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CNN IN THE MONEY
Inflation Rears Its Ugly Head; State Of Mexico's Economy; Older Americans Forced Out Of Jobs Early; Critics' Jeers May Not Curse Film's Box Office Success; How Much Information Is Too Much Information On An Online Profile?
Aired May 21, 2006 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ANDY SERWER, MANAGING EDITOR, "FORTUNE" MAGAZINE: Welcome to IN THE MONEY. I'm Andy Serwer. Jack Cafferty has the day off.
Coming up on today's program, here's hoping you like that stuff in your closet. A handful of reports say prices are on the rise. Find out why we're all feeling a pinch.
Also ahead, something to stick around for, Mexican workers come here illegally because they want a better life. We'll look at why they just can't do as well at home.
And gray days. Older workers are having a tougher time hanging onto their jobs. See what Corporate America loses when it gives experience a pink slip.
Joining me today, a couple of IN THE MONEY veterans. "Headline News" correspondent Jennifer Westhoven, and CNNMONEY.com managing editor Allen Wastler.
Well you know guys, the story with the NSA and the telephone companies keeps on keeping on. BellSouth telling "USA Today" that the story's not true, Verizon doing the same. What do you guys make of it?
JENNIFER WESTHOVEN, CORRESPONDENT, "HEADLINE NEWS": Well, the corporate angle is interesting with all the lawyers coming out. I also like what's going on in Washington, which is that you've got the people who are getting the information and then they're saying everything's fine.
And the people who aren't, just railing, making a lot of hay, feeling really left out and turning this into a bigger issue of whether or not they think the presidency has suddenly gotten more power, or over time has created more power and pushed Congress down.
ALLEN WASTLER, MANAGING EDITOR, CNNMONEY.COM: It's sort of confusing about what's going on, though, because you got the phone companies coming out saying no, we didn't, and then you have the White House going we're not saying and -- you know, because it's all wrapped in secrecy and stuff.
So you can't get straight up, then I love these people that parse the phone company statements. Wait a minute; they use that adjective there. Does that really mean they're denying it or is it really an undeniable denial?
SERWER: Reading those legal tealeaves, the statement between Verizon and BellSouth is what you're talking about. I also thought it was interesting that some lawyers are on a fishing expedition, going after Sprint, suing them in case they get named. I mean, you know, it's the kind of thing that gives lawyers a bad name. And it would be interesting to see where this goes, don't you think?
WESTHOVEN: Sometimes lawyers deserve that, I believe those statements deserve to be parse. They give them self-wiggle room here.
WASTLER: I don't know. Sometimes it's carried to extremes. Then you ask the PR flack, hey, are you or aren't you? And they tell you no, we're not, no, no.
SERWER: The other thing's for sure, I think, is that we're going to be reading more about this next week. I guarantee you that one.
All right. If you're worried about inflation threatening the U.S. economy, you probably didn't get much sleep this week. The core consumer price index clocked a .3 percent rise for April, and that doesn't even include the price of food or gas. Wall Street got a little antsy on the news. The Dow dropped 214 points alone on Wednesday. Mark Zandi is going to tell us what is up; he is the chief economist with Moody'sEconomy.com.
Mark, I guess the big question is, isn't inflation rearing its ugly head again?
MARK ZANDI, MOODY'SECONMOY.COM: Well, it is accelerating. Overall, inflation is about three-and-a-half, four percent. That is as about as high as it's been since the turn of the decade. Underlying inflation, excluding the cost of energy, is now rising too, and that's a concern to investors and the Federal Reserve.
WESTHOVEN: Mark, hi, Jennifer Westhoven. I'm going to ask you for a little bit of dark clouds here, but on Wall Street, a lot of analysts, a lot of traders, saying they didn't think it was just that CPI number that tripped the Dow off something like 500 points in the past week. What other red spots are out there? What else is in the economy that's lurking a bit that seems to be making Wall Street nervous?
ZANDI: Well, I think the thing that got Wall Street a little nervous is the fact that stock prices rose so far so fast. I mean, it had been a pretty good year so far, and a correction is something that's not unusual after seeing such a big run up in price.
And then you throw in the fact that inflation is seemingly accelerating, and most importantly, what this means is higher interest rates. The Federal Reserve will probably have to tighten policy at least a couple more times, and that doesn't make investors happy. So you combine all these things together and it makes for a bad week. WASTLER: Mark, about the inflation signal, though. I mean it wasn't that big an inflation jump. It was kind of teeny tiny. I mean, it was sort of all right, so it's there, but it's coming up. Was there an overreaction? And does the Fed seem to have it pretty well contained?
