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Mark Gongloff   |   April 10, 2014    2:59 PM ET

The stock market got completely kerslammered on Thursday, and the kerslammering might not be done.

The punishment started on the Nasdaq, which sank 3.1 percent, its worst day since November 2011. The selloff metastasized and took down the Dow Jones Industrial Average, which fell 1.6 percent, and the Standard & Poor's 500-stock index, which fell 2.1 percent. Here's a look at the day's trading in the Nasdaq, courtesy of Yahoo Finance:

nasdaq plunge

Update: The Nasdaq tumbled again on Friday, closing below 4,000 for the first time since February 3. It fell 1.3 percent on the day. It's down 8 percent from its peak on March 5. Here's a longer-term view of the Nasdaq, courtesy of Google Finance:

nasdaq long

There's been lots of yammering in the market for a while now about how tech stocks are in a bubble that is due for bursting, and we could be witnessing the start of that. Funny enough, tech stocks actually weren't the worst performers in the Nasdaq on Thursday. That unwelcome honor went to biotechnology stocks: The Nasdaq Biotech index was bulldozed 5.6 percent.

Still, this bloodshed comes just a month after the Nasdaq hit a 14-year high and the other major stock measures hit new records. Venture capitalists are handing out billion-dollar valuations to any brogrammer with half a dream, and the market for new stocks is hotter than it has been since the end of dot-com boom.

Thursday's rout was the resumption of one that started about a month ago, but has picked up speed lately, sending investors scurrying for safe havens like Treasury bonds. The Nasdaq has lost 8 percent in that time, led by former high-flying stocks like Facebook, Google and Tesla. The big debate now is whether this is The Big One, the long-awaited correction to a bull market that has been carrying on with only minor interruptions since March 2009. Or maybe something worse, something crash-ier.

Or maybe it's just temporary agita about the Federal Reserve's long-stated desire to stop pumping quite so much cocaine into the financial system, along with the start of corporate-earnings season, which is not expected to be very good. A near-record number of companies have warned of disappointing profits in the first quarter, according to data tracker FactSet.

Mark Gongloff   |   April 4, 2014    9:20 AM ET

In what must be history's strangest socialist dictatorship, hiring by private companies just hit a record high. Meanwhile the government is still not hiring anybody.

Private employers added 192,000 jobs to nonfarm payrolls in March, the Bureau of Labor Statistics said on Friday, making up all of the economy's job growth for the month. Federal, state and local governments added nada. There are now 116 million people working in the private sector, topping the previous peak set in January 2008. Federal, state and local governments, meanwhile, employ 21.8 million people, down from a high of nearly 23 million in May 2010.

The two charts below tell the whole story: The first shows the rebound of the private sector. The second the non-rebound of the public sector. (Story continues after charts.)

private sector

public sector

That's pretty much how it has gone throughout the grinding recovery from the Great Recession: Private hiring has been slow but steady -- despite right-wing warnings that the private sector will collapse under the weight of President Barack Obama's allegedly socialist policies -- while austerity has led to government job cuts that have helped keep the recovery frustratingly slow.

Both private and public hiring are still far too low. If the economy were living up to its full potential, there would be about 5.7 million more people on private payrolls, according to the Economic Policy Institute, a think tank that focuses on labor issues. The chart below, from EPI, is based on jobs data through February. It doesn't include March's 192,000 jobs, which closed the gap just a smidgen. (Story continues after chart.)

missing jobs

Some conservatives blame Obama for the weak recovery, saying uncertainty about government regulations and Obamacare have hurt hiring. Most economists, though, agree that the recovery has suffered from the huge overhang of private-sector debt that built up ahead of the financial crisis and recession, which has taken years to work off. Austerity and a too-timid approach to stimulating the economy haven't helped.

Meanwhile, most of the private-sector jobs in the recovery have been low-paying, keeping wage growth anemic even as corporate profits have soared.

A new record high in private-sector jobs is better than nothing, but it's far from the end of the story.

Mark Gongloff   |   April 1, 2014    8:04 AM ET

Skilled Wall Street-botherer Michael Lewis has a new book out claiming the stock market is hopelessly rigged against investors, and the backlash from Wall Street has been predictably ferocious.

The backlash is not entirely wrong! It is just wrong about some of the most important stuff. To help explain what I mean, I will list some of the standard reactions to Lewis' book, Flash Boys, which claims that the stock market favors high-speed traders. These are the guys that use super-fast computers, fiber-optic cables, microwaves and frickin' laser beams to trade milliseconds ahead of the rest of the pack, sucking up kajillions of dollars for themselves in penny increments while adding little to the march of human progress.

