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Olympic Wheel of Fortune

August 31, 2013 by

Instead, on Sunday, Sept. 8, you’ll see the leaders of three sports federations — wrestling, squash and baseball-softball, which combined last year — presenting finely honed sales pitches to the 104 members of the International Olympic Committee. After each 20-minute spiel, there will be 10 minutes of questions and answers. At some point, the committee members will test their electronic voting equipment with an irrelevant warm-up question. (The group was once asked to choose a favorite of three oceans; the Atlantic won.) Then the members will decide a matter of genuine import: Which of these sports will join the Olympic Games in 2020?

It will be the culmination of a contest that began two years ago and has cost the finalists millions of dollars. But for the winner, the prize is so big that it’s hard to value. Actually, part of it can be valued. Every sport gets a cut of the money generated by the Games’ broadcast and revenue deals, with each share determined by the sport’s popularity, measured by the number of spectators, television viewers and other factors. The pot to be divvied up for sports in the London Games last year is $520 million.

More important, the sport gets the global exposure of billions of television and online viewers and a place in the sports pantheon in which countries worldwide invest, simply because the sport is part of the Olympics. Suddenly, there are youth leagues and commercial endorsements. Medals are at stake, and with them a chance to burnish national self-image.

“The U.S. is a special case because, unlike most countries, it doesn’t have a direct federal government program for sports,” says Michael Payne, the I.O.C.’s former marketing director. “But look at Turkey. It’s currently spending $500 million a year on sports development, and all of that money goes to Olympics-related sports. You’re either at the table or you’re not.”

In the United States, the imprimatur of the Games means universities pay attention. A few years ago, it was hard to find a college team in women’s beach volleyball. The sport is now an Olympics favorite, and there are about 34 college teams, says Doug Beal, the chief executive of USA Volleyball.

“It’s impossible to overstate how significant it is to be included in the Olympics,” Mr. Beal says. “Participation has increased by a factor of 100 or 200. We’ve got high-performance camps, a national junior tour. The Olympics drives kids’ interest. They see it on TV, they identify with the medal winners and they want to play that game.”

This is squash’s third attempt to enter the Olympics, which has capped the total number of sports at 28, and it is the only sport among the finalists that has never been in the Games.

For squash’s ardent fan base, this is more than a little confounding. Every four years, when synchronized swimming scissor-kicks its way onto the world stage, squash aficionados ask: If that sport is in the disco, how long will squash be stuck behind the velvet rope?

Not much longer, if Mike Lee has his way. He is chairman of Vero Communications, a sports lobbying consulting firm that is part of a small but growing industry for campaigns like this. Mr. Lee, a onetime political consultant who is based in London, was hired by the World Squash Federation to oversee its Olympic bid. Among Vero’s recent achievements is guiding rugby sevens into the 2016 Olympics in Rio de Janeiro. Squash was one of the sports that rugby sevens bested.

Working in politics and Olympic sports is not that different, Mr. Lee said. Both need compelling narratives and both need to cater to voters. The squash narrative, as framed by Vero, is all about the game’s global reach, its embrace of innovation and its easy integration into the Games — the event would involve just 64 players from around the world, 32 men and 32 women, in a glass court that could be built anywhere.

“In the final stage of this, we’re also giving a push to the very salient and important point that squash is the only truly new sport in terms of the Olympic program,” Mr. Lee said. “That will feature significantly in our final presentation in Buenos Aires.”

What exactly is the Olympics looking for? The I.O.C. has a dauntingly long list of 39 criteria. The sport should offer gender equity (medals to men and women in roughly equal numbers), excellence around the world (as opposed to a few countries) and popularity among fans and sponsors. Ease of broadcasting the sport is another factor, along with the cost of building a place for competition. There is also the vague but all-important “value added,” defined as “value added by the sport to the Olympic Games; value added by the Olympic Games to the sport.”

Article source: http://www.nytimes.com/2013/09/01/business/olympic-wheel-of-fortune.html?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,

Times Co.’s Thompson to Testify in Parliament on BBC

June 12, 2013 by Leave a Comment

The program started in 2008, according to a release the BBC issued last month, and was intended to convert all of the BBC’s production and archived materials to a digital format. The BBC halted the project in October 2012 to review how well it was performing.

In May, the BBC’s current director general, Tony Hall, decided to cut the program after it had accumulated about $154 million in costs.

“The D.M.I. project has wasted a huge amount of license fee payers’ money,” he said, “and I saw no reason to allow that to continue, which is why I have closed it.”

