Derek Thompson

Derek Thompson is a senior editor at The Atlantic, where he oversees business coverage for TheAtlantic.com. More

Thompson has written for Slate, BusinessWeek, and the Daily Beast. He has also appeared as a guest on radio and television networks, including NPR, the BBC, CNBC, and MSNBC.

The Graph That Will Solve the Financial Crisis

Business
It now sounds like Treasury Secretary Tim Geithner's big bold plan to buy toxic assets from the banks might not even get off the ground. According to the WSJ, investors are feeling too skittish to marry their money to government backing. Two months ago, this would have sent the economy into a tizzy. Today, it doesn't make the WSJ.com homepage (unlike Bing.) Ultimately, the Geithner plan was never as important to solving the financial crisis as the actions taken by the Federal Reserve. This graph explains why:

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Will Microsoft Bing Be a Google-Killer Search Engine?

Business
Microsoft has had a rough few years. There are more self-identifying Republicans in America than Microsoft Live Search users, the Zune would be joke except nobody talks about it, and their public face is pudgy little John Hodgman looking stupid in those Apple commercials. But now they're about to role out a new search engine called Bing, and you know what? It looks pretty good!

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The Stimulus Is Lagging. Why is Obama Bragging?

Business
One hundred days after the passage of Obama's $787 billion stimulus bill, the administration is on a bragging tour, saying they've saved or created nearly 150,000 jobs in a hundred days. It's true that 150,000 more employed Americans is a great thing and a cause for some celebration. But shouldn't we be celebrating a number three times higher?

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Business

Reshaping Financial Oversight

Business

The worst financial crisis since the Great Depression is about to prompt the most far-reaching renovation of the rules and institutions that regulate finance since the 1930s. And the change won't wait for the economy to recover. The Obama administration is rushing to finish a proposal for reshaping financial regulation and wants Congress to act on it by the fall.

The current crisis exposed two huge vulnerabilities. One is that a handful of financial institutions grew so large and so intertwined that the failure of just one put the entire world financial system at risk.

How Al Gore and Kevin Martin Screwed Up Cable Regulation.

Business
In the early days of cable, long before anyone dreamed of a 24-hour food channel, Real World Season 22, or Glenn Beck, a startup network showing nothing but music videos struggled to get carried by cable systems--that is, the companies that own the wires leading into people's homes. Frustrated, the owners of this new channel created a now-classic advertising campaign urging teenagers to call their cable operators and declare: I Want My MTV!

G.M. Reaches a Deal With Bondholder Committee

Business

General Motors said in a regulatory filing on Thursday that it has proposed a new deal to a committee representing many of its largest bondholders, offering an equity stake of as much as 25 percent in the restructured automaker in exchange for not opposing G.M.'s reorganization plan.

The filing also fills out many of the details of that plan, crafted under the eye of the Treasury Department, which would be G.M.'s majority owner once it emerged from bankruptcy protection.

The Case for Taxing Emails

Business
Everybody's talking about making people pay for what they use online, and the New York Times has a short piece about making you pay for what you use the most: taxing all your emails.

Why would governments do such a thing? To kill spam, save bandwidth, and make a ton of money.

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Ten Risks to Resumed Economic Grwoth

Business

Last week, I discussed why the U.S. and global recovery will occur later than the optimistic consensus argues. This week, I will discuss why the recovery will be sub-par and below trends for a few years once it does occur, and why there is even the risk of a double-dip W-shaped recession.

The crucial issue facing us is not whether the global economy will bottom out in the third or fourth quarter of this year, or in the first quarter of next year. It's whether the global growth recovery, once the bottom is reached, will be robust or weak over the medium term--say 2010-11.

Stress Test "Adverse Scenario" Looks a Lot Like Reality, Part II

Business
A few weeks back, Conor Clarke pointed out that the stress tests' more adverse projection for the US economy looked frighteningly like the front page of that day's newspaper. The pessimistic hypothetical for the economy projected 8.9% unemployment, a 22% decline in housing prices, and a 3.3% decline in GDP in 2009. The unemployment numbers came out that day and, well, they were 8.9% exactly.

