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VOLUME II

ISSUE X
WHAT’S INSIDE:

ANDERSON’s 2009
ENTREPRENEURS
BRUINFINANCE CONFERENCE
CHECK IT OUT Get the inside scoop.
See page 9. See page 10.

WHAT’S
GENERAL MOTORS
DOING TO AVOID

BANKRUPTCY ?

CURRENT
See page 5.

HAPPENINGS
2008-2009 BBR STAFF
Shannon Kung Christine Liu Jaeman Kim
President VP of Marketing Finance Department

Benjamin Lo Julie Chen Grace Chan


Editor-in-Chief VP of Finance Finance Department

Maya Lucaci-Vashee Erika Solanki Dmitry Shuster


Assistant Editor VP of Creative Development Staff Writer

Cristina Carillo Eric Park


Copy Editor Marketing Department

Sunny Wong Stefanie Ju


VP of Operations Marketing Department

ABOUT US
Bruin Business Review is a student-run online publication established in 2007
for the purpose of providing the UCLA student body with a convenient source
of business news and career information. We publish every two weeks on the
Internet and by subscription, allowing our content to be accessible to every-
one. Our goal is to enrich our readers’ knowledge of the business world and
the career options within it by presenting a wide range of business-related
topics in a non-technical style. Our broad range of topics encompasses cur-
rent business news, resume tips, employer and MBA program profiles, indus-
try insight, and others. For more information about BBR, visit
www.bruinbusinessreview.com.

QUESTIONS, COMMENTS, CONCERNS?


E-mail: bruinbusinessreview@gmail.com
Mailing address:
Bruin Business Review
118 Kerckhoff Hall
308 Westwood Plaza
Los Angeles, CA 90024-1641

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May 1 May 6

May 2009 Bruin Consulting and iFLY Indoor


Skydiving Marketing Plan Competition
Career Fair Career Roundup
Time: 11:00am – 3:00pm
Location: Applications at www.Cal- Location: Ackerman Grand Ballroom
Student-Fliers.com Description: Gather information and
Description: Submit an innovative market- internship/job opportunities with com-
ing plan to win a $5,000 scholarship. panies, including Disney Consumer Prod-
ucts, Northwestern Mutual, and Ray-
Grant Thornton LLP: Footsteps Program theon Company.
Applications Due
Location: Apply through Bruin View May 12
Description: FootSteps is a two and a half
day program designed to give sophomores Job Search Jump Start: Marketing
the opportunity to learn more about their Time: 4:00-7:00 pm
future profession, experiences from Grant Location: UCLA Career Center, 3rd Floor
Thornton professionals, and participate in Description: Learn the skills necessary to
activities to introduce you to public ac- be competitive in a career in marketing.
counting. Learn how products are marketed, what
career opportunities are available, how
Undergraduate Business Society Execu- professionals got into this field, and
tive Board Applications Due what you can do to market yourself for
Location: 8283 Bunche Hall, Department the profession.
of Economics Register at career.ucla.edu/JumpStart
Description: Interested in becoming a part
of the executive board for the Under- May 15
graduate Business Society? Go to
www.ubsbruins.com to download an ap- Bruin Finance Executive Board
plication. Application Due
Time: By 11:59pm
May 2 Description: Interested in becoming a
part of the executive board for UCLA’s
Bruin Consulting Mentorship Program premier finance organization, Bruin Fi-
Applications Due nance? Go to www.bruinfinance.com
Location: Applications at and download an application.
www.bruinco.com
Description: The Bruin Consulting Board is May 19
offering one-on-one training to first and
second years. The four week program will Student Accounting Society’s 27th
include resume construction, mock inter- Annual Spring Awards Banquet
views, and networking opportunities. Time: 6:30-9:30 pm
Location: Covel Grand Horizon Ballroom
May 5 Description: The Student Accounting
Society a banquet to acknowledge the
Bruin Finance Investment Banking Panel 100+ firm professionals in attendance
Night (Ernst & Young, PWC, Deloitte, KPMG,
Time: 7:00 – 9:00 pm etc.) as well as UCLA's own accounting
Location: Royce 190 professors. You will have the chance to
Description: Network with a panel of in- sit and network with firm professionals
vestment banking professionals represent- throughout the night.
ing JPMorgan, Barclays Capital, Credit
Suisse, and Houlihan Lokey. Also, get ad-
vice for successful recruitment as well as
resume critiques from real bankers. To get
more information or join the list serve,
visit www.bruinfinance.com.
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TABLE OF
CONTENTS
5
News of the Week: General Motors
Tries to Avoid Bankruptcy

