A blog about business and economics.

Sept. 23 2015 12:21 PM

Volkswagen CEO Steps Down Amid Scandal Over Catastrophic Environmental Fraud

Martin Winterkorn, embattled chief executive of Volkswagen and public face of the company’s disastrous “defeat device,” said Wednesday that he is stepping down. His decision follows the unveiling of an emissions-rigging scandal in which Volkswagen systematically cheated on U.S. air pollution tests.

While the full toll of the damage is yet to be taken, the scheme is likely to go down as one of the worst and most environmentally harmful of its kind in corporate history. From 2008 to 2015, Volkswagen programmed as many as 11 million vehicles to detect when federal air pollution tests were being conducted on its diesel cars and to shift to a low-emissions mode until they passed. Once that was accomplished, the cars returned to their normal state—spewing up to 40 times the legal amount of pollutants into the atmosphere.

Here’s a jaw-dropping bit of analysis from the Guardian (spotted in an equally wrenching post on Fusion by Kevin Roose):

The rigging of emissions tests may have added nearly a million tonnes of air pollution by VW cars annually—roughly the same as the UK’s combined emissions for all power stations, vehicles, industry and agriculture. According to a Guardian analysis, the 482,000 non-compliant US vehicles would have released between 10,392 and 41,571 tonnes of NOx annually at an average US mileage, rather than the 1,039 tonnes the EPA standards would imply. Scaled to the 11m global vehicles, that would mean up to 948,691 tonnes of NOx emissions annually. Western Europe’s biggest power station, Drax in the UK, emits 39,000 tonnes of NOx each year.

Emissions-rigging scams are nothing new, but Volkswagen’s setup was particularly nefarious. As law professor James Grimmelmann explained in Slate on Tuesday:

VW’s defeat devices were subtler and more insidious. Instead of just turning off and on with the air conditioner, they took into account “the position of the steering wheel, vehicle speed, the duration of the engine’s operation, and barometric pressure”—a list of criteria that precisely mirrors the conditions of the EPA’s required emissions testing.
This kind of sophisticated sneakery is only practical with software, and software also makes it possible to get away with (for a while). A dedicated circuit or a special valve would have been impossible for VW to hide. But it’s easy to conceal the scraps of code that check to see whether the car is being driven in a way that looks suspiciously like an emissions test. Modern cars already contain tens of millions of lines of code; what’s a few more between friends?

On Tuesday, Winterkorn said that Volkswagen was “working hard to find out exactly what happened” and cooperating “closely with the relevant government organizations and authorities.” He apologized for the company’s misconduct and said it would “do everything necessary to reverse the damage.” He pleaded for consumer forgiveness and “trust as we move forward.” He conspicuously avoided the topic of his own future at Volkswagen. One day later, though, we have an answer on that previously undiscussed point. “Volkswagen needs a fresh start—also in terms of personnel,” Winterkorn said in a statement. “I am clearing the way for this fresh start with my resignation.”

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Sept. 23 2015 8:48 AM

How the Government Could Punish That Hedge Fund Bro Who Wanted to Raise a Drug’s Price 5,000 Percent

This week, the prize for most-hated man in America goes to Martin Shkreli, the rap-lyric-spouting former hedge funder who has found a potentially lucrative and socially useless niche in the business world by buying up the rights to old pharmaceuticals that treat rare diseases, then radically raising their prices. In August, his company, Turing Pharmaceuticals, purchased Daraprim, a 62-year-old drug that treats toxoplasmosis, a potentially deadly parasitic infection affecting infants, AIDS patients, and cancer patients, among others. As the New York Times reported, Turing promptly raised Daraprim's cost from $13.50 to $750 per pill. Shkreli's various justifications for the move—that the drug was supposedly underpriced to begin with, and that his company was absolutely, 100 percent going to use its profits to produce better versions of the treatment (even though many doctors didn't seem to think one was needed)—did little to mute the uproar. Last night, amid all the scrutiny, he budged a bit and said Turing would lower the price, though not by how much.

