Start-up backers this year are on track to invest the largest sum since 2001.

Venture capitalists invested $7.1 billion in U.S. start-ups in the second quarter, up 3% from a year earlier, according to data released Monday. The amount invested was spread across 977 deals, the most completed during a three-month period since the third quarter of 2001. Venture capitalists more recently have been hustling to find promising ideas that could lead to lucrative payoffs in two to five years, either through an initial public offering of stock or a start-up’s sale to a larger company. Much of the recent investment has been flowing to start-ups focused on software, biotechnology, medical devices, the Internet and alternative energy.

John D. Rockefeller tops the list with 192 billion.

When wealth is measured as a percentage of the economy, John D. Rockefeller was the wealthiest American ever. Many of the all-time richest Americans made their fortunes during the Gilded Age of the late 1800’s. Take a look! Take Notice The Only Two Men Showing Their Pearly Whites

MarketWatch’s Stress Test For Shorting a Bear Market

Do you really have what it takes to be a day-trader and profit from both shorting the market when it dips and also timing the turns and capturing the upside when it rallies and surges ahead? Do you know how to anticipate a bear drop and go short, and how to anticipate a bull rally and go long? Do you have the “wisdom to know the difference” while riding the market-timing roller coaster? Tired of the cheeseball interrogation? Here’s an updated pop quiz created to help you test yourself. Find out if you have what it takes to trade short in a bear market, because one’s overdue. Take this 20-question “Market Stress Test.”  Answer each question “Yes” or “No” and keep track of each:

1. You’ve tried more than one new investment strategy this year?
2. Feel you’re buying and selling funds at the wrong time?
3. Rarely open up to anybody for feedback about your losses?
4. Subscribe to two or more newsletters, feel overwhelmed?
5. Can count on one hand all the good laughs this week?
6. Have a lingering resentment about someone or something?
7. You love cable news, but need more extra time to trade?
8. Rarely break a sweat when exercising the past few weeks?
9. Wonder whether you bet too much on recent investments?
10. Need more than three caffeine and alcohol drinks a day?
11. Feel “something” keeps you from making more money?
12. Frequently don’t trust your instincts or your strategy?
13. You’ve had a major family or personal loss recently?
14. Believe losses are caused by the market manipulators?
15. Are you overweight and snack often on comfort food?
16. Fear future trades may fail due to a losing streak?
17. Diet and sleep are disturbed by worries about money?
18. Your retirement portfolio’s not growing fast enough?
19. No vacation in a year, and lack an active social life?
20. Nothing (or everything) interferes with making money?

 Now grade yourself. Add up the number of yes answers. If the total of your stressors (”yes” answers) is eight or more, then short-term trading, market timing and shorting are probably too stressful and risky for you at this time.

At The Beginning of Their Careers, They Set Themselves Apart From The Crowd

When Businessweek came up with a list of the biggest brains in investing, we noticed how much each of them has influenced the way the world invests. And we noticed one other trait: Each saw opportunity well before the pack. John Templeton pushed international investing way before it was cool. Warren Buffett was buying up undervalued companies long before his brand of value investing became popular. Many of the world’s top investors got to the top by being first. They didn’t follow in the footsteps of others or copy wholesale the investing styles of others. They set themselves apart from the crowd. Standing out like that can require a lot of courage, especially on financial markets that, by their very nature, represent the epitome of the herd mentality.

Top investors “think for themselves”. They defy conventionalism. Perhaps this is why any list of the world’s top investors represents a vast array of political beliefs, personality quirks, and strange hobbies. While some keep a low profile, people like Buffett and bond king Bill Gross seem to love regaling others with their views. Another common trait: Most of the top investors, though not all, think long term. They have a confident belief in what their investments ought to be worth at some point in the future, and they stick with it. A long-term focus is crucial when you’re being judged on your record of not just a few months or years, but decades. The top investors usually stay active for several decades, at least. They have been survivors of every type of economy cycle. They’ve survived economic chaos, war, and volatility. True, not all the top investors make money by buying and holding investments. Some, like currency speculator George Soros, profit on the perfectly timed trade. But that requires being an independent thinker, too. Soros must understand conventional wisdom, but he is also willing to challenge it. He has bet billions by going against nations’ central banks.

One thing doesn’t change, however: It helps to be lucky. Even the best of the best can provide a long list of investing mistakes. Sometimes even the best investors wish they could turn back the clock and undo a big blunder. But the brightest minds in investing are nothing if not adaptable, and can even use those missteps to fine-tune their future strategies. While ordinary investors may not be able to match their results, they could certainly profit by taking a page or two from the methods and approaches employed by our brain trust.

