Why does Asia have an advantage in the PC market?

In the PC Wars, the Asians Have a Clear Advantage
Beset by scandal and legal distractions, U.S. PC makers are ceding ground to Asian rivals in major markets
By Roger L. Kay
Source: Bloomberg Business Week
As the balance of power in many domains shifts from the U.S. to China, computer makers are also refocusing their strategies to include a larger China component. China is critical as both a market and a supply base. And Asian vendors have become serious rivals to the top U.S. companies, many of which are beset by persistent management dramas and palace intrigue.

For years, the equation was clear: Large PC brands were American, the big makers were Taiwanese, and China was, at best, a low-cost production site. Today several of the former Taiwanese makers have become international brands, and mainland China has risen to become a full player as both customer and supplier. The Chinese leader, Lenovo Group, is the fourth-largest PC vendor in the world. No. 2 is Taiwan's Acer.
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So who's winning? My call is that the Asian brands have a long-term advantage. Top-ranked Hewlett-Packard (HPQ) and No. 3 Dell (DELL) share characteristics absent in the Asian vendors: Both face various legal troubles and leadership turmoil. Both have seen a string of executive and board departures. Dell has been able to settle most, but not all, of its lawsuits. HP faces yet another regulatory probe over its split with former chief Mark Hurd. Both continuously bleed high-level talent. Meanwhile, Acer, Lenovo, and Asus, another Taiwanese firm, now in the sixth spot, slowly and steadily build their international presence.

The U.S. and China represent big battlegrounds for all these vendors, must-wins in the market share wars.
Across the Strait

In China, the Taiwanese are striving to overcome an important long-term handicap: They are identified with what Chinese political leadership regards as a renegade Chinese province. Recently, however, commercial relations between Taiwan and the mainland have become so intermingled that money, people, and technology now flow between the two relatively freely, characterized by the resumption of direct air service in 2008.

Principal competitors in China include Lenovo, with a 29 percent share, and HP and Dell, with about 10 percent each, according to IDC. Acer, Asus, and domestic players Tongfang (600100:CH) and Founder Group all have market shares in the single digits. In the U.S., the picture is quite different: HP and Dell are the clear leaders, Acer is half as large as either of them, Lenovo is half the size of Acer, and Asus is half that figure.

The path the Asians are on does not lead straight to the top, however. Until about six months ago, they were on a steady march, gaining in share and making an early mark in a new popular category, netbooks. These low-cost notebooks added substantially to unit shipment numbers but little sales or profit. Meanwhile, the U.S. companies, struggling with management departures, boardroom issues, and federal investigations, appeared to be losing focus.
Shift to Mobile Gizmos

The picture changed again, however, in the latter half of 2010, when the big bets Acer and Asus made on netbooks started to unravel in the face of Apple's (AAPL) introduction of the iPad and the subsequent flood of Android (GOOG) tablet introductions. High-mobility products, such as smartphones and tablets, have been added to the conversation; the landscape is shifting away from traditional PCs.

But this market shift gave the Asians a chance to show they are nothing if not nimble. Asus announced Windows 7 and Android tablets and several smartphones at January's Consumer Electronics Show. Acer showed two Android tablets, one running on a Qualcomm (QCOM) chip and one running on Nvidia (NVDA) silicon. Lenovo came up with both tablets and phones at the show. In essence, the Asians may have missed a turn but they are likely to catch up fast.

Meanwhile, HP is saddled with its Palm acquisition, obligated to get some mileage out of the $1.2 billion it spent. That means HP is not as free to pursue Android as other vendors are—and Android may be the only viable platform in the tablet arena besides Apple's iOS. Dell, meanwhile, continues to struggle with consumers, making essentially no gains in that market in either China or the U.S.
Mainland End-Around

Acer, the worldwide leader in consumer portables, faces an uphill slog in China. When the company tried to buy Beijing-based Founder, it was blocked by the Chinese government and had to settle for a "memorandum of understanding." In October 2010, Acer said it was moving some operations to Chongqing, both to ameliorate rising labor costs on the coast and to establish a base from which to increase sales in China's interior. Acer, with 4.3 percent, is still barely a blip on the Chinese market-share radar. Asus toils away in Acer's shadow in most places, and will likely continue to do so, but in China Asus has managed to garner a 6.7 percent market share.
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Lenovo represents the dark horse. For the most part, it is stuck in China—a market leader there but also a company that has done little over the past six years to exploit its acquisition of IBM's PC business. The company's luck may soon change, however. HP's ace marketing guru, David Roman, defected to Lenovo in 2010, and the fruits of his labor will soon be evident as he recasts the company's image. With a souped-up brand, Lenovo may at last be set to make headway outside its main markets.

