The Wall Street Journal notes that these cases share more than defendants who accepted bailout money:

The common thread of the rejected settlements seems to be a request for "more serious sanctions against individual managers," said Robert Heim, a former SEC assistant regional director. "Right now, it's numbers negotiated between prosecutors and the accused. Judges are concerned the penalties are too small" and that shareholders are burned twice, first by the wrongdoing and second by the fines.

Think of the alleged Wall Street miscreants of the last decade: Merrill Lynch's Henry Blodget, Credit Suisse's Frank Quattrone, Bear Stearns's Ralph Cioffi and Matthew Tanin, Bank of America's Theodore Siphol, the New York Stock Exchange's Dick Grasso, Morgan Stanley's Mary Meeker, and Citi's Jack Grubman--the list goes on.

None of those individuals were convicted.

That pattern has been a big concern for the three judges, who the New York Times points out were all appointed by President Bill Clinton. The Times noted the frustration of Sullivan in the Barclays case, after asking the lead prosecutor, "You agree there must have been some human being who violated U.S. laws?"

He proceeded to ask that same question in a dozen different ways, growing increasingly exasperated with the answers, until he finally interrupted the government lawyer to ask, "Can I just share a thought with you?"

"You know what?" he asked. "If other banks saw that the government was being rough and tough with banks and requiring banking officials to stand before federal judges and enter pleas of guilty, that might be a powerful deterrent to this type of conduct."

If putting a banking official on trial would please the court, it may happen soon in Rakoff's chambers. That's a location Bank of America has been trying to avoid since last year's ruling. Now, two of the company's former executives, ex-CEO Kenneth Lewis and ex-CFO Joe Price, are facing fraud charges connected to their personal involvement in the same Merrill Lynch deal. This time, it's not federal prosecutors pressing charges but New York Attorney General Andrew Cuomo. Defense lawyers are asking for the case to be thrown out.

But baring a dismissal from Rakoff, an individual banker could finally have his own day in court.

Redefine the Latte Factor for More Successful Money Saving

The "Latte Factor" is a popular money-saving strategy that entails saving large amounts of money by cutting down on small things—like daily lattes. Personal finance blog The Simple Dollar explains why this strategy can fail and how to rethink it.

Photo by Scott Feldstein.

There's no doubt that saving $5 a day adds up in the long run. However, a lot of people don't put this strategy into practice, for the simple reason that they like their metaphorical lattes:

The problem is what you're giving up. The "latte factor" of course refers to coffee – something that's inessential to basic life, something that's purely a treat. Yet, for some people, a latte a few times a week is a significant part of their emotional happiness. They rely on that sweet flavor and that little caffeine boost and it fuels them throughout a challenging day.

The trick is figuring out which of those little thing really does brighten your life – and which of those things don't. What you'll find is that when you really dig into this question, you begin to find that surprisingly few things really make you significantly happy (beyond the initial burst of pleasure at acquiring something). An awful lot of things we buy are part of a routine or done to make others happy or done because we've believed that it'll make us happy when it really doesn't.

Whether or not you agree that your latte has a large effect on your happiness, it can apply to anything you may be sad about cutting. Instead, try what The Simple Dollar dubs the Laundry Detergent factor: instead of cutting down on your stress-relieving treats, cut back on something less integral, like laundry detergent. After all, we already know less detergent washes as well, and you can even make your own to save more.

Again, this doesn't mean you have to scrimp on laundry detergent; it's more of a metaphor—cut back on the things less important to your day-to-day happiness and you'll probably be more successful at saving money. Hit the link to read more, and share your frugality success (and failure) stories in the comments.

S.J. man fights back

San Jose homeowner and Santa Clara Valley Transportation Authority bus driver Darrell Thomas stopped paying his mortgage in late 2008 after he lost overtime pay and while he was seeking a loan modification. He was offered a trial modification in April last year, but as he was about to start making the new payments, he learned he'd been foreclosed on. With help from an attorney, he successfully sued to get back his triplex, where he lives and has tenants.

But he's still pursuing legal action against his lender, Wells Fargo, because he feels he was improperly denied a loan modification under the Home Affordable Modification Program. In May he began making mortgage payments for the first time in almost a year and a half, as part of an agreement with Wells Fargo to ensure the bank would not foreclose on him during litigation.

While some might find relief in walking away from their homes after prolonged struggle, "I don't look at it that way," said Thomas, 46. "That's home. I'm established, that's where my family's at, and it's hard to start over."

Don't you have to start the first time before you can start over? The article doesn't say when Thomas closed. But if the loss of overtime pay is enough to render you unable to pay your mortgage, you are by definition a "reach" borrower. If Thomas has one penny of equity in this property, I'll switch to non-alcoholic beer.

If anybody should be suing Wells Fargo, it is Thomas' tenants, for not foreclosing on him while he's running a completely fraudulent business: living free and collecting rents. 

Find Unclaimed Money or Property that Belongs to You

The phrase "unclaimed money" may sound like the beginning of any number of spam email you've received and deleted, but unclaimed money and property are out there, and finding out whether you're owed either is just a few web searches away.

We've highlighted unclaimed money search engine Missing Money in the past, but money blog Get Rich Slowly goes in depth into how to find unclaimed money and property, mentioning Missing Money along with several other tools for hunting down unclaimed cash—like Treasury Hunt for savings bonds, the National Registry of Unclaimed Retirement Benefits for unclaimed 401ks, and several other options. Beyond search aggregators and national search options, the post also rounds together a state-by-state list of links to help you hunt down unclaimed money and property at the individual state level.

Remember that you should never have to pay a fee to claim abandoned money or property that belongs to you (though some services offer to do the hunting for you, for a fee). If you've ever reclaimed unclaimed funds, let's hear about your experience in the comments. Photo by redjar.