Why China’s Problems Could Keep It From Becoming The Next Superpower. Thanks To Their Gov’t Officials

If a mayor announces a plan to reclaim hundreds of acres from the sea and build a massive industrial complex, only a few years later you’d see busy factories, families are living in thousands of new apartments, and 10,000 workers have launched Phase Two. This is the side of China that awes the outside world. The mainland’s extraordinary ability to mobilize people and capital to accomplish daunting feats in record time is the reason it has averaged annual growth of 9.5% for three decades. Why, then, is it so hard for this same government to crack down on exporters of dangerously tainted seafood, toothpaste, and medicine, despite years of warnings by local and foreign experts?

The party has talked for decades about building a social safety net, yet as the working population ages the government isn’t investing nearly enough to head off looming crises in health care, education, and pensions. China spends more than Japan on research and development, according to the Organization for Economic Cooperation & Development (OECD), but its record of innovation is underwhelming. The same policies that have been so successful at boosting the gross domestic product, it turns out, undermine initiatives that might move China’s economy to a higher level. In its pursuit of growth at all costs, China skimped on investments needed to provide basic affordable health care and the regulatory machinery that can enforce environmental, safety, and corporate governance regulations nationwide.

The root of many problems is China’s power structure. Although Beijing holds a monopoly on politics, local Communist Party officials enjoy wide latitude over social and economic affairs and have huge professional and financial incentives to spur GDP growth, which they often do by ignoring regulations or lavishing companies with perks. Even if Beijing has the best intentions of fixing problems such as undrinkable water and unbreathable air, it is often thwarted by hundreds of thousands of party officials with vested interests in the current system. Conjuring ancient Confucianism, President Hu Jintao harps repeatedly on the need to attain a “harmonious society,” implying that China today is anything but. In March, Premier Wen Jiabao labeled the economy “unstable, unbalanced, uncoordinated, and unsustainable.”

To their credit, Chinese officials have unveiled a blitz of corrective measures. Beijing is launching new health-care initiatives, regulating food producers and pirating, trying to tame the runaway stock market, and passing stringent environmental rules. And in 2006 alone, nearly 30,000 officials were prosecuted for corruption. If problems persist, the world will have to keep living with a giant trade partner that can’t guarantee safe products, control piracy, or curb pollution. China could keep growing rapidly for years, but a scenario of dysfunctional administration calls into question whether it will really become an economic superpower. What Beijing does lack is the will to overhaul a political structure that gives party officials down to even the smallest villages huge influence over many facets of economic life.

The roots of China’s ersatz capitalism go back to devil’s bargains made in the 1980s and ’90s to accelerate China’s takeoff. Late paramount leader Deng Xiaoping declared it was O.K. to “get rich,” a green light for legions of cadres to discard their Mao suits and rush into business, often by setting themselves up as middlemen or grabbing stakes in communal assets. Beijing also granted great latitude to provincial and local officials to manage development and social services such as education and health care. The two requirements: Remain loyal to the party and meet high economic-growth targets. That explains why many mainland companies have financial ties to county, city, and township governments. In terms of China’s pollution dilemma, the central government struggles to impose its will on local officials nationwide. A 2006 OECD study says that while pollution fines are rising, they’re usually far below the cost of installing equipment to cut pollution. And authorities often negotiate down the charges. “For the sake of their own political scorecards, some local officials have joined forces with businesses seeking windfall profits,” Pan Yue, SEPA’s deputy chief.

The misplaced economic priorities explain the decrepit state of social services. Compared with spurring growth, social services got the short end of the stick. Government surveys show that nearly half of Chinese say they can’t afford to visit a doctor when ill, 70% lack health insurance, and 30% refuse hospitalization due to cost. Of course, the system is corrupt. Hospitals earn most of their revenue selling drugs, and get kickbacks from pharmaceutical suppliers—creating an incentive to overprescribe.In China, everything seems to come down to the cozy relationship between government and industry. Some 95% of the stocks on the Shanghai bourse are state enterprises, and last year no private companies were permitted to list there. Although, 14 state enterprises did. The reason: By floating 10% to 30% of their shares, state companies can ease their dependence on bank loans without ceding any real control, while insiders make windfalls on the stock offering.

The list of shortcomings in China’s economic model is long, but is it fair to expect any different? It took the U.S. and Europe centuries before they developed modern financial systems and methods for ensuring food safety, providing pensions, and protecting the environment. Americans tend to think China should be held to the same standards that we have today, disregarding that we had the same problems ourselves in the not-too-distant past. So how can China tame the unregulated, raw self-interest that flows from Deng’s historic compromise with the party and the people? By getting the party out of business.