Assuming his conscience doesn't send Daraprim's price all the way back to $13.50 a tablet, Shkreli will be able to get away with his price gouging for a simple reason: Even though the drug's patents are long-expired, nobody else makes it. Thus, he has an effective monopoly over a life-saving treatment that lacks an alternative. One could argue that this speaks to the fundamental flaws of American oversight of the pharmaceutical industry. While the rest of the developed world uses price controls to keep medication affordable, the U.S. allows drug companies to charge whatever they please, with the hope that once their patents expire, competition from generics will drive down costs. To some slight extent, that's worked—about 8 out of every 10 prescriptions filled in this country are for generic drugs. But as production has become concentrated in the hands of fewer and fewer manufacturers, the prices of some generics have rapidly risen in recent years. And the costs of some specialty medications, like Daraprim, have skyrocketed.

So, is there anything to be done, short of completely rejiggering American pharmaceutical regulation (which, let's be honest, isn't happening any time time soon)? Last year, a group of doctors offered one clever potential solution to this issue in the New England Journal of Medicine. When the price of an unpatented drug shoots up, they argued, the Food and Drug Administration should actively go out and look for another company willing to make a generic version and put it on a fast track through the official approval process. The government already does something similar to deal with drug shortages, which have cropped up more frequently in the past several years, and the idea could also help with cases like Daraprim.

Here's why: Theoretically, another company could take notice of Shkreli and Turing's stunt and decide try to make a profit by selling its own generic version of Daraprim for a cheaper price. The problem is it would take a while. Largely thanks to a lack of office funding, the approval process for generic drugs has been slowed by a massive backlog of applications. “Even if a company wanted to enter tomorrow, it would still have to wait three years,” Aaron Kesselheim of Harvard Medical School, who wrote the article with Jonathan Alpern of Regions Hospital in St. Paul, Minnesota, and William Stauffer of the University of Minnesota's Department of Medicine, told me. By promising to expedite things, though, the government would remove that roadblock, and maybe lure some competition into the market. During our talk, Kesselheim suggested that Washington could also offer other incentives, such as promising to buy some of the newly manufactured drugs through the Veterans Health Administration.*

The biggest hurdle, Kesselheim suggested, could be regulators themselves: “The problem here is the crisis relates to drug costs, and the FDA doesn’t see itself as an agency that gets involved in drug costs.” But, he added, there's no reason that mindset couldn't change.

Some experts have suggested that it's unlikely that another company would try to steal Turing's market share because the market itself is so small—in 2011, before several price increases, fewer than 13,000 Daraprim prescriptions were filled. Moreover, even if a company were to try to undercut the drug's current price, that might mean selling it for $300 a pill instead of $750. Hence, they say the only solution to the rising cost of generics, especially for specialty drugs, is more direct government regulation. “Given the size of this market, [encouraging competition] may not be a practical solution," Alan Sager of Boston University's School of Public Health said when I asked him about Kesselheim & co.'s proposal. "When we encounter natural monopolies, we regulate. Adam Smith didn’t have just one string on his violin.”

Nonetheless, recruiting generic manufacturers seems like a concept at least worth trying. As of now, companies that manage to corner the market for an obscure but essential old drug are more or less guaranteed a window of obscene profitability. Even if public outrage might dissuade some from trying—see Shkreli's second thoughts, or the recent case of Rodelis Therapeutics—there's still every reason to expect some companies will attempt to pull off the trick. But by showing that it's willing to go out and solicit other players into the market, the government might make gouging helpless cancer and auto-immune disease patients a slightly riskier proposition, and convince investors to put their money elsewhere.

It might not be the perfect fix. But, as George Mason University health policy professor Len Nichols put it to me, "We’re hostage to the reality that we depend on competition to keep prices down.” Until Congress finally does something bolder with pharma regulation, we might as well try to introduce as much competition as we can. 