I will grade these critiques on a truthiness scale from A to F, with "F" representing "Excuse me, but your pants are on fire," and "A" representing the chiseled-in-stone gospel truth.


Claim: The market is not rigged!!!! This was the line from Politico's Ben White and a parade of jittery New York Stock Exchange traders on CNBC on Monday.

Truthiness Grade: F Gentleman's C: The market is of course rigged in favor of people and companies who have more information and more technological prowess than other people and companies. If you think otherwise, then boy does Stratton Oakmont have a can't-miss investment opportunity for you.

Update: Ben White protested his grade. Because I am a fair grader, unlike some college professors I could name, I listened and realized I may have been too hasty with the "F" pen, maybe because I found this argument less compelling than others and because I wanted to avoid grade inflation.

White's point, like that of Yahoo Finance's Michael Santoli, is that the whole stock market is not rigged to favor high-speed traders. I agree with that, as you'll see below -- your 401(k) is probably safe from the flash traders, unless they accidentally destroy the market somehow. If you're not playing their game, you're not losing. You might even be winning. The market will always favor some players over others, but not some players over everybody else all the time. It's only fair to give some credit to this argument.


Claim: So what if the market is rigged, it has always been rigged! This was the reaction of The Reformed Broker blogger Josh Brown, FT Alphaville and, really, me (see above).

Truthiness Grade: B+: As Brown and FT Alphaville pointed out, the guys who gathered under that buttonwood tree in downtown New York in 1792 and formed what would eventually be the New York Stock Exchange did not do so out of any sense of charity. They did it because they could make a Ye Olde Fucktonne of money monopolizing the trading of stocks. Throughout the decades, market specialists of the human variety squeezed rents out of the market that were often more egregious than what the high-speed traders do.

So why does this reaction not get a Truthiness grade of A? Because the near-permanence of a bad thing -- herpes, say, or the New York Mets -- does not necessarily make it acceptable.


Claim: Bah, this is old news! The Wall Street Journal has been writing about this stuff for years. The WSJ's Scott Patterson wrote his own book nearly two years ago, Dark Pools, which made pretty much the same case Lewis is making. The hero of Lewis' book, Brad Katsuyama, called Patterson's book a "Must Read."

Truthiness Grade: B+: It is indeed quite old news. So old, in fact, that slowpoke regulators have already gotten around to launching years-long investigations into some of high-speed trading's shadier practices. Nearly a year ago, Bloomberg Businessweek declared the robots had lost, that flash trading was in retreat along with profits. It is telling that the vampire squid itself, Goldman Sachs, has joined other Wall Street banks and hedge funds in getting on the right side of history to back Katsuyama's new exchange, IEX, which purports to make it impossible for flash traders to skim money on trades.

But just because high-speed trading is old news, and even if it is in retreat, that doesn't mean we shouldn't shine a light on its worst practices and try to fix them. Then Goldman and the hedge funds and the flash traders can find a way to work around the reforms, and the cycle of life continues, hooray.


Claim: So what if the market is rigged, high-speed trading doesn't hurt the average investor. This was the reaction of New York magazine's Kevin Roose and, again, me.

Truthiness Grade: C+: High-speed trading mainly hurts the other traders who are competing with the high-speed traders. If you quietly invest in low-cost index funds and aren't trying to make a killing in the market, then high-speed trading is not a problem for you. I'm finding it difficult to work up very much outrage about hedge funders like David Einhorn or the artist formerly known as SAC Capital -- two of the flash-trading "victims" mentioned in Lewis' book -- losing money on trades. Individual investors trying to day-trade against these firms, meanwhile, are like windsurfers taking on the U.S. Navy's Third Fleet. Michael Lewis has done those people a great service by reminding them that they are hopelessly outmatched.

So, again, why no A+ for this reaction? Because not everybody is investing quietly in low-cost index funds. A lot of us are, by accident or design, invested in actively traded mutual funds. Institutions might be eating the extra costs of high-speed trading or starting to use countermeasures like IEX. But these costs could be getting passed on to you, the consumer.

And more importantly, we still don't fully understand the potential for market disruption (the bad kind of disruption, not the Silicon Valley happy kind) high-speed trading can cause. It has already led to scary flash crashes and botched IPOs, which have already caused investors to lose faith in the capital markets, surveys have shown. That is generally not healthy for the economy.


Claim: High-speed trading is a net good for the markets and the economy. You can't make an efficient market without breaking a few Facebook IPOs.

Truthiness Grade: C: High-speed trading has lowered trading costs, even if it does still extract some cost. You could argue, as Bloomberg View's Matthew Levine did, that it makes markets more efficient. A stock price is whatever the market says it is, even if that price changes a zillion times per second.

