A poor jobs report for September. Netflix reports positive results. Bill Gates invests in a Spanish builder and the Chinese government cracks down on reality TV shows.
Job creation in September lower than expected
CNBC is reporting that the US economy added just 148,000 jobs in September, significantly worse than expected. The unemployment rate fell unexpectedly to 7.2 percent, the lowest since November 2008 but the labor-force participation rate is at 35-year lows. Private payroll creation was at 122,000 with state and local governments adding 28,000 positions. Economists had been expecting the economy to add 180,000 jobs. A broader measure of unemployment that takes into account the underemployed and those who have quit looking for work is 13.6 percent.
Netflix adds 1.3 million customers
Netflix added 1.3 million US customers in the third quarter, according to the Wall Street Journal. The company ended the quarter with 29.23 million paid domestic users while HBO had 28.96 million as of June 30. Netflix’s growth has been attributed to its increasingly high profile in Hollywood due to the success of TV series such as “House of Cards”. Despite its growth, profits still remain marginal. The company’s stock is up 282 percent since the beginning of the year. The company’s challenge will be to keep up enough growth in $7.99 subscriptions to balance out its investments in television programming.
Bill Gates makes big bet on Spain
Microsoft co-founder Bill Gates has become the second-largest shareholder in FCC, a Spanish builder hit by the collapse of the property bubble in Spain. According to the Financial Times, the primary shareholder is the heiress and philanthropist Esther Koplowitz. The construction group expanded rapidly during a decade of cheap credit that fueled a housing boom in Spain. But as the domestic market collapsed, the company was forced to reposition itself and now works on construction projects worldwide. Shares of the company rose more than 10 percent on Tuesday after the company announced it had sold more than 6 percent of its treasury funds to funds affiliated with Gates for 113.5 million euros.
Smaller law firms grab more business
Companies are no longer hiring the pricey law firms but are sending more work to cheaper, smaller firms. The Wall Street Journal reports that over the past three years, law firms with 201-500 lawyers have doubled their share of the big-ticket litigation (with legal fees over $1 million) from 22 percent to 41 percent. The biggest firms (those with over 750 lawyers) are losing ground. Their share of overall legal billings dropped to 20 percent from 26 percent while mid-sized firms increased from 18 percent to 22 percent. The analysis is based on a report by CounselLink after review of $10 billion in legal fees. Corporations began searching for lower legal costs in 2008 when the recession forced expense cuts.
Chinese government cracks down on American Idol-like shows
Chinese authorities are cracking down on how often broadcasters can air reality, dating and talent shows such as the Chinese version of “American Idol” or “The Voice”. The Associated Press reports that these types of shows now need approval from the governmental body that oversees broadcasting. The government will license one such show per quarter for prime-time viewing. Regulations require satellite channels to allocate viewing to no less than 30 percent of news, economics, culture and science. They hope to stop the promotion of vulgar content and promote more efficient use of resources. The satellite channels have been taking too much viewing time away from the CCTV, which is the TV broadcaster responsible for carrying forward the government’s message.
Catherine S. McBreen is President of Millionaire Corner. McBreen plans and develops content for Millionaire Corner. Catherine balances editorial content to meet the informational needs of both new and seasoned investors. She designs special monthly surveys on topical issues affecting the economic environment.
McBreen has a B.S. in speech communications from Northwestern University and a J.D. from DePail University College of Law. She is a member of the American Bar Association, the Illinois Bar Association, and the Chicago Bar Association.
Well-known for her expertise in the affluent and retirement arenas, McBreen is a frequent speaker at industry conferences. She has been quoted widely by the financial media, including The Financial Times, The Wall Street Journal, Research, Private Asset Management, On Wall Street, Reuters, Bloomberg News, The Dow Jones Newswires and Worth. Cathy has appeared as a guest on CNBC Closing Bell, First Business Morning News, Neal Cavuto at Fox Business News, ABC and CBS radio.
McBreen is co-author with Spectrem President George H. Walper, Jr. of the book "Get Rich, Stay Rich, Pass It On: The Wealth-Accumulation Secrets of America's Richest Families" (Portfolio, January 2008)
Catherine is the mother of four and is involved in many school and community events.