Last week a group called New York Communities for Change (NYCC) joined with New York City Comptroller John Liu and seven of New York's largest unions to demand that Wall Street's biggest banks reform their loan modification policies so families facing foreclosure will not lose their homes. If other groups follow that lead, we might make a big dent in the foreclosure crisis.

NYCC and its sister organization, Mutual Housing Association of New York, have been working with foreclosure victims neighborhoods like St. Albans in Queens, or Bed-Stuy in Brooklyn not far from Wall Street, where homeowners have been forced to make impossible choices: keep up their skyrocketing mortgage payments or provide their families with food and clothing.

Members of the group are angry at banks, who have been painfully slow to offer loan modifications, or simply refuse to lift a finger to help vulnerable families and neighborhoods to avoid foreclosure. Some banks often screw homeowners by sending numerous requests for already-submitted documents, and then foreclose on the hapless homeowner because the banks falsely claim that they never got those same documents!

The federal government's attempt to solve the foreclosure crisis has failed. In 2009, 50,000 foreclosures swept New York state, with nearly half in NYC. Across the country the crisis is getting worse, not better. Katrina vanden Heuvel on July 15, in the Nation, reported that New York City foreclosures rose 16 percent in the first quarter of 2010 compared to the same period last year, with "...over 265,000 mortgages -- 13 percent of the mortgages in New York State-are now past due or in the foreclosure process. Meanwhile, banks have made less than 12,000 permanent modifications in the state since May 2009."

After several community meetings it became clear that many NYCC and union members need their mortgages modified because they are underwater or delinquent. The community and labor groups put together an action plan with Comptroller Liu, SEIU 32BJ & 1199, United Federation of Teachers, TWU, DC37, RWDSU, and the NY Hotel and Motel Trades Council.

To start they will send a letter to Citigroup, JPMorgan Chase, Bank of America and Wells Fargo, criticizing them for dragging their feet and demanding they do "everything possible" to avert foreclosures, including mortgage modifications.

At a July 13th, press conference, Michael Mulgrew, President, UFT, said he has brought the issue to the pension funds and they will consider all options. John Samuelsen, President, TWU Local 100 said that "since he was on the board of the city pension fund, he would ask that the bank's response be one of the ways in which they evaluate where they put their money." NYCC member, Jean-Andre Sassine, caught in the mortgage bind, said, "if the big banks won't listen to homeowners, we thought that they should hear from some of their biggest investors -- the city, the unions and their pension funds."

If the banks fail to act, all parties involved could move their pension funds and bank deposits to other institutions. That is why the groups call their plan the Move Your Money campaign.
They claim it will not only modify foreclosures and save homes, it will hold big banks accountable to the community where they take deposits and profit from government supported loans. After foreclosures, neighbors who remain behind suffer from declining property values, and local and state revenues plummet, contributing to a stagnant economy and high unemployment. The coalition is demanding answers by September 1.

Thus far the Obama administration plan -- which relies on a voluntary mortgage modification program -- has not worked, forcing New Yorkers to take matters into their own hands.
The groups put Wall Street on notice that unless the banks increase the number of modifications, including principal write-downs, expedite the modification process and stop foreclosure proceedings while applications are being reviewed, the group will increase the pressure. "This is just the first step in a campaign to win loan modifications that stop preventable foreclosures. We're saying it loud and clear - if the banks won't listen, it's time to move our money," Jon Kest, NYCC's executive director.

What happened to ACORN?
It is a rare showing of both money and people power, with the unions representing over 500,000 working families. NYCC is a coalition of low- and moderate-income working families fighting for social and economic justice throughout New York State and includes some of the leaders and organizers from the now defunct ACORN. The group also uses many of the same tactics and strategies. NYCC's members and leaders hope the action taken by New York City's Comptroller and labor leaders will lead to a dramatic shift in how the banks deal with borrowers.

Civic leaders across the country should follow the coalition's lead. Either big banks become part of the solution or the rest of us will have to Move the Money.

You can buy a copy of John Atlas's new book about ACORN, which tells the whole Acorn story at Amazon or Vanderbilt University Press or in most local book stores.

Foreclosures Up In 75% Of Metro Areas, But Congress Reduced To Pleading With Banks To Modify Mortgages

According to the latest data from RealtyTrac, “foreclosures rose in three of every four large U.S. metro areas in this year’s first half,” providing yet another piece of proof that the foreclosure crisis is far from over. “More than 3 million households are seen getting at least one foreclosure notice this year, and this record will be surpassed slightly at the peak of next year,” RealtryTrac estimated.

The slow but consistently mounting number of foreclosures is, sadly, warranting little attention from lawmakers. And the Obama administration’s signature foreclosure prevention program, the Home Affordable Modification Program (HAMP), has fallen flat on its face. The latest report shows that fewer than 400,000 homeowners have received permanent modifications. In fact, more homeowners (520,814) have fallen out of the program than have had their mortgage modified.

HAMP has suffered from a series of design flaws, but one of the biggest is that there’s simply no incentive for banks to make a wide effort at implementing modifications, as the program contains no stick to force a bank’s hand. In fact, at this point, Democratic lawmakers have been reduced to asking banks if they would deign to pick up the pace of modifications on their own:

In a letter Tuesday, [Sen. Sherrod] Brown (D-OH) stated that a number of constituents have contacted his office saying banks are offering limited assistance in helping them restructure their home loans. The senator used the letter to call on banks to do more to help these individuals. “It is in the best interest of your banks to work with responsible borrowers to help them stay in their homes or find other alternatives to foreclosure,” Brown wrote.

