January 2008

Los Angeles Times

Writers Take Eye Off CBS
January 31, 2008
Attempting to leverage their position during the ongoing writers strike, the Writers Guild of America organized but then cancelled a controversial event aimed at targeting investors of CBS Corp. Daniel J.B. Mitchell, professor at UCLA Anderson School of Management, says the guild's tactic is typical of a corporate campaign strategy to pressure companies by lobbying boards of directors and staging protests at shareholder meetings.

Get Uncomfortable, This Could Take a While: James Saft
January 30, 2008
The national housing market bubble is unwinding, raising the risk that the current state of poor economic growth could be prolonged. According to Edward Leamer, director of the UCLA Anderson Forecast, when housing markets fall home owners resist selling.  This causes housing prices to gradually reset downward and increases the chance that an extended period of slow growth will follow. This column was reprinted in the International Herald Tribune and The Guardian (UK).

Tax Resisters Fight IRS
January 30, 2008
Gonzalo Freixes, lecturer and Associate Dean of the OPMBA program at UCLA Anderson School of Management, discussed the anti-tax movement in relation to the current IRS case leveled against Wesley Snipes for his failure to pay income taxes. 

Los Angeles Times
Two L.A. Unified Schools Take Back Control
January 30, 2008
In response to high dropout rates and low test scores, some Los Angeles high schools have given approval to plans to reform their current leadership system. Under the proposed plan, district bureaucracy will hand leadership over to a team of administrators, teachers, parents, older students and community members. William Ouchi, a school-reform expert and management professor at UCLA Anderson School of Management, expressed concern over these diffused lines of authority, favoring instead an approach that invests local control in the school principal, who is then held accountable. 

National Public Radio
January 28, 2008
Edward Leamer, director of the UCLA Anderson Forecast, discussed the effects of price cuts on new home sales, suggesting that price cuts may not be the best strategy. 

Sacramento Bee
Retail Goes Green, From Ground Up
January 28, 2008
California businesses and consumers are increasingly turning to chemical-free, "green" raw materials when making products and when purchasing them. Charles Corbett, professor at UCLA Anderson School of Management, says putting the burden on consumers to choose safer alternatives is a lot to ask, and a successful business strategy may be to place the burden on suppliers instead.

News Conference
January 25, 2008
Edward Leamer, director of the UCLA Anderson Forecast, was a featured guest along with UC Irvine economist Peter Navarro discussing falling home prices and potential effects on California's economy. "As long as potential buyers see home prices declining," Leamer says, "that makes them all more fearful another decline is coming." However, he adds, "home buyers should go in and buy new homes to get the market going." 

Los Angeles Times
Big Loans Could Get Cheaper
January 25, 2008
President Bush's new economic stimulus plan could help boost California's distressed housing market by providing cheaper loans to those interested in buying or refinancing higher-cost homes.  However, according to Edward Leamer, director of the UCLA Anderson Forecast, higher loan limits are not going to make a big difference because the current housing market is destabilized by bubble-era home prices that must continue to fall. Leamer says the proposed new loan limit is still beyond the grasp of what most Americans can afford and only seems realistic because, "in the good old days, a year or two ago, you didn't have to have the down payment or income."

LA City Beat
Wal-Mart vs. the Poor
January 24, 2008
Having to compensate for lost property tax revenues since passage of Proposition 13, Los Angeles city governments have increasingly focused their zoning decisions on bringing sales tax generators like Wal-Mart and Best Buys into their cities. As a result, local governments' preferences have shifted away from building affordable-housing to favoring retail and business properties instead. Stuart Gabriel, finance professor and director of the Ziman Center for Real Estate at UCLA Anderson School of Management, says the land-effects of Prop.13 have almost always disfavored affordable housing because, "affordable housing often times doesn't pay its way in terms of local government cost-revenue impact, and because of that, affordable housing doesn't get built."

Daily News (LA)
20 Entrepreneurs Plan Million-Dollar Pitches
January 23, 2008
Los Angeles hosted "Make Mine a Million," a contest designed for female entrepreneurs whose businesses have the best chance of making $1 million. One participant who hopes to win the contest is the CEO of an online marketing business who has implemented a creative business model that charges clients upfront for advertising. Ely Dahan, an assistant professor of marketing at UCLA Anderson School of Management, says the departure from traditional advertising models this company employs could make it a winner.