Today there's another graph that makes it look like we've living through the adverse scenario of our recession:

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Sonia Sotomayor and the Economics of Gender

Business
President Obama's Supreme Court pick Sonia Sotomayor has stirred the controversy pot with some of her statements about race and gender. In 2001 she said: "I would hope that a wise Latina woman with the richness of her experiences would more often than not reach a better conclusion [as a judge] than a white male who hasn't lived that life." This has the powers that be and the punditocracy in quite the wrangle over who's being racist, reverse-racist, sideways-racist and the like.

But more interesting to me is the question Sotomayor's comment raises: How does experience, gender in particular, impact political judgment?

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Why I Drink More Alcohol Than You

Business
Well this is fun. England's Department of Health ranked the biggest drinkers by industry. Where do you and your colleagues fall? I can't say for sure, but it's definitely below my colleagues and me:

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How the Crash Will Reshape the World's Cities

Business
An ebbing tide lowers all ships, but which leading world cities will sink in the Great Recession? Atlantic correspondent Richard Florida points me to this excellent report on how the global financial centers are weathering the financial storm. The biggest loser in the world is:

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Does Unemployment Guide the Stock Market?

Business
Conventional wisdom holds that stock prices are leading indicators of economic health, while unemployment figures are lagging indicators. This makes sense, because stock prices reflect real-time valuations of company health, whereas employers don't make the decision to downsize (or restaff) until they feel like they've got a sense of long-term recession or growth. But along comes Felix Salmon with a graph to blow up that whole theory:

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Should We Blame California's Government or Its Citizens for the Deficit?

Business
Deficits are simple things, really. A government spends too much, brings in too little, or both. But in the case of California, there's a not-so-simple debate over whether we should pin the state's extraordinary deficit on California's spend-happy government or tax-sad citizens. The People of California vs. Sacramento (with a verdict!) after the jump:

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Two Ways to Talk About Health Care Reform

Business
The debate over health care reform is only in its larvae stages, but even among its advocates, it seems to me that there are two distinct methods to debating its impact on the budget. The first relentlessly seeks realistic, but politically unpopular, ways to pay for universal care. The second looks to pass health reform first and pay for it later. Who's winning?

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NYT: Texting on Cell Phones Causes Anxiety, Insomnia, Dumbness

Business
Do you have a cellphone? Do you use it to text people? If you answered yes, the New York Times has news for you: You're losing sleep, rotting your brain and getting stress fractures on your thumbs.

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The Case Against Pennies, Coins and Paper Money

Business
I don't like carrying cash. I leave most of my change in tip jars. And on the nuisance scale, pennies for me fall somewhere between mosquitoes and DC parking laws. But reading Time to Cash Out by Wired writer David Wolman, I was pleased to discover the argument to do away with cash and coins makes even more sense than I imagined.

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Hank Paulson Admits He Doesn't Understand Mortgage Securities

Business
This quote, from Newsweek's piece on former Treasury Secretary Hank Paulson, strikes me as a bombshell:

Paulson--by his own admission--was not paying much attention to the way banks were slicing and dicing mortgages and selling them as complex securities. "I didn't understand the retail market; I just wasn't close to it," he told NEWSWEEK.
If Newsweek won't play prosecutor, I will: "Hank Paulson, you were Goldman's chief executive as mortgage securities boomed in 2004-5. Your earned an incredible severance, partly because of it. And you say you didn't understand mortgage securities? How is that remotely possible?"

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Does Twitter Make Blogging Obsolete?

Business
Andy Serwer is the managing editor of Fortune magazine and he is so busy with Twitter and Facebook status updates that he has announced the end of blogging -- for himself and, it would seem, the world. As newspapers and magazines drown, are blogs really just the next inland city to be submerged in the wave of communications technology?

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Early Monsoon Rains Flood Northern India

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