As Elizabeth Warren, Chair of the TARP Oversight Panel, said, “for every family that Treasury has helped into a sustainable mortgage modification, ten other families have lost their homes to foreclosure. Foreclosures show no clear signs of abating.” Atrios added, “HAMP was announced with great fanfare, a big budget, and a promise that the program could help millions of homeowners. Instead it’s mostly gouged desperate people, extracting a few more mortgage payments out of them while doing little to help them.”

Treasury has been reluctant to implement substantial changes to the HAMP program, but states across the country are trying other approaches to stem the foreclosure tide, including mediation programs that compel banks to meet with a homeowner before finalizing a foreclosure. And it remains the case that the failure to get a handle on the housing crisis will impair an economic recovery.

Jive Software Nabs $30M in Round From Kleiner Perkins, Sequoia Capital

Thea Chard 7/21/10

Jive Software, the Palo Alto, CA-based software company started in Portland, OR, has received $30 million in Series C financing led by Kleiner Perkins Caufield & Byers.

This latest shot of cash, part of which comes from Sequoia Capital, means the company has raised more than $57 million in the last three years. Sequoia had been Jive’s sole investor up until this point, providing $12 million back in October, and $15 million in 2007.

“This is the biggest joint investment that Kleiner and Sequoia have done since they partnered up with Google,” says Bryan LeBlanc, Jive’s chief financial officer.

The investors are betting big that Jive has figured out how to harness some key elements of social media for business. Jive provides social-networking, communication, collaboration, and social media monitoring tools to more than 5,000 businesses, a group that ranges from small and mid-size companies to huge global brands. Jive’s customer roster includes Nike, Starbucks, SAP, Cisco Systems, Charles Schwab, and Intel. The company also provides social networking and collaboration software for a number of U.S. government agencies, as well as congressional members and their staffs.

“We’re the largest and fastest-growing company in this new category,” says Christopher Lochhead, Jive’s chief strategy advisor. “It’s about a $5 billion dollar market growing at about 40 percent, and we’re the clear leaders.”

The company’s biggest competitors include Microsoft and IBM. But according to Lochhead, Jive has an advantage—the support of some significant VC dollars, which he says will give Jive the ability to expand its product offerings and hire the best talent Silicon Valley has to offer in “multiple gene pools.”

As part of the deal, Kleiner Perkins managing partner Ted Schlein will be joining the Jive board of directors. The $30 million capital will be used to “accelerate Jive’s rapid growth and further drive the company’s leadership in the social business market,” according to a company statement.

What does that mean for potential clients? That the company will be expanding on its current social business software—the “doppler weather radar” of what’s going on in specific markets as Lochhead puts it. It will also allow Jive to focus on developing four strategic pillars moving forward. First is what Lochhead calls  ”Jive What Matters,” a one-stop command center that encompasses “everything that you need to get your job done,” in terms of monitoring deadlines, status updates, sales numbers, all in one place. Then there’s Jive mobile apps; social widgets, such as YouTube and SalesForce, integrated into the software; and seeking out more strategic partnerships with companies like Google and Twitter.

“What social business software entails is a new way to engage with your employees, customers and the web,” Lochhead says. “Why is it so fun, effective and easy to do all of this stuff in my personal life, and yet work sucks? All of those innovations in the consumer social web, Jive is bringing to the enterprise.” He adds: “It’s a new way to do business that allows people to work together, interact, in a way that just wasn’t possible before.”

LeBlanc, the finance chief, added: “$30 million allows us to have the currency to execute that strategy.”

Though Jive, founded in Portland, OR in 2001, relocated its headquarters to Palo Alto, CA last May, it continues to maintain a growing presence in the Pacific Northwest. The company laid off one-third of its employees—around 40 people, including the vice president of engineering and vice president of sales—after the economic down turn in 2008. But Lochhead says it’s maintained profitability and is growing again, with 270 employees spread throughout the offices in Palo Alto, Portland, OR, and Boulder, CO, as well as two outposts in Europe. In January, the company posted record profits—an 85 percent increase in full-year revenue in 2009 when compared to the previous year.

And although LeBlanc could not give us exact figures on how Jive is doing this year, he did say that the financial support from Kleiner Perkins and Sequoia is a strong indication of the company’s potential.

“We do intend to build a large, relevant software company, and often when you look at large, relevant software companies, they’re $1 billion companies,” LeBlanc said. “Having that capital now—I think it’s a testament that Sequoia has been very bullish about this space…it’s unusual and we feel, frankly, very honored to have two of the titans of Sand Hill Road both behind us.”

Thea Chard is the Assistant Editor for Xconomy Seattle. You can e-mail her at tchard@xconomy.com or follow her on Twitter at http://twitter.com/theachard.

As you’ll read tomorrow (or Monday), I’ve entered a new phase in my life. After years of hard work and long hours building this blog (time that I’ve enjoyed), I’ve been shifting things around so that I have more free time. As a result, I’m going to have more time to devote to creating quality blog posts, instead of rushing around at the last minute looking for something to write about.

Because of this, it’s time yet again to take requests. I do this about once a year, and it’s a great way to get a feel for what GRS readers are interested in. I’d be grateful if you’d take the time to leave a comment below with topic suggestions or article requests. It doesn’t matter if we’ve covered the subject in the past. If you’d like me (or one of the other GRS staff) to write about it, let me know.

Have there been too many articles about credit cards? Too few articles about credit cards? Would you like to know more about individual savings accounts? Do you like the articles about the psychology of spending? Would it be helpful to have somebody come in to explain insurance concepts in plain English? Should I try to persuade my wife to share more of her recipes now and then? Let me know what you’d like to read about!

