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Bloomberg Businessweek

Bloomberg Businessweek 3/27/2017

Each issue of Businessweek features in-depth perspectives on the financial markets, industries, trends, technology and people guiding the economy. Get the digital magazine subscription today and draw upon Businessweek's timely incisive analysis to help you make better decisions about your career, your business, and your personal investments.

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United States
Bloomberg Finance LP
50 Issues

in this issue

5 min
apple’s alternative to virtual reality

Tim Cook has talked up a lot of technologies since becoming Apple Inc.’s chief executive officer in 2011. Driverless cars. Artificial intelligence. Streaming TV. But no technology has fired him up quite like augmented reality, which overlays images, video, and games on the real world. (Think Pokémon Go, not Oculus Rift.) Cook has likened AR’s potential to that of the smartphone. He predicted at a tech conference late last year that eventually we’ll all “have AR experiences every day, almost like eating three meals a day. It will become that much a part of you.” He isn’t just speculating. People with knowledge of the company’s plans say Apple has begun an ambitious bid to bring AR to the masses, an effort Apple’s leaders see as the best way for the company…

4 min
fat wallets come to the shale patch

Big Oil is muscling in on shale country. For example, there’s a project called Bongo 76-43, a well being drilled 10,000 feet beneath the table-flat West Texas desert. It extends horizontally for a mile, blasting through rock to capture light crude from the sprawling Permian Basin. While the first chapter of the U.S. shale revolution belonged to wildcatters like Harold Hamm and the late Aubrey McClendon, who parlayed borrowed money into billions, Bongo 76-43 is financed by a deep-pocketed major, Royal Dutch Shell Plc. Some of the world’s top oil companies—including Shell, Exxon Mobil Corp., and Chevron Corp.— plan to spend a combined $10 billion on shale projects in 2017, up from next to nothing only a few years ago. If these efforts succeed, they’ll scramble the U.S. energy business and boost…

6 min
cambridge analytica’s low-tech fisticuffs

Beneath its high-tech data is a history of political subterfuge “Previously we were able to do our job in the background” Last fall, the political consulting firm Cambridge Analytica gained fame as the group of nerdy British data scientists that helped Donald Trump get elected. The firm says it’s able to use its “psychographic data models” to sway undecided voters by targeting people’s social media profiles and serving up messages and ads based on their perceived biases. Cambridge Analytica now hopes to leverage that success—and its ties to Trump—to do more business with the U.S. government. Working from offices just blocks from the White House, it’s been pitching itself to defense and national security agencies. In February it signed a $500,000 U.S. State Department contract to fight radicalization of young people abroad. While…

3 min
indians reconsider life in america

Rahul Lachhani, a technology analyst at Credit Suisse Group AG in Mumbai, is on the verge of realizing his dream of pursuing a graduate degree in the U.S. The University of Southern California Viterbi School of Engineering has accepted him into its computer science graduate program. But the Trump administration’s strident anti-immigration stance has him worried. “After so many years of hard work, my friends and I are now questioning—are we right in investing in a U.S. degree at this time?” he says. For decades, the U.S. has lured thousands of foreign students who’ve earned graduate degrees in engineering or mathematics and been quickly hired by the likes of Google Inc. and Microsoft Corp. Now the Trump administration is trying to slash immigrant visas, while Republican and Democrat lawmakers are introducing…

4 min
along came a scapegoat

For anyone burning to see financial wrongdoers put behind bars, Tom Hayes might seem like an ideal white-collar villain. As a superstar derivatives trader at a series of investment banks in London and Tokyo, Hayes masterminded a conspiracy to manipulate a benchmark interest rate that underlies hundreds of trillions of dollars’ worth of loans. British prosecutors—armed with gigabytes of evidence showing Hayes caught in the act, plus his own taped confessions—put him on trial in 2015; he’s now serving an 11-year sentence. It was an epic downfall, and David Enrich, an editor at the Wall Street Journal, recounts it well in The Spider Network: The Wild Story of a Math Genius, a Gang of Backstabbing Bankers, and One of the Greatest Scams in Financial History (HarperCollins, $29.99). One thing readers…

4 min
payless flops, but the owners get a payday

The Payless Inc. shoe company was already on its way to becoming another retailer felled by the internet when the private equity guys showed up and acquired it in 2012. Golden Gate Capital and Blum Capital weren’t able to turn Payless around. But the buyout firms still made out handsomely. Payless is closing hundreds of stores as it struggles to repay $665 million of debt. Golden Gate and Blum have nonetheless turned a profit on the deal by having Payless borrow millions in the financial markets, a move that’s pushing the company to the brink. The firms have collected $350 million from Payless through debt-funded special dividends. Golden Gate and Payless declined to comment, and Blum didn’t respond to requests. While private equity firms have long financed buyouts by having companies borrow,…