Fiscal standoff leaves U.S. payrolls in doubt

WASHINGTON — If the nation goes over the "fiscal cliff," some Americans will wake up Tuesday with financial headaches to rival a New Year's Eve hangover.

More than 2 million long-term jobless would receive their final unemployment benefit check within days. Millions of taxpayers would be unable to file their returns early, resulting in delayed refunds. Taxes would rise immediately on workers across the board. And although some of those increases may eventually be reversed, the first paychecks of the year would be smaller until any legislative fixes kick in.

Even if the crisis is resolved quickly after the new year as pressure mounts on President Obama and lawmakers, it poses a short-term administrative nightmare for businesses. And it would be a financial blow to millions of people struggling to make ends meet in the aftermath of the Great Recession.

"As a working-class person, I would miss any money taken out of my paycheck," said Stephanie Smith, an office administrator in Sacramento. "I just feel that we're already paying high taxes, and it feels like we're still in a recession. Everybody wants to take money out of our paychecks, but nobody wants to put more in."

As the White House and Congress try to avoid the large tax increases and federal spending cuts coming next week, taxpayers, businesses and even the Internal Revenue Service are scrambling to figure out the effects if an agreement is not reached.

The fiscal pain could be averted by a last-minute deal. And even if there is none by Tuesday, Washington policymakers could retroactively reduce tax rates if they ultimately make a deal. But the uncertainty and short-term loss of income could damage an already fragile economy.

Some effects:

Income taxes: Rates would rise on everyone as the George W. Bush-era tax cuts expire. Middle-income households would get hit hard, paying about $1,500 more a year in taxes.

Payroll taxes: Rates would increase by 2 percentage points with the lapse of a temporary, two-year tax cut designed to boost the economy. Workers making $50,000 annually would take home about $40 less every two weeks.

Long-term unemployment benefits: Checks would abruptly end for people receiving extra federal aid — as much as 47 additional weeks of benefits in states such as California. State benefits of up to 26 weeks would still be available, but workers would be out of luck once those run out.

Alternative minimum tax: The number of people facing the provision would skyrocket to about 33 million next year from 4 million this year. The tax, enacted in 1969, was designed to make sure the very wealthy paid some income tax. But it was not indexed to inflation and needs to be fixed each year to avoid ensnaring middle-income households.

Although Congress at some point is expected to spare most of those people from that tax, delays in doing so mean that as many as 100 million people might not be able to file their returns until the end of March or later, according to the IRS. Delays would come as the IRS has to reprogram its system, as well as for taxpayers who would have to do special calculations to determine whether they owe money because of the tax.

Business already are struggling to adjust. They've got to figure out how much in federal taxes to withhold from employee paychecks starting next week. But as of Thursday, the IRS still had not told employers what the 2013 withholding levels would be.

That limbo is particularly vexing for small firms as Golden State Magnetic & Penetrant. The Los Angeles company inspects, cleans and paints aircraft and aerospace components. The firm's president, Joanne Weinoe, does the payroll for herself and her 12 employees. At present, she doesn't know what the withholding should be for the next set of checks she cuts.

"I'm going to tear my hair out of my head and shoot myself," Weinoe joked, adding she'll wait until the morning of Jan. 4, her next payday, before she makes any changes.

"If I have to adjust them, it'll be additional work for me," she said. "Every time they change something, it becomes more work for employers."

The IRS said it continued "to closely monitor the situation" and would "issue guidance by the end of the year."

Workers might not see the new income tax rates immediately reflected in their paychecks. The American Payroll Assn. is advising its members to continue to use 2012 withholding tables until they hear differently from the IRS.

The payroll service Payality Inc., with headquarters in Fresno County, is urging its 700 clients with 25,000 employees throughout the state to hold off on issuing paychecks and making direct deposits for January as long as they can in hopes that lawmakers and the Obama administration will strike a deal.

"We should have some direction by Dec. 31," company President Chet Reilly said. "Then we'll have to scramble as fast as we can."

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12 Tech Moments of 2012 That Made You Say 'WTF?'

The tech world never ceases to amaze. Sometimes, people build amazing things. And sometimes, the people who build amazing things do other stuff that leaves your jaw on the floor. Some of it's good. Some of it is oh so very bad. And some of it is just plain weird.