But as Lewis notes, we also need to consider the costs to the economy of some of our best and brightest minds working on how to milk a little bit more money out of stock trading instead of on stuff like cold fusion or flying cars.

There's also a potential cost here of making our markets even more complex and more opaque, as Quartz's Matt Phillips pointed out. Financial innovation is always awesome right up until the time it stops being awesome, at which point it occasionally destroys the economy.

Mark Gongloff   |   March 26, 2014   10:27 AM ET

Monopoly's new "house rules" will probably not be popular in the houses of Ron Paul or Rick Perry. Many of those rules are straight out of their Fed-hating nightmares.

Hasbro, maker of the Monopoly board game, has proposed a bunch of new "house rules," the most popular of which will be officially adopted as optional rules. Here's a sampling:

Free Parking, Fast Cash: All taxes and fees will be collected in the middle of the game board, if you land on Free Parking, it's your lucky day: collect all the money from the middle of the board.

Dash for the Cash: Landed on Go! Amazing, you get to double your salary - 400M dollars instead of 200M Dollars.

Lucky Roller: Did you just Roll Snake Eyes (double one's)… odds are in your favor, collect 500M Dollars.

3's a Crowd: Are there 3 players in a row on 3 unique properties? Well done, each player gets an extra 500M Dollars.

Break The Bank: At the start of the game, leave half the money in the bank. Then mix up the other half of the money in the center of a board. On the count of 3 every player grabs what they can! Free For All!

Look at all that cash flying around! That last rule is straight out of former Fed Chairman Ben Bernanke's playbook: In 2002, he proposed that one way to stimulate the economy would be to just dump cash out of a helicopter for people to grab.

Bernanke's Fed didn't go that far, but it did slash interest rates to zero and pump hundreds of billions of dollars into the economy in a series of stimulus measures. This enraged Texas Governor Rick Perry so much that he threatened Bernanke with lynching.

Perry, Paul and other conservatives and gold bugs hate the Fed's easy money. Fed money-printing will destroy capitalism and cause rampant hyperinflation and other perversions of nature, they have warned. Hasbro has not listened to those warnings, obviously.

The original Monopoly rules create a fake economy that "is akin to one tightly and aggressively controlled by a central bank," noted Slate writer Alison Griswold. They're more favorable to hard-money enthusiasts like Ron Paul, in other words. Looser rules will better reflect our current economy, economist Jock O’Connell told Griswold.

“People who have taken the rules into their own hands are probably trying to more closely emulate what they see happening in financial markets around the country and on Wall Street," O’Connell said.

Maybe, but these rules are also simply a lot more fun, which is why variants of them have been used by players for many decades, through hard times and good.

They could also represent fantasies of wealth redistribution. Under the old Monopoly rules, owning expensive properties like Boardwalk and Park Place is a key to success. With cash being funneled straight from the wealthy bank, even the riffraff slumming it on Mediterranean Avenue have a chance.

Soon, our living rooms may be full of little socialist Bernankes, if they aren't already.

Mark Gongloff   |   March 25, 2014   11:23 AM ET

This may sound hard to believe, but it is still possible to buy a bargain house in the United States today. You may need to be willing to relocate to Detroit or Cleveland, however.

Those cities are among the locales with the cheapest homes for sale in the United States, according to a new study by real-estate website Trulia. The homes in these cities are wayyy underpriced relative to fundamentals like income and rent, according to Trulia's estimate. Here's a look, courtesy of Trulia, at just how undervalued:

unbubbly


Many of those places are actually not terrible places to live. Oft-mocked Cleveland, where the median home price is $58,700, turns up on lists of the world's "most liveable" cities. And when global warming turns everything south of Allentown, Pa., into a broiling hellscape, current frozen hellscape Detroit -- where the median home price is $37,000, according to Trulia -- might be more desirable.

For the time being, however, even $1 houses in Detroit might not be the bargain that they seem.

Speaking of not-bargains: Until California sinks into the Pacific, its houses will always be the most expensive houses, because all right-thinking humanoids prefer weather that does not go to miserable extremes for several months out of every year. To make matters worse, a swelling tech bubble is helping pump up a housing bubble in Northern California, pricing all but the richest people out of San Francisco and San Jose.

Here, again via Trulia, is a list of the most-overpriced housing markets in America. Spot the recurring theme:

bubbly


As for the rest of the country, you will be pleased to know that Trulia does not think we are in a national housing bubble:

bubble watch


The number of large housing markets in bubble territory is slowly rising, but still way below the number at the peak of the last housing bubble, according to Trulia:

how many markets


Still, in many markets, Wall Street investors have pumped home prices beyond fundamentals, pushing ordinary homebuyers out of the market. Fortunately, we'll always have Cleveland.