ZANDI: No, I don't think it was an overreaction. I mean, I think investors are pricing things as if we'd had no inflation problem at all, that things would be perfect, and they're not. Inflation is picking up, and it's now above what policy-makers would deem to be desirable. So we will see rates rise a bit more, and I don't think investors were counting on that, and that's now what we're seeing in these somewhat more squishy stock prices.
SERWER: We've really seen some tremendous inflation in commodity prices, things like copper and sugar and steel. How much is that contributing? And how much of that is real versus just hedge fund speculators making prices go higher?
ZANDI: Well that is a good point. The run up in commodity prices, energy, aluminum, everything is in part fundamental, supply and demand conditions, but it is also part of the fact that these have become financial markets and we have momentum players that are driving prices up. All that has contributed, but we are now at record- shattering prices for all of these things.
Interestingly enough, it hasn't translated into other pricing, at least not so far. Obviously, we're paying a lot more for gasoline and for some of these commodities, if we buy them directly, but it hasn't translated into broader inflationary pressures yet. The concern would be, however, if these prices move up even higher, at some point we will see that translate through into prices for other goods and services.
WESTHOVEN: Mark, I want to step back from the markets and go to the housing market where we've got these comments from the old Fed chief Greenspan, and now new Fed chief, Ben Bernanke saying that yes, the housing market is gradually cooling off. What does that mean for homeowners? What are you predicting here?
ZANDI: The housing market is weakening and that is by design. The Federal Reserve wants to head off those inflationary pressures. The way to do is slow growth in the economy and the way to do that is take a bite out of housing. Higher rates will affect housing. And the housing market is weakening and I think all of us should expect a measurably weaker housing market going forward.
And what that means for most of us, is that is going to be a lot harder to buy a home if we want to, and if we own a home, we can't count on big increases in prices, at least not to the degree we've enjoyed over the past number of years.
WASTLER: Mark, if I'm an investor now, and I think an inflationary environment is coming, what should I do to prep for that?
ZANDI: Well, you know, I think that you should expect that for the next three, six, nine months, you're not going to get the kinds of returns that you had come to enjoy over the last couple of years. Stock prices aren't going to post double-digit gains, and certainly if you're a bond investor, this is going to be a bit difficult for you.
You'll probably see the value of your bond holdings fall. So the point here is don't lose faith, don't lose confidence. The underlying economy is very strong and asset values will appreciate again, but for the next three, six, nine months, it's going to be little more difficult.
SERWER: Mark, quick last question here. We only have a second, but how can higher fuel prices be inflationary if they slow the economy down?
ZANDI: Well, because energy prices, fuel prices are going to production in many goods. Everything is transported, of course higher cost there. And ultimately, for workers, and we say our cost of living rises because we have to pay for more gasoline, we may ask employers to shoulder some of the burden. All that adds to inflation. So you can have an environment of a weakening economy and higher rates of inflation.
SERWER: All right. Always good stuff. Mark Zandi, chief analyst at Moody'sEconomy.com. Thank you for coming on the program.
ZANDI: Thank you.
SERWER: When we come back, workers who risk their lives for a better wage. We'll look at the economic conditions that send Mexicans across our border.
Plus, relax, and that's an order. See what's pushing more U.S. workers into early retirement.
And buzz versus buzz kill. Some of the critics are slamming "The Da Vinci Code" movie. Find out if what they say matters at the box office.
WESTHOVEN: Illegal immigration has caused a stir across the United States and in Washington, but can the Mexican government afford a crackdown? Money that's sent home by Mexican migrant workers accounts for more dollars in Mexico than even that country's entire tourism industry. So, here to help us sort this all out is Pam Starr, Latin America analyst for the Eurasia Group. Welcome Pam.
PAM STARR, LATIN AMERICA ANALYST, EURASIA GROUP: Thank you.
WESTHOVEN: My first question for you to start off. Give us a sense of just how bad the Mexican economy is. It seems to me it's failing its own people if they are in such desperate straits that they're willing to risk their lives to come here just to try to feed their family. What's happening there?