Here, we give you our 12 most amazing tech moments of 2012. (Click on the images above.) Yes, you'll get all kinds. The good. The bad. And the weird. Lots o' weird.

Above:

Hands down, this is the craziest story of the year. A man is found dead, floating in a pool in Belize, and when authorities try to question his neighbor, Silicon Valley legend John McAfee, he hides overnight beneath a cardboard box and then goes on the run, phoning in dispatches from safe houses and, finally, surfacing in Guatemala where he was the star of a full-fledged international media circus.

McAfee says he's innocent, but he's got a serious credibility problem. He says a lot of things, and not all of them add up. McAfee — the guy who basically invented the computer antivirus industry — is a self-admitted master of social engineering, the art of deceiving others to achieve his own ends. On discussion forums, he's claimed to be an expert on the amphetamine-like drunk known as bath salts, and then later said it was all a joke. In Guatemala, he faked a heart attack to delay his extradition.

When last we heard, McAfee had been extradited to Miami and was heading his way west — staying in cheap motels, and switching into different disguises. Or at least that's what he says.

John McAfee Photo: Brian Finke

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FBI removes many redactions in Marilyn Monroe file

LOS ANGELES (AP) — The FBI has re-issued files it kept on Marilyn Monroe, removing dozens of redactions from entries related to surveillance of the actress for communist ties.

A large section of the files obtained by The Associated Press focuses on Monroe’s 1962 trip to Mexico and her emerging friendship with Frederick Vanderbilt Field, who was disinherited from his wealthy family for leftist views. Field was Monroe’s guide on a trip in which she furniture-shopped for her new home.

The AP appealed the redactions in the file as part of a series of stories on the 50th anniversary of Monroe’s death in 1962, but the bureau previously said it no longer had access to the files. The bureau issued a new version after a request for details on the records’ locations.

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The New Old Age Blog: United States Lags in Alzheimer's Support

This month, the United States Senate Special Committee on Aging released a report examining how five nations — the United States, Australia, France, Japan and Britain — are responding to growing numbers of older adults with Alzheimer’s disease and dementia.

Every country has a strategy, but some are much further ahead than others. Notably, France began addressing Alzheimer’s disease and dementia in 2001 and is in the midst of carrying out its third national plan. (Scroll down at this link to find the English version of the 2008-2012 French plan.)

By contrast, the United States released its first national plan to address Alzheimer’s in May.

The Senate report highlights several trends under way in all five countries, including efforts to coordinate research more effectively, diagnose Alzheimer’s disease more reliably and improve training in dementia care by medical practitioners.

Most relevant to readers of this blog is another trend with increasing international scope: an accelerating effort to keep patients with Alzheimer’s disease and other forms of dementia at home and arrange for care and treatment there, rather than in institutions.

Anyone who’s followed reader response to Jane Brody’s column this week on aging in place knows the burden that this can place on families, especially if government support for home-based services (companions or home health aides who help with bathing, dressing, toileting and other tasks), adult day care or respite care is scarce or nonexistent, as is the case for most middle-class families in the United States.

Is care at home for patients with Alzheimer’s necessarily more humane? Only if caregivers have the resources — financial, physical and emotional — to handle this draining, exhausting, immeasurably difficult job. And only if the institutions that serve people with more advanced forms of Alzheimer’s disease and other types of dementia are so poorly financed, staffed and operated that we wouldn’t feel comfortable leaving loved ones in their care.

Three charts in the new Senate report underscore the extent to which the United States differs from other countries in what is expected of family caregivers. The first, on Page 60, shows countries’ support for paid long-term care services for residents age 65 and older. This includes all residents who need long-term care, including those with Alzheimer’s disease, other forms of dementia and other disabling chronic illnesses. Not included are services provided by unpaid family caregivers.

Look at where the United States ranks compared with Australia, Japan, France and the 30 other developed countries that belong to the Organization for Economic Cooperation and Development. Paid support for long-term care is much less in our country than in theirs.

The second chart, on Page 64, gives a sense of how much paid support for long-term care is provided in people’s homes. Again, the data is not specific to Alzheimer’s disease or dementia, although these are primary reasons older adults need long-term care.