The Washington Post
Fed Cuts Interest Rate to Stem Panic
January 23, 2008
The Federal Reserve slashed a key interest rate by three-quarters of a percentage point, a bold action designed to prevent steep losses in world stock markets from causing an all-out panic. This rate cut, the largest in 24 years, soothed financial markets but also generated much concern about the health of bond insurers. "What's going on is the unwinding of probably the biggest credit bubble in history," says David Shulman, senior economist at the UCLA Anderson Forecast. "It will take a while to undo this, and it could get very messy." This article was reprinted in the Concord Monitor.

L.A. Story: $1.5 Billion Lost Due to Strike
January 23, 2008
Opinions vary as to whether the eleven-week writers' strike has had a seismic or modest effect on the Los Angeles economy. According to the Los Angeles Economic Development Corp.,the estimated economic impact of the strike on the local economy is $1.5 billion. But a recent forecast released by the UCLA Anderson School of Management suggests that the strike will be far less damaging to the economy, with an estimated loss of $380 million, if the strike lasts until March.

California Mortgage Defaults Soar as Home Prices Fall
January 22, 2008
Highlighting the impact of falling home prices in California, default notice filings more than doubled against mortgage borrowers delinquent on payments from a year earlier, according to a recent DataQuick report. The report came as the U.S. Federal Reserve cut the benchmark interest rate by three-quarters of a percentage point. According to Stephen Cauley, director of research at the Ziman Center for Real Estate at UCLA Anderson School of Management, the Fed's rate cut will have little effect on home prices, but may help forestall or minimize a recession by helping to prevent job losses that would send foreclosures soaring even higher.

Lollipop Economics 101
January 21, 2008
Columnist Robert Samuelson writes that in this election year, voters are feeling anxious about a weakening economy and by proposing an economic stimulus plan, politicians are offering "economic lollipops" to make people feel at ease. He relates that the government action boils down to mostly political symbolism and there is a touch of hysteria to much of the current economic commentary. The housing slump is vicious, but is still only the fourth worst since World War II, according to economist Edward Leamer, director of the UCLA Anderson Forecast. 

Financial Times
Skills Beyond the Home Run
January 20, 2008
Students at UCLA Anderson School of Management are enthusiastic about a new course titled, ‘The Pursuit of Leadership: A Female Perspective.' Taught by Jamie McCourt, faculty member at UCLA Anderson as well as chairman and president of the Los Angeles Dodgers, the class focuses on personal challenges that women must manage in order to become effective leaders, emphasizing teaching students skills so they can achieve work and life balance. McCourt says her goal is, "to teach women to leverage their skill set," and in the process becoming, "a better leader doing what you do naturally." The course features guest speakers from a variety of fields and industries.

Los Angeles Times
State's Jobless Rate Surges
January 19, 2008
California's unemployment rate jumped to 6.1 percent in December, up from 4.8 percent a year earlier, according to figures released by the state Employment Development Department. While economists vary in their opinions about whether this data signifies a recession, economist Ryan Ratcliff at UCLA's Anderson Forecast says the economy may be slowing down, but it is not in a recession. Ratcliff points to the fact that there are few signs of real weakness outside of the construction and finance sectors, suggesting that retail job loss might be overstated in reports and is likely to be revised when more surveys are issued in the coming months.  

AACSB International eNEWSLINE
Chair's Exchange With Judy Olian
January 19, 2008
In this months' eNEWSLINE posting, UCA Anderson School of Management Dean Judy Olian illustrates the benefits of collaboration in business education among multi-disciplinary sectors at universities. "There is tremendous need for, and opportunity to, bridge the professional orientation of schools of management with the discipline-based content of other areas of campus, to mirror and better serve the linkages that exist in industry. Whether preparing students to embark on their careers, or servicing the business community through lifelong learning or the intellectual insights of our faculty, we must work closely with the business community."