STARR: Well, I don't think it's fair to say that the Mexican economy is bad. In fact the Mexican economy is growing at five-and-a- half percent the first quarter of this year, and it has been growing at an average rate throughout the last six years of about 3 percent, and that's sort of the average rate of growth in the Mexican economy.
The problem is, that rate of growth isn't sufficient to generate enough jobs to employ all the new entrants into the job market, and as a result, many Mexicans either have to work in the informal sector, such as selling things on streets or things like that, or they have to go abroad to find work.
SERWER: Pamela, let me ask you a question. We have an awful lot of conversation in this country about what the government can do here, but what can the Mexican government do? What can President Fox do to help this situation?
STARR: Well, actually, at this point there's very little that President Fox can do, because he is a lame duck president. The elections will be held for the next president on July 2nd, and the new president will take office on December 1st. So between now and then, it's fairly difficult to implement new strategies.
President Fox has found it very difficult to undertake the reforms that the Mexican economy needs in order to be able to generate more growth and more employment, and it's been hard for him to do that in large measure because Mexico, is at the same time, adjusting to a new rules of politics.
It's adjusting to a new democracy in Mexico, and the result is, you have for the first time, a president that really has to work to negotiate with the Congress. The Congress is sharply divided amongst three large parties and several minor parties.
He also has to deal with governors who are finally operating as independent actors in Mexico's federal political system, plus a Supreme Court that sometimes declares the government's policies unconstitutional. So, getting through those structural obstacles to effective governance is difficult, particularly in a country that has no experience of doing so.
WASTLER: Pamela, you mentioned reforms. What specific reforms have to be taken in Mexico to fix it?
STARR: I don't think you can say specifically Mexico needs to implement x policy. What we really know is clear, however, is that Mexico needs to generate more fiscal resources so that it has the money to invest, for example, in infrastructure, education, and healthcare.
It needs to find money to re-capitalize both the petroleum company Pemex and also it's main electricity company The Federal Electoral Commission, and finally it needs to find a way to lower the costs of labor for employers. Now how you go about doing that is the big debate of this election.
There are two different approaches to that. One is an approach that is very much like what Vicente Fox has been promoting for years and that most economists, traditional orthodox economists favor, which is lower taxes in the hopes that people then will be more apt to pay their taxes and make it easier to pay your taxes. Secondly, bring in private investment into the oil company and to the electricity company, and third, change labor laws so employers can easily hire and fire workers.
The alternative proposal, however, is one that says, what we need to do is make government more efficient and reduce as much as possible the enormous amounts of corruption in contracting in state agencies. And that should generate income to invest in infrastructure and such, do the same for the electricity company and the petroleum company, believing that that will generate sufficient capital for those two firms.
And finally to democratize the labor unions -- if you do that, the corrupt labor leaders will probably be voted out of office and you save on labor costs that way. So everybody agrees on the basic problems. No one agrees how to solve it.
WESTHOVEN: All right. Speaking of no one agreeing, let's talk about what's happening in Washington. We have got all kinds of proposals from amnesty to militarizing the border, guest worker programs. What do you think about what the Mexican reaction is going to be, both the people and the government, to what is happening in the United States? Obviously, right now, its a little bit confusing, but also what that mean in the upcoming elections.
STARR: I don't think that the United States' debate on migration is going to have a specific impact on the election in Mexico. Mexicans in general have a similar reaction to the United States. Whenever it deals with the issues of migration, which is basic.
The United States has the absolute sovereign right to control its border. Every country has that right. The United States also has the right to determine if it wants to have a temporary worker program if it wants to grant amnesty to the Mexicans who are living in the United States or not.
However, what Mexico absolutely insists upon, is that those Mexican citizens who are living in the United States are treated with respect under international human rights law, and obviously, Mexico will not say that Mexico right now does not want those workers to come back home.
Mexico does not have the ability right now to generate jobs for them at home. So if they were to come back home en masse, as some people are suggesting, even if that's realistically feasible, that would be a social problem as well as an economic and political problem for Mexico.
WESTHOVEN: OK. Well thank you very much.
Now it's time for this week's "Look Ahead." On Tuesday, the Senate Banking Housing and Urban Affairs Committee will hold a hearing on improving financial literacy. I can't wait, in the United States.
SERWER: There you go.
WESTHOVEN: Fed Chief Ben Bernanke and Treasury secretary John Snow are expected to testify. Also, some key housing numbers will be out next week as well. We'll have new home sales out on Wednesday, and then on Thursday, even bigger, existing home sales. So we'll be looking at that closely too.
