Electric cars... $25 billion to promote, yet none on the street...

Electric powered cars are so close within our grasp. The Energy Department has $25 billion to make loans for the manufacturing of these cars, but no money has been allocated yet, despite the 75 companies who applied. President Obama's campaign promise of having one million electric cars on the roads by 2015 has yet to start. These loans are supposed to fulfill this promise. Congress is starting to wonder WHY these loans are not being made. The Energy Department will also be receiving another $2 million for the $787 billion stimulus package. This money is supposed to focus on developing advanced battery technology needed to power electrical cars. These batteries will be more durable, safer and cheaper than anything offered today. The Department finally set deadlines for issuing money. The first loans will be made by late April or early May.

This sounds promising for all the automakers out there, however, there is fine print. Money can only be given to companies and projects that are deemed financially viable. This could possibly exclude GM and Chrysler who have applied for a combined $13 billion from the Energy Department. GM is requesting $8.3 billion using a portion of the money towards the Chevy Volt, a plug-in hybrid. Ford is asking for $5 billion for a variety of electric car retooling. Chrysler is asking for $5 billion. Nissan has also applied for a loan. Other applications also include battery developers.

This new innovation and trend is rising rapidly. People are interested in more economical ways of living. "Green" products are all the rage, as well as high gas mileage with the skyrocketing gas prices. Together the combination is lethal. Today people are more conscious of what they are doing to the earth and how they affect it. We have to get around in a timely manner. There is no way around that. This gives people a way to feel better about themselves and what they are doing to the environment, all while saving money in the long run.

Original article from nytimes.com:
http://www.nytimes.com/2009/02/27/business/energy-environment/27green.html?hp

Cutting Back... A Lesson from Japan

As we adapt to the struggling economy, we are forced to do something some of us never thought we would do... be frugal. Japan struggled in the 1990's to early 2000's and learned how to cope with lower wages and low stock prices. In the aftermath of their economic disaster even well-off Japanese households are resorting to conservation. For example, using old bath water to do laundry is not uncommon these days. They are also not buying cars, causing sales to fall by half since 1990. They are constantly living in fear of a repeat and focus on saving versus spending now. Japan was able to pull itself out of its slump by exporting to the US and China, but its consumers were left feeling less than confident. Per-capita consumer spending only rose 0.2% between 2001 and 2007. Japan relies on its exports, so our economy effects them as well. When we reduce our spending, and therefore imports, they are losing money. They also have to compete with other economies, like South Korea and Taiwan, where the labor costs are low. So maybe the consumer in Japan have good reason to be cautious.

Japanese consumers are now giving up the luxurious and trading it in for a more simple life. The demand for cars by men in their 20's is down 48% from 2000. Women are also trading in their Louis Vuitton for more economical purchases. The baby boomers who were expected to splurge their savings are also holding back.

The same fear that resides in the US is also occupying Japan. And that is DEFLATION. Stimulus packages may seem like a good idea in theory, but when consumers are living in fear of losing everything they have extra money isn't going to go into buying a new car, Manolo Blahniks, or a new Chloe bag. Consumers will more than likely save the extra money in hopes that it will be more valuable in the future.

Original article from NY Times:

http://www.nytimes.com/2009/02/22/business/worldbusiness/22japan.html?_r=1&ref=business

Online Dating... Increasing Our Love Lives?

It's that time of year again... Valentines Day is right around the corner. Dating has proved to be a very expensive form of entertainment and companionship. It doesn't help that the last 5 months have been a time of turbulence in our wallets. Nearly 600,000 jobs were lost in January alone. We have accumulated a national debt of $10.7 trillion and counting. The Dow is down more than 2,200 points from only 5 months ago. But despite the economic crisis, romance has been flourishing. Both online and offline matchmakers are reporting that their business is up. Match.com reports its strongest fourth quarter in the last 7 years. Many brick-and-mortar companies are reporting an increase in business, some up to 40%.

There are a few reasons for this increase in the search for love through third parties. Unemployed and underemployed people have more time for things like searching the web. Online dating is a relatively inexpensive way to meet people. It allows you to get to know a person without wasting an entire dinner just to find out you have no interest in them whatsoever. Organized dating events are also cheaper than original dating. It allows you to meet multiple potential partners all at once, cutting down ten dates into one. Dating has become so expensive that people cannot afford it anymore. The old fashioned way of just going out to a bar at night has become impossible for those who are monetarily strapped. Alcohol is expensive and not a guaranteed tool to work. Speeddate.com,a free online dating site, reported an average of about 80,000 virtual encounters a day in October. Today that has been bumped up to 130,000, a 60% increase. Match.com has seen their membership grow 17% in December, despite the $34.99-a-month charge. Perfectmatch.com had a 30% increase in January. Love-seekers were not turned off by their $50-a-month fee. Duane Dahl, chief executive of Perfectmatch.com, noted that the situation is quite similar to the last economic downturn in 2001.

An increase in traffic at the beginning of the new year is no surprise. This is pretty typical behavior in this industry. Finding someone to spend your life with is a common New Year's resolution. But this year seems to be different. The economy has put a lot of people out of work leaving them with plenty of time on their hands and not a lot of money to burn. Online dating seems to be the perfect activity to fill the void while hopefully fulfilling their resolution.

Original Article from nytimes.com:
http://www.nytimes.com/2009/02/12/fashion/12dating.html?_r=1&ref=fashion

Crafty Marketing Tool Wins Market Share for Hyundai

Despite the recent plunder of big name auto companies, Hyundai is forking over $3 million during the Super Bowl just to teach Americans how to say their name correctly. Every other auto maker has felt the slump in the economy, with sales falling 37% last month. But Hyundai developed a new marketing strategy... no more rebates or low APRs. They cleverly came up with a plan called "Hyundai Assurance." This program allows buyers to return their vehicles, at no cost in most cases and with no penalty, if they lose their job or income within a year. With this program they are able to soothe most buyers fears of fear and uncertainty. With the economy the way it is, one day you have a job and the next day you might not. Hyundai gives the buyer assurance, which gives them confidence to buy. This also broadens Hyundai's target market. People who never thought of owning a Hyundai are now lining up to purchase a new car.

The program covers buyers who leases or finances a vehicle. If they involuntarily lose their job, become physically disabled, lose their license for medical reasons, transferred to another country , self-employed and file for bankruptcy or die in an accident Hyundai covers the difference between the value of the car and the amount the buyer owes, or negative equity, up to a max of $7,500.

Hyundai now has 7% of the market in the US. In 2008, it became the world's 5th largest automaker, sliding ahead of Honda, Nissan and Chrysler.

Original Article from nytimes.com:
http://www.nytimes.com/2009/02/05/business/media/05auto.html?_r=1&ref=business&pagewanted=print