Mark Gongloff   |   March 24, 2014   12:38 PM ET

People tend to skedaddle out of town whenever they smell trouble. Apparently, companies do the same thing.

Companies that schedule annual shareholder meetings in unusually remote locations tend to announce bad news fairly shortly thereafter, according to a new study by Yuanzhi Li of Temple University and David Yermack of New York University. And those companies usually see their stock prices tumble, too, according to the study.

In other words, if you want to know whether a company is about to hit hard times, keep an eye on where it schedules its annual meeting. Often, the more surprising the location, the worse the news, and the harder the company's stock price falls.

"[W]e find that managers schedule long-distance meetings when the firm is experiencing adverse operating performance that is not already known to the market," the authors wrote. "Company stocks perform very poorly in the aftermath of remote meetings, and part of this result stems from disappointing quarterly earnings announcements following these meetings."

Annual meetings are where shareholders, analysts and board members get a chance to pepper corporate managers with questions. Typically, the shareholders, analysts and board members who live closest to the company know it best. So if you're a company with a nasty secret to hide, it makes sense to get as far away as you can from the people who know you best, to make it more difficult for them to ask you hard questions. It's not unlike how companies sometimes choreograph earnings calls so that only friendly analysts ask questions, in order to hide bad news.

"By moving the meeting far away, the managers might forestall shareholder or news media questioning that could lead to the early disclosure of adverse news," the study's authors wrote.

And companies aren't scheduling these remote meetings in happy fun-time places like the Bahamas or Las Vegas -- "resort" locales get surprisingly little annual-meeting business, according to this study. Instead, these companies apparently want traveling to their annual meeting to be a real chore.

Investors don't seem to have caught on to this trick yet. The study found that companies scheduling remote annual meetings have significantly worse stock performance in the months that follow. Companies that hold meetings at least 50 miles from their headquarters and 50 miles from a major airport do 6.8 percent worse than the broader market over the next 6 months, according to the study.

There are some exceptions to this rule of thumb: General Electric, for example, moves its meeting location to a new place every year, seldom coming anywhere near its Connecticut headquarters. You won't be able to get any read on GE by watching its travel schedule.

And a strange annual-meeting locale isn't always a harbinger of doom. You shouldn't mortgage your house to short every company that picks an unusual meeting spot. But it's not a good sign.

Mark Gongloff   |   March 20, 2014    8:53 AM ET

Little by little, the crazy is returning to financial markets.

Borrowing money against your overpriced home in order to gamble in the stock market is the sort of bananas thing people did before the housing bubble popped and the stock market crashed. But a story published on MSN Money and the financial-news website Benzinga earlier this week encouraged people to do just that.

Specifically, author Jonathan Yates suggested you could take out a home equity line of credit and use the money to buy shares of hotel real estate investment trusts, which pay dividends that might be higher than the interest you'd pay on your loan. Then just sit back and wait to be rich. Try not to think about how stock prices are at all-time highs after a five-year bull market, or about how home prices have been inflated by Wall Street investors, putting them totally out of line with normal incomes again.

And try not to think about this factoid, from Wall Street Journal personal-finance columnist Jason Zweig (who is obviously just jealous he didn't think of this genius idea first):

Zweig and many others denounced this terrible, terrible financial advice widely and thoroughly almost immediately after it was published. TheStreet.com's Herb Greenberg called it "the scariest thing I've read in a long time."

MSN wisely took the story down, though it's still up on Benzinga. It is also still available on the heavily trafficked Yahoo Finance.

But just in case you happened to see the story, missed the village stoning, and think this approach might be your ticket to riches, let me just say:

DO NOT DO THIS.

Still not convinced? Maybe this handy flowchart will help you in your decision-making process:

heloc flow

An simpler approach could be to set your house on fire and collect the insurance money. Although you could also, as MarketWatch reporter and aspiring financial planner Ben Eisen pointed out, stay in a hotel after your house has burned down, which will nicely boost the value of those hotel REITs.

There's no evidence yet that anybody has actually taken this terrible advice, or that the stock or housing markets are about to crash. But this is the sort of thing that starts to happen more and more frequently the less detached from reality markets get.

As Business Insider's Joe Weisenthal put it:

"This is the top, right?"

Mark Gongloff   |   March 17, 2014    9:25 AM ET

If you missed out on the housing bubble and the chance to gamble away your financial future, fear not: Banks are giving you a chance to get in on that kind of money-destroying action again.

Remember adjustable-rate mortgages, which helped pump up the U.S. housing bubble that led to the financial crisis? Well, those things are back, The Wall Street Journal reported on Monday.