*Correction, Sept. 23, 2015: This post originally misidentified the Veterans Health Administration as the Veterans Administration.

Sept. 22 2015 12:11 PM

Bank of America’s CEO Just Got a Big Vote of Confidence

Brian Moynihan, chairman and chief executive of Bank of America, is having a good morning after 63 percent of shareholders voted Tuesday to let him keep both roles. Moynihan, who has served as the bank’s CEO since 2010, was appointed to the dual role of chairman last fall by the board, reversing a 2009 shareholder vote to keep the two roles separate. Bank officials cast the move as rewarding Moynihan for his work in navigating Bank of America through the fallout from the financial crisis. Others were less convinced, with two pension funds—the California Public Employees’ Retirement System and the California State Teachers’ Retirement System—arguing staunchly against the combined roles:

“Since Mr. Moynihan’s appointment as C.E.O. in January 2010, the company has continued to underperform, has failed important Fed stress tests, and has perpetuated a subpar engagement with its shareholders,” the California pension funds wrote in a joint letter to the bank’s lead independent director last month. “Given these missteps, we do not believe now is the time to reduce oversight of management by combining the roles of C.E.O. and chair.”

Shareholder votes don’t often rise into the mainstream press, but as Tuesday’s vote approached, the campaigns on the matter drew serious attention. Earlier this month, Warren Buffett made headlines when he spoke up in favor of keeping Moynihan as both chairman and CEO, telling CNBC, “If I could vote, I would vote as management suggests.” A week later, Barney Frank, famously a co-sponsor of Dodd-Frank and advocate of sweeping Wall Street reform, also tossed his support to Moynihan. “I have a very good opinion of Brian,” he told Politico. “I have never understood the argument that in principle it’s bad to have the CEO also be the chair.”

The vote to let Moynihan retain both roles is a big win for his camp and an equally big statement of confidence in his stewardship of the bank. Leading up to Tuesday, people thought the results could have gone either way. At least based on recent history though, the odds seem to have been in Moynihan’s favor. Per the Wall Street Journal, proposals to split the chairman and CEO roles at big U.S. companies have succeeded only 6 percent of the time over the past 10 years.

Sept. 21 2015 10:52 PM

Oyster, a Subscription E-Book Service That Tried to Take on Amazon, Is Shutting Down

Oyster, a subscription e-books service, launched two years ago “with a simple idea to build a better way to read on mobile.” When invitations to the platform first rolled out, they offered access to “more than 100,000 titles” for $9.95 a month. Before long, Oyster was being called the “Netflix of e-books” and over the next few years its library increased tenfold, to roughly 1 million titles. This past April, the startup announced that it would expand beyond its subscription model (still priced at $9.95 a month) to sell e-books as well. Growth was strong. Reader page views were soaring. “What we’re doing,” Willem Van Lancker, Oyster’s co-founder and chief product officer said audaciously, “is bringing every book in the world into that system.”

Alas, no longer. In a blog post Monday, Oyster’s co-founders said the company “will be taking steps to sunset” its existing service. Current users should expect a personal email in the next few weeks regarding the status of their account, and can contact Oyster for a refund. The co-founders “look forward to sharing more details soon,” but so far haven’t done so. Thankfully, though, Re/code has more info, reporting that several members of Oyster’s team—including its three co-founders—have gone over to Google and will join its e-book store, Google Play Books. Google will also reportedly pay out Oyster’s investors, basically making this an “acquhire.”

What could have done Oyster in? Oh, I don’t know, perhaps another company with a subscription e-book service and significantly more resources and consumers. Like, say, Amazon? It was pretty clear back when Amazon debuted “Kindle Unlimited” in July 2014 that the service could spell trouble for Oyster. The price was comparable ($9.99 a month) as was the collection of titles (600,000 on Kindle Unlimited as compared with about 500,000 at the time on Oyster). Not to mention that Amazon Prime customers already had complimentary access to one book a month from the company’s Kindle Owner’s Lending Library (selection that summer: more than 500,000). In theory, Oyster’s online e-book store was partly created to strengthen its bid against Amazon, but even here the startup was fighting a losing battle, with many titles priced significantly higher there than on Jeff Bezos’ platform.

