations. CNN explains this well here.

What’s happening?
Bottom line, there’s not enough money to pay the bills after Aug. 2, the deadline for raising the ceiling. And some in Congress--mainly Republicans--are opposed to simply lifting the limit again, so there will need to be some sort of deal to make it happen. Spending cuts and raising revenues (taxes) are on the table, but the talks have grown increasingly contentious. 

What’s at stake
Without more funds, the U.S. government will not be able pay the interest on borrowed money to investors--it would essentially default--and potentially not make Social Security payments. U.S. debt ratings might be downgraded (making them riskier assets to own and potentially harder to sell). The sum of all this would be a “huge financial calamity,” according to Ben Bernanke, the chairman of the Federal Reserve, and many others.

China and other countries that invest heavily in U.S. bonds may be less inclined to buy bonds, making the money situation here tight. This matters because like it or not, it is debt that keeps things moving in the economy -- debt finances new building projects, etc. If you own a home, you likely took on debt to purchase it, ultimately a much smaller example of the kind of financing it takes to run the country.

Bernanke told Congress that if the U.S. were to default on its debt it should stop Social Security payments to pay investors first, and said a default would send mortgage rates and interest rates higher. It would also make it more expensive for the U.S. to borrow money (which it currently borrows very cheaply--at about 3%). Putting this in context: for every dollar the U.S. spends, about 40 cents is borrowed.

Contrary to Bernanke, a group of Republicans in Washington say there would be no major fallout from not raising the debt ceiling and that payments would be prioritized. Others argue it would be a good experience for the United States to not know what it’s like to be able to pay its bills, and better not to “kick the can” -- or problem -- down the road.

The Washington Way
Washington is using this as a political campaign moment. Are you (the politician) for or against increasing tax revenue (closing tax loopholes)? Are you willing to let the government default on its debt obligations and possibly damage global economic stability? How deep are you willing to cut spending to help move the country out of debt? Within the Washington dealmaking, there are some important and challenging questions for the country to answer for itself. But as the clock tic-tocs toward Aug. 2, foreign investors and Wall Street are growing increasingly nervous, and likely so are people who rely on Social Security to live.

Paul Krugman (love him) has a poignant editorial on the topic worth reading.