The Oregon Biz Report - Business News from Oregon

By Nike Kern, Business Reporter

The verdict is still out on whether advertising on the web works for small or large businesses. Some critics in the field believe that the Internet marketplace may not be a strategic venue for a targeted advertising message – yet.   “Most ad servers do not allow the ability to perform complex targeting based on the wide variety of data available, but the issues are complex, “ says Daniel Jaye recently on the “Next Big Thing,” a popular blog by Microsoft executive, Don Dodge. A former executive at Tacoda, the behavioral ad-targeting firm acquired by AOL, Jaye explains adserving technology needs to be improved extensively. Results from ad targeting campaigns need to be proven. And, the ad serving technology must be easy for a junior ad buyer to understand and use.

By Bill Conerly,

Businomics, Conerly Consulting

The excess supply of housing units is being worked off quickly.  Here’s the picture for new single-family homes:

We’ve made a lot of progress towards a normal inventory of unsold homes.  At the rate we’re going (and not making any forecasts about changes in new construction or home sales), we’ll be down to a normal inventory of unsold new homes by May of next year.

What was rated the best in the nation by Conde Nast Traveler Magazine this week?
A) Best Airport (Portland)
B) Best Waterfall (Columbia River Gorge)
C) Best Casual Business to work for (Nike)
D) Best Seafood Chain (McCormick and Schmicks)

On Wednesday, Oregon Senator Gordon Smith and Senator Jospeh Liberman (CT) introduced the Affordable Coverage for Small Employers Act which aims to help small business owners provide health care coverage. Here are some of the key provisions as listed in the Senator’s joint statement:
·         Requires the development of an affordable, comprehensive standard benefit package that will be available nationally.  This benefit package mirrors the health care benefits available to Members of Congress and other federal employees.

[Oregon Entrepreneur Network Sept. 18, 2008] Portland, Ore. — The Oregon Entrepreneurs Network (OEN) announced the winners of the 2008 OEN Tom Holce Awards for Entrepreneurship during its 15th annual awards ceremony on September 18, 2008. The ceremony, held at the Oregon Convention Center, honored finalists in four categories: Entrepreneurship Award for Individual Achievement; Development Stage Company of the year; Working capital Stage Company of the year; and the Growth Stage Company of the year.

By Mark G. Neil,
Pres. Northwest Wealth Advisors
Radio Host, Your Money & Your Life, KBNP AM 1410

I spent the weekend reading and researching and working on my interpretation of the events leading up to our “current” financial crisis.  I hope this helps to put matters into a perspective that make senses to you.  As in most cases, complex issues can be broken down into simple components.  Here is an attempt to do just that.

Let’s start by asking: how did this financial crisis happen? The unfortunate truth is that this financial crisis has happened to us before and each time we have been told, “It’s different this time.”  Well here we go again and this time let’s not believe that this crisis is different, because it isn’t.  It’s just a different version of the same fundamental concept behind every financial crisis.

By Bill Conerly, Businomics, Conerly Consulting

Who broke the buck?  A money market fund, the Reserve Primary Fund, was unable to preserve its $1 price per share.  Losses on its portfolio of short-term, safe investments overwhelmed the fund’s earnings.  The Wall Street Journal reported that the fund was the top performing money market fund in 2007.  If you want safety in a money market fund, perhaps you don’t want the fund that does best in good times.

1. What was the name of the major Texas town to be devastated by hurricane Ike?

2. How much did the Feds loan to AIG?
A) 95 Billion
B) 85 Billion
C) 75 Billion
D) 65 Billion

By Nike Kern,

As 39 states across the country vie for Hollywood’s production money, here at home the Governor’s Office of Film and Television is doing its part. At stake is a significant slice of the mega-million dollar film production industry, not to mention the potential tourism dollars that may follow a blockbuster film produced and filmed in Oregon.  The film industry in Oregon alone generates more than $475 million in direct economic output per year and creates nearly 5,000 FTE jobs according to the Governor’s Office of Film and Television’s website.  This agency works to build the film, television and multimedia industry in the state and is a major part of the governor’s economic development plan.

[Moore Information systems Inc.]

Obama/Biden Narrowly Lead Presidential Race in Oregon.

Our recent survey of Oregon voters shows Republicans John McCain and Sarah Palin within six points of Barack Obama and Joe Biden (43% Obama/Biden, 37% McCain/Palin). Another 14% have not made a decision as of today, and 6% of Oregon voters say they would not vote for either set of candidates in the November election.