While you’re all providing feedback about the site, here are a few recent articles of note:

Over at The Simple Dollar, Trent and his readers had a thoughtful discussion about the obligations of wealth. “I think there is some inherent distrust of the rich in the mainstream of American society,” Trent writes as he describes how a wealthy person can keep from alienating his friends. There’s so much to say about this topic; I’m tempted to write an entire article about it.

GRS reader Steven writes a blog called Hundred Goals, which is about achieving your goals while managing your finances. After Sierra’s post this morning about travel, he dropped me a line to let me know that he has a recent article about how to have a great vacation.

Speaking of vacation, my pal Jason over at No Credit Needed spent time compiling day-use fees and free days for state parks across the United States. Handy page to bookmark!

And here’s more travel! At The Art of Non-Conformity, my good friend Chris Guillebeau has posted a beginner’s guide to travel hacking. I’ve been asking him to share this info for a long time; now I’ve got to take responsibility to use the knowledge he’s shared.

Finally, I’ve been giving a lot of interviews lately. I’m much more comfortable with these than I used to be. (They used to scare me to death!) Some examples:

• Colleen from The Frisky interviewed me about how to save money even when you’re living paycheck to paycheck. This is a tough quandary, something I’m asked about a lot.
• In an interview with BeFrugal, I discuss frugality, happiness, and conscious spending. (Note: “the ballot” should be “the balance” — I must have mumbled.)
• Jeff Rose at Good Financial Cents also interviewed me. This interview is very much about the process of writing a book, which may or may not interest you.
• I also spoke with Beverly Harzog from Card Ratings. We chatted about credit cards, of course, but also about other aspects of personal finance.
• Finally, USA Weekend has a short piece on how to give your 401(k) a midyear check, for which author Richard Eisenberg interviewed me back in May. This is a perfect example of how much work goes into even a small newspaper article. Eisenberg spent 20-30 minutes on the phone with me, and I’m sure he did the same with the other folks he quotes. Plus, I’ll bet he spent a lot of time writing. I wouldn’t be surprised if there were 4-6 hours in this small piece.

Okay, one last thing before I go. Tim pointed me to a two-year-old New York Times series about the debt trap, which includes an interactive infographic showing average household debt loads over the past century.

That’s enough links for today. Please do leave a comment with topic requests or other feedback. Meanwhile, it’s time for me to go do some yardwork…

As a budding scientist who has been involved in the HIV field, it is rather frustrating to see media reports of the latest breakthrough in research without a full understanding of the findings and their significance (not that the medical establishment is not complicit … we put out these press releases in order to justify continued research money).  As you are well aware, the field had been fraught with repeated false hopes and, after more than two decades of trying, we are no closer to a preventative vaccine than when we first started.

These findings today do not really change this fact.  The same group has previously described another such neutralizing antibody but have been unsuccessful in their attempts to elicit this response in other individuals (this is the premise of a vaccine).  The very fact that the vast majority of people fail to mount a significant immune response against the virus (unlike we do to most other pathogens) suggests that a vaccine may not even be possible in the first place.  Pharmaceutical therapy, for better or worse, will remain our best response to this disease for the foreseeable future. 

That being said, without any signs of the disease abating, research like this cannot be discounted.  Just don’t expect results any time soon.

I don't. The Dish has long been dismissive of the search for a vaccine against HIV, but this did seem like a positive development. Another writes:

Thanks for that piece of news, Andrew. It actually brought tears to my eyes. I keep forgetting how much we suppress those hopes for a cure, then I read something like that and there's this flame, this glimmer of promise and I'm suddenly in tears. We forget how much that hope for a cure means to us, and how much we've pushed it aside and filed it away.

Right now I'm in this perfect storm of unemployment, heathcare crisis and AIDS.

Since I am, according to some, too lazy or drug-addled to find work, I've had to choose between my COBRA payments and my med copays and Dr. visits. I chose my COBRA payments for fear of that dreaded insurance lapse that would kick in pre-existing exclusions and not getting that all important certificate of coverage for my next (hopefully) job. Since I actually have a home (not sure for how long) and not totally homeless and destitute (yet) I don't qualify for a lot of help. Even if I did now, the state of GA, like many states, now have a Ryan White waiting list to get meds. Even my discount med cards from the drug companies didn't help enough to make them affordable.

So I'm waiting, waiting, waiting - so much has to fall into place, IF I can get a job in the next month or so, and IF they have good benefits, and IF the timing is just right, I might just be able to keep my insurance and go back on my life-saving meds. IF in the next month or so, I don't, I"m hitting several walls, my unemployment running out, my COBRA ending, foreclosure, bankruptcy. That's hoping too that after almost a year off my meds now, that I'm not blindsided by some totally preventable HIV related disease that would put me in the hospital and suddenly make any hope of this turning out well fly right out the window.

I have an older brother who is a wealthy retired executive from Philips, and very much a ditto head. They can't see giving me money since they would just be "enabling" me and keeping me from really looking a job (yes he really said that, almost a verbatim FOX talking talking point). Being a Christian though he did help me rewrite my resume. He keeps saying "just get private insurance" and even "just start my own company" but he hasn't a clue. With my meds running at $10,000 a month and having HIV/AIDS, I'm uninsurable through private health insurance, he doesn't understand that and almost refuses to believe it.

To address a lot of the current bashing of the unemployed: I'm a sharp hard working guy. I had the highest SAT scores in my class, I was pre-med at Wake Forest, two years ago I was making almost $60,000 a year, running an entire print production facility and doing it well. I've worked in consulting firms, F500 marketing departments, I have a killer resume. Yet...