It is too soon to predict who will dominate in the coming hardware wars, but it is clear the Asian vendors do not face the debilitating dramas that have become common in America. Either they know how to stay out of trouble, or they really do just stick to business.

"Paid by the piece" replaced by "paid the task" for online workers

Meet the Microworkers
A new breed of online worker is paid by the task
By Rachael King
Source: Bloomberg Business Week
When Julia Lee first heard of Tongal, she thought it was a scam. Tongal pays people—anyone with a good idea, really—to create online videos for companies such as Mattel (MAT), Allstate (ALL), and Popchips. Companies typically pay $15,000 to $20,000 for each project they post on Tongal's website. Tongal runs the projects like contests. Yet, instead of a winner-take-all approach, it breaks up the projects into stages, such as ideas and videos. The top-five ideas are rewarded with cash and then participants in the video phase can use any of those five ideas to create the video.

Lee's first submission, an idea for a 30-second commercial for a wine-related iPhone app won $1,000 and it only took three hours of work. When she created an animated video for a nonprofit, she earned $4,000. There have also been projects where her ideas or videos didn't make the top five, so she didn't make any money. Still, in the past year, Lee, 36, has earned more than $6,000 for about 100 hours of work, or $60 an hour on average. "It helped me pay off my credit-card bills," she says. In addition to supplementing her salary from her job at San Francisco nonprofit VolunteerMatch, Lee is finally able to put her Master of Fine Art degree to good use. She says she'd like to save money to make a film someday.

The idea of breaking up a job into small pieces and then using the Internet to find workers to do those tasks was pioneered by LiveOps about a decade ago and Amazon.com's (AMZN) Mechanical Turk in 2005. LiveOps lets call-center workers sign on for shifts in 30-minute increments and then uses the Web to route calls to them. Mechanical Turk pays per task—often less than 50 cents—for quick jobs like checking Web pages for errors or transcribing audio recordings.
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The trend, which goes by many names—crowdsourcing, the human cloud, microwork—uses the Internet to access workers around the world for short-term projects that pay a few bucks to hundreds of dollars per hour. The tasks might require a few minutes or a few days to complete. Benefits to companies include finding large numbers of workers to complete projects quickly, finding niche expertise, saving money, and making better use of in-house resources. It also lets Western workers, in places with a high cost of living, compete directly with those in developing markets. For many freelancers, microwork gives them unprecedented flexibility to work almost anywhere at any time.
Big Companies Use Micro-Sourced Work

Microsoft (MSFT) turned to uTest in 2009 when it needed more than 100 testers around the world to find bugs in its security software and see how it would fare in places like China, India, Brazil, and Russia before being released. UTest has more than 33,000 testers in 172 countries, which means work can be done 24 hours a day, seven days a week. Companies pay only for the testing they need, rather than keep a team of testers on contract. At Santa Monica (Calif.)-based Tongal, companies such as Mattel and Robert Half International (RHI) are getting 30-second online videos for a fraction of the $500,000 it costs to create a 30-second TV spot, says Tongal co-founder James DeJulio.

In 2008, Pfizer (PFE) wanted to make employees more productive, so the company began letting them outsource certain tasks so they could focus on higher-value work. Employees can push a button on their desks and send out work like creating PowerPoint presentations or checking data in spreadsheets. The company contracted with several firms in the U.S. and abroad to do those tasks. In the first year, Pfizer estimated that the service freed up more than 66,000 hours for employees. That program still exists and Genpact, one of the providers, helps Pfizer with business intelligence work on demand.

Microwork in the U.S. and Developing Countries

Some microwork sites such as Tongal attract mostly U.S. workers while others such as Freelancer.com and Elance cater to a global audience. About $100 million worth of work was posted on Elance last year. Of the $24.5 million that online freelancers made on Elance in the third quarter of 2010, those from India had the biggest cumulative total, followed by workers in the U.S., Ukraine, Pakistan, and Russia. Freelancer.com primarily connects Western-world small businesses with labor in the developing world, says Chief Executive Officer Matt Barrie. A business can have a developer in an emerging market write an iPhone app for $650, compared with upwards of $20,000 from a developer in the U.S.

