If Airbnb Can Make It in NYC, It Makes It Anywhere: Opening Line

There’s probably a reason for laws. They were meant to bring order out of chaos. When it comes to housing, look at photographs of living situations in the 19th and early 20th century and you see the problem.

Tenements overflowing with sprawling families living and sleeping on top of one another, houses more closely resembling huts built out of whatever’s lying around, hulking factories with dangerous processes and chemicals plopped down in the middle of thickly settled neighborhoods -- it was nuts. The laws, like most are, were meant to save people from themselves.

The special intensity of the fight over Airbnb in New York, exhaustively laid out today by Felix Gillette and Sheelah Kolhatkar in Bloomberg Businessweek, takes us back to practices from who knows how long ago, when there were no rules, or a lot fewer of them. All the management that society and government had brought to housing regulations were now an impediment to a more libertarian interpretation of what you could do with your own property.

There’s probably undiscovered middle ground, and it will be sought after, because of money. Some people feel like they need to experience New York City, perhaps justifiably, but one night in a nice hotel in New York could be a week’s wages to some of them. Apartment owners with idle space on their hands have a natural desire to monetize it. The tourism trade in NYC wants people to come.

But then safety is a fair point. Who knows who these people are that check in to your neighbor’s apartment for 24 or 48 hours, never to be seen again, and what they’re really, actually doing while they’re there? What’s to stop a guy from creating fake profile after fake profile on Airbnb and using it as a looting system?

The story’s point about the helplessness of third parties is ably made. When a tenant leases the apartment to someone else, it’s the owner who suffers the consequences when the seance goes horribly right. Yet the owners and the old couple in Apartment 2R have no say in anything that goes on between Airbnb, the lessor and the lessee without the help of city officials.

Something will have to give in the end because NYC is the most fun place to visit in the U.S. and thus the bell cow for this experiment in the sharing economy, as they’re calling it.


Today’s economic indicators include initial jobless claims at 8:30 a.m. EDT, Bloomberg’s consumer comfort index at 9:45 a.m., and the Philadelphia Fed survey and LEI at 10 a.m.

BlackBerry reports earnings before the bell, and Oracle and Smith & Wesson come after the bell. Other earnings include Kroger, Rite Aid and ITT Educational Services.

Rite Aid also is scheduled to hold its annual meeting today, as is Dollar Tree, a name circulating lately as Carl Icahn takes aim at Family Dollar.


+ Justice is probing banks over potentially undisclosed charges in currency trading. + Prosecutors are gathering evidence for a grand-jury probe into whether congressional staff helped tip Wall Street traders to a change in health-care policy, the Wall Street Journal reports. + BlackRock and Pimco with other plaintiffs sued Citigroup, Deutsche Bank and others over their roles as mortgage-bond trustees in the days leading up to the financial crisis. + A white man speaking English with a British accent led the attack on a World Cup viewing party in Kenya that killed more than 60. + Aereo, the Barry Diller-backed online repeater of broadcast TV signals, may learn its fate from the U.S. Supreme Court. + Facebook went down for about a half-hour this morning. The Wall Street Journal says that unlike previous failures, today’s was more widespread, affecting the homepage, the mobile application and messaging service globally. + The EPA’s new carbon-emissions regulations will be subjected to a hearing of the Energy and Power Subcommittee of the House Energy and Commerce Committee at 10 a.m. + Prince Felipe of Spain is now King Felipe VI. + Gene mutations that cut the risk of heart attacks may yield new types of drugs. + Dov Charney is out at American Apparel. + Merkel talks with Danish Prime Minister Helle Thorning-Schmidt about the presidency of the European Commission in Berlin at noon local time, 6 a.m. EDT. + The CFTC holds a public hearing on limits for physical-commodity derivatives at 9:30 a.m. in Washington. + Euro-area finance ministers meet as the European Stability Mechanism’s Board of Governors in Luxembourg at 1:30 p.m. local + Obama awards the Medal of Honor at the White House to retired Marine Corporal William Carpenter for his heroic actions in Afghanistan. + Saba Capital and other hedge funds are finding that while a rising tide lifts all boats, they’re still capable of taking on water in flat seas.


Matthew Leising, who told us late last month the CFTC is looking into incentives and discounts offered by derivatives exchanges, and how long these promotional considerations endure, has at least partially answered the question.

Nine years after offering incentives on a CME contract for Eurodollar futures, the discounts for the early adopters are still in place, Leising reports, citing a CME Group regulatory filing. The perks are 10 times greater for the earliest adopters in the contract than new users, he finds, citing regulatory filings.

Questions surrounding these incentive programs are implicit in the examination of high-frequency trading, and specifically whether these perks encourage trading. Virtu Financial, an HFT shop, said in March it was being asked about these perks, and a month later postponed its IPO indefinitely.

Interest-rate products like Eurodollars are the biggest revenue source at CME, and in May the contracts were the second-most traded behind U.S. Treasury futures, Leising reports.


