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Archive for November, 2011

Expert alert: Buffett to buy Omaha World-Herald

Wednesday, November 30th, 2011

Berkshire Hathaway Inc. announced today it will acquire the Omaha World-Herald Co., a transaction that should close in late December, pending approval of the World-Herald’s shareholders.

What will Wall Street make of this latest purchase by CEO Warren Buffett? Donna Dudney, associate professor of finance at UNL’s College of Business Administration, studies and teaches a course in Buffett’s investing strategies and behavior. Here are Dudney’s thoughts on the latest acquisition by “The Oracle of Omaha”:

The purchase seems like a natural fit for Berkshire Hathaway. Buffett has frequently said that he is interested in purchasing companies that are understandable and within his circle of competence. Buffett has extensive knowledge of the newspaper business, and has on occasion said that if he hadn’t gone into money management he probably would have gone into journalism.

He has owned many newspapers, starting with the purchase of the Omaha Sun newspaper in 1969. Berkshire has been a major investor in and member of the board of directors of the Washington Post since the 1970’s, serving as a confidante and advisor to Katherine Graham and Don Graham. Buffett certainly understands this business and knows how to analyze the value of the World-Herald.

Buffett also looks for companies with a durable competitive advantage. The World-Herald is in the top 10 newspapers in the country in terms of the percentage of subscribing households in its market, and its digital news site dominates the Omaha market. While nationally the newspaper industry faces substantial challenges, the World-Herald has a sustainable niche as the dominant provider of local and regional news in Nebraska.

The thing that I find most surprising about this acquisition is its small size. The performance of the Omaha World-Herald, even if is exceptional, will not move the needle on the performance of Berkshire Hathaway. However, it is an investment that is right in Buffett’s backyard, with management that Buffett knows and likes. My guess is that Buffett liked the fundamentals of the company and was able to purchase the company at a very attractive price.”

Reach Donna Dudney, UNL associate professor of finance, at (402) 472-5695 or ddudney1@unl.edu.

What about the acquisition’s effect on the World-Herald’s newsroom and its performance as a news enterprise? Gary Kebbel, dean of the UNL College of Journalism and Mass Communications, says there are many positives to Buffett becoming the new owner of the state’s largest news operation:

“Most people will think that, obviously, Warren Buffett buying your stock and buying your company is a vote of confidence in your management. It also means that it’s a vote of confidence in the future of your business.

This allows the Omaha World-Herald to be much stronger, because it won’t have to worry as much about its capital needs for expansion, improvement and innovation. This development gives the World-Herald a huge opportunity to extend its brand to all distribution platforms — even ones that haven’t been invented yet — because they’ll have the resources to do so.

“The really important thing, though, is this means the World-Herald is staying in local hands. What we know about the newspaper industry in general is that community news is in very high demand. Those locally owned newspapers that are delivering information about their communities and their communities’ needs have been stronger in comparison to large metropolitan papers. By their nature, metros have not been able to create as strong of community ties, particularly in tight geographic areas.

If you’re wondering how this might change the World-Herald, my advice would be to look at his other similar holdings, the Washington Post and the Buffalo News. Has he interfered in those newsrooms? The answer is an unequivocal no.”

Reach Gary Kebbel, dean of the UNL College of Journalism and Mass Communications, at gkebbel@unl.edu. Telephone interview requests can be arranged through Steve Smith, Office of University Communications, (402) 472-4226 or ssmith13@unl.edu.

Your credit card use depends on what you know — and what you think you know

Wednesday, November 23rd, 2011

To manage your credit cards efficiently, it goes without saying that it’s important to have a firm understanding of finance. But equally important to good credit-card practices is what you think you know about finance, a national study shows.

University of Nebraska-Lincoln economists Sam Allgood and William Walstad used a data set that measures Americans’ financial knowledge on two fronts – how much they actually know and also how much they perceive themselves to know – to examine how that affected their use and management of credit cards.

Predictably, they found that those who had high knowledge of finance and were aware of that fact managed their credit cards most competently. But they also discovered that a person’s perception of having financial knowledge mattered as much or more in some instances in how they treated their cards.

The nationally representative study, which surveyed roughly 27,500 people nationwide, measured five credit-card behaviors: Paying credit card bills in full; carrying a credit card balance; paying just the minimum payment; paying late fees; and exceeding the card’s limit. In all cases, respondents who perceived their financial knowledge as high had better credit-card behavior than those who saw their knowledge as low.

For example, the study found, Americans who are actually smart about finance and know it are 15.5 percent more likely to pay their credit card bills in full compared with people with the same level of financial knowledge, but who perceive themselves as not having a high financial expertise.

The low self-perceivers also are 15 percent more likely to carry a monthly balance, 12 percent more likely to merely pay the minimum payment each month, 11 percent more likely to be charged a late fee and 6 percent more likely to exceed their card’s spending limits.

“Before beginning, we hypothesized two possibilities: people would be over-confident and this would lead them to make bad decisions or that people need confidence to act on the knowledge they possess,” Allgood said. “Our study suggests that it is the latter.