6 News Briefs

9 Profile: Bruin Finance

10 Profile: Anderson Conference

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STRUGGLING GENERAL MOTORS
TRIES TO AVOID BANKRUPTCY
By Shannon Kung
Senior Staff Writer

General Motors announced last Monday that it is planning to cut


as many as 23,000 U.S. jobs by 2011 in addition to slashing 40
percent of dealer networks and dropping the Pontiac brand. GM
hopes that this new proposal will help it avoid the looming
threat of bankruptcy, brought on by the failing U.S. automobile
industry and the current economic state. Its efforts to reduce
costs stem from problems that have bothered the company
since 2005. By the end of all the cuts, GM expects to have only
38,000 union workers and 34 factories left in the United States,
a far cry from the 395,000 workers and more than 150 plants
General Motors had at its peak employment in 1970.

The new restructuring plan would entail the Treasury accepting


General Motors stock in place of cash for the repayment of Gen-
eral Motor’s $10 billion government loan. This would leave the
Treasury, and thus American taxpayers, with a significant stake
in GM. The United Auto Workers union holds a large stake in
GM and, if bondholders agree to the proposal, 89 percent of GM would be owned by the union and the Treasury. This
would leave bondholders with a less than 10 percent stake in GM.

General Motors CEO, Fritz Henderson announced that if bondholders do not agree to the swap, bankruptcy may be in
GM’s near future. GM needs at least 90 percent of the bondholders to agree to the terms by June 1; otherwise, the
auto company may have to file for Chapter 11 bankruptcy. If the company does file for Chapter 11 bankruptcy, General
Motors would still be in control of its business operations as a debtor in possession and would be given the chance to
reorganize.

Furthermore, General Motors is completely


eliminating the Pontiac brand. Pontiac, an
iconic brand dating back to the late 1950s, is
credited with creating the first muscle car.
Although it is difficult to fathom now, Pontiac
was once marketed as GM’s “excitement divi-
sion” with cars such as the GTO. Now, how-
ever, the Pontiac is set to be shut down by the
end of next year. General Motors claimed
that Pontiac was given the axe not because of
sales, but because of profitability. Instead,
GM will focus more on four core brands: Chev-
rolet, Buick, GMC, and Cadillac. This leaves
three other troubled lines: Saturn, Saab, and
Hummer all up for deliberation by General
Motors.

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NEWSBRIEFS By Benjamin Lo and Julie Chen
Senior & Staff Writer

BITTER BANK OF AMERICA SHAREHOLDERS REMOVE KENNETH LEWIS AS CHAIRMAN


After working for Bank of America for 40 years, Kenneth D. Lewis, its current chief
executive, was voted out of his chairman position last Wednesday after an annual
general meeting for the nation’s largest bank. While Lewis was voted out of his
position as chairman, he will retain his position as chief executive officer. A chair-
man is selected by a corporation to lead its board of directors, while the chief ex-
ecutive officer serves to handle total management of the company. After a 50.34
percent shareholder vote, or 25 million votes, to oust Lewis, Walter E. Massey,
the president emeritus of Morehouse College in Atlanta, will take on the position
as chairman of Bank of America. A third had voted to remove him from the board
altogether. Investors made this decision largely in part to hold him accountable
for what they view as management mistakes that led to two government bailouts.
Even after receiving billions of taxpayer dollars in government loans, the bank may still need to raise more capital.

THE U.S. BENEFITS AS CHINA TRIES TO SPUR ITS ON ECONOMY


U.S. industrial-equipment makers, which work closely with China’s infrastructural development, are seeing increased
activity in China’s markets as China’s $585 billion stimulus package increases demand for steel and labor. Many people
involved with the industrial sector, including James W. Owens, chief executive of industrial-equipment maker Caterpil-
lar Inc., , said China is boosting its economy much more quickly than the United States has to date. "It's something like
nine months [in the U.S.] versus nine weeks" in China, he says in regards to the amount of time needed to start civil
works projects such as the construction of a $930 million bridge and expressway project called Xiangshan Island Bridge.
As a result, Wall Street Journal analysts believe China may be the first major economy to recover. China's investment in
infrastructure projects has soared, rising 102 percent in the first quarter from a year earlier, the National Bureau of
Statistics says. In contrast, Washington has distributed $69 billion of its $787 billion in stimulus funds to states and lo-
calities, which have spent $14 billion.