And again, the United States falls short in terms of the amount of paid care it provides in home settings, even though older people tend to prefer these settings over institutions.

The third chart, on Page 75, brings results in the other two down to the level of families. When paid long-term care support is scarce or unavailable, you would expect a heavier load to fall on unpaid caregivers, and this is what the chart shows. Look at the number of caregivers in the United States who put in 10 to 19 hours a week (34.2 percent) or 20 hours or more a week (30.5 percent), and compare those with similar figures for France, Australia and Britain, all of which provide more paid long-term care than we do. Where are informal caregivers working the hardest? Right here at home in the United States.

For me, the take-away is clear. Other countries with which the United States is closely aligned have embraced long-term care as an essential social responsibility while we have not. Unless and until we do so, caregivers here will be among the most harried, stressed and burdened among wealthy, developed countries in the world.

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Autonomy's Lynch Defends Record as HP Confirms Federal Probe

LONDON (Reuters) - Mike Lynch, the founder of the software firm sold to Hewlett-Packard last year in a deal tainted by accusations of accounting fraud, said he would defend the company's accounts to U.S. Federal investigators.

HP confirmed in a filing late on Thursday that the U.S. Department of Justice was investigating Autonomy's books.

The PC and printer maker bought the British company for $11 billion last year to lead its push into the more profitable software sector.

Autonomy did not deliver the growth expected, resulting in Lynch's departure earlier this year.

But worse was to come last month when HP wrote off some $5 billion of the company's value and accused its former management of accounting improprieties that inflated its value.

The Silicon Valley company said it had passed information from a whistleblower to the U.S. Department of Justice, the SEC and Britain's Serious Fraud Office.

"On November 21, 2012, representatives of the U.S. Department of Justice advised HP that they had opened an investigation relating to Autonomy," it said in the filing.

"HP is cooperating with the three investigating agencies."

Lynch launched a robust defense of his track record almost immediately after HP made the accusations.

He said on Friday that he was still waiting for a detailed calculation of HP's $5 billion writedown of Autonomy's value and a published explanation of the allegations.

"Simply put these allegations are false, and in the absence of further detail we cannot understand what HP believes to be the basis for them," he said in a statement.

"We continue to reject these allegations in the strongest possible terms. Autonomy's financial accounts were properly maintained in accordance with applicable regulations, fully audited by Deloitte and available to HP during the due diligence process."

Lynch said he had not been approached by any regulatory authority, but he would co-operate with any investigation and looked forward to the opportunity to explain his position.

HP has refused to concede to Lynch's demands for more information about the allegations.

"While Dr. Lynch is eager for a debate, we believe the legal process is the correct method in which to bring out the facts and take action on behalf of our shareholders," it said in response to an open letter from Lynch last month

"In that setting, we look forward to hearing Dr. Lynch and other former Autonomy employees answer questions under penalty of perjury."

(Reporting by Paul Sandle; Editing by Helen Massy-Beresford)

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A risky return to the U.S.

The barrilero never stops moving.

All day he wheels cardboard barrels stuffed with used clothing through the narrow aisles of the warehouse. He dumps the apparel atop tables for sorters, who separate nylons from cottons, satins from silks, denims from plaids. If a sorter is standing around with no garments, it's the barrilero's fault. Supervisors hover nearby.

Tons of old clothing come in every week, and tons go back out, to India and Pakistan, where it's sold at outdoor markets.

The factory hired the barrilero in September, a few weeks after the now-21-year-old showed up at the manager's door looking for work. Right away, the manager had recognized him as Anthony, that cute kid who walked his factory floor selling Helen Grace chocolates to workers years ago.

Anthony didn't say much about where he'd been, or what he'd been doing since. He was polite, upbeat, and his knock on the door still had the soft touch of a child. But his hair was falling out, and there was something unfamiliar in his eyes.

"He seemed sadder," the manager said, "like he wanted to say something but didn't know how."

There were many things the barrilero would keep to himself. First among them: His name wasn't Anthony.

::

Luis Luna returned to his hometown of South Gate in May. His arms and legs were scraped raw from cactus needles and his eyes kept blinking, still starved of moisture from his eight-day journey through the Arizona desert the week before.

