Business - BusinessWeek Online

ARTEIXO, SPAIN Many U.S. apparel retailers are choking on slow-moving inventories as consumers hold back on spending. But Spain's Inditex, whose Zara chain pioneered cheap chic, is zipping ahead. The $13.8 billion company, which is closing in on Gap for the title of world's biggest clothing retailer, has nearly quadrupled sales, profits, and locations since 2000. This year, Inditex plans to expand by up to 640 stores. "They will weather the storms better than most of their rivals," says Michael Lewis, a supply-management professor at University of Bath's School of ...

Hard times have been pretty good to Rita Cortese. Since 2006, she has owned a Plato's Closet used clothing store in Deptford, N.J. In recent months, Cortese says, business has exploded as people descend on her store to buy or sell castoff shirts, dresses, and jeans. Cortese is so busy she recently built a shed out back to contain her overflowing inventory.

In the fickle world of retailing, where hot concepts can be as fleeting as pop stardom, Costco (NasdaqGS:COST - News) has been a fortress of stability over the years. The $72 billion discount warehouse chain has built an empire of 544 stores in 40 states on one proposition to which it is fanatically devoted: keeping the prices of its quirky assortment of wares, everything from bulk antacids to flat-screen televisions, as low as possible.

Josh Corlew's grocery bill is zero. The furniture in his Nashville home didn't cost him anything, either. His fridge, TV, and microwave -- all free. It's been two years now since he last bought the ingredients for his signature sausage dish. Corlew, a 26-year-old nonprofit manager, has effectively dropped out of Consumer Nation. He goes shopping in the disposable culture's garbage instead.

On a shady lane in New Hope, Pa., a quiet revolution in American culture may be taking shape. Here, a family of four lives in a white, colonial-style house in a manner that once would have been considered All-American but more recently has been seen as just plain weird: They're frugal.

More than five years ago, in April 2003, the attorneys general of two small states traveled to Washington with a stern warning for the nation's top bank regulator. Sitting in the spacious Office of the Comptroller of the Currency, with its panoramic view of the capital, the AGs from North Carolina and Iowa said lenders were pushing increasingly risky mortgages. Their host, John D. Hawke Jr., expressed skepticism.

Financial advisers are usually an unflappable bunch. When the markets are wild, investors turn to their financial planners for calm, consistent advice: Stick to the plan, think long term, don't do anything rash. Advisers have studied their history and know that markets go up, down, and sideways; proper investing requires patience.

Google's mission is to organize the world's information -- be it via search, e-mail, online maps, or mobile apps -- but it could someday help you manage your daily energy consumption, too. At a speech at the Commonwealth Club in San Francisco last week, Google (NasdaqGS:GOOG - News) CEO Eric Schmidt said that as part of its recently announced collaboration with General Electric , the search engine giant is currently looking at designing tools to help consumers understand their energy consumption. ...

Amid a credit crunch that is decimating consumer psyches and spending power, gasoline demand has dropped nearly 10% from a year ago, even as crude oil prices have fallen.

I"You have to just about be walking on water to get financed but even with our prime customers, banks are looking for a reason to say no." -- AutoNation CEO Michael Jackson, The Wall Street Journal, October 2008

Take a stroll through central Moscow, and you'd be hard-pressed to find evidence of the global economic turmoil. Shiny new malls are packed with shoppers. The streets are filled with Mercedes, BMWs, and Land Rovers. On the Presnenskaya Embankment, overlooking the Moskva River, a half-dozen skyscrapers are nearing completion at the Moscow International Business Centre, a $12 billion development intended to become the city's new financial hub. ...

When Mark Akers got an offer from his mortgage lender in September to slash his monthly payments down to $2,500, from $4,200, he jumped at the chance. The Norco (Calif.) resident ran into trouble earlier this year after his wife got sick and he lost his job managing a factory that made doors for houses. The 53-year-old Akers could have become another foreclosure statistic if his bank, IndyMac, had not stepped forward to halve the interest rate on his fixed-rate loan to 3%, for a period of five years. ...

Some unlucky investors like Dino Macaluso are feeling the double whammy of the market meltdown: They are watching their investment portfolios shrivel while college tuition payments loom.

How has Carlson achieved gender balance? A big part of the answer is Marilyn Carlson. She created a culture of meritocracy, where talent drives development and promotions. And surprise, surprise. When women are given an equal chance and the same preparatory experiences, they rise in equal numbers.