When Mr. Thompson testified before the Public Accounts Committee of the House of Commons about the program in February 2011, British newspapers said, he described how the program had been progressing.

“When I appeared in front of the P.A.C. in 2011 to discuss D.M.I., I answered all of the questions from committee members honestly and in good faith,” Mr. Thompson said in a statement on Monday, according to The Guardian, which on Tuesday reported on Mr. Thompson’s pending appearance before Parliament. “I did so on the basis of information provided to me at the time by the BBC executives responsible for delivering the project.”

Mr. Thompson left the BBC last fall to become chief executive of the Times Company. Since then, he has been called to testify about how the BBC handled sexual abuse accusations against one of its longtime television hosts, Jimmy Savile.

While it is unclear exactly when Mr. Thompson will return to London to testify in the Digital Media Initiative matter, Eileen Murphy, a Times Company spokeswoman, said in a statement, “Mark has always been cooperative with inquiries when they arise and he fully intends to continue that practice.”

Article source: http://www.nytimes.com/2013/06/13/business/media/times-cos-thompson-to-testify-to-parliament-about-bbc.html?partner=rss&emc=rss

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Fed Endorses Stimulus, but the Message Is Garbled

May 22, 2013 by Leave a Comment

While some Fed policy makers suggested that the central bank could begin reducing its monthly purchases of government bonds as early as next month, most still want to see continued evidence of an upswing in the job market and a decline in unemployment first, according to minutes of the most recent meeting of the Fed’s policy arm that were released Wednesday afternoon.

Confusion on Wall Street over the Fed’s intentions led to a topsy-turvy day in the stock market. The major indicators were up in the morning after Mr. Bernanke testified to a Congressional committee but then fell sharply after the meeting minutes were disclosed.

In his testimony, Mr. Bernanke said that ending the $85 billion monthly bond-buying effort too soon would do more harm than good.

“A premature tightening of monetary policy could lead interest rates to rise temporarily but also would carry a substantial risk of slowing or ending the economic recovery,” he said.

While Mr. Bernanke clearly enjoys the support of a majority of the Fed’s Open Market Committee, the minutes suggested that he was finding it challenging to forge a consensus.

Under questioning from a lawmaker, Mr. Bernanke suggested that the Fed might cut back on bond purchases some time in “the next few meetings.” That statement took on greater significance on Wall Street after the minutes hinted at the more unnerving prospect of action as early as June.

Still, many analysts said the odds were against a change of direction at the Fed’s meeting next month.

“It’s been on the minds of committee members, but I don’t think the minutes mean they’re going to collectively take their foot off the gas in June,” said Erik Johnson, an economist with IHS Global Insight.

More likely, he said, would be a pullback beginning in late summer or early fall if the economy sustains its momentum. Even if that happens, the Fed will remain extraordinarily accommodative by many other measures, with short-term interest rates staying very low.

In response to a question from Representative Kevin Brady, a Texas Republican who is chairman of the Joint Economic Committee, Mr. Bernanke said that whenever the stimulus began to taper off, it would not happen in an “automatic, mechanistic program. Any change would depend on the incoming data.”

Further evidence for a move in a few months, rather than weeks, came in an interview shown on Wednesday on Bloomberg TV with the president of the Federal Reserve Bank of New York, William C. Dudley, that seemed aimed at clearing up some of the confusion.

“I think three or four months from now you’ll have a much better sense of is the economy healthy enough to overcome the fiscal drag or not,” said Mr. Dudley, who is a close ally of Mr. Bernanke.

Outside the canyons of Wall Street and the world of Fed watchers, the difference between June and August or September might not appear significant. But with interest rates at historical lows, any move to cut back on bond purchases by the Fed would undoubtedly cause an uptick in bond yields. That would affect the huge market for government and corporate bonds and force stock market investors to recalibrate their positions.

When the trading day began on Wednesday, investors were in a buoyant mood, sending stock indexes higher as Mr. Bernanke began his testimony. Markets around the world have rallied this year on hopes that the Fed and other central banks will continue to support financial markets with monetary policies.

As the day went on, though, traders began to reconsider some of Mr. Bernanke’s comments. After the details of the Federal Open Market Committee meeting on April 30 and May 1 were released, many strategists said they were surprised by the number of voices inside the Fed calling for a slowdown in the stimulus effort in the near future.

The minutes said, “A number of participants expressed willingness to adjust the flow of purchases downward as early as the June meeting if the economic information received by that time showed evidence of sufficiently strong and sustained growth.”

