- Now it is Citicorp’s turn: early on July 14th it preempted the government’s usual self-congratulatory announcement by disclosing a $7 billion payment to settle fraud charges linked to its sale of residential mortgage-backed securities between 2003 and 2008. But the statement is brief and does not assign culpability to any individuals.The last point in particular touches an increasingly sensitive nerve: the settlement once again places the burden of penalties on current shareholders, employees and clients—while extracting nothing from those who were involved. How the proceeds will be used is controversial as well.A record $4 billion will go to the Department of Justice. And some $2.5 billion will be used to lower interest rates for some borrowers, provide funds for housing groups to be used in counseling.
- THE CARDS have been stacked against Atlantic City for years. This resort city in New Jersey lost its casino monopoly in the region when neighbouring states began legalising gambling a decade ago. In 2012 Pennsylvania, which opened its first casino in 2006, edged out Atlantic City to become the nation’s second-largest gambling market. The casino industry is the city’s biggest employer, and roughly a quarter of all jobs are now in jeopardy. Four of Atlantic City’s dozen casinos have already announced plans to close their doors. ers. Atlantic County, which includes Atlantic City, represents 20% of the state’s tourism industry, and tourism is the third-most important industry to the state.
- After much speculation over the cause of a deadly set of explosions in Lagos last month, Boko Haram’s leader, Abubakar Shekau, released a video claiming responsibility.In laying claim to the bombing, Boko Haram has exacerbated concerns over its ability to reach deep into the south of the country. Lagos is the biggest city in Nigeria and the business centre for Africa’s largest economy.
- America’s homicide rate is certainly far higher than that of any country where guns are largely prohibited, such as Britain, France, Germany and Japan. Yet this rate is in decline, with firearm-related homicides falling 39% from 1993 to 2011, even as gun ownership remains widespread. And in New Hampshire, where guns are flaunted proudly, the rate of violent crime is among the lowest in the country, behind only Maine and Vermont, according to FBI figures.There are several reasons for New Hampshire’s particularly low rate of firearms-related crime. The mostly rural state has relatively high levels of education, income and employment.The state is also fairly ethnically and racially homogenous.The question then becomes what to do about places where gun violence is more common, such as Chicago, where urban poverty, poor schools, higher unemployment and racial friction create an often toxic mix.? Messrs Cook and Ludwig suggest a combination of solutions: make it costlier to get guns in high-crime areas; improve the records available for screening gun buyers (with more information on possible mental-health problems); keep a paper trail to help connect legal gun owners to illegal gun-use; and offer better law enforcement against illicit gun use.
- Reynolds, America’s number two tobacco company, and Lorillard, the third-largest, took the more dramatic step of agreeing to merge. Reynolds is to pay $27.4 billion in cash and shares to form a combined company with $11 billion in sales. Its biggest shareholder, British American Tobacco, will spend $4.7 billion to maintain its 42% share in the merged firm. The transaction will reshape the American tobacco market, the world’s second-biggest by volume (after China). The main point of the merger is to bring Lorillard’s Newport brand, a menthol-flavoured cigarette that is especially popular among black and Hispanic smokers, into Reynolds’s domain. It is the number-two American cigarette and takes in more revenue than “original” Coke. It will be a more formidable competitor for tobacconists’ shelf space to Altria, Marlboro’s manufacturer. Britain’s Imperial Tobacco will acquire Lorillard’s blu, the biggest brand of e-cigarettes (most analysts had thought that blu was one of the prizes that Reynolds coveted.