Where Oyster failed to take Amazon on, however, it’s conceivable that Google plus a solid portion of Oyster’s staff could succeed. The Oyster team has the experience, while Google has the user base and largely bottomless pockets. By itself, Oyster wasn’t able to bring “every book in the world” into its system. But with Google, who knows? The Google Books project, a sort of complement to the Google Play Store, is already well on its way to becoming a digital Alexandria. Reincarnated under the auspices of that effort, Van Lancker’s dream may happen yet.

Sept. 21 2015 4:58 PM

Kickstarter Wants to Be Sure You Know How Much Good It’s Doing

Over the weekend, Kickstarter, the popular crowdfunding website, made a rather dry but nonetheless significant announcement. It was reincorporating as a so-called public benefit corporation—one with a legal obligation to do good not just for shareholders but also for society. “Kickstarter’s mission is to help bring creative projects to life,” it declared in a charter on its website. “We measure our success as a company by how well we achieve that mission, not by the size of our profits.”

For Kickstarter, the bullet points on this mission include “zealously” defending its users’ privacy rights, not using “loopholes or other esoteric but legal tax management strategies as a way to reduce its tax burden,” supporting green initiatives, and donating 5 percent of after-tax profits toward arts education and toward organizations that fight inequality each year (which is a lot!). While Kickstarter was already socially focused, reincorporating as a public benefit corporation essentially locks in the company’s dedication to these stated goals. In other words, at a time when Silicon Valley is overflowing with money-hunting unicorns, Kickstarter is trying to ensure that its projects stay as important as its profits.

Wait, you say. Why would a for-profit company ever want to do such a thing? Well, there are a couple reasons. First, consumers may be happier with your service and products if they feel like you’ve really made a serious social commitment. Second, formalizing that commitment can act as a hedge in the event of management shake-ups or other big changes. Ben & Jerry’s famously became a certified B-corporation (a private designation given to public benefit corporations and other socially focused companies) in 2012, 12 years after it was acquired by Unilever, as part of an effort to demonstrate that being owned by a corporate giant hadn’t altered its devotion to a social agenda.

“In a normal company, the only commitment management has to the shareholders is to make money,” says Paul Brest, director of the law and policy lab at Stanford Law School. A public benefit corporation “also has a social commitment.”

The flip side is that companies reincorporating as public benefit corporations can end up sacrificing a good deal of flexibility because, as Brest says, “It really is binding yourself to a particular social mission.” That might explain why just 0.01 percent of American businesses are certified B-corporations, though far more have their own social missions. Chipotle, for example, has made much of its “food with integrity,” but to become a B-corporation it would eventually have to outline that mission in writing, perhaps more permanently than it would like.

Perry Chen, Kickstarter’s co-founder and chairman, tells the New York Times that the platform’s emphasis on social good has “allowed us to find people who have a similar idealism.” He says the company elected to become a public benefit corporation because “there’s a huge difference between a values document and the legal foundation of your company.” We’ll see how that plays out. In the meantime, Kickstarter users have one more thing to feel gloaty about.

Sept. 18 2015 5:58 PM

Self-Important Pop-Up Ads Aren’t Nearly As Clever As They Think They Are

First off, I have a few confessions to make. Despite being a business and economics writer, I’m not interested in today’s most important stocks. I don’t actually like winning. And really, I don’t care about the future, either. Sorry.

These are weighty insights indeed, but I know they are true because they came to me from that source of all truth, the Internet. Or, to be more precise, from a series of small messages that I’ve clicked, thereby expressing my philosophical preferences, in order to close out of pop-up ads on the Internet. These ads typically crop up on websites to advertise a newsletter, or sometimes a product. They offer a space to enter your email and below that a big, brightly colored button to submit it. But should you not be interested, they also include a pointed, slightly guilt-inducing opt-out message in small print.