For Western workers, though, it means more direct competition as businesses can easily find labor in developing markets. In 2010, the number of Web users surpassed 2 billion, of which 1.2 billion were in the developing world, according to the ITU, the U.N.'s agency for information and communications technology. About 95 percent of people in developing countries live on less than $10 a day, according to a 2008 World Bank report.

"Thirty dollars is 10 hours of work in Bangladesh at a great pay rate," says Freelancer.com's Barrie, adding that his site has 2.1 million registered workers. "The whole industry has only just begun—this is going to go mainstream." There's room for an eBay (EBAY)-sized company for workers to provide labor à la carte, he says.
Impact on U.S. Jobs

Barrie says that business at Freelancer.com grew quickly during the most recent recession. While the first wave of IT offshore outsourcing happened in the late 1990s during preparations for Y2K, it really took hold after the dot-com meltdown a few years later. There aren't any statistics yet as to how much micro-outsourcing might impact the U.S. job market but there's growing evidence that the movement of work to India and other developing countries is contributing to the jobless recovery in the U.S.

About 1.1 million jobs in IT, finance, and other areas have disappeared since 2008 because of offshoring, improvements in productivity, and a lack of economic growth, according to a December 2010 report by the Hackett Group (HCKT), which provides business-consulting and technology-implementation services. An additional 1.3 million jobs are expected to disappear by 2014, with offshoring becoming a bigger factor, the report says.
Surviving by Specializing
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Ray Grainger, a former partner at Accenture (ACN), says freelancers who specialize in niche skills are able to find higher-paying work in the U.S. He created Mavenlink, an online workspace for independent workers so they can easily collaborate with others, keep track of multiple projects, and network with other high-level professionals.

Wyatt Nordstrom, CEO of Maven Research, a company that signs up experts in various fields, decided to focus on high-quality, high-paying work. An investment firm that needs specific answers about new markets might come to Maven, which has no connection to Mavenlink, to speak with experts for short phone calls. A typical member makes $250 to $500 an hour, he said.

For some U.S. freelancers, microwork has required them to specialize in skills that aren't easily commoditized. When Kelly Parkinson began her company Copylicious about four years ago, she looked at Elance but never used it, realizing it wasn't where she'd make the most money. Parkinson, who worked as an executive assistant for three years to save money to start her business, developed a niche in copywriting for business-to-business companies that have trouble describing what they do in one sentence. The 34-year-old, who uses Mavenlink to collaborate on projects, says she was very busy during the recession. Last year she handled 100 projects for clients and her fees worked out to about $150 an hour.

As for Julia Lee, she says she is happy to flex her creative muscles, even on a part-time basis. The founders of Tongal, on a recent visit to San Francisco, took her to lunch. As the company draws new clients who want creative online videos, it is working to keep talented workers like Lee engaged with the site. Lee says she likes the creative satisfaction, the flexibility, and the ability to add to her income. "This year," she says, "I'm saving up for a vacation."

King is a writer for Bloomberg Businessweek in San Francisco.

The Egyptians' stand vis-à-vis the United States in the Mubarak political crisis

Egypt Pits American Values Against U.S. Interests: Albert Hunt
January 30, 2011, 11:47 AM EST
By Albert R. Hunt
Source: Bloomberg Business Week
Jan. 31 (Bloomberg) -- All contemporary U.S. presidents vacillate between promoting democratic values and human rights around the globe versus protecting security or national interests. Usually, “realpolitik” comes out on top.

The moment of high tension for President Barack Obama arrived last week as the populist uprising against President Hosni Mubarak of Egypt escalated, to the surprise and consternation of Washington. Obama gave an eloquent speech in Cairo on the value of democracy in 2009; Egypt and Mubarak have been among the most important U.S. allies in the Middle East, receiving about $1.5 billion a year in assistance.

This schism between national interest and values was on embarrassing display as the Obama administration struggled to keep up with fast-changing events. When street demonstrations started in Cairo -- in the aftermath of the rebellion in Tunisia that forced out the autocratic leader, Zine al-Abidine Ben Ali - - the emphasis in Washington was on regional stability and Egypt’s importance; the president said little. Vice President Joseph Biden went so far as to insist Mubarak isn’t a dictator.