His friend, Julio Cortez, said it was hard to believe that this gaunt young man with patches of missing hair was the same person he knew at Southeast Middle School.

"I was in shock to see him back and see all he had gone through," Cortez said. "It made me sad and angry."

Cortez, a 22-year-old Cal State Long Beach student, took Luis to buy some clothes. Another former classmate gave Luis a cellphone. Luis slept on couches and in spare bedrooms and spent his days passing out resumes filled with the jobs of his teen years: flipping burgers, waiting tables at I-Hop. He fudged the dates to account for the 15 months he spent in Mexico after he was deported for being in the country illegally.

Luis had been pulled over three years ago for a broken headlight in Pasco, Wash., where he and his mother lived. He was cited for driving without a license, jailed and ordered out of the country in February 2011.

He had a wife back in Washington, but she had left him, in part because of the long separation. Luis decided to build a new life in Southern California, where he had grown up and where he still had friends

Weeks after arriving, he was still jobless and borrowing money to eat when he decided his future might lie in his past. He started retracing the route he took as a boy selling chocolates at warehouses and factories. The assembly line workers, truck drivers and managers knew him as Anthony, the name his mother told him to use to hide his identity.

They could vouch for his strong work ethic — that he'd been working for a living since he was 5 years old.

He eventually found the barrilero job, and a place to live. A swap meet vendor who picked through the bins of cast-offs looking for vintage garments told Luis he had extra space at his house.

Luis goes home to a converted two-car garage with no address in a middle-class neighborhood with trim lawns and streets lined with late-model cars. Much of his clothing is stuffed in a battered dark green suitcase that sits at the foot of his bed. The only other furniture is a mini refrigerator and two lawn chairs.

In some ways, he's a typical youngster with edgy tastes. He has a sleeve tattoo, wears skinny jeans and earrings, and is part of a deejay crew that plays at house parties. He cheers his beloved Los Angeles Lakers and hangs out in hookah bars, and is constantly texting flirty messages.

But his future is dimmer than most. Many of his friends are planning for life after college. Some are applying for work permits and temporary reprieves from deportation, taking advantage of an Obama administration program, announced in June, to help young people who were brought into the country as children.

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New Year's Resolutions From 10 Top Minds and Makers

Every New Year people around the globe resolve to get healthy by joining gyms, eating better and quitting the detrimental habits that we complain about for the remaining eleven and a half months. We applaud those efforts, but propose that in 2013, we don't just work on our waistlines, but on our hacking, coding, soldering and making skills as well.

We've gathered 10 DIY experts to get their proposed New Year's resolutions, including repurposing forgotten materials and 3-D printing less stuff. And documenting projects better, something you'll hear from a few of them. Read up, then get to your workshop.

Here's to an inspired and productive 2013.

Above:

Resolution: In the new year, makers should develop the new means of maker finance, distribution and publicity: meaning the likes of Kickstarter, Etsy and the tech-art and design blogs. Beware the focused interest of Google, Apple, Microsoft, Facebook, Amazon and the Defense Department. They're not your friends.

Bruce Sterling runs the locked account @bruces on Twitter

Photo: Courtesy Bruce Sterling

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Marvel’s Peter Parker in perilous predicament

PHILADELPHIA (AP) — After 50 years of spinning webs and catching a who’s who of criminals, Peter Parker is out of the hero game.

But Spider-Man is still slinging from building to building — reborn, refreshed and revived with a new sense of the old maxim that Ben Parker taught his then-fledgling nephew that “with great power, comes great responsibility.”

Writer Dan Slott, who’s been penning Spidey adventures for the better part of the last 100 issues for Marvel Entertainment, said the culmination of the story is a new, dramatically different direction for the Steve Ditko and Stan Lee-created hero.

“This is an epic turn,” Slott said. “I’ve been writing Spider-Man for 70-plus issues. Every now and then, you have to shake it up. … The reason Spider-Man is one of the longest running characters is they always find a way to keep it fresh. Something to shake up the mix.”

And in the pages of issue 700, out Wednesday, it’s not just shaken up, it’s turned head over heels, spun in circles, kicked sky high and cracked wide open.