So thanks again for that article. I do still hope. I've been in this crisis from the beginning, HIV+ back before there was even a test or a known cause. I had a partner who was only months ahead of me in progression, yet for every new drug that he just missed being able to take advantage of, I was able to. So our paths that at one time seemed to be almost lockstep veered apart and he died some 20 years ago and I'm still kicking around (I hope). I would just be crushed though that after living the miracle that being a 20+ year long-term survivor entails, that because of seemingly mundane things like a job and health insurance it might all be for nothing.

A reader writes:

As a budding scientist who has been involved in the HIV field, it is rather frustrating to see media reports of the latest breakthrough in research without a full understanding of the findings and their significance (not that the medical establishment is not complicit … we put out these press releases in order to justify continued research money).  As you are well aware, the field had been fraught with repeated false hopes and, after more than two decades of trying, we are no closer to a preventative vaccine than when we first started.

These findings today do not really change this fact.  The same group has previously described another such neutralizing antibody but have been unsuccessful in their attempts to elicit this response in other individuals (this is the premise of a vaccine).  The very fact that the vast majority of people fail to mount a significant immune response against the virus (unlike we do to most other pathogens) suggests that a vaccine may not even be possible in the first place.  Pharmaceutical therapy, for better or worse, will remain our best response to this disease for the foreseeable future. 

That being said, without any signs of the disease abating, research like this cannot be discounted.  Just don’t expect results any time soon.

I don't. The Dish has long been dismissive of the search for a vaccine against HIV, but this did seem like a positive development. Another writes:

Thanks for that piece of news, Andrew. It actually brought tears to my eyes. I keep forgetting how much we suppress those hopes for a cure, then I read something like that and there's this flame, this glimmer of promise and I'm suddenly in tears. We forget how much that hope for a cure means to us, and how much we've pushed it aside and filed it away.

Right now I'm in this perfect storm of unemployment, heathcare crisis and AIDS.

Since I am, according to some, too lazy or drug-addled to find work, I've had to choose between my COBRA payments and my med copays and Dr. visits. I chose my COBRA payments for fear of that dreaded insurance lapse that would kick in pre-existing exclusions and not getting that all important certificate of coverage for my next (hopefully) job. Since I actually have a home (not sure for how long) and not totally homeless and destitute (yet) I don't qualify for a lot of help. Even if I did now, the state of GA, like many states, now have a Ryan White waiting list to get meds. Even my discount med cards from the drug companies didn't help enough to make them affordable.

So I'm waiting, waiting, waiting - so much has to fall into place, IF I can get a job in the next month or so, and IF they have good benefits, and IF the timing is just right, I might just be able to keep my insurance and go back on my life-saving meds. IF in the next month or so, I don't, I"m hitting several walls, my unemployment running out, my COBRA ending, foreclosure, bankruptcy. That's hoping too that after almost a year off my meds now, that I'm not blindsided by some totally preventable HIV related disease that would put me in the hospital and suddenly make any hope of this turning out well fly right out the window.

I have an older brother who is a wealthy retired executive from Philips, and very much a ditto head. They can't see giving me money since they would just be "enabling" me and keeping me from really looking a job (yes he really said that, almost a verbatim FOX talking talking point). Being a Christian though he did help me rewrite my resume. He keeps saying "just get private insurance" and even "just start my own company" but he hasn't a clue. With my meds running at $10,000 a month and having HIV/AIDS, I'm uninsurable through private health insurance, he doesn't understand that and almost refuses to believe it.

To address a lot of the current bashing of the unemployed: I'm a sharp hard working guy. I had the highest SAT scores in my class, I was pre-med at Wake Forest, two years ago I was making almost $60,000 a year, running an entire print production facility and doing it well. I've worked in consulting firms, F500 marketing departments, I have a killer resume. Yet...

So thanks again for that article. I do still hope. I've been in this crisis from the beginning, HIV+ back before there was even a test or a known cause. I had a partner who was only months ahead of me in progression, yet for every new drug that he just missed being able to take advantage of, I was able to. So our paths that at one time seemed to be almost lockstep veered apart and he died some 20 years ago and I'm still kicking around (I hope). I would just be crushed though that after living the miracle that being a 20+ year long-term survivor entails, that because of seemingly mundane things like a job and health insurance it might all be for nothing.

James : Thanks for your time Gary. As a Technical Marketing Manager, how have you been involved with the release of Internet Explorer Platform Preview 3?

Gary : It’s really exciting to be involved! ASUS has been providing both mainstream and cutting edge hardware to Microsoft to ensure the best possible user experience with Internet Explorer 9. Not only have we been supplying exciting hardware for testing but we’ve also been providing input and feedback on how to make IE9 perform its absolute best on ASUS products.

James : You said that it’s been exciting being involved with Platform Preview 3. What’s been most exciting for you?

Gary : Here at ASUS we’ve been at the forefront of netbook and notebook innovation by providing the type of CPU and graphical processing power that Internet Explorer 9 thrives on. For example, we shipped the first Intel Atom dual-core with NVIDIA ION powered netbooks, NVIDIA 3D Vision enabled notebooks and one of the first DX11 gaming notebooks powered by ATI’s Mobility Radeon HD 5870 GPU. It’s this type of power that enables IE9 to provide an extremely responsive and interactive user experience on the Web. ASUS’ continued commitment to provide excellent CPU and GPU performance in its mobile products along with Microsoft’s innovative use of hardware acceleration in IE9 will help to create an unlimited possibilities for new Web applications that are both graphically and functionally rich.

James : You mentioned some of your innovative hardware. I’ve had my eye on your U30Jc or UL80Vt notebooks. How will they perform with the latest Platform Preview?