On Jan. 28, after intense internal deliberations, the administration publicly began to change its signals. By mid- afternoon, Obama’s senior adviser, David Axelrod, openly criticized the Egyptian government’s actions, and Robert Gibbs, the press secretary, said the U.S. might cut off aid if Mubarak crushed the demonstrators. By early evening, Obama addressed the nation, reporting he had called his Egyptian counterpart to warn him against a violent response and vowing the U.S. would “stand for the rights of the Egyptian people.”

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Regional Spread

Privately, the administration has little confidence in its ability to shape the outcome. Even more of a quandary, officials say, is uncertainty over what effect this crisis will have on other countries in the region, including Iran, Saudi Arabia, Jordan and, of course, Israel.

Obama follows in a long line of presidents with ambivalent positions on promoting democracy in Egypt. Six years ago, the centerpiece of President George W. Bush’s second inaugural speech was his “Freedom Agenda,” a vow to spread democracy and end tyranny around the world.

“Every ruler and every nation,” the 43rd president said, should know that “success in our relations will require the decent treatment of their own people.”

‘Freedom Agenda’

Bush was widely praised, though there were skeptics; Zbigniew Brzezinski, a Democratic foreign-policy strategist, said the speech was “high-sounding rhetoric” without “a real sense of priorities or directions.”

This proved prophetic, as most entreaties Bush may have made to Mubarak were done in private, and in short time, Secretary of State Condoleezza Rice was publicly embracing the Egyptian ruler. Not surprisingly, by 2008, a survey of public opinion in Arab countries, conducted by the University of Maryland and Zogby International, showed that, overwhelmingly, the people didn’t believe the U.S. was serious about spreading democracy.

No president came into office more devoted to human rights than Jimmy Carter three decades years earlier. Yet when confronted with the repressive policies of a key strategic ally, the shah of Iran, the administration waffled.

The upshot was that the shah was overthrown by an Islamic revolution, and the Carter administration and the U.S. lost on all counts. The Iranians, deeply resentful of American support for the shah that long predated Carter, were virulently anti- American and the realpolitik experts assailed Carter for failing to support an ally.

Superpower Politics

And when it comes to human rights, nowhere have the conflicts and contradictions been more pronounced than in Washington’s dealing with other superpowers. President Richard Nixon and Henry Kissinger, his national security adviser, were deeply embroiled in fights with congressional Democrats and conservative Republicans over issues such as the Soviet Union’s treatment of Jews, which the administration considered a distraction from major geopolitical concerns.

This conundrum has been equally evident in dealings with China, as it becomes an emerging economic and political rival. Each of the last three administrations came into office determined to emphasize human rights and political freedoms, and then subsequently decided that economic and security interests were more important.

In Washington this past weekend, there was confusion over the evolving events in Cairo. The best intelligence seemingly came from Al Jazeera, though the network said yesterday that the government closed its offices and withdrew the accreditation of its reporters; the administration badly underestimated the depth of the protests.

Mubarak’s Exit

There’s now a broad consensus that Mubarak won’t last, though there is no real sense of exactly how his tenure will end or what will come next. Administration officials take solace that the uprising, stoked by internet social networks, is about freedom and opportunity and not religious or cultural demands.

Still, the tones of anti-Americanism got louder yesterday, and these elements no doubt are aware that for more than 30 years, the U.S. has solidly supported authoritarian rule. Although the outlawed Muslim Brotherhood was late to the parade in Egypt, some officials fear it could emerge as the most formidable post-Mubarak political force.

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Moreover, there is no certainty as to whether or how these protests on the Arab streets will spread through the region, whether they will imperil American strategic allies like Jordan and Saudi Arabia. Though less likely, they could pose a threat to the anti-American regime in Iran.

Iran Parallels

Reflecting this long tension in U.S. foreign policy, conservatives may be as ambivalent as the administration. Some of the Tea Party Republican newcomers instinctively side with any anti-authoritarian or anti-government forces. Yet Representative Thaddeus McCotter of Michigan, the chairman of the House Republican Policy Committee, implored the administration to get behind the Mubarak regime, warning of the parallels to Iran three decades ago.

“The Egyptian demonstrations are the reprise of Iran’s 1979 radical revolution,” McCotter said. “America must stand with her ally Egypt to preserve an imperfect government capable of reform and prevent a tyrannical government capable of harm.”