To help juice their profits, banks have recently been writing many more ARMs and their slightly more-evil cousins, interest-only ARMS -- which allow borrowers to pay only interest for a certain period, leading to more debt and higher payments in the future -- according to the WSJ.

"The tactics are reminiscent of the period before the 2008 crisis, when ARMs exploded in popularity as banks and mortgage brokers touted their low initial rates to consumers," wrote AnnaMaria Andriotis and Shayndi Raice.

Not to worry: Banks say they are totally being careful this time, giving ARMs mainly to high-income borrowers with good credit. ARMS make up only about 10 percent of mortgages under $417,000 -- the dividing line between regular and "jumbo" mortgages. At the peak of the bubble, roughly half of these mortgages were risky ARMs.

But ARMs make up about a third of all mortgages between $417,000 and $1 million, the highest percentage since before the recession, according to WSJ data. And they make up about 60 percent of all mortgages above $1 million.

So this is maybe not putting the housing market in jeopardy. Yet. But this could still be a terrible deal for homeowners down the line.

Mortgage rates have jumped a bit lately, to about 4.3 percent for a 30-year fixed-rate mortgage, up from a record low of about 3.4 percent last April. As you can see from the chart below, though, rates are still near their lowest levels in history. Why would you not lock that down?

One reason not to lock such low rates down is that an ARM typically means lower payments in the short term. After that, you will be gambling that the United States is basically going to be Japan for the next decade or so, with rock-bottom interest rates lasting forever.

That's not the world's worst bet. It's possible. But the risk is that you'll find yourself in five years with an interest rate that could be much higher than your initial rate. And if you've got an interest-only ARM, you'll be paying that rate on principal that has been largely undented.

As the WSJ pointed out, when writing ARMs, banks are betting that interest rates are going to rise. That is the opposite of the bet you'd be making if you took out an ARM. Some homeowners might be gambling that they can sell their house or otherwise get out of their mortgage if their interest-rate bet goes wrong. But as we learned when the housing bubble popped, selling a house is not always such an easy thing. It'll be even harder when interest rates are rising.

As history has shown us, when banks bet against homeowners, the banks usually win.

Mark Gongloff   |   March 12, 2014   10:41 AM ET

Hey, Corporate America, are you befuddled as to why you are widely considered the mustache-twirling villain in the tragicomedy that is the U.S. economy? Here are two pieces of news that might help explain.

First, your chief financial officers shipped $206 billion in cash to overseas tax shelters last year, Bloomberg reported on Wednesday. The total amount of cash held in offshore havens rose to $1.95 trillion, according to Bloomberg, which is more than the combined market values of the six biggest companies in the U.S.

(Fun fact: Some of those six companies are also major hoarders of offshore cash -- Apple, Exxon, Google and GE alone have $250 billion parked offshore, according to Bloomberg.)

To add insult to injury, or maybe injury to injury, corporate CFOs are also staunchly opposed to raising the minimum wage, according to a new survey by Duke University and CFO Magazine.

Tim Cook, CEO of Apple, which has one of Corporate America's largest stockpiles of overseas cash.

About 39 percent of the 216 U.S. CFOs surveyed said they would cut jobs if the minimum wage were higher, including nearly 57 percent of CFOs in the retail industry and 40 percent of manufacturing CFOs. These companies are worried that having to pay their lowest-paid workers slightly more will crush their profits.

Meanwhile, corporate profits are at record highs, and worker wages have not budged for decades, when adjusted for inflation.

The CFO survey is not scientific, given its small sample size. And it is encouraging that 61 percent of CFOs said they wouldn't cut jobs if the minimum wage were higher. In fact, many studies have suggested that a higher minimum wage would result in little or no job loss.

One exception is a recent study by the Congressional Budget Office, which estimated that raising the federal minimum wage to $10.10 an hour from $7.25 an hour would kill 500,000 jobs.

But a higher minimum wage would also lift 900,000 people out of poverty, according to that CBO study, and give consumers $28 billion per year to spend, boosting the broader economy, according to a separate Chicago Federal Reserve study.

A higher minimum wage could save the U.S. government $4.6 billion in food-stamp costs every year, according to a study by the Center For America Progress.

Meanwhile, those corporate cash-hoarders -- America's true welfare queens -- are costing the U.S. government between $30 billion and $90 billion in revenue every year, according to a 2013 study by the Congressional Research Service.

In other words, Corporate America, you are costing us money in two ways, by paying workers too little and by shielding cash from Uncle Sam. Now do you see why everybody is mad at you?

Mark Gongloff   |   March 4, 2014   12:31 PM ET

Private-equity kingpins made billions last year subsidized by you, the taxpayer.