PROFIT JUMPS AT DREAMWORKS ANIMATION


First quarter net income more than doubled to $62.3 million for DreamWorks
Animation, due in large part to strong box-office and DVD sales from
“Madagascar: Escape 2 Africa.” Jumping from $26.1 million a year ago, the re-
sults far exceeded Wall Street predictions and tops the charts for Hollywood
companies. The “Madagascar” sequel generated $595 million in worldwide ticket
sales and increased DreamWorks’ sales from last year by 68 percent. The stu-
dio’s latest film, “Monsters vs. Aliens,” has grossed about $320 million in ticket
sales since its March 27th release. DreamWorks Animation chief executive Jeffrey
Katzenberg announced at a conference that this has been their “strongest first
quarter ever.”
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LONDON’S FINANCIAL SECTOR CONTINUES TO FEEL EFFECTS OF THE ECONOMY
The financial services industry has been a major source of revenue in London for the past ten years and now analysts
are predicting major declines in the city as the current economic crisis continues to affect Britain’s capital. “By 2010,
the U.K. will have the largest budget deficit in the developed world,” Rich-
ard Snook, a senior economist at the Center for Economic and Business
Research in London, said in an interview with the New York Times. “The
problem is that the financial services industry has been a huge cash cow
for the British government for the last 10 years and now it is going into
reverse.” The country’s budget deficit has increased in the past year to 12
percent of gross domestic product and its current public debt burden
could soon reach 80 percent of its annual economic output. Analysts ex-
pect over 70,000 jobs in the world’s financial industry to disappear in the
next two to three years. In the meantime, the British government is trying
to prevent further declines in its financial industry, as it has pumped hun-
dreds of billions of pounds into preventing several of its largest banks
from filing for bankruptcy.

STARBUCKS REPORTS DECLINE IN REVENUE


Starbucks has recently reported its fall quarterly profits have tumbled 77
percent. With this announcement, the company also reported a net
profit of $25 million compared to $108.7 million in profits during the
same quarter last year – an $83.7 million decrease. Total revenue fell 7.6
percent. The company has also closed 123 U.S. stores in the quarter in
efforts to reduce its costs during this economic downtown. Starbucks
has previously announced plans to close 960 stores globally during this
recession. Since July, the company has shut down 507 locations in the
U.S. and 64 locations in other countries. Despite these reports, executive
vice president of Starbucks Troy Alstead said in an interview with BBC
News, "We are building a healthier and more sustainable business model
to support the company into the future and deliver value to our share-
holders."

RECESSION HITS MAJOR INTERNATIONAL AUTO INDUSTRIES


In past years, many international automakers, such as Toyota, have prospered
when U.S. auto companies have seen declines. Now, the economic crisis has
halted the good times for Japan’s Motor City, Toyota City. Toyota has idled fac-
tories and decreased production during its first annual net loss in 59 years. This
has pushed Toyota City into its worst slump in memory, as jobs and tax reve-
nues have declined. “The only places [in Toyota City] that are still busy are
those producing for the Prius,” said Masahiro Tanaka, who was recently fired
from Toyota, referring to Toyota’s fuel-efficient hybrid sedan. “Everywhere
else, jobs are just gone. Completely gone.” He and others said jobs began dis-
appearing after last summer, as collapsing global auto sales led Toyota Motors
to lay off 6,000 employees and slow production at its seven factories in Toyota
City, where the majority of the its 72,000 Japan-based employees work. Toyota
said it expected a $3.5 billion net loss in the last fiscal year, its first loss since
1950.

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SWINE FLU HITS THE AMERICAN ECONOMY
An outbreak of swine flu in Mexico has raised concerns
worldwide that the disease could turn into a global pan-
demic. So far, 168 people are suspected to have died
from the strain of swine flu in Mexico. American officials
declared a public health emergency on April 26, 2009,
after 20 cases of swine flu were confirmed in the United
States. Since then, the number has more than doubled,
leading countries around the world, including Israel, Bul-
garia, and Japan, to tighten their border and immigra-
tion controls. The pork industry is beginning to feel the
repercussions as people become continually more hesi-
tant of eating pork. Although medical authorities say
there is no evidence that people will contract the swine
flu by eating cooked pork, Wall Street analysts predict a sharp decline of pork sales in grocery stores. Ten countries,
including China, have already banned pork products from the United States.