Coming up after the break, Burger King goes for a triple whopper. We'll tell you how the stock's doing after its IPO this week.
Plus, entertainment tips from people who spend too much time in the dark. With "The Da Vinci Code" coming out, can film critics really make or break a movie anymore?
And corporate animal meets party animal. Those spring break shots that you post on a social networking site, they might come back to haunt your career later on.
SERWER: Is this the best time to go public with a burger franchise? The folks who own Burger King thought so, and they rolled out their IPO Thursday. It was a modest opening day for the chain, but all the talk about fighting obesity and unhealthy food choices could hurt Burger King. Then there's a question about how much this very well known product can grow in the future. That makes Burger King our "Stock of the Week."
Interesting numbers here. The value of Burger King is about $3 billion. The value of McDonald's $40 billion. Wendy's, which is smaller than Burger King, is worth $7 billion, and the reason why Burger King is worth so little is because it's been badly run. It's been run by Brits, it's changed hands many times. What do Brits know about an American hamburger chain? Maybe this is an opportunity for the chain to finally get its act together.
WASTLER: It got taken over by a private equity group for a while, and there is some speculation that it got loaded up with too much debt and while they're paying off some with the IPO proceeds, maybe it will still be hampered on a fundamental basis.
WESTHOVEN: I got questions about that; the owners gave themselves a $350 million plus bonus just a couple months ago. So they're going to use all the money from the IPO to pay off their bonus?
WASTLER: Nice work when you can get it. That's the whole private equity flip fear. They buy these companies, load it up with debt, pay themselves, toss it out to the public and run away.
WESTHOVEN: Well I mean, that's money, but the other thing, I saw that Burger King is stealing some market share from McDonald's, but when is the last time you heard about something great at Burger King besides that big icon? I haven't heard about the whoppers getting better.
SERWER: You mean the king?
WESTHOVEN: With the food, what about the food?
SERWER: The food, well, they've always assortment of been known for having a better hamburger than McDonald's.
WASTLER: I have to admit that I love their whopper.
SERWER: They've never really gotten their french fries together, I must say, and they've always been working on that, but it's a very mature business. It's tough. McDonald's had Chipotle, the Mexican chain which they spun off, that's doing well. I think people are starting to look for alternative foods, and obviously, you've got to get into salads and all that right now, but this company, again, their largest franchisee went bankrupt a couple years ago, and I really think that this is a chance.
I mean, you're supposed to buy things when they're cheap, not when they're expensive, you know? So maybe this is a chance for this company to finally grow, but as we suggested, growing overseas is difficult, growing here is difficult. So it's a tough time, I think.
WASTLER: It's going to be a tough time.
All right. Coming up on IN THE MONEY, adapt or die. Pretty soon a big chunk of the USA work force will be 50-plus. See why companies better start learning to love their older employers.
And self-portrait with beer balm. Hello that stuff you post on social networking sites can come back to haunt you. Find out about that in our "Brain Storm" segment.
Also ahead, playing off politics and winning. Find out if the number of friends you have at work factors into your paycheck. Allen's going to break that down for us. Coming up next.
WESTHOVEN: Boomers, beware. As the first of the baby boom generation turns 60, many will being forced to retire earlier than they planned. So, why are those over the age 50 suddenly unemployed and unappreciated in the American workplace?
Welcome to the program. Just this week, a McKinsey study out found 40 percent of retired people were forced out of their jobs early, meaning that they are losing years of paychecks that they might have been counting on, they might have been planning to use that money for their retirement. What's happening here? What's going on?
JOHN ROTHER, AARP: Well, it's about half and half. About half of the people who are forced out early have to do so because of changes in the business. The business either went out altogether or moved or downsized, something like that. Then half had to leave for unexpected health reasons. Either their own health deteriorated or they were in a situation where they had to be a caregiver for someone in their family. So it's about half economic reasons, half health.
SERWER: John, it seems like everyone I know over 60 years old who's in the work force is an independent consultant. You know, you leave your job and then go back into the business as a consultant. How do these people generally fair?
ROTHER: Some do quite well, but it's really a reflection of the fact that it is hard statistically, for an older worker to get into a job on a regular basis, since so many are doing the consulting route, because it allows them to go to employers without the employer having to pay for health benefits and other things. So it gives them more flexibility to the people who are hiring them.