KNX-AM 1070 (LA)
Business Hour
January 18, 2008
UCLA Anderson Forecast director Edward Leamer discussed the credit crisis and its implications for the economy and overall investment market.

Marin Independent Journal
Bay Area Home Market Slump Widens Sales, Prices Still Going Down; Economists See Ongoing Trouble
January 18, 2008
Home sales continued to drop dramatically at the end of 2007, indicating a prolonged and widespread slump affecting the entire Bay Area. Edward Leamer, director of the UCLA Anderson Forecast, points to tougher lending criteria and fewer prospective buyers as contributing factors. Economist Ryan Ratcliff, also with the Anderson Forecast, claims that "the mortgage market is in a continuing state of dysfunction," with "marginal improvement this year at best." This article was reprinted in the Oakland Tribune, Contra Costa Times, and the San Jose Mercury News.

Investor's Business Daily
Housing Downturn Takes a Toll on Land
January 17, 2008
The UCLA Anderson Forecast is referenced in this article about the housing deflation and its effects on land depreciation. This article was reprinted on CNNMoney.com.

Los Angeles Times
Bringing Suburbia to Watts
January 17, 2008
It's an improbable place to find a home-building boom in the midst of Los Angeles' sluggish housing market, yet new homes are rising in the city of Watts. According to Stuart Gabriel, a finance professor and director of the Ziman Center for Real Estate at UCLA Anderson School of Management, "the project would be very favorably greeted in the marketplace," marking the development as a, "trend of revitalization of the Watts community."

Los Angeles Times
Export Surge Helps Keep L.A. - Long Beach on Top
January 17, 2008
Despite the dollar's declining value, the ports of Los Angeles and Long Beach remained the nation's busiest seaports. "When the U.S. economy is growing more slowly relative to foreign economies, this is what you see," says Jerry Nickelsburg, economist with the UCLA Anderson Forecast. "That export growth is one of the strengths of the U.S. economy right now."

Los Angeles Times
Southland Home Sales, Prices Continue Their Fall
January 16, 2008
Southern California home sales and prices plummeted again in December, solidifying a view among analysts that the housing slump will not end soon. "I don't expect it to get better in 2008," says Ryan Ratcliff, economist with the UCLA Anderson Forecast, citing prices that have fallen out of step with incomes, and tightened lending standards.

National Pubic Radio
January 14, 2008
UCLA Anderson School of Management professor Daniel J.B. Mitchell was featured on the news program KCRW discussing the state budget.

San Diego Union-Tribune
Less FDR, More Hoover in Governor's Budget Plan
January 13, 2008
Ryan Ratcliff, an economist with the UCLA Anderson Forecast, was quoted in Dean Calbreath's column discussing the effects of Governor Schwarzenegger's budget cuts during a time of increased unemployment. "In some sense, his proposed budget is adding insult to injury for the economy," said Ratcliff. "He's talking about belt-tightening at the state level at exactly the wrong time for the economy."

Wall Street Journal
Striking Out: Are the Oscars Next?
January 12, 2008
The Hollywood writers' strike claimed its biggest casualty when the threat of picket lines forced NBC to pare back the annual Golden Globes awards ceremony. According to the private Los Angeles County Economic Development Corp., the strike has cost the Los Angeles-area economy nearly $1.4 billion so far. However, an estimate by the UCLA Anderson Forecast argues that losses will actually be closer to $380 million if the strike ends by March.

Los Angeles Times
Countrywide Deal May Ease Credit Crisis
January 12, 2008
Although Bank of America's acquisition of Countrywide Financial Corp. is seen as a crucial step toward mending the battered housing and financial markets, some economists predict that it would do little to help homeowners whose property values were falling. Stuart Gabriel, a finance professor and director of the Ziman Center for Real Estate at UCLA Anderson School of Management, says the ongoing problems in the housing market are, "not going to go away as a consequence of this deal. Those problems could worsen in the short run as it appears the economy is sliding into a recession, if not already in one."