Predictably, some Republicans will blame the administration no matter the policy or outcome.

“Obama has no good choices, and he may blame himself for this in part for two years of laughing at the Freedom Agenda instead of embracing it,” said Elliot Abrams.

Abrams was a national security adviser in the administrations of George W. Bush and Ronald Reagan. Both, with little equivocation, supported Mubarak.

(Albert R. Hunt is the executive editor for Washington at Bloomberg News. The opinions expressed are his own.)

Pfizer makes the most of tax gain

Source: Market Watch
Feb. 1, 2011, 12:10 p.m. EST
Pfizer’s profit boosted by tax gain
Drug giant plans to buy back stock, raise dividend
By Val Brickates Kennedy, MarketWatch

BOSTON (MarketWatch) — Pfizer Inc. reported a markedly higher fourth-quarter profit early Tuesday, its bottom line boosted by a $2 billion tax-related accounting gain, and issued a better-than-expected 2011 revenue forecast.

The pharmaceutical giant also announced plans to buy back up to $9 billion of its shares and raise its dividend.

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Shares of Pfizer /quotes/comstock/13*!pfe/quotes/nls/pfe (PFE 19.29, +1.07, +5.87%) jumped 4% in late-morning trading.

The New York-based industry juggernaut said it earned $2.89 billion, or 36 cents a share, compared with $767 million, or 10 cents a share, in the year-earlier period.

This year’s quarter featured a $2 billion tax-related gain, along with lower restructuring and merger costs associated with its takeover of rival Wyeth, which it acquired in 2009 for $68 billion in an effort to boost both its product portfolio and pipeline.

Excluding various items, Pfizer would have posted adjusted earnings of 47 cents a share versus 49 cents.

Revenue rose to $17.6 billion from $16.5 billion. Sales of legacy Wyeth products contributed $2.3 billion to the top line.

On average, analysts surveyed by FactSet Research expected Pfizer to earn 46 cents a share on revenue of $16.99 billion.

Pfizer said it now sees 2011 adjusted earnings of $2.16 to $2.26 a share and revenue of $66 billion to $68 billion.

Analysts were expecting 2011 earnings of $2.30 a share on revenue of $66.5 billion, according to FactSet

Sales of Lipitor, Pfizer’s top-selling medication, fell 17% to $2.63 billion. The product, which is already facing generic competition overseas, is expected to lose U.S. patent protection later this year.

In an effort to address that impending shortfall, Pfizer has been on an acquisition binge, with Wyeth being its priciest purchase. The company is also in the process of buying specialty drug maker King Pharmaceuticals Inc. /quotes/comstock/13*!kg/quotes/nls/kg (KG 14.24, -0.01, -0.04%) for about $3.6 billion.

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Pfizer also said its board has approved a $5 billion stock buyback on top of an existing $4 billion authorization. The drug maker plans to repurchase about $5 billion of its shares in 2011 alone. As of the end of 2010, Pfizer said it has repurchased about 60 million shares.

The company added that it intends to raise its dividend, more in line with its once-coveted level after having slashed it to help pay for the 2009 mega-merger with Wyeth.

“While the dividend level remains a decision of the board and will continue to be evaluated in the context of future business performance, barring significant unforeseen events, we continue to target a dividend payout ratio comparable to the current industry average of approximately 40% in about three years,” said Ian Read, Pfizer’s new chief executive officer, in a statement.

In December, Pfizer surprised the market by announcing that then-CEO Jeffrey Kindler was stepping down due to personal reasons. He was succeeded by Read, who had served as Pfizer’s head of global pharmaceutical operations.

Val Brickates Kennedy is a reporter for MarketWatch in Boston.

How the Duvaliers cheated their impoverished Haiti out of tens of millions of dollars

Source: Caribbean News Now
Duvaliers had access to blank checks, court affidavits show
Published on January 27, 2011
By Frances Robles
McClatchy Newspapers

MIAMI, USA (MCT) -- Haiti's former dictator Jean-Claude "Baby Doc" Duvalier took the proverbial "blank check" to heart.

As "president for life," he and his then-wife had blank state treasury checkbooks at their disposal. When the couple wanted a little extra for jewels or cash, they'd fill in the account number and convert flour, lottery or electricity revenue from one of the world's poorest nations into overseas cash, according to affidavits filed in French courts.