The nine highest-paid private-equity executives in the U.S. hauled in more than $2.6 billion in 2013, The Wall Street Journal's Ryan Dezember reported on Tuesday, citing regulatory filings by their firms. That's not a misprint: Just nine human beings split a $2.6 billion jackpot last year.

Salaries made up only a tiny sliver of this pay, according to the Journal. Most of the income consisted of dividends and profits on investments their firms made. That included hundreds of millions of dollars of what is called "carried interest" -- a slice of a firm's investment returns that is regularly paid to hedge-fund and private-equity managers and taxed at the capital-gains rate of just 15 percent, instead of being taxed like regular income.

The Journal did not break down how much money, in total, these men made in carried interest, aside from offering just a couple of examples: Henry Kravis and George Roberts of the firm KKR each made $43.3 million in carried interest, or about a quarter of their total haul.

But the overall numbers involved here are huge: Closing the carried-interest loophole could raise $21 billion for the federal government over 10 years, according to one estimate by the tax-reform advocacy group Citizens for Tax Justice.

This loophole is one big reason why a tiny sliver of the very wealthy has pulled away from even other members of the 1 percent.

President Obama's proposed federal budget for the fiscal year 2015, unveiled on Tuesday, asks to close this loophole to help pay for a tax break that could lift 13.5 million working people out of poverty. Even some Republicans support the idea, at least partly: House Ways And Means Committee Chairman Dave Camp (R-Mich.), last week proposed closing the carried-interest loophole, sparking apoplexy by the private-equity industry.

But, oh well, too bad, working poor people, no tax breaks for you: Obama's proposal is reportedly a non-starter in Congress, as it has been every other year that Obama has raised it. Why? Because reasons, that's why! Wealthy fund managers pay an awful lot of money to politicians to encourage them to keep the loophole closed, and nobody wants to stop that gravy train.

And these wealthy fund managers get very, very angry about any effort to take away a tiny bit of their billions. Blackstone Group co-founder Stephen Schwarzman -- who made $465.4 million in 2013, according to the Journal -- declared in 2010 that Obama's idea of raising taxes on him and his buddies was just "like when Hitler invaded Poland in 1939.”

"It's a war," he declared at the time.

If this is a war, it's one being waged on the poor. And Schwarzman and his buddies are winning.

Mark Gongloff   |   February 28, 2014   11:03 AM ET

Here's more proof that women make better investors than men: It's quite likely that almost no women lost any Bitcoins in the great Mt. Gox meltdown of 2014.

That's because almost no women own Bitcoins at all, according to a new online survey of Bitcoin users by Simulacrum, the blog of Lui Smyth, a researcher at University College London. About 93 percent of the crypto-currency's users are male, according to Smyth's latest survey, which is still ongoing. This survey hasn't yet hit a representative sample, but last year's survey of 1,000 users came up with a 95-percent male demographic.

The results suggest that Bitcoin has alienated women just as much as the two worlds it inhabits, finance and technology. This is good news for women, who have avoided a string of Bitcoin debacles, including the collapse of Mt. Gox, once the world's biggest Bitcoin exchange, which recently admitted it had lost more than $400 million worth of Bitcoins, maybe forever, to theft. But it is probably not healthy for Bitcoin.

The average Bitcoin user is "a 32.1 year old libertarian male," according to the 2013 survey, with 44 percent of users describing themselves as "libertarian/anarcho-capitalist." And libertarian/anarcho-capitalists tend to be white men, other studies have shown.

Smyth's findings gibe with anecdotal evidence from around the Interwebz, ThinkProgress noted on Thursday. Fred Ehrsam, the co-founder of Coinbase, a virtual-currency wallet company, told a New York Department of Financial Services panel in January that his user base had been "93 percent male" and young -- a "typical early tech-adopter crowd," he called it -- six to eight months earlier, though he said it had gotten a little less male and young lately.

The evidence also suggests these users are not only men, but also mostly white and wealthy, TP's Annie-Rose Strasser wrote.

"In order to buy the sometimes wildly expensive currency, Bitcoin users need to be wealthy. And they can afford to put their wealth into a currency that isn’t widely accepted or even recognized," wrote Strasser. "Plus, they move easily through the financial and digital space — the process of 'mining' bitcoins demands it.... The sum total of these things — advanced knowledge of computer science, wealth — are also markings of the young, white male."

Even the rare woman Bitcoin enthusiast Arianna Simpson -- who has displayed some anarcho-capitalist tendencies herself, warning of the risks of hyperinflation from the "irresponsible printing of money" by governments -- described being physically groped, hit on and gawked at like "a unicorn" at a recent Bitcoin meetup where she was one of only two women in a sea of dudes.

If Simpson's experience is any guide, then Bitcoin might possibly be even more hostile to women than finance or technology, as unlikely as that sounds.