HOME PRICES ARE DECLINING LESS


Prices of single-family homes in 20 U.S. metropolitan areas in February were down 18.6 percent from last year. The
slowing rate of decline brings hope for the housing market. The National Association of Realtors said that home prices
rose more than normal from February to March, indicating
that the market may be stabilizing. Despite this, price drops
remain brutal, especially in areas where they rose fast. Ac-
cording to the Case-Shiller index, San Francisco, Las Vegas,
and Phoenix were among the hardest-hit cities. The Obama
administration recently announced a plan that may reduce
payments for up to 1.5 million at-risk homeowners, who
continue to struggle financially. Under the plan, the govern-
ment would tap a $50 billion housing fund to encourage
mortgage suppliers to modify second mortgages and cut
monthly payments for borrowers.

CZECH REPUBLIC PAYS IMMIGRANTS TO GO HOME


During its manufacturing boom earlier this decade, the Czech Republic enticed immigrants with plentiful jobs and com-
paratively higher wages. Now, the Czech government is paying them about $990 American dollars to go back home,
due to a fall in demand for exports and an unemployment rate that has soared to 7.7 percent. The Czech Republic plans
to disintegrate the global work force, consisting of 40 percent foreigners that helped the nation grow into a manufac-
turing hub, in order to open up jobs for the increasing num-
ber of jobless Czechs that must now apply for the low-wage
work traditionally left for foreigner laborers. The Czech econ-
omy is set to contract by 2 percent this year—a major decline
from its 7 percent peak in 2006. The Czech Republic contin-
ues to increase the budget for its multimillion-dollar program
to pay newly jobless migrants to go home. The pay-to-go pro-
gram is only open to citizens of countries that are not in the
European Union. Japan has also begun a similar program.

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By Sunny Wong
Senior Staff Writer

Founded this spring quarter by several undergraduate students, Bruin Finance


is the first undergraduate business organization on campus that solely focuses
on the financial sector. The organization aims to fill the void of a business
major, or more specifically, a finance major, at UCLA. Daniel Kim, one of the
co-founders of Bruin Finance, states that USC students have an advantage in
the sense that they have finance course offerings, which can be very attractive
to area banks. Bruin Finance plans to set up various events, speaker panels,
and workshops to aid students going through the recruiting process, the first
of which will be on Tuesday, May 5th. Kim said he hopes that UCLA students
interested in finance will become better prepared for winter recruitment
through being a part of Bruin Finance’s events during the year, which will
allow students the chance to receive networking opportunities and resume
critiques from investment bankers, to name a few.

Although areas like investment banking and corporate finance appear to be the
“ We want to provide a main focus of this organization, the club also plans to explore other fields within
the realm of finance, including private wealth management and investment
niche for students in management. “We want to also cover topics such as microfinance that pertain
finance.” - Eric Im, Co- not only to economic students,” said Eric Im, another one of the organization’s
cofounders. Im said he believes that tackling areas of finance other than just
Founder investment banking will provide the general student body with a better
rounded perspective on the financial sector.

INVESTMENT BANKING PANEL NIGHT


Bruin Finance kicks off its first major event with the Investment Banking Panel Night, slated for May 5th from 7-9 PM in
Royce 190. Several investment banking professionals from banks such as a Credit Suisse, Houlihan Lokey, JP Morgan,
and Barclays Capital will be attending and discussing their profession, as well as providing insight and analysis about
the current economic crisis. For sophomores and juniors interested in investment banking, the event should also be a
good opportunity to network with the panel speakers, drop of resumes, and receive resume critiques from real
bankers. The event will also provide opportunities for students to learn more about Bruin Finance and pick up
executive board applications if interested, which are due on May 15th.

OTHER EVENTS
Besides the investment banking panel night, Bruin Finance will host
UCLA’s first undergraduate Finance Case Competition in the near www.bruinfinance.com
future. EdgeCorp, a West Coast Wall Street prep company, will be
presenting about the financial case process as well as providing a info@bruinfinance.com
financial modeling workshop. There will also be opportunities to win
free prep classes from Edgecorp, valued at $950.