American Titans

The tributes to Sanford I. Weill line the walls of the carpeted hallway that leads to his skyscraper office, with its panoramic view of Central Park. Each heralds Mr. Weill’s genius in assembling Citigroup into the most powerful financial institution since the House of Morgan a century ago. Soon after he formed Citigroup, Congress repealed a Depression-era law that prohibited goliaths like the one Mr. Weill had just put together anyway, combining commercial and investment banking, insurance and stock brokerage operations.These days, Weill and many of the nation’s very wealthy chief executives, entrepreneurs and financiers echo an earlier era (the Gilded Age before World War I) when powerful enterprises, dominated by men who grew immensely rich, ushered in the industrialization of the United States. The new titans often see themselves as pillars of a similarly prosperous and expansive age, one in which their successes and their philanthropy have made government less important than it once was.

“People can look at the last 25 years and say this is an incredibly unique period of time,” Mr. Weill said. “We didn’t rely on somebody else to build what we built, and we shouldn’t rely on somebody else to provide all the services our society needs.” Those earlier barons disappeared by the 1920s and, constrained by the Depression and by the greater government oversight and high income tax rates that followed, no one really took their place. Then, starting in the late 1970s, as the constraints receded, new tycoons gradually emerged, and now their concentrated wealth has made the early years of the 21st century truly another Gilded Age. Such concentration at the very top occurred in 1915 and 1916, as the Gilded Age was ending, and again briefly in the late 1920s, before the stock market crash. Now it is back.

At 74, just over a year into retirement as Citigroup chairman, Mr. Weill sees in Andrew Carnegie’s life aspects of his own. Andrew Carnegie, an impoverished Scottish immigrant, built a steel empire in Pittsburgh, taking risks that others shunned, just as the demand for steel was skyrocketing. He then gave away his fortune, reasoning that he was lucky to have been in the right spot at the right moment and he owed the community for his good luck — not in higher wages for his workers, but in philanthropic distribution of his wealth.

The new Gilded Age has created only one fortune as large as those of the Rockefellers, the Carnegies and the Vanderbilts — that of Bill Gates, according to various compilations. His net worth, measured as a share of the economy’s output, ranks him fifth among the 30 all-time wealthiest American families, just ahead of Carnegie. Only one other living billionaire makes the cut: Warren E. Buffett, in 16th place. Individual fortunes nearly a century ago were so large that just 30 tycoons — Rockefeller was by far the wealthiest — had accumulated net worth equal to 5% of the national income. Their wealth flowed mainly from the empires they built in manufacturing, railroads, oil, coal, urban transit and mass retailing as the United States grew into the world’s largest industrial economy.

Let’s Face It: The World Is A Stage

In a thought-provoking book published last year, Jeffrey Pfeffer and Robert I. Sutton suggest that the overriding impact of leadership on performance is a myth, or at least only a half-truth. 30 years ago, in reviewing research on leadership, Pfeffer concluded at that time that actions of leaders most often explain no more than 10% of performance. Such things as a company’s operating environment, the economy in general, or its long-run success or failure account for more of its current performance.Pfeffer concludes that it may be quite important for leaders to perpetuate the myth of having significant control over performance. As employees, we expect it of our leaders. In our behavior, we defer to leaders. And that reinforces their tendency to act like what we expect of leaders. According to this line of thinking, it may require that a leader act out the role, concealing real feelings in the process. In short, it suggests that some part of leadership is theater that perpetuates the half-truth that leaders are indeed in control.When asked about leadership challenges, Andy Grove, legendary former CEO of Intel, once commented: “Well, part of it is self-discipline and part of it is deception—deception in the sense that you pump yourself up and put a better face on things than you start off feeling. But after a while, if you act confident, you become more confident. So the deception becomes less of a deception.” It may be important for us to believe that our leaders have control over performance, whether or not it is true, particularly in times of turmoil or concern about the future. So to what degree should leaders become thespians, creating an impression that fits expectations? Is some part of leadership about creating the myth of being in control while subtly transferring it to others in the organization?

It’s Zecco meets MySpace

Three decades after San Francisco-based Charles Schwab led an investor revolt against mainstream stock brokerages, an Internet start-up a few miles to the south is redefining the meaning of a discount brokerage. The Burlingame online brokerage’s stock trades are free - hence the name Zecco, an amalgam of letters derived from “zero commission costs.” Giving away free trades - which Goliaths Bank America and Wells Fargo soon matched - isn’t what poses the biggest long-term threat to the established players on Wall Street, analysts say. Some predict it’s just a matter of time before free commissions are widespread.In an attempt to capitalize on the younger generation’s comfort with online social networks, Zecco and a low-commission competitor called TradeKing are fostering virtual “communities” where investors can trade stock tips, boast about their trading prowess and conduct their trades in public view for everyone to analyze.

The Internet has reshaped the brokerage industry by making it less expensive to execute trades and adminis ter accounts. But some analysts think online social networks like Zecco’s could empower do-it-yourself investors and fundamentally disrupt Wall Street’s broker-driven way of life.