Lawyers estimated that the former dictator embezzled at least a half-billion dollars through an elaborate scheme of false companies, phony charities and transfers in the name of friends and family. They spent it on everything from a Ferrari to yachts, jewelry and Miami condos.

The former president, now 59, returned to Haiti unexpectedly last week and once again finds himself accused of massive theft. The former teen tyrant spent the past three decades dodging at least a dozen lawsuits in three countries.

He now finds himself in a hotel in the hills above the capital under police surveillance as Haitian prosecutors dust off decades-old ledgers and copies of canceled checks in a quest to get justice.

"If Duvalier wanted to get money, say from the education ministry, he'd take the checkbook, fill in the account number of the education ministry and get cash," said Gilles August, a Paris attorney hired by the Haitian government in the 1980s to recover looted funds.

"Duvalier should go to jail for the rest of his life," August said.

The night before he was run out of office, Duvalier wrote $169,000 in three checks made out to cash, according to canceled checks presented by the Haitian Justice Ministry in a 1987 lawsuit in France.

Duvalier was president of Haiti from 1971 until 1986, when a popular uprising forced him out of office. The year he left, lawyers and accountants in Port-au-Prince began deconstructing a massive fraud scheme that allegedly involved the president, his mother, wife, sisters and key aides.

Baby Doc even gave his bride — now his ex — $100,000 before they wed, Haiti's former justice minister said in an affidavit.

August said suits filed in France, the United States and Switzerland often fell apart because Haiti's government kept collapsing and new administrations failed to follow up.

Charges were first filed against him and 38 others in 1986, but a judge dismissed the complaint on a technicality.

In 2008, additional complaints for human rights abuse were added to that case.

Chief Prosecutor Harycidas Auguste said the government is still interested in pursuing charges against Duvalier.

"We are on the road to delivering justice — no matter who the person is. We have to start somewhere," said Auguste.

Prosecutors presented corruption charges last week; a Haitian judge will decide whether the case can go to trial or if the statute of limitations has run out.

Reynolds Georges, a Duvalier defense attorney, declined to comment for this story because he said he hadn't had a chance to review the evidence in the affidavit.

Duvalier told the French newspaper Le Figaro in a rare 1988 interview that the Haitian government cannot prove he spent public money on himself.

Calling the funds an "inheritance," Duvalier insisted that the jewels were not for his bride, but for the wife of an unidentified high-ranking foreigner. The government exaggerated how much was transferred to overseas accounts. The funds were used by his ex on lobbying, he said.

Duvalier's former attorney told the paper that even a U.S. politician received $3 million.

"In our country," Duvalier told Le Figaro, "we always had a dynastic, paternal, conception of power. Social, medical and educational expenses were not all budgeted. It was to the Duvaliers that people directly addressed themselves, and we responded to their needs. Each week we distributed thousands of envelopes.... In fact, 90 percent of social expenditures were financed by us."

Attorneys involved in the paper chase say the Haitian government compiled convincing stacks of evidence. There was an apartment in Miami and a yacht in the name of his former personal secretary. Checks made out to cash were endorsed by the president himself. A scam charity run by the first lady collected money but never spent any on social works.

Sometimes money went straight from state coffers to New York jewelry stores. One such transaction, on Dec. 26, 1980, was for $414,324, according to a 1988 Miami Herald news account.

Over time, money traced back to Duvalier's ex-wife, Michele Bennett, totaled more than $94 million, according to an affidavit signed by former Haitian Justice Minister Francois St. Fleur.

According to St. Fleur's affidavit submitted for a failed 1987 lawsuit in Paris, the Duvaliers used revenue-generating government institutions to support a lavish lifestyle. The state lottery, the electric company, the telecommunications office, National Bank of Credit and the Tobacco Directorate — which controls prices of consumer goods — were secretly issuing checks for the first family and friends.

"During a recent and short period, the Duvaliers rerouted a sum of almost $47.4 million," St. Fleur wrote.

Lawyers documented $120 million in siphoned funds — just in Duvalier's name.

"These actions by the Duvaliers and their accomplices are unique in the annals of the Third World," St. Fleur wrote. "That pillaging, in giant proportions, has made the people of Haiti one of the poorest in the planet."