Gary : Thanks to the Intel dual-core processor and discreet graphics performance of the NVIDIA mobile GPU chipset in either notebook the user experience with Internet Explorer 9 will be incredible. In fact, even our AMD based Eee PC 1201T netbook will provide enough graphical and CPU processing power to ensure the user has a terrific web experience with IE9.

James : How about elsewhere in your range? Is there a price point or a particular type of machine I should be looking for?

Gary : We have a vast number of new mobile products launching this summer that are built with Internet Explorer 9 in mind. Everything from our upcoming Eee PC 1215N netbook and slim and light U35Jc notebook to the new 3D capable Republic of Gamers G53 gaming notebook will offer users a rich and interactive internet experience with IE9.

James : So do I need to buy a new notebook or workstation to take advantage of the hardware acceleration in Internet Explorer 9?

Gary : Not at all. We’ve been using discrete graphics and multi-core processors in most of our machines since we started shipping Windows Vista and Windows 7 machines so Internet Explorer 9 will be able to take advantage of that horsepower too. Of course, buying a new shiny notebook with an aluminum body never hurts does it?

James : You’re really trying to talk me into that U30Jc aren’t you? One last thing, what’s your favorite Platform Preview 3 demo on the www.ietestdrive.com site and why?

Gary : That’s a very difficult question to answer. I really do not have a single favorite Internet Explorer Platform Preview 3 demo as they all show how the combination of IE9 and the processing power available in ASUS mobile products will provide a uniquely rich, responsive and interactive Web experience for the user. However, I would have to say during testing that we probably ran the Flickr Explorer demo the most as it truly displayed the power of our current and upcoming mobile products when using IE9.

James : Gary thank you so much for your time.

Gary : It’s been a pleasure.

I’m Neil Glassman and my beats for Social Times include social media marketing and advertising tools, techniques and success stories. Sometimes my posts go off on a tangent, focusing on small business social media issues or research with broader implications.

How did I get the gig? Well, I certainly did not tell Nick O’Neill the whole story that follows.

I didn’t realize growing up that AM radio was one of the original social networks. It had Top 40 formats (mashups), DJ shout outs (tweets), contests to win logo T-shirts (badges) and exclusive clubs to which everyone belonged (Facebook groups).

I got into late night talk shows (blogs), which had an intimacy and affinity with listeners that radio has lost and web social networks have yet to fully discover. My parents didn’t think it was such a great idea for me to stay up late listening on school nights and took away my TV privileges for one night as punishment. That was the night of The Beatles’ first appearance on Ed Sullivan.

My luck with media improved over the years and I found myself marketing technology for media companies. My training was much like everyone else’s in the field: a box of Mad Magazine “best-of” books, learning how to touch-type and a brief career teaching emotionally disturbed junior high schoolers.

In the beginning, I worked with startups, turning underdogs into wonderdogs. Recently I’ve helped a few companies avoid a mid-life crisis. Whatever my responsibilities are for a particular company, my favorite part is finding ways to present a solution to the marketplace and having the marketplace react by saying, “Ah-Ha!”

Successful marketing means thinking outside the box while delivering campaigns inside the box. I leaped on the web-based and electronically delivered marketing platforms very early and with good success. When Nick put out a call for writers on marketing and advertising, I thought it was a cool opportunity and am grateful to have been chosen to contribute to Social Times. My posts are a great way to share my explorations of the potential of the social web, not just for marketers, but for the world’s cultures.

As marketers, our first priority is to develop campaigns that are effective. If we manage to leave a slogan, image or song in our collective unconscious in the process, that’s a great bonus. In my collaborations, I’ve had the chance to participate in some firsts — at least I think they were firsts. If you know something I don’t, teach me.

The first music video shown on TV that was shot and produced totally on video — no film conversion at any step. The Towel Tapes, February 1979.

Marketing the first hardware product to include mp3. Telos Zephyr, April 1993.

The first time the Internet ground to a halt because too many were trying to log in to a multimedia event. Streaming George Clinton concert audio to demonstrate Macromedia Shockwave, the precursor to Flash. November 1996.

On the personal front, I’m a New Yorker with a huge appetite for great songwriters and musicians of diverse genres. Tweet me and I’ll send you a link to my calendar of all the free concerts in town this summer.

Blogging works best when it’s participatory, so join in the conversation with the talented team on Social Times. Pitch me ideas for posts about using social media for marketing and advertising. Don’t forget to include how you are going to make the market say, “Ah-Ha!”

The problem is going to be that there is only more competition in content and so trying to suddenly charge more flies in the face of basic economics. The absurdity of the strategy struck me yesterday as Amazon tried to sell me a subscription to Time for 28.8 cents an issue while Time is trying to sell its iPad issues for $4.99 and I see no reason to buy either. In what world do these economics make sense? In their dreams.

“I want to collect income from the consumer,” Townsend told The Times earlier. “An annual magazine subscription may be something like anywhere bet $12 and $24. So I’m currently locked into a model that says I get a buck or two a month. How about I get a buck for a click?”

Dream on.

They’re not wrong that they need to get money from consumers but they’re not going to get it for content. Sorry guys. But as Google schooled the newspaper industry (I’ll substitute appropriate words):

The large profit margins enjoyed in the past were built on an artificial scarcity: Limited choice for advertisers as well as readers. With the Internet, that scarcity has been taken away and replaced by abundance. No will be able to restore revenues to what they were before the emergence of online . It is not a question of analog dollars versus digital dimes, but rather a realistic assessment of how to make money in a world of abundant competitors and consumer choice.

Instead, I suggest they have to get new revenue through commerce — through selling the things they once advertised now that advertisers are deserting them to sell direct. Problem is, that’s hard, as Condé knows best from its experience with Style.com, which started as an attempt to create a high-end store (I worked there then). They created it in partnership with a retailer and the retailer bagged the effort when times got tough in the first bubble; it then became another ad-supported site. But the strategy wasn’t wrong. Problem is, there is no retail expertise in the company.