"If women fail to take an active interest in Bitcoin now, when it is still in its infancy and its potential is largely untapped, we will have yet another sector in which the gender is underrepresented and trailing," Simpson wrote.

Of course, unless and until Bitcoin gets its act together, with more regulation and safeguards for customers, staying far away from Bitcoin might be the smart thing to do. Then again, maybe getting more women involved in Bitcoin is what Bitcoin needs to get its act together.

Of COURSE Fast-Food Workers Say Crazy Things On Receipts. Their Job Is Awful

Mark Gongloff   |   February 27, 2014    3:58 PM ET

When you read that story recently about the Burger King customers who were called "bitch ass hoes" on their order receipt, you may have felt shock, outrage and sympathy for the customers.

I felt a little of that, but something else, too: I felt empathy for the employee who typed up the receipt and then got fired over it.

That's because I worked in fast food for years, and let me tell you: The customers there can be the absolute worst. They can be the worst part of a pretty terrible job, one that involves grueling physical labor, rock-bottom pay, miserable working conditions and the feeling like you will never, ever get the smell and feel of grease out of your hair, face or clothing.

Of course, I don't condone giving a customer a receipt that calls them a bitch ass hoe, or says "fuck you," like another infamous Burger King receipt did recently. Burger King had every right to fire those employees.

But I can kind of understand how it happened.

In my time working at a Hardee's in West Columbia, S.C., I personally never dealt much with the customers. I stayed in the back, flipping burgers and frying fries (and chicken patties, and fish filets, and apple pies, all of which went into the same vat of scalding brown grease).

But we could all hear the customers loud and clear. Drive-through orders were broadcast over speakers throughout the store. Jerks at the register were also typically loud enough to be heard all the way back in the kitchen. We could hear when people berated the women who ran the registers. (They were almost always women, unless they wore a manager's tie.) Being rude, cursing at them, belittling them, accusing them of getting orders wrong when we could all hear they hadn't.

The people who worked the registers were on the front line of a daily trench war that ended only when the store closed late at night and started over again at the crack of dawn the next day. We were in that war with them, and we partied with them and sometimes dated or married them. When customers were rude to them, everybody took it personally. You might think employees can fight back in these situations, but too often your tip or your manager's good graces depend on just putting your head down and dealing with whatever cruel thing the customer throws at you.

I'm not saying that all fast-food customers behaved badly. Most didn't. Most people who eat at fast-food or other restaurants treat their servers with something between indifference and grudging politeness. That's fine. That's the social compact.

Then there are the rare customers who treat their servers like actual human beings, not only being polite but also smiling and making small talk with them about the weather or whatever. Those are the people who sometimes get extra apple pies or chocolate chip cookies slipped in their bags, gratis.

But then there are the customers who treat servers like dirt. I don't know what percentage of customers at any given restaurant fall into this category. It's small, but it's not small enough. And these people are everywhere, even at fancier places than Hardee's.

I have no idea what led to those Burger King receipt incidents. Let's just go ahead and assume the customers in those cases didn't deserve the harsh treatment they got.

But I do know the frustration that comes with working at a job that strips you of your dignity on a daily basis. Sure, it's paying work, which is better than the alternative. Many of the people who do the work aren't high school kids, as I was, but adults trying to support families. Still, it can be easy to lose perspective in the heat of the moment.

I can fully imagine these Burger King employees, in moments of weakness, needing a way to vent their frustrations, maybe by typing "FUCK YOU" into the cash register. They may not even have realized it was going to show up on a receipt and cost them their jobs.

But be warned, rude customers: Most people in the restaurant industry won't make that mistake. They will get their revenge in quieter ways.

Let's just say that when Tyler Durden pissed in the lobster bisque in "Fight Club," it did not entirely come as a shock to me. That absolutely revolting scene (trigger alert: Dane Cook is involved) in "Waiting," the 2005 movie with Ryan Reynolds and Anna Faris? Only slightly over the top.

As Reynolds says at the end of that scene:

"Don't fuck with people that handle your food."

Mark Gongloff   |   February 25, 2014   10:53 AM ET

This is why Bitcoin can't have nice things.

The unregulated digital currency beloved by techies, libertarians and the Winklevoss twins is having a crisis moment that could end its hopes to ever be accepted as a legitimate currency. Its busiest online exchange, Tokyo-based Mt. Gox, has been frozen for days, amid rumors that hackers have stolen maybe $350 million worth of Bitcoin wealth. The price of one Bitcoin has collapsed to about $500 on a rival exchange, Slovenia's BitStamp, down from about $1,100 last December, according to Bitcoin tracker Coinstackr.com (story continues after Coinstackr chart).

bitcoin

After going silent for several days and erasing its Twitter history, Mt. Gox -- which is short for Magic The Gathering Online Exchange, believe it or not -- posted a statement to its website Tuesday morning:

In the event of recent news reports and the potential repercussions on MtGox's operations and the market, a decision was taken to close all transactions for the time being in order to protect the site and our users. We will be closely monitoring the situation and will react accordingly.