"It's worse than 'The Sopranos,'" August said. "You are the son of a criminal, and you could marry someone worse than you — which he did."

Efforts to reach the former first lady were unsuccessful. Bennett was in Haiti two weeks ago for a commemoration ceremony at the Hotel Montana, which collapsed during last year's earthquake. Her brother Rudy was one of the victims.

Those close to Bennett say she made friends promise not to reveal her contact information.

"I've been in exile for 24 years, and I've been very reserved about all the difficulties we have faced and all the bad things said about us," she told the London Daily Mail last year.

The couple divorced in 1993. By all accounts, Duvalier was left ruined, and spent the next two decades stiffing everybody, from landlords to hotels. He drove a Ferrari and lived in rented villas, but is not known to have ever held a job.

The paper trail, August said, shows how the first couple raided a charity and pocketed $20 million donated by the Canadian government to build a hospital.

"They were stealing from everything," August said. "There was no law in the criminal code they did not break, aside from maybe double parking."

Miami Herald translator Renato Perez and correspondent Jacqueline Charles contributed to this report.

(c) 2011, The Miami Herald.
Visit The Miami Herald Web edition on the World Wide Web at http://www.herald.com/
Distributed by McClatchy-Tribune Information Services.

Retirement's gray areas

Robert Powell
July 15, 2010, 12:46 p.m. EDT
Retirement may mean a lifestyle downgrade

As a nation, we are far from retirement-ready, so prepare to live frugally or save more

Source: Market Watch
BOSTON (MarketWatch) -- If you're a baby boomer, the odds are high you'll exhaust your retirement savings after 10 or 20 years of retirement, according to the latest Retirement Readiness Rating report released this week by the Employee Benefit Research Institute.

Nearly half of older boomers -- those now aged 56 to 62 -- and some 44% of younger boomers -- aged 46 to 55 now -- are at risk of not having sufficient income to pay for basic retirement expenses and uninsured medical expenses, according to the study.

The study, which assumed that boomers would retire at age 65, also found that lower-income retirees are most likely to run out of money after 10 and certainly 20 years of retirement, while higher-income retirees are least likely to run out of money.

To wit: 41% of those in those lowest income quartile are likely to run short of money after 10 years of retirement, and 57% after 20 years. Meanwhile, just 5% of those in the highest income quartile will run out of money after 10 years, and 13% after 20 years.

So, what to make of this study?
Run out of lifestyle, not money

In reality, most Americans don't run out of money, they run out of lifestyle. As they age and spend down their assets, they typically reduce their living standard.
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"For the most part people do not completely run out of money when our software says they will," said Stephen L. Deschenes, senior vice president and general manager for the annuities division of Sun Life Financial's U.S. operation.

"They do not run full speed like Wile E. Coyote off the cliff and only then realize that they are out of terra firma. Rather they take action either to spend less or work more or some combination to forestall running out," he said.

Other research finds a high likelihood that Americans will be forced to spend less. After factoring in health-care and long-term-care costs, the National Retirement Risk Index, or NRRI, produced by Boston College's Center for Retirement Research, finds that some 65% of American households are at risk of not having enough money to maintain their living standard in retirement, according to the NRRI. Read the report at this website.

Work longer

A point to consider about EBRI's study: It assumes boomers will retire at age 65. That's not likely to happen. Most boomers, assuming good health, likely will work past age 65, according to Sun Life Financial's Unretirement Index.

According to that index, the portion of Americans who plan to work past age 67 is higher than ever: a record 55% plan to work full- or part-time, up from 52% one year ago. And the percentage planning to work full-time past age 67 reached a new high of 28%, up from 19% one year ago.

There was also a sharp rise in workers who said they will need to work longer than planned because of the economic crisis, according to Sun Life. Sixty-five percent said they will have to work more than one year longer, compared to 54% in the last index. And 27% said they will have to work more than five years longer, compared to 24% in the last Index

Why are they working longer? To earn enough money to live well and maintain their standard of living, according to Sun Life. Learn more about the Unretirement Index at this website.

Truth be told, many Americans are already working longer, be it to maintain their standard of living, stay mentally engaged or for the health-care benefits. Americans aged 65 and older in the upper income quintile now get about 40% of their income from working.
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But the bottom line from all these studies: Saving more and perhaps reducing your standard of living now might be the only way to be reasonably certain you'll enjoy any standard of living later on.