More recently, Condé should have bought Net-a-Porter but instead luxury conglomerate Richemont snarfed it up. (Disclosure: I spoke at Richemont’s corporate retreat recently.) Condé should buy Gilt to establish new skills, a new relationship with customers, and new revenue. Its content then becomes just added value: the Cinnabon’s in the mall.

A media company going into retail and selling in areas held by former advertisers has precedent: Media News’ Salt Lake City paper became a real estate broker and undersold the entire business in town. The Telegraph, as I like to point out, sells everything from hangers to wine to betting to its readers.

But if Condé and other media companies are going into retail, they need entirely new skills of merchandising and sales, an entirely new financial structure to cope with inventory costs and tight margins, the ability to cope with entirely new competitors and suppliers (that is, former advertisers — but, worse, Amazon), and an entirely new efficiency (forget the cafeteria; they’d be lucky to have a Wal-Mart lunch room with vending machines as a profit center).

They also have to defeat a calcified, entitled culture. For that, I’d suggest they buy Gawker Media to get the incredibly popular competitor Jezebel and to infuse the company with a new culture. Make Nick Denton editorial director and COO and then watch the fun.

I doubt they heard any of this from KcKinsey because in the few encounters I’ve had with them they remix known models rather than invent new ones, which is what is called for here. I’ll bet they proposed cutting some costs (done) and remixing revenue (started) when what’s really needed is a complete restrategizing.

Or maybe I”m wrong. Maybe 4 Times Square will become the world’s lushest mall, with one helluva food court.

Nevermind my advice. The moral of this story remains that advertising is next to fall into the black hole (as a Time Inc. president once dubbed this damned internet thing). Welcome to Bob Garfield’s Chaos Scenario.

The SmartScreen team just informed me that we’ve reached an amazing milestone – Internet Explorer 8 has blocked 1 billion attempts to download malware!

Socially engineering attacks like malware are a growing threat on the internet and are one of the most common risks to people’s safety online. We introduced malware protection in Internet Explorer 8 as part of the SmartScreen Filter and have talked about it on the Windows Experience Blog a couple of times over the last year.

Here are a couple of quick facts about Internet Explorer and malware as we hit this 1 billion blocks milestone:

• NSS Labs have recognized the Internet Explorer 8 SmartScreen Filter as a leader in protection against Socially Engineered Malware in their August 2009 and March 2010 reports which compared Internet Explorer 8 to Chrome, Firefox and others.
• Our malware block rates continue to improve because we continue to improve the SmartScreen service back-end. For example, in August 2009 we had blocked about 70 million attempts to download malware or about 18 million blocks per month. At the time, according to Net Applications, about 15% of the internet population used Internet Explorer 8. In the last two months, we’ve blocked 100 million attempts to download malware. Last month, according to Net Applications, nearly 26% of the internet population uses Internet Explorer 8. There are 1.7 times more users on Internet Explorer 8 than August 2009 but we’re blocking 5 times more malware month on month.

1 billion malware blocks is an amazing milestone and an example of two things. First socially engineered attacks like malware continue to be a real threat for users on the web. Second, to help keep you safe online your browser needs to continually enhance and improve its service. We have got better and better at blocking malware through the SmartScreen Filter because we have continued to invest in our back end service since we released IE8 in March 2009. It’s this investment that has kept us at the top of the socially engineering malware charts according to NSS Labs and has helped our customers stay safe online.

If you haven’t already upgraded to Internet Explorer 8, now would be a great time to do so at www.microsoft.com/ie . If you’ve already upgraded, you can check that SmartScreen Filter is enabled by going to the Safety Menu and clicking on SmartScreen Filter. If the menu gives you the option to “Turn Off SmartScreen Filter”, the SmartScreen Filter is switched on.

James Pratt, Senior Product Manager

Internet Explorer Business and Marketing Team

Cypress Bio Gets Buyout Offer, Trius Prepares for IPO, Arena Gains Following Vivus Setback, & More San Diego Life Sciences News

Bruce V. Bigelow 7/22/10

San Diego’s life sciences companies continued to raise big money, which is a good thing, since a survey shows that venture funding for biotech and medical device companies accounted for more than 80 of all second-quarter VC deals in San Diego. We’ve rounded up all that and more for you here:

—San Diego’s Cypress Bioscience (NASDAQ: CYPB) said its board will review an unsolicited buyout offer with its financial and legal advisers, and advised the company’s shareholders to “take no action at this time.” New York-based Ramius, a $7.8-billion hedge fund group, owns almost 10 percent of Cypress and offered $4 a share, or about $160 million, to acquire the rest.

—San Diego-based Trius Therapeutics is back on track after it was forced to postpone its planned IPO earlier this year to accommodate new FDA guidelines for a late-stage trial of its antibiotic. The company’s initial stock offering is expected next week.

—An expert panel that advises the FDA voted 10-6 against approving an obesity drug developed by Mountain View, CA-based Vivus (NASDAQ: VVUS), saying the negative effects outweighed the weight-loss benefits. After the ruling, shares of San Diego’s Arena Pharmaceuticals (NASDAQ: ARNA) climbed toward its 52-week high of $5.93 a share, but San Diego-based Orexigen Therapeutics (NASDAQ: OREX) continued to trade around $4 a share. Both San Diego biotechs are developing obesity drugs of their own.