WASTLER: John, the people who are getting laid off, is it any particular industry or income level, or is it skilled versus unskilled? Because I've heard a lot of reports that skilled workers actually have a very bright future, whether they're old or not.
ROTHER: I think skilled workers are better off in general, and particularly as they get older. The people who are getting laid off here are predominantly lower income, unskilled, and of course, they're the very people who are unlikely to have saved enough, unlikely to have pensions or health insurance.
So they're really in trouble when this happens to them. They may have counted on working longer, but about four out of ten are statistically going to have to face up to the reality that they may not be able to work as long as they had expected.
WESTHOVEN: Now, for people who that happen to, we know that they end up, you know, holding the bag individually. They're trying to find a way to survive financially. Can we just talk a little bit about the government's role in this?
Because, of course, with some of the Social Security, I think they really encourage you to try and work later, but if you can't, if you want to and you're able, but you can't work later, is it really fair for the government to have that kind of gap between their expectations for how long you work and then what's really happening?
ROTHER: Well, not everyone knows the Social Security normal retirement age is going to 67, and for people who are forced out early, this does put a lot of pressure on them. Fortunately, Social Security does have a disability program that's going to be helpful to some, but only really a small fraction of people who are no longer able to work for themselves.
So they're going to have to figure out how to get themselves at least to age 62, then they can take the early retirement benefit for Social Security. But for this group as a whole, Social Security is going to be their salvation. They, generally speaking, do not have much else to rely on.
SERWER: Getting back to the private sector what companies do a good job of employing individuals over 50 years of age?
ROTHER: Companies that rely heavily on highly skilled people. So companies that hire a lot of researchers, people, say in the pharmaceutical industry, or healthcare, or where it's basically knowledge work rather than physically demanding jobs. And they're the same companies that are not finding enough younger people to fill the ranks. So they've got to hang onto those skilled, older workers.
WASTLER: John, can you give us a concrete example of some companies that are actually doing right by older workers and maybe some of their characteristics?
ROTHER: Well, AARP puts out a list of the 50 best companies for people 50 and older to work for every year, and what we find is the key theme is that the good companies have more flexible work arrangements to keep people productive, but also give them more time to do the care-giving, to be with their grandchildren, their families. And so they're not demanding that older workers work that 50, 60-hour week that's all too common for younger people.
And that's what allows people to stay on and stay productive. We find a lot of people in healthcare do this, but really, it's a broad spectrum of companies that have kind of seen the light and are doing things to allow older workers to stay productive and on the job.
WESTHOVEN: All right. You've talked a little bit how a lot of people are in trouble, they sort of end up struggling toward their older years here. Supposed to be your golden years. Can you talk a little bit about; I know you've said in some of our research that you think things are going to get better, because the American work force is aging. So give us a little bit of hope here.
ROTHER: Well, we do have a demographic change. We have a lot more people in the boomer generation that are coming into their 60s. A lot fewer people coming out of college into the work force. For companies that want to continue to grow and need skilled people, they're going to have to start looking more carefully at cohort, the boomers who are generally better educated, who have many of them do have the skills, and who we expect now to work until 67, on average. So, the availability of labor is there if the companies are willing to do some things to make themselves attractive.
WASTLER: Well, let's hope those companies get their act together and start looking at it. John Rother of AARP, thank you so much for joining us.
ROTHER: Thank you.
WASTLER: There are lots more to come here on IN THE MONEY.
Up next, everyone's a critic, when they're holding a movie ticket. As "The Da Vinci Code" premiers, see if there's any connection between the reviews and the box office.
Plus, the frat party that's frozen in time. Snapshots of your college can come back to bite you on a social networking site. Find out what that means for your career.
WASTLER: The "Da Vinci Code" has already proven itself to be a best-seller, but its blockbuster status is up in the air, mainly because of some not so divine reviews before its opening, but our next guest says that critics' jeers don't necessarily curse a film's box office success. Paul Dergarabedian is president of Box Office Tracker Exhibitor Relations and he joins us now to explain. Welcome, Paul.
PAUL DERGARABEDIAN, PRESIDENT, EXHIBITOR RELATIONS: Good to be here.
WASTLER: All right, so we've got some so-so critics' reviews where they all went, oh, it's not that good, but we also got a lot of publicity and controversy. Who trumps?
DERGARABEDIAN: Well, I think in this case, people are going to want to make their own decision. This movie has been talked about so much over the past many weeks, and actually, the book is so huge, selling tens of millions of copies, that you know, critics' reviews are important, people read them, they use them as sort of a jumping off point to make decisions about movie-going.