“You must have actual knowledge to make good personal financial decisions, but people are not willing to act on that knowledge unless they also perceive themselves to be knowledgeable.”

Also in the study:

– Forty-one percent had both low actual and self-perceived financial knowledge. Twenty-five percent had low actual financial knowledge but thought their knowledge was high; 16 percent had high actual knowledge but perceived their understanding as low; and 18 percent had high actual knowledge and perceived themselves the same way.

– Forty-two percent of respondents said they paid their credit card balances in full each month, while 58 percent carried a balance forward.

– Those who thought of themselves as highly knowledgeable yet were actually low-knowledge about finance behaved similarly in all five credit-card behaviors as those who had high actual knowledge but saw themselves as low-knowledge.

The authors recognized that credit-card behavior is only one area of a person’s financial decision-making, and have begun to explore whether someone’s perceived financial knowledge is a predictor of other behaviors, such as investments, retirement planning and decisions regarding mortgages.

Preliminary results suggest that the predictive value of perceived financial knowledge carries over into these other areas, as well, they say.

“We still need to find out why two people with the same level of knowledge differ in how they perceive their level of knowledge, because financial literacy education can incorporate elements to help boost actual and perceived knowledge,” Allgood said.

Contacts: Sam Allgood, professor of economics, (402) 472-3367 or sallgood1@unl.edu ; William Walstad, professor of economics and economic education, (402) 472-2333 or wwalstad1@unl.edu

Pitch craft: How to develop story ideas & build media friendships

Tuesday, November 15th, 2011

Recently, I was asked to write about ways to come up with story ideas that catch reporters’ eyes and help build meaningful media relationships for the long term for CURRENTS, the official magazine of the Council for Advancement and Support of Education (CASE). I was flattered to get the invite, and it proved to be really good for me. A lot of what I do, I often feel, is done sort of semi-unconsciously or is more formless than it should be, really. So I was grateful for the opportunity not only to share a few thoughts with CASE’s loyal readership, but also to have a chance to provide myself a little clarity on what I do and how I do it.

If you’re interested in reading the column, the good folks at CASE have made it available to non-subscribers for the next three months. So if my meager math skills are still functioning, you should be able to see this until about mid-February.

The executive summary:

Reporters are busy and getting busier. They don’t have the time or patience to mess around with off-target pitches.

– There are two rules to landing stories: You need a good story, and you need credibility with journalists. Neither is easy to attain or maintain.

– Developing good stories requires getting out of the office and a fierce curiosity about your campus. You must know the researchers, teachers, students and administrative assistants in the colleges and departments. Deans, directors and administrators are great people, but they often have a very different idea of what news is.

Monitoring the news is time-consuming, but it is time well spent. You have to understand what’s going on in the world. Spend time on Google News and social media platforms to judge the currents flowing through the media. That’ll help you conjure up pitches based off the news.

Think like an assignment editor. When considering a national story, ask yourself how the local paper, TV or radio station might cover it. Story and source ideas will flow easily from that.

– Maintaining credibility requires a balance in your relationships with media. Don’t be the pain-in-the-butt PR person who only contacts them when you need something. Be a helpful resource, if you can, even if it doesn’t directly help your institution. And don’t be afraid to help reporters spread their influence on places like Twitter and Facebook and Google Plus.

The best pitch may just be the one you never send. If it doesn’t pass the basic news test — is it timely? Unique? Affect a broad segment of society? Have conflict? Evoke emotions? — then maybe it’s not worth risking your reputation with a journalist. Choose your battles when pitching stories.

– Last, be sure to be brutally honest with yourself, and try to think objectively about your pitches. When evaluating a pitch’s chances of landing, the best question to ask yourself is the old reliable: “Who Cares?”

I’m sure there are tips and tricks of this science/art that I’ve overlooked. Feel free to add them in the comments.

TransCanada says bill on Keystone XL rerouting is unconstitutional; law professor says they’re wrong

Monday, November 14th, 2011

Today, the Nebraska Legislature will begin debate on one of the bills currently under consideration to reroute the proposed, and now delayed, Keystone XL pipeline. Nebraska, along with many other states, lack regulations for state interest from the effects of oil pipelines. The full legislature will begin debate on LB4, which would provide state authority to approve or reject pipeline routes within Nebraska.

TransCanada has said such a state law would be unconstitutional and would be pre-empted by federal law. But in a blog post today for the Center for Progressive Reform, Sandra Zellmer, University of Nebraska professor of natural resources law, says the bill, like a similar one (LB1) before it, passes constitutional muster. She points to five main reasons why: (1) the state has a well-established authority over natural resources and water; (2) the bills are a fair expression and exercise of the public-trust doctrine; (3) state authority is not expressly or implicitly pre-empted by federal laws; (4) Delay in the environmental-impact study process does not result in a “taking”; and (5) the bills do not violate the Dormant Commerce Clause of the federal constitution, which guards against state statutes discriminating against interstate commerce either on its face or in practical effect.

Zellmer’s full argument can be found here. She can be reached at (402) 472-1245 or szellmer2@unl.edu.