In response, the Standard Poor’s 500-stock index finished the day at 1,655.35, down 13.81, while the Dow Jones industrial average fell 80.41 to 15,307.17. The tech-heavy Nasdaq index, which has been on a tear lately, sank 38.82 to 3,463.30, or slightly over 1 percent.

Mr. Bernanke indicated that he was not particularly worried that the stock market was moving into bubble territory, despite the 16 percent surge in the S. P. 500 since the beginning of the year.

“Our sense is that major asset prices like stock and bond prices are not inconsistent with fundamentals,” he said. Commonly used yardsticks for measuring the value of stocks, like price-to-earnings multiples, Mr. Bernanke concluded, are “fairly normal.”

Nathaniel Popper contributed reporting from New York.

This article has been revised to reflect the following correction:

Correction: May 22, 2013

An earlier version of this article incorrectly described the timing given by Mr. Bernanke of a potential Fed move. He said the Fed could prepare to “take a step down” in the next few meetings, not the next few weeks.

This article has been revised to reflect the following correction:

Correction: May 22, 2013

Article source: http://www.nytimes.com/2013/05/23/business/economy/bernanke-fed-stimulus-still-needed-to-help-recovery.html?partner=rss&emc=rss

Filed Under: Economy News Tagged With: , ,

Economix Blog: Giving the Fed a Good Grade

September 23, 2011 by Leave a Comment

It’s been a rough week for the Federal Reserve, as its latest plan to stimulate growth was greeted by the sound of falling stock prices.

But here’s a bit of good news for the Fed: A new study by the Federal Reserve Bank of Cleveland finds that the central bank’s previous effort to push growth, announced in August, has had a positive impact.

The Fed announced after the August meeting of its policy-making committee that it intended to hold short-term interest rates near zero until the middle of 2013. The statement was its latest effort to reduce the cost of borrowing, in this case by giving lenders the confidence that money would remain cheap for another two years.

“The Committee was attempting to alter the expectations of market participants,” the Cleveland Fed said in its report. “It worked. Since the announcement, forecasts for a variety of interest rates have fallen, at least in part due to the lower expectations for future interest rates.”

Source: Federal Reserve Board, via Federal Reserve Bank of Cleveland

Central banks generally avoid specific statements about long-term plans, to preserve flexibility and to avoid the need for apologies. But the Fed’s August statement culminated a gradual move in the direction of talking about the future. Beginning in 2009, the Fed said that it would maintain rates near zero for “an extended period,” language it repeated until August. Earlier this year, the Fed’s chairman, Ben S. Bernanke, defined an “extended period” as meaning at least two meetings of the policy-making committee.

Fed officials decided to go even further after concluding that the risk of backtracking was low because there was little prospect the economy would recover sufficiently in the next two years to put significant upward pressure on wages and prices.

The decision was controversial. Three of the 10 committee members dissented, the largest bloc of dissent in almost two decades. They expressed concern that the majority was underestimating the danger of inflation, overestimating the benefits of low interest rates — and that the announcement might persuade some consumers and business to wait before borrowing, in the confidence that rates would remain low and the hope that the economy would improve.

The Cleveland Fed study does not resolve those concerns, but it does point to clear evidence that the announcement has succeeded in reducing interest rates.

Specifically, by convincing investors that short-term rates would remain low, the Fed succeeded in lowering rates on longer-term debt — which are based in large part on expectations about the level of short-term rates throughout the longer period. Rates on the benchmark 10-year Treasury note, for example, declined by about 0.20 percentage points.

Moreover, the study found that the announcement also reduced market expectations about future interest rates for mortgage borrowers and corporations, suggesting that the Fed may succeed in reducing the cost of borrowing across a wide swath of the economy.

Markets now anticipate, for example, that corporations with good credit will be able to borrow at 4.80 percent at the end of 2012, down from an expectation of 5.60 percent before the Fed’s announcement.

Source: Blue Chip Financial Forecasts, via Federal Reserve Bank of Cleveland

Of course, one great caveat looms over all of the Fed’s efforts: Reducing the cost of borrowing does not make loans any easier to get. Federal regulators reported Thursday that mortgage loan originations fell by 12 percent last year, despite the historically low level of interest rates.

Article source: http://feeds.nytimes.com/click.phdo?i=b6aa04423cdc9dc6c4a62567cee7d887

Filed Under: Economy News Tagged With: , ,