But at the end of the day, with this film, "The Da Vinci Code," there's been so much controversy around this film, and even all the press attention paid to the bad reviews raises the awareness level. And awareness means that people know the movie's opening, they're going to go out and want to see it.
SERWER: Right, Paul. I mean, don't these critics know that protests against this movie are 1,000 percent counterproductive? It's all about publicity. I saw a full-page ad in "USA Today" saying join the protest, come out and demonstrate against this anti-religious movie. Hello! You know, that's an expensive page in the newspaper, right?
DERGARABEDIAN: Oh yes. I mean, look, that's great exposure. I think most of the time, when people come out against a movie and there's all this publicity paid to that, it helps the movie. We see that time and again. It's just the mere fact that people are talking about it, and you know, Monday at end of the weekend, if you want to be in the know at the water cooler, you'd better have seen this film. And the controversy sells. No question about it. I think the people who protest a movie like this; they end up helping the movie more than hurting the movie.
WESTHOVEN: And this was one of those instances where the studio didn't let the critics see it beforehand. Sony in this case decided not to. Do you think there's any truth to the idea that maybe they do that because they want to protect that opening weekend box office receipts that, they don't want the sort of bad headlines about it being not such a great movie?
DERGARABEDIAN: Yes, I think that's part of it. I mean, Sony's been very careful about nurturing this movie to the big screen. With the controversy surrounding it, I think they knew they had to be really kind of careful with it, which they did.
Sometimes, though that, raises a red flag, where people wonder why they don't want the film to be seen. But I think in this case, and certainly I think at the end of the weekend when the box office numbers are in, it is going to be seen that Sony was vindicated in their strategy. I think it was a right move on their part.
WASTLER: Paul, what's probably going to be success here, and Hollywood coming out with some pretty eh years financially, are we going to see studios purposely go out to find controversy subjects? Subjects that get people steamed up, to sort of make a buck?
DERGARABEDIAN: Well, they may. I mean, it's a double-edged sword. Because if all you do is get involved in controversy, sometimes that can kind of fall flat after awhile. I think what happens is, is that as we've seen, like with a move like "Passion of the Christ" and also "Fahrenheit 9/11," those two movies kind of typified this whole notion of controversy, by bringing two taboo subjects, religion and politics, right into the mainstream. I think it shows that those kinds of subjects can polarize an audience, but it can also raise awareness, national discussion, and oftentimes that, translates to big box office.
So I think we will see plenty of these types of movies hitting the big screen. I mean, we saw it recently with "United 93." There was a lot of controversy around that. People went out and saw that film. It did well, considering the subject matter. So I think we're going to see more of this.
SERWER: Paul, but the movie theater business is in bad shape. I mean, it's been in a long -- listen to this, in 1996, the average American went to the movies 28 times. Today less than 5 times a year, box office has been declining three years in a row. I know it's up a little this year. Is this a dying business?
DERGARABEDIAN: Well, you know, it's a different world today than it was in the 40s. I mean there's so many options now for people's entertainment, with you know, iPod and the Internet and home theater and all these different things. It's just getting more competitive out there. The movies have to be that much better. I don't think it's a dying business.
I think that, you know, the movie theater and the theatrical movie-going experience really drives everything else, and there's a prestige factor associated with opening a movie on the big screen, and that has a ripple effect on DVD sales, and all other ancillary markets, so I don't think it's a dying business.
I think it's an ever-changing business. We're in a transitional period, 2005 saw a big box office slump. We're back on track right now, but it's just getting that much tougher to lure that audience into the movie theater.
WESTHOVEN: Well, when you think about theaters losing some power, what about critics losing some power? Someone asked about the power of the critic, but I also wanted to kind of bring up room for a personal moment here, which is just that there are so many movies that I feel like that the critics hate and sometimes you just love them. And I'm embarrassed to say, I loved "Hudson Hawk" I feel like I do give the critics respect.
SERWER: You and you alone!
DERGARABEDIAN: Well, I think there is a disconnect often between what the critics like and what the general public likes. Every once in a while, though, there's a film that will appeal to both the critics and the general public, like "Forrest Gump" was one of those, "The Sixth Sense" and "Titanic."
Those were all very well reviewed and did huge business at the box office. I think at the end of the day, there is a place for critics. You want to be able to have that option to read what someone else's opinion is of a movie, and actually it helps the marketing as well.