Study suggests genetic links to impulsivity, alcohol problems in men

Thursday, November 10th, 2011

Being impulsive can lead us to say things we regret, buy things we really don’t need, engage in behaviors that are risky and even develop troublesome addictions. But is hastiness and rashness embedded in our DNA?

A new study suggests the answer is yes – especially if you’re a man.

The research, led by University of Nebraska-Lincoln assistant professor of psychology Scott Stoltenberg, found links between impulsivity and a rarely researched gene called NRXN3. The gene plays an important role in brain development and in how neurons function.

The newly discovered connection, which was more prevalent among men than women in the study, may help explain certain inclinations toward alcohol or drug dependence, Stoltenberg said.

“Impulsivity is an important underlying mechanism in addiction,” he said. “Our finding that NRXN3 is part of the causal pathway toward addiction is an important step in identifying the underlying genetic architecture of this key personality trait.”

For the study, researchers measured impulsivity levels in nearly 450 participants – 65 percent women, 35 percent men – via a wide range of tests. Then, they compared those results with DNA samples from each participant. They found that impulsivity was significantly higher in those who regularly used tobacco or who had alcohol or drug problems.

The results, interestingly, also came down along gender lines. In men, two connections clearly emerged – first, between a particular form of the NRXN3 gene and attentional impulsivity, and second, between another NRXN3 variant and alcohol problems. The connections for women, meanwhile, were much weaker.

Stoltenberg said the gender-specific results are a rich area for further study. “We can’t really say what causes these patterns of association to be different in men and women. But our findings will be critical as we continue to improve our understanding of the pathways from specific genes to health-risk behaviors,” he said.

The researchers were interested in impulsivity because the trait can predispose people to any number of behavioral problems – addictions, behavior control, failing to plan ahead or think through consequences of actions – and settled on the role of NXRN3 from previous studies.

While the results add important new evidence to the genetic role in impulsivity and, in turn, its role in substance abuse, researchers were careful to not claim a perfect cause-and-effect relationship. Impulsivity may interact with sensitivity to alcohol, for one example, or anxiety, for another, to create complex pathways to substance use problems in both men and women.

“If you’re working to explain how genes are associated with something like (substance) dependence, you have to connect a lot of dots,” Stoltenberg said. “There’s a big gap between genes and a substance use disorder. Impulsivity is one factor to such problems – not the only factor.”

The study, which appears in the journal Drug and Alcohol Dependence, was authored by UNL’s Stoltenberg; Melissa Lehmann of Black Hills State (S.D.) University; Christa C. Christ of UNL; and Samantha Hersrud and Gareth Davies of the University of South Dakota School of Medicine.

Contact Dr. Stoltenberg at 402.472.7861 or sstoltenberg2@unl.edu.

Coverage: Yahoo! News | Gizmodo |

UNL in the national news: October 2011

Wednesday, November 2nd, 2011
National media outlets featured and cited UNL sources on a number of topics in the past month. Appearances included:
Charles Braithwaite, communication studies; 2011 graduate Kyle Basarich; and communications major Elizabeth Kinnel were quoted in an Oct. 26 USA TODAY College story about how intercultural video chatting can help bridge global cultures.
John Gates, hydrology, appeared Oct. 7 on the Canadian Broadcasting Corporation about what the proposed Keystone XL pipeline will mean for Nebraska’s groundwater.
James Goeke, hydrology, wrote an op-ed that appeared in the New York Times on Oct. 4 about the nature of the Ogallala aquifer and the controversy surrounding the proposed Keystone XL pipeline through it.
Peter Harms, management, had his research into the nature of mentorship featured by Business News Daily of New York on Oct. 19.
Ari Kohen, political science, was quoted in an Oct. 17 story about universities using Twitter for customer service. In late October, he was quoted and cited in a number of stories about the inaugural Chicago Conference on Jersey Store Studies, at which he was a presenter.
Julia McQuillan, sociology, had her research into American men’s views on the importance of fatherhood appear in a number of media outlets in mid-October. Stories on the work appeared at UPI.com, Forbes and CBS News.
Dean Sicking, director of the Midwest Roadside Safety Facility, was quoted in an Oct. 18 ESPN story about the death of IndyCar racer Dan Wheldon following a crash during a race in Las Vegas.
Rob Simon, marketing, was quoted in a national Associated Press story Oct. 11 about a Nebraska hardware chain’s “Zombie Preparedness Center” promotion for Halloween.
Kevin Smith and John Hibbing, political science, had their research that examined the propensity for disgust and political orientation featured by Wired magazine on Oct. 21. The research also was featured by the London Daily Mail, LiveScience, and Yahoo! News on Oct. 27.
William Thomas, history, was quoted about the Transcontinental Railroad in the Wall Street Journal’s Oct. 26 preview of the new AMC series “Hell On Wheels.”
This is a monthly column featuring UNL faculty and staff in the national news. National media often work with University Communications to identify and connect with UNL sources for the purpose of including the university’s research, expertise and programming in published or broadcasted work.
Faculty, administration, student and staff appearances in the national media are logged here.  If you have suggestions for national news stories, contact me at (402) 472-4226 or ssmith13@unl.edu.