Parker’s mind is trapped in the withered, decaying dying body of his nemesis, Doctor Octopus aka Otto Octavius. Where’s Doc Ock? Inside Parker’s super-powered shell, learning what life is like for the brilliant researcher who happens to count the Avengers and Fantastic Four as friends and family.

The two clash mightily in the pages of issue 700, illustrated by Humberto Ramos and Victor Olazaba. But it’s Octavius who wins out and Parker is, at least for now, gone for good, but not before one more act of heroism.

Slott said that it’s Parker, whose memories envelop Octavius, who shows the villain what it means to be a hero.

“Gone are his days of villainy, but since it’s Doc Ock and he has that ego, he’s not going to try and just be Spider-man, he’s going to try to be the best Spider-Man ever,” said Slott.

Editor Stephen Wacker said that while Parker is gone, his permanence remains and his life casts a long shadow.

“His life is still important to the book because it affects everything that Doctor Octopus does as Spider-Man. Seeing a supervillain go through this life is the point — trying to be better than the hero he opposed,” Wacker said.

“Doc has sort of inspired by Peter’s life. That’s what I mean when he talks about the shadow he casts,” he said.

The sentiment echoes what Uncle Ben said in the pages of “Amazing Fantasy” No. 15, Slott said.

Editor Stephen Wacker called it a fitting end to the old series, which sets the stage for a new one — “The Superior Spider-Man” early next year — because it brings Peter Parker full circle, from the start of his crime-fighting career to the end.

“In his very first story, his uncle died because of something he did so the book has always been aimed at making Peter’s life as difficult as possible,” Wacker said. “The book has always worked best when it’s about Peter Parker’s life, not Spider-Man’s.”

And with Octavius influenced by Parker’s life — from Aunt May to Gwen Stacy to Mary Jane — it will make him a better person, too.

“Because Doctor Octopus knows all of those things and will make decisions on what he saw Peter going through,” Wacker said. “In a way, he gets the ultimate victory as he becomes a better hero.”

___

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___

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Creating the Ultimate Housework Workout

Robert Wright for The New York Times

Chris Ely, an English butler, and Carol Johnson, a fitness instructor at Crunch NYC, perfecting a houseworkout.

CAN housework help you live longer? A New York Times blog post by Gretchen Reynolds last month cited research linking vigorous activity, including housework, and longevity. The study, which tracked the death rates of British civil servants, was the latest in a flurry of scientific reports crediting domestic chores with health benefits like a lowered risk for breast and colon cancers. In one piquant study published in 2009, researchers found that couples who spent more hours on housework had sex more frequently (with each other) though presumably not while vacuuming. (The report did not specify.)

Intrigued by science that merged the efforts of a Martha with the results of an Arnold (a buffer buffer?), this reporter challenged a household expert and a fitness authority to create the ultimate housework workout — a houseworkout — in her East Village apartment. Perhaps she could add a few years to her own life while learning some fancy new moves for her Swiffer. Christopher Ely, once a footman at Buckingham Palace, and Brooke Astor’s longtime butler, was appointed cleaner-in-chief. Mr. Ely is a man who approaches what the professionals call household management with the range and depth of an Oxford don. Although he is working on his memoirs (he described his book as a room-by-room primer with anecdotes from his years in service), he was happy enough to put his writing aside for an afternoon. His collaborator was Carol Johnson, a dancer and fitness instructor who develops classes at Crunch NYC, including those based on Broadway musicals like “Legally Blonde” and “Rock of Ages.”

Mr. Ely arrived first, beautifully dressed in dark gray wool pants, a black suit coat and a crisp white shirt with silver cuff links. He cleans house in a white shirt? “I know how to clean it,” he countered, meaning the shirt. When Ms. Johnson appeared (in black spandex and a ruffly white chiffon blouse, which she switched out for a Crunch T-shirt), theory, method and materials were discussed.

“If you’re dreading the laundry,” Ms. Johnson said, “why not create a space where it’s actually fun to do by putting on some music?” If fitness is defined by cardio health, she added, it will be a challenge to create housework that leaves you slightly out of breath. “I’m thinking interval training,” she said. As it happens, one trend in exercise has been workouts that are inspired by real-world chores, or what Rob Morea, a high-end Manhattan trainer, described the other day as “mimicking hard labor activities.” In his NoHo studio, Mr. Morea has clients simulate the actions of construction workers hefting cement bags over their shoulders (Mr. Morea uses sand bags) or pushing a wheelbarrow or chopping wood.