Countrywide's Hometown Braces For Leaner Times
January 11, 2008
With news of Countrywide Financial Corp.'s buyout by Bank of America, local businesses in the corporation's headquarters of Calabasas, California, have braced themselves for possible negative consequences. However, according to Stuart Gabriel, a finance professor and director of the Ziman Center for Real Estate at UCLA Anderson School of Management, "there has not been a real discernible local impact." Gabriel adds that, "there could have been much more severe outcomes with respect to staff reductions and capacity if they went into bankruptcy."

Fox 11 News
January 11, 2008
Stuart Gabriel, a finance professor and director of the Ziman Center for Real Estate at UCLA Anderson School of Management, discussed Bank of America's buyout of Countrywide Financial in relation to the mortgage crisis. This segment also aired the same day on KCOP-TV CH13 (LA).

KFWB-AM 980 (LA)
January 11, 2008
Stuart Gabriel, a finance professor and director of the Ziman Center for Real Estate at UCLA Anderson School of Management, commented on Bank of America's acquisition of Countrywide Financial Corp and what it means for individual mortgage holders.

Daily Bruin
Fees May Increase
January 9, 2008
California's Governor Schwarzenegger called for fiscal restraint in the face of a potential $14 billion state budget deficit, leading experts to predict that fees for California public universities may increase in the next year. Though Schwarzenegger said he believes the budget deficit is a result of the current budget formula, Daniel J.B. Mitchell, professor of management at UCLA Anderson School of Management, says it can also be attributed to the state's economic slowdown.  

The Press Enterprise
Striking Hollywood Writers Reach Deal With United Artists
January 7, 2008
Striking Hollywood writers have reached a deal with United Artists Films to resume working on movies while the strike continues against other studios. The deal could begin to drive a wedge between the producers alliance and independent production companies that want to get their writers back on the job, says Daniel J.B. Mitchell, a professor of management at UCLA Anderson School of Management. 

Los Angeles Times
New Years' Outlook: Experts Forecast Healthy Job Growth for 2008
January 6, 2008
Los Angeles has met the new year with a major housing slump and a writer's strike. Even so, economists at the UCLA Anderson Forecast predict that the overall business climate in Southern California will dodge a recession bullet in the months ahead with many industries, such as the professional business services sector, posting solid job growth. Ryan Ratcliff, an economist with the Forecast, says it is unlikely that there will be rampant job losses or a statewide recession.

Associated Press
California Budget Mess Brings Schwarzenegger Full Circle
January 6, 2008
California's fragile fiscal state has been evident over the past year, with the expected budget shortfall growing to $6 billion. Ryan Ratcliff, economist with the UCLA Anderson Forecast, says the governor's budget reforms to date have largely been gimmicks, "made to look like we addressed the problem, but most of the underlying issues still exist." This article was reprinted in the San Jose Mercury News, San Francisco Chronicle, San Diego Union-Tribune, Oakland Tribune, Sacramento Bee, and Fresno Bee.

Orange County Register
Real Estate Means Real Economic Risks
January 6, 2008
Troubles in the real estate market are weighing on the economic outlook for Orange County in 2008. Economists at the UCLA Anderson Forecast agree that the number of jobs in Orange County will decrease this year, but say that in itself doesn't constitute a recession. Moreover, personal incomes will continue to grow, from existing jobs that continue to pay higher salaries, pensions, dividends and rental income.

Target: Business School
January 4, 2008
Getting into business school is tougher than ever. Scott Shrum and Omari Bouknight have tried to make the process a bit easier with the most recent edition of their book Your MBA Game Plan: Proven Strategies for Getting into the Top Business Schools. In it, authors Shrum and Bouknight refer to UCLA Anderson School of Management as cutting edge in learning style because of its integrated curriculum.

Los Angeles Times
New Year, New Revenue Model
January 4, 2008
2007 was profitable for Hollywood studios and theater chains, with almost $9.6 billion in domestic ticket sales, or 4 percent more than the previous record. However, box-office gains stem from higher ticket prices, not increased attendance. This points to a need for studios and their guilds, comprised of writers, directors and actors, to collaborate on new ways to make money and attract viewers. Sanford Jacoby, professor at UCLA Anderson School of Management, notes that partnerships are built on a history of trust, which is something that is sorely lacking in the relationship between the studios and the writers union.