When reviews come out, people are reading about that movie, even if it's a bad review, oftentimes people want to make their own decision. I think there is a place for critics. I just think that moviegoers, ultimately, they're going to make their own choice, their own decision were.
SERWER: All right. We're going to have to leave it at that. Paul, thank you very much for coming on the program. He's the president of Exhibitor Relations. Thank you very much.
DERGARABEDIAN: Thank you.
SERWER: OK, in this week's "Brain Storm" segment, as graduation time rolls around, how much information is too much information on an online profile? Social networking Web sites like MySpace.com and Friendster.com are extremely popular, particularly with college students across the country. Millions and millions of users log on every day to meet new people or connect with old friends.
UNIDENTIFIED FEMALE: You go on line and you create a profile and you can load pictures, or you know, your birthday, where you're from.
UNIDENTIFIED FEMALE: It's kind of like your life on the Internet, because it gives people that maybe don't know you a peek at who you are.
SERWER (voice-over): For the most part, this information is harmless, but there are some exceptions.
UNIDENTIFIED MALE: Some people embarrass themselves or think they put things that probably should never be posted online, because it can come back to bite you.
UNIDENTIFIED FEMALE: There are pictures of people drinking. I mean, there's stuff that's there that you know happens in college, but you know; now you can actually see it. SERWER: Like all sites on the Web, there's always concern about who can see the information. Students thinking about a future job, beware.
TRUDY STEINFELD, NEW YORK UNIVERSITY: We actually have been advising students here at New York University for months now, that when you start using these sites, you have to be aware, especially if you're in the job market, that somebody could in fact get onto these sites and find out information about you.
Employers haven't told us that they are actively looking at these pages, but I know from sharing information with my colleagues across the United States that students are telling us antidotal that in interviews, employers have brought up to them, oh, I visited your page.
As people who are in decision-making positions are starting to have grown up with some of these sites, they are more comfortable, so that to them, its just business as usual, it's just routine. Oh, why wouldn't I Google somebody? Why wouldn't I look at their page?
SERWER: How do students feel about a potential employer looking at these Web sites?
UNIDENTIFIED FEMALE: At first when I heard people were doing things like that, I was a little caught off guard. I would think maybe that's going a little far in their investigation, but at same time, you know, it's public information, so you're the one posting it. You should be aware of the consequences.
UNIDENTIFIED FEMALE: I would probably like making it a little more politically correct, I guess. Shows a little bit of a crazy side of me. So I wouldn't want to show my employers, so that's the only thing I might change.
UNIDENTIFIED FEMALE: I wouldn't be concerned because I don't have anything on my profile I'm ashamed of or wouldn't want anybody to see.
SERWER: Trudy's advice, be sensitive to what's on your Web site, steer clear of very personal information, and think twice about strong political or religious statements. It's also a good idea to take advantage of the site's privacy features that allow you to control who has access to your information. Aside from social networking Web sites, it is also a good idea to consider what information you put on personal Web sites and blogs that potential employers could access.
Coming up next on IN THE MONEY, friends and benefits. We'll take a look at whether popularity at work gives you a boost on the corporate ladder.
And we'll read some of your emails from the past week. You can send us an email right now to INTHEMONEY@CNN.com.
SERWER: Want to know how I got this plum TV gig? Everyone at CNN likes me. Well, maybe not. Allen's got more on whether like ability really means anything when it comes to succeeding on the job. He also has our "Fun Site of the Week." What is up with this like ability stuff? I got a problem with that probably.
WASTLER: We had a column from our friends at Biz 2.0 up on the site this week. It was an examination of whether or not you have to be well liked to be successful at your job, and an example was brought forth of a CEO who's a complete jerk, you know, and he's forth right.
WASTLER: This guy divides people up into a, can you help my career, b neutral on my career, and c the dud. Only hang out with the a list. So we were wondering, is that really right? Does everybody really think that way? Where else do we go?
We go to you, the audience. We put up a poll on the Web site to see whether or not people think that's true, and surprisingly enough, they said, 60 percent, about two-thirds, said yes. You should be well liked at work to make it happen.
SERWER: You've got to be popular; it is just like high school.
WESTHOVEN: Well you don't want to have to give up something you stand for. You don't want to be a constant people-pleaser, but it is true if people don't like you, you can't get things done.