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Anderson School of Management’s
2009 ENTREPRENEURS CONFERENCE

By Eric Park
Staff Writer

“I took the one less traveled by, and that has made all the difference.” Those are the concluding words of Robert
Frost’s “The Road not Taken,” which will be the theme for this year’s Entrepreneurs Conference hosted by the Ander-
son School of Management, titled “The Entrepreneurial Road Less Traveled.” This is an annual, all day event to be held
on May 8, 2009. The conference’s focus will be on entrepreneurial opportunities during the current downtrodden
economy.

The conference’s audience ranges from current and future MBA students, alumni, faculty, entrepreneurs and profes-
sionals from a variety of career fields. Prominent individuals scheduled for this event include: Isaac Larian of MGA En-
tertainment; Claude Ruibal, CEO of Universal Sports; Mary Leslie, president of the Los Angeles Business Council, and
many others. This event is designed to promote development
in entrepreneurship, business prowess, and opportunities in
today’s market.

REASONS FOR SUCCESS


The Anderson Entrepreneurs Conference is now in its 24th year
and boasted over 400 attendees for its 2008 conference. Phil-
ippe Lavertu and Carlo Soracco are two of Anderson’s students
who are heavily involved with the planning of this event.
Soracco’s MBA focus is in Entrepreneurship and Technology
Management, while Lavertu’s is in Entrepreneurship and Fi-
nance.

When the two graduate students were asked about what has
made the event so successful and lasting, Lavertu and Soracco
stated, “Attendees come to this event religiously, and the rea-
sons range from the different and great keynote speakers, re-
peat attendance and support from alumni, and even good
food.”

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Another large part of the event’s annual success is its
excellent management, which the two men credit
that to “the handoff of transfer”. This is important to
maintaining the success and atmosphere of past
events as event managers pass on their experience
to intern managers who will manage future events.

EVENT SPEAKERS

Keynote speakers are critical to the event and this


year’s speakers are Richard Rosenblatt, CEO of De-
mand Media, and Greg Waldorf, CEO of eHarmony.
These men possess several vital entrepreneur skills
such as innovation, intelligence, and business acu-
men. “Greg Waldorf was chosen because he created
an innovative way to bring people together and he brought his own scientific method to his business application,” said
Lavertu and Soracco. Waldorf has been with the company since its inception in 2000 and also had previous experience
working with high growth companies in many different aspects ranging from investor to executive. “Richard Rosenblatt
was the CEO of Intermix as well and started demand media, which has been the aggregator of social media such as
MySpace, Facebook, and Twitter. He helped sell this idea to Myspace, and engineered its sale to Newscorp,” said
Lavertu and Soracco. Rosenblatt is deemed by many as an Internet entrepreneur and visionary as he has built, oper-
ated, and sold several Internet and media
companies. The combined value of these
companies exceeds the $1.3 billion thresh-
old. These two men have been incredibly
successful in brand development while
using the experiences and skills they have
learned from the field of business.

REASONS FOR UNDERGRADUATE ATTENDANCE

While this event may seem like it is focused on MBA students and individuals with professional experience, this is an
excellent opportunity for undergraduate students as well. When asked why undergraduate students unsure of their
career plans should attend this event, Lavertu and Soracco gave several intriguing reasons. “This event has profession-
als from many different fields and gives students instant access to the company they want to work for, exposure to
various career fields, mentorship, creation of synergies with attendees from different schools, and even chances to net-
work,” responded Lavertu and Soracco. With the current state of today’s economy and job market, Lavertu and
Soracco state that the time immediately after graduation is the best time to pursue entrepreneurship. The two also go
on to say, “It forces individuals into their passions, and allows them to brainstorm innovative and new methods to cre-
ate revenue during these difficult economic times.” They conclude by saying the “current economy still has many op-
portunities available to aspiring entrepreneurs as many goods have experienced price reductions, and if entrepreneurs
can stay afloat during the recession, they will be able to ride the ‘wave of success’ in the future.” Many undergraduate
students pursue careers in various fields upon graduation but entrepreneurship is an interesting and different alternate
route. The 2009 Anderson School of Business Entrepreneurs Conference provides insight into and encourages the de-
velopment of business expertise and skills necessary to take the road less traveled.

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