Here are a few other revelations that I have achieved from clicking on these opt-out messages (and which you can too!):

  • I’m not interested in protecting my skin.
  • Marathons are easy.
  • I’m not interested in free recipes.
  • I already have a bikini body.
  • I don’t think our generation needs a voice.

Screenshot from Cook’s Illustrated

More than learning about myself, I’ve also learned about how incredibly important and influential the purveyors of these ads and subscription notices are. Who would have guessed that opting out of a CNBC newsletter was the same as turning down the day’s most important stocks? That passing on an iHome speaker sweepstakes meant disavowing all desire to win? That declining a manifesto on travel in 2020 was tantamount to declaring apathy about the future?

If anyone knew, it was Bounce Exchange, the 3-year-old ad-tech startup behind many of these overlays. Earlier this month, Ryan Urban, the company’s co-founder and chief executive, told my colleague Heather Schwedel that opt-out messages some might find judgmental he considers “playful.” Because nothing says playful quite like accusing your readers of not caring about themselves or their generation.

Other adjectives he might want to consider: aggravating. Obnoxious. Pompous. On its website, Bounce Exchange claims that its technology has “unlocked ‘exit-intent,’ ” aka the ability to “accurately predict on any device when a visitor was going to leave before they actually left.” From personal experience, I’d say this is a fair claim. In fact, this style of pop-up has unlocked my exit intent for plenty of websites, so much that I’ve vowed to never return to them ever again. Good job, guys!


Screenshot from CNBC

These pop-ups are so irksome because they fail at everything they try to accomplish. They present themselves as witty and playful, when they are really only annoying. They set up choices that feign an understanding of readers’ thoughts and values, but actually are premised on totally absurd comparisons. Most maddening, though, these pop-ups are invariably phrased to be about you when in reality they are utterly self-absorbed. How else could anyone possibly equate disinterest in a Men’s Health newsletter with “not looking to lose weight?” Or turning down a random travel manifesto with not caring about the future?

Well, in the interest of the future—even though I don’t care about that—here’s some free advice for whomever is writing the copy: Your ads are not funny. They’re not clever. They certainly aren’t playful. Do the Internet a favor. Just stop.

Sept. 17 2015 7:12 PM

Uber Has New Data on How Surge Pricing Is Good for You (and Uber)

We’ve talked about Uber’s surge pricing—the mechanism by which the company increases fares for riders when demand in an area spikes—plenty of times here before. We’ve discussed how it’s not price gouging, how it doesn’t take unfair advantage of drunk people, and how people are still bound to hate it no matter how many times you explain all of that (especially on New Year’s Eve). Lately, though, outrage-fueled thinkpieces on surge pricing have been pleasantly absent from the news, which you might take as a sign that people are finally coming around to the business model, or at least aware enough of it to stop being shocked by it.

But in case you hadn’t quite gotten there yet, fear not, for Uber has just released a new study showing how surge pricing is good for its riders and its service. The short paper, which was put together by two people at Uber along with Chris Nosko, a professor at the University of Chicago’s Booth School of Business, mostly serves to confirm what Uber has been telling us all along: that the function of surge pricing is to bring supply in line with demand. The supply, of course, is measured in terms of drivers providing rides, and the demand in users requesting those rides.

To illustrate the price-surging magic this time around, Uber and Nosko have pulled data on driver supply and ride requests from two specific events. First, a roughly five-hour window around the end of an Ariana Grande show at Madison Square Garden in late March. Second, this past New Year’s Eve in New York City, when surge broke down for 26 minutes because of a “technical glitch” in Uber’s systems. I’ll spare you most of the details, but basically they conclude that when the Ariana Grade concert ended, surge pricing did what it was supposed to—increased the supply of drivers filling requests in the area, while keeping the amount of people actually requesting rides far below the much more substantial number who had opened the app. And then they give us a pretty graph! (Click to enlarge.)

