Last week's question
I'm the result of a 2000 merger of two financial giants, one of which traces its roots to a water company co-founded in 1799 by Alexander Hamilton and Aaron Burr. Sporting assets of more than $700 billion and operations in more than 50 countries, I have relationships with nearly every Fortune 1000 company. I'm a global leader in investment banking, asset management, private banking, private equity, retail and middle-market financial services, and e-finance. A component of the Dow Jones industrial average, I serve more than 30 million consumers. Who am I? (Answer: J.P. Morgan Chase)
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Job-hunting tips
Like it or not, many Americans are looking for work. It can be a frustrating process, but the tips below can help:
Look for a good fit, not just any job. Think about what you like to do, what you're good at, and what kinds of jobs and employers would match well. This might seem like a luxury when you really just need a salary again, but you might be able to land a more fitting job more easily, as your genuine interest and skills will earn you extra points.
Do your homework. Employers likely will interview a bunch of people for a job. They probably won't be too impressed with those who don't have a good grasp of what the company actually does, its industry and competitors, and its strategy and challenges.
Focus on people and connections as much as on your rmTalk to people you know about where they work, and feel out any possible fits for yourself. Ask contacts to put in a good word for you when you apply to various companies.
To get the job, do the job. If at all possible, demonstrate to the company that you have what they want. If you're a salesperson, demonstrate how you would sell the company's product. If you're a Web designer, ask for a small project with which to show your skills and turn it around quickly. If the manager can imagine you in the position, you'll have a leg up on your competition.
Whither drug prices?
During the past 20 years, the amount Americans have paid for medications has increased by more than 15 percent annually, on average, to an estimated $117 billion in 2001. This far outpaces GNP, which has increased, on average, less than 4 percent per year.
Government-set price controls are appealing, but remember that profit is a powerful motivator for drug companies, which spend enormous sums on research and development. Limiting their profits on successful drugs may not be ideal and could limit innovations.
Drug companies, as a group, have net margins four times that of the average Fortune 500 company, according to the Kaiser Family Foundation. The companies point to the high cost of drug development, but per a Kaiser study, research and development expenses make up only 14 percent of total drug company revenues, less than both net profits (18 percent) and marketing expenses (16 percent).
If drug companies ignore the problems inherent with existing pricing structures, a backlash may be inevitable. This would hurt the companies, would impede their incentives to develop new therapies, and would ultimately harm the public as the opportunity cost of drug development becomes too high.
Investors interested in drug companies should keep an eye on drug-pricing developments.
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