Planet Money

Patents are supposed to promote innovation. But in the world of software and the Internet, they're having precisely the opposite effect.Tech companies are spending billions of dollars to buy up patents — not to drive innovation, but to defend themselves from potential lawsuits. There's a legal war on in Silicon Valley, and patents are the weapons.We talked about this issue recently on This American Life and All Things Considered. On today's podcast, we ask: How much is the patent war costing us? And what does it mean for innovation in America?For answers, we talk to Jim Bessen, an entrepreneur and researcher, and Eric Maskin, a Nobel-prize-winning-economist.

Today's podcast is a recording of the live show Alex and Adam did in DC this week. In keeping with the vibe of the nation's capital, they go big, and talk a lot about "America." Key themes: 1. Disco destroyed America. 2. Now there are two Americas: Broken America and American Dream America 3. A three-step plan for solving America's problems.

Let's assume that the U.S. government raises the debt ceiling, and the country keeps paying its bills next month. It's still very possible that one or more rating agencies will downgrade the country's credit rating. On today's show we ask: Would a downgrade matter? We revisit a question we asked last year: How do you rate a country? And we talk to one expert who says a downgrade of America's credit rating would make for splashy headlines, but would likely have a relatively small impact. Most of America's debt is held by big institutional investors — and those investors do their own research, and don't tend to be swayed much by what rating agencies say.

On today's Planet Money, more twists and turns in our story about the more than one billion dollar coins sitting unused in government vaults:We talk to self-described 'travel hackers' who use frequent-flier mile credit cards to buy dollar coins and pile up miles.And we learn that the U.S. Mint  — just today! — said it would stop letting people use credit cards to buy the coins.Also on the show: Why they love U.S. dollar coins in Ecuador.

Say you're a country with a decent-size national debt. Everything's going fine: Investors are willing to lend you money at a low interest rate, andyou can pay your bills without too much trouble. But then investors get nervous and start demanding higher interest rates. All of a sudden, you have to devote more and more of your money just to pay off your debt.Your economy starts to falter, and investors demand still higher interest rates. Now you're really in trouble.What causes this to happen? Is there some magic threshold that countries cross before they get into trouble?On today's Planet Money, we put that question to Ken Rogoff — a Harvard economist and an expert on the history of sovereign debt crises. We talk to Rogoff about three countries in particular: Greece, Italy and the U.S.

North Korea relies on charity to feed its starving people. But the country's elites like their luxuries — imported wine, fine china, dancing shoes. To buy those things, they need foreign currency. (North Korean currency is worthless outside of North Korea.) To get foreign currency, they need to sell things to the outside world. But North Korea's industrial base is a disaster, and the country doesn't grow enough food to feed itself. On today's Planet Money, we look at the ways North Korea's leaders have managed to keep foreign currency flowing into the country. Their strategies include manufacturing drugs, counterfeiting U.S. dollars, and selling gigantic statues to foreign leaders.

Bitcoin is a new kind of currency. But unlike, say, the dollar or the yen, it's not backed by any government. Also, you can't hold it in your hand or put it in your pocket; it exists only on computers. Bitcoin is supposed to be cash for the Internet age — anonymous money that anyone can use without using a credit card or going through a bank. On today's Planet Money, try to get our hands on a few bitcoins, which turns out to be harder than it sounds. We dig into some basic questions that come up when you're creating a new currency from scratch. And we buy lunch.

On today's show, we tell the story of a secret battle that's been going on for more than a year: Creating the song of the summer, the music industry's holy grail. Our case study is Rihanna's "Man Down." The story starts in the spring of 2010, when Rihanna's label flies in songwriters and producers from around the company for a "writing camp" — a pop-up version of the old hit factories that churned out pop tunes. Writing camp is expensive. But the real money doesn't start flowing until after the song is done. *Correction: An earlier version of this podcast used the incorrect version of Jennifer Lopez's, "I'm Real."

In the seventies and eighties, the Antar family ran Crazy Eddie, a popular electronics chain known for its frenetic commercials. The business was crooked from the start, but the fraud got more serious when the family took the company public in the 1984. In 1987, the Securities and Exchange Commission investigated the family and discovered years of inflated profits and overstated income. On today's show, one of the masterminds of the fraud, Eddie's cousin Sam Antar, explains how they did it and why it worked for so long.

  Every time the Fed's key policy committee met last year, almost everybody in the group agreed on what the Fed should do. On today's Planet Money, we talk to the one guy who, meeting after meeting, cast the lone "no" vote: Thomas Hoenig, president of the Kansas City Fed. Hoenig thinks the Fed is repeating mistakes of the past, keeping interest rates too low for too long. That risks creating another bubble — and another crash, he says.

On today's Planet Money, we travel to a place where people are trying to live without government interference. A place where you can use bits of silver to buy uninspected bacon. A place where a 9-year-old will sell you alcohol. It's the 2011 Porcupine Freedom Festival, known to its friends as PorcFest. It's the summer festival for people who think we should return to the gold standard and abolish the IRS.

On today's Planet Money, we visit an underground vault that's full of money nobody wants. The money — bags and bags of dollar coins — is the result of a 2005 law that requires the U.S. Mint to print a series of coins bearing the likeness of each U.S. president. The problem is, people don't really like dollar coins. So more than 1 billion dollar coins are now sitting, unwanted, in Federal Reserve vaults around the country. By the time the program wraps up in 2016, the Fed will be sitting on 2 billion unwanted coins, according to the Fed's own estimates.

Unemployment is still dangerously high. But things are looking up for both households and companies. On today's Planet Money, economist Mark Zandi says households have been steadily reducing their debt over the past few years. Companies slashed 8.5 million jobs in the recession and their productivity has soared. But one thing that Zandi is still worried about: the federal government's long-term deficit.

In the 16th century, coffee shops prominently displayed coin boxes with the phrase "to ensure prompt service" written on the side. If you wanted your coffee in a hurry, you dropped a little something extra in the box, and made sure the waitress saw you do it. This, according to at least one version of history, is where tipping began. But today, we tip after we get served, not before. And, according to one expert we talk to on today's podcast, the quality of service we perceive makes a tiny difference in how much we tip. (The weather has a comparable influence on tip size.) According to one theory, when you get down to it, we don't even tip for good service. We tip because we feel guilty.

If you know the right people — and if can get other criminals to vouch for you — you can go online and buy huge bundles of stolen credit cards. As it turns out, Planet Money knows the right people. On today's show, we sit in with Keith Mularski of the FBI. Mularski got so deep into this world that he wound up running a major criminal website. He takes us to a giant online mall for stolen credit cards, where vendors offer discounts for repeat customers and banners advertise hacking and phishing tutorials.