The House Republicans will hold their leadership election today. Kevin McCarthy of California appears to be a lock to replace Eric Cantor as Majority Leader. Louisiana’s Steve Scalise, Indiana’s Marlin Stutzman and Illinois’s Peter Roskam are jostling for McCarthy’s old job, the Whip.


Iraq is disintegrating, Ukraine is being gnawed by the bear, Syria is still slaughtering its people, somewhere there are a couple hundred Nigerian schoolgirls, China is essentially annexing all waters between it and Hawaii, but what’s really important is the Washington Redskins’ name.

Quick to recognize this is Representative Howard Coble, the North Carolina Republican and chairman of the House Judiciary Committee’s subcommittee on intellectual property. The ink on the U.S. Patent and Trademark Office’s revocation of trademark protections for the team’s name was still drying when Coble said his panel would look into hearings on the Trademark Office’s decision.

But then who’s going to attend the Benghazi hearings?

The Internet went Defcon 5. Like everything else that happens in Washington these days, the Internet said this was yet another instance of the Obama administration threatening freedom. Evidently we’ve arrived at that moment in history when, if you can’t do whatever you want, your freedom is under threat.

“Yes, officer?”

“You blew through that red light and ran over a puppy.”

“I’m expressing my First Amendment right of expression to protest government hegemony though the symbolism of symbols that tell us when we can stop and when we can go.”

“License and registration, please.”

In the reluctants’ mind, it’s not America that’s turning against the name “Redskins,” it’s “Obama’s America” that’s doing it. One conservative commentator blamed “a bunch of overeducated white guys who cry during ’Love Actually’” and “a class of men who pee sitting down.”

No less a paragon of sensitivity than Howard Stern is throwing up his hands over this idiocy: “It’s just like, give these American Indians a break. Their entire history has been obliterated. Their entire ancestry is gone. If it really bothers them that much that there’s a team, the Washington Redskins, [bleeping] change it. Have a heart.”

If it all seems like a lot of controversy sprung up out of nowhere one day, BuzzFeed put together a highlight reel of how the name was used (and a lowlight reel of how lazy journalists are). Here’s one from the New York Times in 1962:

“Those pesky varmints, the Redskins, are on the warpath again. For many moons they had remained on the reservation with their squaws, tilling their fields and bothering no one.” Eventually it gets to the part about the football game.

There’s a reason the Trademark Office did this, rightly or wrongly: Because Coble’s legislative body gave them the authority.


When Abraham Lincoln was campaigning for his first term as president, his handlers were worried he would send the wrong message by riding around on his fancy horse, a Chestnut Bay gelding he had named Falsetto. Lincoln’s polling firm was coming back with negative testing, so his Super PAC stepped in and gave Honest Abe a nice, lived-in draft horse they named Subterfuge. This image-building was in addition to the lighter touches his people had devised, like the shawl and the beard, according to research by Bob Newhart in 1960.

Yes we made this up but it gives you an idea of Tim Jones’s great story today on politicians and their choice of transportation as an expression of their middle-class aspirations, even when they’re millionaires with multiple homes and probably wouldn’t be able to find the latch on a car’s hood even if a diagram of it was stapled to a copy of the Social Register.

Beginning with today’s fakers, like Tom Wolf, the millionaire Democratic nominee for governor in Pennsylvania, to Scott Brown, running for office somewhere in New England -- we’re not sure where this week, and tracing the use of transportation symbolism back to Harry Truman and Michael Dukakis’s tank, Jones shows us what’s driving politics these days.


The U.S. Open golf tournament begins today at Pinehurst No. 2 in Pinehurst, North Carolina.

Printing error? No, it’s the women playing this week.

Not sure what kind of shape the course is going to be in, given that the men just chewed it up a week ago, but it will remain a challenge just the same.

Who are the big names in the sport these days, now that Annika Sorenstam is gone? We’re stuck. There’s her and Nancy Lopez, right? No, Michelle Wie doesn’t count. You have to win tournaments, not just walk around in them.

Huh. How pathetic is that? We don’t even know a name. So we went to the Central Repository of All Human Knowledge, typed in “top women golfers” and in the top results we got this:

“LPGA Babes: 50 Hottest Women Golfers” (Presumably they’re not describing their game.)

“Top 10 Sexiest Female Golfers” (At least they got the gender adjective correct this time.)

“Golficity’s Top 10 Hottest Women in Golf for 2013” ("Golficity"?)

That’s how pathetic.


Dodgers pitcher Clayton Kershaw cut through the Colorado Rockies last night to record his first no-hitter, and it would have been a perfect game if not for a throwing error that allowed a runner to reach base. It’s the second no-hitter of the season, both from Dodgers pitchers. Josh Beckett no-hit the Phillies on May 25.


World Cup yesterday: Chile 2, Spain 0 Netherlands 3, Australia 2 Croatia 4, Cameroon 0

Today’s matches: Colombia vs. Ivory Coast at noon EDT Uruguay vs. England at 3 p.m. EDT Japan vs. Greece at 6 p.m. EDT

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