—Alzheimer’s drug developer Sonexa Therapeutics ranked as San Diego’s No. 1 venture deal during the second quarter, when the biotech raised $37.23 million. The MoneyTree survey showed that venture firms invested $170.6 million in 24 local companies during the quarter—with more than 80 percent of the capital going to life sciences deals.

—San Diego-based Zogenix, a four-year-old startup developing drugs for treating neuroscience disorders and pain, said last week it raised $50 million in an undesignated round that includes a $15 million venture investment from its existing investors and $35 million in debt financing led by Oxford Finance and Silicon Valley Bank. The returning venture investors are Clarus Ventures, Domain Associates, Scale Venture Partners, Thomas, McNerney & Partners, Abingworth Management, and Chicago Growth Partners.

—San Diego authorities have charged a 59-year-old man, Kent Thomas Keigwin, with murder in connection with the death of John G. Watson, a retired biotech executive and angel investor who was found dead in his La Jolla home on June 8. Prosecutors said Keigwin also was charged with identity theft, grand theft of personal property, burglary, and forgery of documents in connection with $7.5 million that was unlawfully transferred from Watson’s brokerage account.

—Auspex Pharmaceuticals of Vista, CA, has raised an additional $12 million from investors to continue development of deuterium-based analogs of clinically validated drugs in multiple therapeutic areas. The biotech raised almost $13.9 million in a previous round from Thomas, McNerney & Partners, CMEA Ventures, and Costa Verde Capital.

Bruce V. Bigelow is the editor of Xconomy San Diego. You can e-mail him at bbigelow@xconomy.com or call 858-202-0492

IT, startups, Finance

Innovating Where Banks Won’t: Talking with Rich Aberman About WePay’s Vision for Group Payments

Wade Roush 7/8/10

It’s too bad the economic collapse of 2008-2009 gave “financial innovation” a bad name, because the online banking and payments sector could actually use a lot more of it. When’s the last time your bank’s website surprised you with a cool new feature or service? For that matter, when’s the last time PayPal rolled out any fundamentally new features or user-interface improvements? Once financial organizations grow to a certain size, it seems, they often stop dreaming about cool new ways to serve customers better.

But that actually turns out to be a good thing for startup entrepreneurs, who have been busy filling the gaps in online money management with services like Mint, acquired by Intuit last fall, and now WePay.

The Palo Alto, CA-based startup emerged last fall from investor Paul Graham’s Y Combinator startup school, with a plan to change the way groups of people pay for things. Born in Boston from the world of its co-founders, recent Boston College alums Rich Aberman and Bill Clerico, it started out as a way to do things like collect frat house dues or pool contributions for a bachelor party. But it’s already grown into something much broader, with some customers using it to round up homeowners’ association payments and others using it to collect donations for humanitarian causes. Couples are even using WePay to set up funds for date expenses without having to take the more deeply fraught step of opening a joint bank account.

“What really made us say, ‘Wow, we should do this’ was my brother’s bachelor party,” says Aberman. “I was collecting a couple of hundred bucks per person from 14 people, and track who had paid what, and I realized that there was a very specific need that PayPal wasn’t addressing…They do a good job of helping people sell things online, but I don’t think they do a good job helping people collect money from other people, particularly in large groups.”

WePay, which opened to the general public in late March, provides the coordinators of group payments with online accounts separate from their personal bank accounts. They can spend the money in the accounts using WePay debit cards or by writing paper checks. All members of a group can monitor that account’s activity, ensuring transparency and accountability. The system can also be used to send group members automated reminders that payments are due—in other words, bills.

Opening an account with WePay is free. The startup makes money by charging groups a small transaction fee that’s added to each bill or deducted from each payment. That’s the same way PayPal profits, and it’s a sufficiently convincing business model to have attracted $1.65 million in funding from August Capital and a group of angel investors that includes PayPal alumni Max Levchin and Dave McClure, former Googler Paul Buchheit, Swipely founder Angus Davis, and “super-angel” Ron Conway.

John Chory, an attorney at Boston-based Wilmer Hale, was an early adviser to Aberman and Clerico, before they entered Y Combinator. He argues that it took a pair of twenty-somethings—members of the Facebook generation—to invent something like WePay. “Rich and Bill are two very smart and very motivated entrepreneurs who recognized a problem in their own life and set out to solve it with WePay,” says Chory. “They are representative of the next generation—tech-savvy people who stay connected with technology 24 hours a day and who are comfortable keeping their friends apprised of their activities. I have a feeling they will keep solving problems for many years to come.”

The 8-person startup is “aggressively hiring” software engineers to solve those problems, Aberman told me during a long phone conversation. I’ve excerpted the most interesting parts of that talk below.

Xconomy: How did you and Bill Clerico end up co-founding WePay, and what was your path into Y Combinator?

Rich Aberman: Bill and I went to school together at Boston College, both on the same scholarship, and ended up rooming together freshman year and again junior year. We started a business together in college selling taxi advertising in Hong Kong. I was interning there for a telecom company and Bill had a software internship at Goldman Sachs. It wasn’t really a scalable, disruptive business, but it gave us an opportunity to work together and fall in love with entrepreneurship. We could have run it really effectively, but we both decided to come back to school. We weren’t quite ready to drop out.

I came out to the Bay Area after graduation to work at a Web development and video production startup for about six months, then I applied to NYU Law School and got in on a full ride. I was supposed to matriculate in the fall of 2008. Bill took a job out of school with a boutique investment bank out in Waltham.

About a year after graduating, and a couple of months before law school was going to start, we started incubating this idea. Bill predicted the impending collapse of the …Next Page »

Wade Roush is Xconomy's chief correspondent and editor of Xconomy San Francisco. You can e-mail him at wroush@xconomy.com, call him at 415-796-3024, or follow him on Twitter at twitter.com/wroush.