Mr. Ely averred that service — extreme housekeeping — is physically demanding, with sore feet and bad knees the least of its debilitating byproducts. Mr. Ely still suffers from an injury he incurred while carrying a poodle to its mistress over icy front steps in Washington When the inevitable occurred, and Mr. Ely wiped out, he threw the dog to his employer before falling hard on his backside. And the right equipment matters: After two weeks’ employ in an Upper East Side penthouse, he was handed a pair of Reeboks by his new boss, the better to withstand the apartment’s wall-to-wall granite floors. (For cleaning, Mr. Ely wears slippers, deck shoes or socks.)

Mr. Ely, whose talents and expertise are wide-ranging (he can stock a wine cellar, do the flowers, set a silver service, iron like a maestro and clean gutters, as he did once or twice at Holly Hill, Mrs. Astor’s Westchester estate), is a minimalist when it comes to materials. He favors any simple dish detergent as a multipurpose cleaner, along with a little vinegar, for glass, and not much else. “Dish detergent is designed for cutting grease; there’s nothing better,” he said. He’s anti-ammonia, anti-bleach. He said bleach destroys fabric, particularly anything with elastic in it. “Knickers and bleach are a terrible combination,” he said. “I had a boss who thought he had skin cancer. His entire trunk had turned red and itchy.” It seems his underpants were being washed in bleach. (Collective wince.) “It’s horrible stuff.”

As for tools, he likes a cobweb cleaner — this reporter had bought Oxo’s extendable duster, which has a fluffy orange cotton duster that snaps onto a sort of wand, but Mr. Ely prefers the kind that looks like a round chimney brush. (If you live in a house, he also suggests leaving the cobwebs by the front and back doors, so the spiders can eat any mosquitoes coming or going.) Choose a mop with microfiber fronds (he suggested the O Cedar brand) because it dries quickly and doesn’t smell. And a sturdy vacuum. Also, stacks of microfiber cloths or a terry cloth towel ripped up.

But first, to stretch. Ms. Johnson took hold of this reporter’s Bona floor mop (it’s like a Swiffer, but with a reusable washcloth) and Mr. Ely followed along with an old-fashioned string mop. Though Mr. Ely has a kind of loose-limbed elegance, he is not exactly limber. He grimaced as he parroted Ms. Johnson, who used her mop as Gene Kelly did his umbrella, stretching her arms overhead, one by one, twisting from side to side, sucking in her stomach, rising up on tip toes. (Mr. Ely said his old poodle-hurling injury was kicking in.) Ms. Johnson adjusted his chin — “You’re going to hurt yourself if you keep sticking your neck out,” she warned — and Mr. Ely raised a black-socked foot napped with cat hair and chastised this reporter: “Would you look at that?” (The cat had vanished early on, but his “debris,” as Mr. Ely put it, was still very much in evidence. The reporter hung her head. Did she know that cat spit is toxic? Mr. Ely wondered.)

“We’re warming up the spine,” said Ms. Johnson. “Squeeze your abdominals.”

Mr. Ely looked worried: “I don’t think I have abdominals!”

MR. ELY’S technique is to clean a room from top to bottom. That means he begins with the cobweb cleaner, wafting it along ceiling corners, moldings, soffits and, uh, the top of the fridge (major dust harvest there). His form was pretty, like a serve by Roger Federer, if not exactly aerobic. For Mr. Ely kept stopping to lecture this reporter — on condensation; on the basic principles of heat transfer and why one needs to vacuum the refrigerator coils; on the movement of moist air in a kitchen; on floor care, which involved a long story about a Belgian monastery whose inhabitants never washed the kitchen floor; on how to dust the halogen spot lights (use a cotton cloth, not a microfiber one, and make sure the lights are off, and cool).  “I do rabbit on, don’t I?” he said. Ms. Johnson gamely hustled him along, noting that anytime you raise your arms over your head you can raise your heart rate. “What about a balance exercise?” she cajoled, executing a neat series of leg lifts. “That’s good for the butler’s booty!”