San Francisco Chronicle
Oil Price Breaks $100 in Glimpse of Future
January 3, 2008
Crude oil futures topped $100 per barrel on January 2, surpassing an important price barrier that was expected to topple due to political unrest and strained global energy supplies. If prices persist at this rate, consumers and the wider economy could feel the shock with higher prices for gasoline, plane tickets, food and other goods. Edward Leamer, economist and director of the UCLA Anderson Forecast says American consumers "have this habit of insisting on their standard of living, even if it means going into debt."

San Diego Union-Tribune
Some Analysts Believe Wall Street's Luck Will Change in 2008; Others Say Recession Unavoidable
January 2, 2008
Wall Street took some hits in 2007 but still managed to end the year on its feet, bouncing back with the help of interest rate cuts by the Federal Reserve. Some stock market analysts say the market's luck will run out in 2008, as the economy is dragged down by a rise in home foreclosures and write-downs, but others say that even though the economy will slow sharply during the first half of the year, it will avoid a recession. Economists at UCLA's Anderson Forecast and Deutsche Asset Management Group predict that after some dips early in the year, the S&P 500 will end 2008 up 8 percent. David Shulman, senior economist with the UCLA Anderson Forecast, cautioned that there will be some wild swings in the market early in the year that could push the S&P as low as 1,300 before it rebounds.

The Orange County-Register
Mortgage Industry Musings
January 2, 2008
Edward Leamer, director of the UCLA Anderson Forecast, was featured in an interview with columnist Mathew Padilla on the mortgage industry, particularly in Orange County. In response to a question about a possible government intervention in 2008 to prevent foreclosures, Leamer replied, "In reality, our federal and state governments do not have the right to intervene in private contracts except under very exceptional circumstances, and no one is likely to suggest using taxpayer dollars to help these borrowers."

American Salon
Mind Set
January 2008 issue
Alfred E. Osborne, senior associate dean at UCLA Anderson School of Management, contributed to the January 2008 issue of American Salon highlighting the Executive Salon Management Program for salon and spa owners at UCLA Anderson School of Management. In collaboration with the Business Education for Salons Today Foundation, UCLA Anderson developed the program to provide an outstanding opportunity for entrepreneurial salon professionals to learn from some of the leading business and management professors in the world.

Sacramento Bee
Poll: Voters See Troubled Times
January 1, 2008
According to The Field Poll released today, more than half of California's residents say the state is in "bad times" economically and only 25 percent think things will get better in the year ahead. However, according to the UCLA Anderson Forecast, California's economy will sputter but not fall into recession this year.

Los Angeles Times
Home Sales Tumble 20 percent in U.S.
January 1, 2008
Sales of previously owned houses and condominiums fell 20 percent nationwide in November 2007 from November 2006, but sales were slightly up from the previous month, according to data released by the research firm DataQuick. The National Association of Realtors interprets the rise as a sign that the housing market is stabilizing, but according to Edward Leamer, director of the UCLA Anderson Forecast, "we've got to take a few months before we know; one month does not a trend make." Leamer adds that sales volumes of houses in Southern California may be bottoming out, but prices will continue to fall for about another year.

Risk Management
Ain't No Business in Show Business
January 1, 2008
While the Broadway strike hurt many New York area businesses, the Hollywood writers' strike has wrought even greater damage on Los Angeles. Even so, according to Jerry Nickelsburg, economist with the Anderson School of Management, figures estimating the damage of the strike on the economy have been overblown. In a separate study, Nickelsburg questions the extrapolated numbers that the Los Angeles Economic Development Corp. has derived, due to the fact that the industry has changed significantly since then.

Builder Magazine
Rx For Recovery
January 1, 2008
Experts are casting a bleak future for home builders in 2008, attributed to growing economic tumult and increasing chances for recession in the broader economy. David Shulman, a senior economist at the UCLA Anderson Forecast, says that consumers are wary about buying a home that may decrease in value. "If the consumer thinks prices are going to fall, even if they have the money and they're a qualified buyer, they're not going to buy unless they have to."

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