The statement did almost nothing to clear up the mystery of what has happened to Mt. Gox or its customers' money, but it's not a good sign. Bitcoin blogs have been passing around a document called the "Crisis Strategy Draft," supposedly an internal Mt. Gox memo that says 744,408 Bitcoins have disappeared, in a "theft which went unnoticed for several years." The document includes plans to "step away" from Mt. Gox CEO Mark Karpeles, who has essentially disappeared, and to re-launch itself under new management and branding, in an effort to restore confidence in Bitcoin.

"At the risk of appearing hyperbolic, this could be the end of Bitcoin, at least for most of the public," the memo says.

There's no telling whether the document is legitimate or not, but it's certainly right that this episode could be the end of Bitcoin. The Mt. Gox debacle has justified the worst fears anybody might have had about jumping into Bitcoins -- namely, that your digital money can be hacked and stolen just like your identity or any other digital property. As Quartz noted, this would not be the first time Bitcoins have been stolen.

Several Bitcoin powers-that-be distanced themselves from Mt. Gox, saying they always thought it was a risky place to hold Bitcoins and promising to "collaborate with other industry leaders to establish better controls to ensure that events like this are not repeated." Gigaom's Jeff John Roberts suggested wealthy Bitcoin owners/proselytizers like the Winklevoss twins might be intervening in the market to stop Bitcoin's slide, acting like the Federal Reserve or something.

But the reputational damage is done, coming hard on the heels of wild swings in the currency's price and other recent public Bitcoin controversies. Those include the shutdown of the Silk Road online exchange and the arrest of Charlie Shrem, vice chairman of the Bitcoin Foundation and a recipient of millions of dollars in funding from the Winklevii.

This is no way to run a currency. If you weren't already convinced that Bitcoin was a risky gamble, this should just about do it.

Mark Gongloff   |   February 25, 2014    9:32 AM ET

Thank goodness for America's vigilant wealthy people, for how else would we know that the country has been taken over by Nazis?

Sean Parker, the Napster co-founder and former president of Facebook, is the latest tech mogul to identify the creeping fascist menace. In an email to the New York Post earlier this week, the billionaire called Gawker Media founder Nick Denton "Joseph Goebbels’ annoying little shitzu (sic)" and called writers for the Gawker-owned tech blog Valleywag "Goebbels’ fleet of diminutive attack dogs."

Why are Denton and Valleywag Nazis, or at least dogs of Nazis? Because they wrote a post last week about the havoc caused on a street in Manhattan's West Village when Verizon installed FiOS in Parker's $20 million apartment there.

And that is exactly something Joseph Goebbels, the chief propagandist for Adolf Hitler's Nazi regime and a fervent supporter of the slaughter of millions of Jews in the Holocaust, would have done. Or at least gotten his dogs to do.

It was once difficult to imagine a tech mogul appearing more unhinged than Tom Perkins, the millionaire venture capitalist who wrote a letter to The Wall Street Journal warning that attacks on the rich by left-wingers were just like attacks on Jews during Kristallnacht. But Parker has somehow managed it. At least Perkins was apparently motivated by an actual fear that he might be lightly holocausted, while Parker went immediately to Nazi metaphors just because somebody wrote an unflattering article about him.

Actually, this is not the first time Parker's ostentatious wealth has been the subject of unflattering media coverage, which may be why he has had enough. First, there was "The Social Network," in which Parker was portrayed by Justin Timberlake as kind of a jackass. Then Gawker and many, many others made fun last year of his fantasy-themed wedding, which may or may not have been harmful to the delicate ecosystem of the redwood forest, but was at the very least hilarious.

Parker responded to that by typing a 10,000-word screed about the evils of the media and some other stuff, maybe (we didn't actually read it all). This latest attack, on his $20 million Manhattan apartment, was the last silk straw that broke the golden camel's back, apparently, and tipped Parker into Godwin's Law territory.

I mean, come on, Parker doesn't even use that $20 million apartment any more, he told the New York Daily News. Who could deny that an empty apartment, and any occasional, hypothetical friends who might want to crash there, should have cable and high-speed Internet service? Nazis, that's who.

Fortunately, along with Parker, there are many other wealthy people joining the Perkins Nazi Spotters Brigade all the time. They will protect us, or at least themselves.