Oregon Presidential Voting Intentions:

By Mark Neil,
Radio Host of Your Money & Your Life,
Mondays 4-5PM, KBNP AM 1410

Yesterday was a very bad day in the markets.  A stunning chain of events over the weekend sent the S&P 500 index to its steepest one-day percentage drop since the 9/11 attacks in 2001.  In a weekend of intense and almost non-stop meetings, the head of the Federal Reserve Bank, Ben Bernanke, Treasury Secretary Henry Paulson and New York Fed President Timothy Geithner were involved in meetings and conversations with key chief executives of the financial services industry.  The purpose of those meetings was to fix the immediate problem with Lehman Brothers, Merrill Lynch and American International Group, and then to come up with a plan and new strategy to make sure we don’t go through this again. 

By Bill Conerly, Businomics, Conerly Consulting

Calculated Risk has a good post about home prices, looking at prices from several different angles.  All angles suggest that prices have a ways further to go before reaching “normal.”  Of course, there’s no reason to expect any time series to get back to normal, but it’s a good first guess. Why should housing prices be above their long-run normal ratio to something (rental rates, income) ? 

Five questions to test your news observance level.
Which nation conducted the atom-smasher experiment this week?
A) Germany
B) England
C) Switzerland

Latest Wells Fargo/Gallup Survey: Confidence drops in July; lowest reported score in five years

[Wells Fargo Press Release San Francisco — September 9, 2008]  Reflecting signs of a weaker economy and rising costs, small business owners’ optimism continues to decline. According to the recent Wells Fargo/Gallup Small Business Index, surveyed in July, small business owner optimism has fallen to 45, the lowest score reported since the survey began five years ago. The Index has been declining since mid-2007.

By Mike Scoggin,

A Portland City Auditor’s report finds that while the city’s Department of Transportation has improved quality assurance, it is resurfacing fewer streets

Taken for granted, most people would be surprised to find out that 25% of the Rose City’s total assets are its roads. Valued at $5.4 billion, there are 3949 lane-miles of improved streets in Portland. This does not include the signals, lights or sidewalks. In August, the Portland City Auditor found that the city’s street maintenance a mixed bag: the quality of work and adherence to State guidelines has improved and Portland Department of Transportation (PDOT) is becoming more cost-effective – PDOT is now resurfacing fewer streets, increasing the backlog of work, increasing costs.

By Bill Conerly, Businomics, Conerly Consulting,
I spoke a couple of months ago about the economic contingency planning process.  You can listen here.

Key steps:

1. Evaluate your company’s own vulnerability to changes in the economy.
2. Develop an early warning system specific to your business.
3. Sketch out a contingency plan for economic changes.
4. Manage the business to gain or preserve the flexibility to implement the plan.

1. What economic indicator is heading for the first sustained decline in nearly two decades?
A) Personal Income
B) Consumer Spending
C) Export

Below are excerpts from the EXECUTIVE SUMMARY, Sept. 2008, Oregon Economic Forecast. from Oregon Economic and Oregon Department of Administrative Services, Office of Economic Analysis.  Full report here.

The second quarter of 2008 would have been the 20th consecutive quarter of rising employment in the state. This five-year pace was cut short one quarter with a seasonally adjusted job decline of 1.7 percent. Except for the 1.6 percent job growth in the first quarter of 2008, the quarterly job gains have been below 1.0 percent since the second quarter of 2007. On a year-over-year (Y/Y) basis, jobs increased in the second quarter by 0.4 percent.

Posted by Nike Kern, Biz Reporter

U.S. Supreme Court Justice Ruth Bader Ginsburg will visit the Willamette University College of Law in Salem on September 12 to  attend a number of public events, mark the law school’s 125th academic year and to kick-off a series of celebratory events.  Appointed by President Bill Clinton in 1993, the 75-year-old Ginsberg is the second woman to serve on the Supreme Court. In  2007, Forbes Magazine rated her as the 20th most powerful woman in the world and the most powerful female lawyer in the world.

From Bill Conerly, Businomics, Conerly Consulting.

The latest month’s news isn’t stunning, but the recent trend has been better than I expected.  Sales of new homes were, depending on your favorite headline, either up, or lower than expectations.  Actually, the change in home sales was trivial. The good news, however, is that we are working off the excess inventory of new homes much faster than I expected–and I’ve been a big pessimist, so this is really good news.