General Growth Properties , the nation's No. 2 shopping mall company, may soon become the next giant felled by the credit crunch. Analysts believe that Chief Executive John Bucksbaum, who put the 54-year-old outfit deep into hock as he bought up retailing real estate across the country, could be forced to sell the company and its more than 200 malls nationwide because he'll be unable to make payments on its staggering $27.4 billion debt load. "GGP is at the end as a going concern," says RBC Capital Markets analyst Richard C. Moore II. "It's time for them to go away."

With the House of Representatives' Oct. 3 passage of the Treasury's $700 billion plan to stabilize the financial markets by buying up troubled mortgage-related assets, you could almost hear the sigh of relief spreading throughout Washington and Wall Street. After two weeks of nearly nonstop negotiations in which the bill repeatedly appeared to flounder, it was quickly passed on to President George W. Bush, who signed it into law within hours.

The new 2009 model cars and trucks have been trickling into dealerships for months. But now that the pumpkins are ripe and showing up in stores, the leaves are turning, and off-weeks in the NFL season have begun, the newest models will really start rolling.

Any efforts to curtail the flow of counterfeit parts into U.S. military planes, ships, and missiles will be hampered by the Pentagon's poor vetting of suppliers and contracting rules that allow questionable companies to continue selling to the Pentagon. The checkered history of one supplier illustrates the problem.

The Pentagon's zeal to buy microchips on the cheap gives an advantage to sometimes questionable parts brokers that compete with more established suppliers. The dealings of AA Dynamic Enterprises of Anaheim, Calif., show how this works.

The American military faces a growing threat of potentially fatal equipment failure -- and even foreign espionage -- because of counterfeit computer components used in warplanes, ships, and communication networks. Fake microchips flow from unruly bazaars in rural China to dubious kitchen-table brokers in the U.S. and into complex weapons. Senior Pentagon officials publicly play down the danger, but government documents, as well as interviews with insiders, suggest possible connections between phony parts and breakdowns.

On Thursday night, Oct. 2, all eyes were on the Vice-Presidential debate. Friday, however, they will turn again to the House of Representatives, as it holds a do-over of its dramatic Monday vote. Will the House this time deliver the financial-system bailout that the Administration and business groups are demanding, and which the Senate passed Wednesday night?

The prosecution of an American company called Syren Technology offers a tantalizing hint of the espionage threat posed by fake Chinese computer parts. But so far neither U.S. law enforcement nor industry has publicly produced evidence of this kind of high-tech spying.

Barry Tipping spent three days searching for gas in Atlanta. The quest seemed to be in vain, as the 44-year-old tried nearly 20 gas stations, many with their pumps draped in bags, or waits that stretched to more than an hour. Twice when Tipping did find stations with gas, he sat in a long line only to see the station run out of premium unleaded before he reached the pump. So here was Tipping on Sept. 30 happily paying $4.33 a gallon to fill his silver Mercedes at an Exxon station in the northern part of the city, a sense of relief on his face. ...

In Las Vegas these days, even billionaires are getting their credit checked. On Sept. 30 Las Vegas Sands founder Sheldon Adelson announced that he would ante up $475 million from his personal fortune to buy preferred stock in the company, which will pay 6.5% interest over five years. Adelson's notes will convert at $49.65 per share, a considerable climb from the $31 at which they currently trade. The move shored up Las Vegas Sands' balance sheet. ...

U.S. banks large and small are buckling under the pressure of the credit crisis. The Federal Deposit Insurance Corp. has seized 13 institutions this year, most recently Washington Mutual. The regulator, which maintains a list of "problem" banks, doesn't disclose which others raise red flags. But one measure, the so-called Texas Ratio, may offer a clue.

The financial crisis has touched off worries among entrepreneurs about the status of their business loans and credit lines (BusinessWeek.com, 9/26/08). Will they have trouble rolling over their credit lines? Will new credit be available for small companies looking to fund operations? Smart Answers columnist Karen E. Klein posed some basic questions to two experts about this issue: Alex Grinewicz, executive vice-president for lending at Columbia Bank in Fair Lawn, N.J., and Nick Florio, an accountant and senior partner at accounting firm Citrin Cooperman in New York City. ...

Critics have faulted European governments for not doing enough to ease the worsening financial and economic crisis in their own backyard, but officials have moved with lightning speed this week.

When you build a wall, you need to start with the bricks on the bottom. In the same way, when fighting a financial crisis, the government needs to start with the basics: reassuring bank depositors that their money is safe.