As you can see, when surge kicks in, all the things that are supposed to happen per economic theory do in fact happen. Namely, the supply of drivers stays mostly in line with the share of riders booking trips. That’s probably because those drivers are being promised more money for making pickups in the surge area, while more price-sensitive riders are being discouraged from hailing cars by the inflated fares. Uber says this is good for customers because it “allocate[s] rides to those that value them most.” That’s true, if you simply equate value with willingness to pay more. Perhaps more importantly, it’s good for Uber because it allows the company to keep its completion rate steady and estimated wait times relatively low throughout the window of increased demand, as shown here:

On the other hand, what happens when surge pricing doesn’t kick in as planned? Inefficiency! Chaos! Disturbance in the force! Also known as hundreds of customers requesting rides all at once, ETAs climbing above six minutes, and Uber’s completion rate plummeting to well below 25 percent.

Anyway, this is Uber’s conclusion from all of the above: “The best evidence for the effectiveness of Uber’s surge algorithm is the remarkable consistency of the expected wait time for a ride. Regardless of demand conditions, the surge algorithm filters demand and encourages supply such that a ride is almost always fewer than 5 minutes away.” To this I will say again, it sort of depends on whose consistency and reliability considerations you’re accounting for. It’s undoubtedly true that surge pricing allows Uber to consistently, quickly, and reliably provide rides to the people that are willing and able to pay the multiples in effect. Does that make it consistent and reliable for everyone who might want or need a ride? That’s a bit more of a philosophical question. The study also doesn’t address the much more interesting—and admittedly more complicated—question of whether surge pricing is more likely to align supply and demand by incentivizing drivers, by discouraging riders, or by evenly affecting both. Presumably that’s a matter for another time.

For now, though, take away these three things. Surge pricing does just what we thought it did. Surge pricing is probably good for Uber riders. And surge pricing is absolutely, definitely, unequivocally good for Uber.

Sept. 17 2015 4:35 PM

That Viral Essay Is So Jaw-Droppingly Wrong About Saving in Your 20s

On Wednesday, Elite Daily writer Lauren Martin wrote an essay called, “If You Have Savings in Your 20s, You’re Doing Something Wrong.” Based on the title, you might guess that Martin is a middle-aged professional whose life experience has taught her it’s a mistake to prioritize saving money in one’s youth, and who wants to share her hard-earned wisdom with the millennial generation. In fact, Martin a twentysomething without savings who feels confident making assertions like, “When you’re 40, you’re not going to look back on your 20s and be grateful for the few thousand you saved.”

The fact that Martin’s advice is grounded not in first-hand knowledge but in her lively imagination should persuade you to take her argument with a grain of salt. But in truth, Martin barely has an argument. There is perhaps a case to be made that the advice often given to twentysomethings—to save as much as you can—is shortsighted and unrealistic, but Martin has not made that case.

It’s hard to know where to start with this essay, which has inexplicably been shared on Facebook 18,000 times so far, so I’ll just pull on a thread at random. Martin seems unaware of the basic principle behind the common advice to start saving for retirement early: compound interest, which causes your savings to grow exponentially over the years. As countless personal-finance articles will tell you, starting to sock away money in your 401(k) or IRA when you’re 25 will leave you significantly wealthier when you’re ready to retire than if you’d started saving at 35. Now, you could certainly make a case that the models on which this advice is based aren’t reliable—the stock market doesn’t grow at a steady 6 percent, and if the market falters right when you approach retirement, you’re out of luck—but the fact remains that middle-aged people who started saving early are “grateful for the few thousand you saved,” because those few thousand have since grown to several thousand or more.

Sept. 17 2015 4:32 PM

Why the Federal Reserve Decided to Wait a Few Months Before Messing With the Economy

Thanks in part to the recent turmoil in China and the world's financial markets, the Federal Reserve announced Thursday that it would not raise interest rates. However, officials hinted that they still would like a hike by year's end. The main takeaway from this largely anticipated decision is that our monetary policymakers think the economy is in fundamentally strong shape, but the global economic outlook is just dicey enough to demand some caution before doing anything with the potential to slow U.S. growth.