SERWER: Well, I think you want people to like you to get ahead. That's what I'm teasing. Listen, there are people in Dilbert comic strips that think that way.
WASTLER: That cuts to the core. You have to get along, teamwork, teamwork's very important. But you know sometimes people on your team are out to get you, you know? And the team leader's going to get the credit and not you, so why -- maybe we should be a little more cut throat --
SERWER: There might be just a little bit about being yourself.
WESTHOVEN: If you respect other people, they generally respect you. You can't help those cutthroats, but I think they show up more times.
WASTLER: I think there's more cut throats than you know about.
SERWER: What about that "Fun Site of the Week," Allen?
WASTLER: Uh oh! She got me!
SERWER: Never knew that about you.
WASTLER: 'Fun Site of the Week." We found a site where you can make motivational posters, so we made a few. Check it out. First one motivation. Sometimes being a pain in the butt pays.
SERWER: Oh my goodness. Can he say that?
WASTLER: Repercussions! I think I might have forgot to water the lawn.
SERWER: Nice. I like it. That's cute.
WASTLER: Of course our very own IN THE MONEY one. Motivation. Make sure you don't mess up this show while I'm gone.
SERWER: Oh! Well, we pretty much did. We pretty much did. Sorry about that, Jack.
WESTHOVEN: He's not watching.
SERWER: Those are good. No, I'm sure he is.
WESTHOVEN: All right, in this week's "Life After Work," giving back in retirement. The retired naval officer, Rick Koca, traveled the world throughout his 30-year career, but he was most touched by was something that he saw right here in the United States, teenagers with no place to call home. He's now giving them hope and getting them off the streets.
UNIDENTIFIED MALE: How are you doing?
UNIDENTIFIED MALE: I'm OK, how are you?
UNIDENTIFIED MALE: I'm alive and well.
UNIDENTIFIED MALE: Yes, you're working now, I hear?
WESTHOVEN (voice-over): Day and night, Rick Koca and his team of volunteers have food, clothes, computers, and most importantly, compassion for street kids.
UNIDENTIFIED MALE: Where have you been all my life, huh? Oh my goodness!
RICK KOCA, FOUNDER, STANDUP FOR KIDS: I traveled all over the world, 40-some foreign countries and saw homeless kids in other cities, and other countries but I never expected they would be in mine, and I saw them here, I was so upset.
WESTHOVEN: So he did something about it, 16 years ago, the former navy officer started Stand up for Kids.
KOCA: How can we help you get back into the job force?
WESTHOVEN: Volunteers go out into the streets and find kids. Their mission, to care about them, and then at every point, prove it.
KOCA: How are you doing? UNIDENTIFIED MALE: I'm OK.
KOCA: We're trying to be the family, the brother, the sister, the mom, and the dad, depending on who you are. That's the piece we're really trying to play for them to be for them, because they don't have that. So almost 18 years now I've been walking the streets, talking to the homeless children and being involved in their lives. And I said in all that time, I never really met a kid who wanted to be on the streets ever, not one.
WESTHOVEN: And on next week's "Life after Work" we'll talk to a 73-year-old retiree who has a picture perfect second career as a model. We'll be right back with more IN THE MONEY.
WESTHOVEN: Time to read your answers to our question about whether gas prices or interest rates are hurting you more?
Gene in Georgia wrote, "When interest rates go up, the only place charging me more is the bank. But when gas prices go up, my grocery store, Wal-Mart, & the hardware store all raise their prices too."
Chris wrote, "Interest rates are much more of a problem for me. I was out of work for a while and had to live on credit cards. I now have a rate of 31 percent on those cards."
Gary in Pennsylvania wrote, "For me, it's a wash. Higher gas prices are hurting me, but the improved income from my higher rate CD's is paying for those higher prices just fine."
Next week's e-mail question, "Are you worried about being forced to retire before you're ready?" Send your answers to INTHEMONEY@CNN.com. You can also tell us, if you have been watching the show what you thought about Burger King, Mexico, immigration, and all kinds of things. And check out our show page CNN.com/inthemoney. That is where you will find the address for our "Fun Site of the Week."
Thanks for joining us of this edition of IN THE MONEY. Thanks to "Fortune" Magazine editor at large Andy Serwer, and CNNMONEY.com managing editor Allen Wastler. Jack will be back here next week. We hope you will join us Saturday at 1:00 Eastern, Sunday at 3:00. See you then.
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