According to EBRI, if you want to be one of the nine in 10 households that maintains its standard of living in retirement, younger boomers in the lowest income quartiles will have to save, on top of what they already save, an additional 25% of compensation every year, while those in the in the third income quintile will have to save an additional 15% per year. Those in the highest income quartile catch a break and don't have to save any more.

The story is a little better for older boomers, but not much. Those in the lowest income quartile have to save an additional 25% per year, while those in the second income quartile need only save 15% more and those in the third income quartile need save just under 5% more. As with early boomers, late boomers in the highest income quartile catch a break again. They don't have to up their savings to have a 90% probability of maintain their standard of living in retirement. Read EBRI's report at this website.

The moral of EBRI's and other's research? Earn lots of money now and save as much as you can. Because the odds are against you otherwise.

Robert Powell has been a journalist covering personal-finance issues for more than 20 years, writing and editing for publications such as The Wall Street Journal, the Financial Times, and Mutual Fund Market News. Powell is the editor of Retirement Weekly.

What sets boomers' retirement apart ?

Jan. 31, 2011, 12:30 p.m. EST
Wealthy boomers’ retirement outlook? Rosy
Source: Market Watch
By Andrea Coombes, MarketWatch

SAN FRANCISCO (MarketWatch) — While many Americans’ retirement looks bleak because they don’t have enough money saved, a majority of wealthy baby boomers say their standard of living in retirement will top that of their parents, according to a new survey.

Eighty-four percent of high-net-worth boomers, age 46 to 64, said their retirement will differ from their parents — and of that group 86% said they plan to be more active, and 72% said their standard of living will be higher, according to a Bank of America Merrill Lynch survey of 1,000 people with investable assets of $250,000 or more.

Seventy percent of these boomers said they’ll work in retirement, at least part time, “to remain more active and engaged;” 26% said they’ll go back to school, 24% said they plan to learn a new trade, and 20% said they’ll start or keep running their own business.

When asked what word they’d use to describe retirement, 35% said “freedom,” 31% said “opportunity,” and 21% said “relaxation.” Just 9% said “uncertainty,” according to the Merrill Lynch survey.
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Still, while these wealthy boomers may be optimistic about their own retirement, other research suggests they’re worried about their children’s future, said Andy Sieg, head of retirement services for Bank of America Merrill Lynch.

“One dichotomy is that when you ask people the question — how does their standard of living compare to their parents in retirement — they tend to give you a very positive readout,” he said. “When you ask them what the future looks like for their children...in terms of the next generation being better off, you tend to see more pessimism than we have in the past.”

A little less rosy

A separate survey last year of savers of all incomes and age levels found that about half of people are either “not too” or “not at all” confident they will have enough money saved for a comfortable retirement. That’s according to the 2010 retirement confidence survey by the nonprofit Employee Benefit Research Institute.

The economic crisis did hit some wealthy boomers’ retirement outlook: 27% said they did not retire at the age they had planned to when they were in their 40s, and 34% of that group said it was because the recession took a toll on their finances, according to the Merrill survey.

Another 23% of that subgroup said they delayed retirement because they had to provide more financial support to their children than they’d expected. And 23% said they decided to keep working.

Twenty-one percent of the group that delayed retirement said they did so because they “didn’t realize how much I would need to save for retirement,” and 18% said they started saving too late or didn’t save enough.

When asked about their financial worries, 64% of the broader survey group said rising health-care costs were a top concern, and 57% are worried about whether their retirement assets will last through their lifetime.

Lessons learned

What was these wealthy boomers’ No. 1 piece of advice, relative to saving and investing, for their 30-year-old self? Thirty-four percent said working with a financial adviser or working with one earlier, 27% said being more hands-on with their investment portfolio, including adjusting their asset allocation, 19% said planning for long-term expenses such as college tuition, health care and caring for aging parents, and 14% said their advice would be to manage debt better.
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And they said they encountered some surprises as they neared retirement: 48% of affluent boomers said that knowing how they want to live in retirement was more important than they’d realized it would be. Fifty-two percent said knowing how to manage retirement income was more important than they’d expected.

Seventy-eight percent of those surveyed said younger people should start planning for retirement no later than their 30s, and 57% said that planning process should start when people are in their 20s.

Andrea Coombes is MarketWatch's personal finance editor, based in San Francisco.