Or, to put it another way, Fed Chair Janet Yellen is basically an order Muppet.

After years of leaving interest rates near zero in order to support the U.S. recovery, the Fed is hoping to gradually raise them back to normal. For a while, the falling unemployment rate made it seem probable that the process would start this month. But China's careening stock market, and the havoc it triggered elsewhere, seems to have given the Fed pause. "Recent global economic and financial developments may restrain economic activity somewhat and are likely to put further downward pressure on inflation in the near term," the Federal Open Market Committee said in its statement.

During her press conference, Yellen elaborated that the Fed wasn't reacting to the topsy-turvy markets themselves, but to the signals they might be sending about the underlying health of the world economy. She said that Fed board members had long anticipated a slowdown in China, but the "developments we saw in financial markets in August in part reflected concerns there were downside risks in Chinese economic performance and concerns about the deftness with which policy makers were addressing those concerns." Translation: The People's Republic might be in worse shape than we thought, and it's not clear their leaders have any idea how to deal with it.

There are a few reasons why a global rough patch would make the Fed hesitant to finally hit the ignition on a rate increase, which tends to cool off the economy by making borrowing more expensive. For one, American growth has already been weighed down a bit by soft exports, and the worse things get abroad, the fewer cars, iPhones, and such we'll be able to sell to our trade partners. Increasing rates at a time of cratering exports would be a double whammy. Then there's the value of the dollar to worry about. The greenback already appreciated this year, which has made our exports more expensive and kept inflation lower than policymakers would like. When the Fed does raise rates, it will likely send the dollar higher, compounding those effects. And if U.S. rates rise while the rest of the world is seriously struggling, then the dollar is going to soar even more, as investors flock to it. 

The Fed has reasons to hold off other than trouble overseas. For instance, low oil prices have helped keep a lid on inflation in the U.S. But ultimately, the central bank seems pretty intent on raising rates at some point this year—13 of the 17 FOMC members said they still think this year is the right time to begin ratcheting them up—because its basic outlook about the future of the economy hasn't changed much. Yellen just wants to make sure things are calm when the tightening starts so that she doesn't accidentally add to the tumult we've seen of late. I mean, she's not an Animal.

Sept. 17 2015 1:43 PM

Amazon Wants You to Buy Tablets the Way You Buy Cheap Beer

Amazon on Thursday announced seven new devices, among them the Fire tablet, a “groundbreaking new tablet for under $50.” By under $50, it really means $49.99, unless you choose to purchase the Fire tablet via the other super-exciting deal that Amazon is offering: in a six-pack for $249.95.

Yes, Amazon wants you to buy these tablets the way you’d buy cheap beer. Business Insider reports that an Amazon exec said as much at the product briefing, joking that “it was definitely inspired by PBR.” The Fire tablet is slated for release on Sept. 30, and the official tag line on the deal, per Amazon’s order page, is “Make it a six-pack. Buy five, get one free.” After that, you might as well buy a 24-pack of Gatorade and a 48-pack of light bulbs so you can just skip the trip to Costco altogether.

Jokes aside, you can potentially see the Fire tablet six-pack being an appealing option for people looking to buy cheap tablets en masse. So, families, schools, anyone who wants an easy holiday gift to distribute, and perhaps even some companies? Jeff Bezos says in Amazon’s release that the Fire tablet is “incredibly durable” and “sets a new bar for what customers should expect from a low-cost tablet.” The specs include a quad-core 1.3 GHz processor, front- and rear-facing cameras, storage capacity that goes up to 128 GB with an SD drive, and all-day battery life.

Oh, and lest you worry about keeping those six Fire tablets straight: Amazon is also selling protective covers in five different colors. Though at $24.99 apiece, you might be better off just buying another six-pack of devices and labeling them with stickers.