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DealBook: Looking for Opportunity Where Few Others Invest

PHNOM PENH, Cambodia — Investors started poking around for deals here five years ago, as the war-torn country began to move past its legacy of genocide and coups. When the global financial crisis struck, Cambodia’s fast-growing economy crashed and the dollars flowing from abroad evaporated.

Douglas Clayton stayed put. In the midst of the crisis, he raised $34 million, starting the first investment fund focused on Cambodia.

“High risk also means the potential for high returns,” said Mr. Clayton, the founder of Leopard Capital.

Persistence can pay in this frontier market of 15 million people. Despite some rocky deals, the fund over all has posted solid gains on several investments, according to Leopard Capital. The three investments sold so far by Leopard have generated average annual returns of 36 percent.

“We got in early and have done well,” said Mr. Clayton, 52.

Building on the experience, Mr. Clayton is expanding into other regions with similar characteristics. This year, Leopard Capital started the first big investment fund in Haiti, backed by economic development organizations like the World Bank’s International Finance Corporation. In coming months, he plans to start portfolios focused on Myanmar, Bangladesh and Mongolia. He also plans the first investment fund for Bhutan, which has been reticent about outside money.

“We are trying to pioneer this investment class,” he said. “We can put money in places it’s never really been, and get good results.”

He will have to tread cautiously. Mr. Clayton is moving into treacherous investment territory, plagued by infrastructure problems, corruption, political instability and weak or nonexistent regulatory leadership. For example, Mongolia’s economy is on shaky ground after a series of political maneuvers left foreign investors nervous.

“We’ve proven ourselves here in Cambodia, and feel we can go anywhere,” Mr. Clayton said.

The potential payoff can be substantial. Some investors can double or triple their capital, according to Kathleen Ng, managing director at the Center for Asia Private Equity Research, which tracks fund performance in the region.

Ms. Ng said that China has been the hottest area for investment in Asia for years, but as returns have peaked, many began looking further afield, to places like Vietnam and Indonesia. Countries like Cambodia, Laos and Bangladesh — all Leopard targets — are just now getting on investors’ radars.

“Frontier markets really attract a different investor,” Ms. Ng said. “For the right fund — and a first mover — you can make a lot of money.” Even now, Ms. Ng notes, Leopard remains one of the few private equity funds focused exclusively on the region.

Still, investors need strong reserves to make money in such far-flung places. Returns can be choppy. Over the last five years, an index that tracks the frontier markets around the world is off nearly 42 percent, according to data from Thomson Reuters.

“On the surface, there is so much opportunity here,” said Nicholas Lazos, an investment manager at Insitor, a fund in Cambodia. “But executing is quite difficult.”

Mr. Clayton knows the challenges, having spent much of his career in Asia,

Originally from Madison, Conn., Mr. Clayton graduated from Cornell in 1982 and then served four years in the Army. While stationed in Korea, he became enamored with Asia.

After leaving the Army in 1986, he moved to Hong Kong and persuaded Sun Hung Kai Securities to give him a job as a trader, despite his lack of experience. “China was just opening up,” he said. “This company wanted some foreigners. I got hired and traded to learn.”

Three years later, he was hired by Kerry Securities to head its investment research in Thailand. In 1999, he opened his own firm in Bangkok, Abacas Equity Partners. The firm specialized in distressed assets, plentiful in Thailand after the Asian currency crisis of 1997.

He made his first trip to Cambodia in 2005, during a period of personal reflection. His first marriage had ended, and he was weary of the frenetic pace in Asian hot spots like Singapore, India, Thailand and Hong Kong.

Cambodia reignited his drive. “It was kind of spooky and scary,” he recalled. Yet he also sensed unique opportunity. “Nobody was here yet. It was really unknown, and exciting.”

He started the Leopard Cambodia Fund in April 2008 with $10 million, mainly from family and friends. Then prospects dried up in the global crisis. Many other firms withdrew from the country.

Mr. Clayton remained committed. Over the next two years, he visited 50 cities around the globe, pitching investment opportunities in Cambodia. He originally aimed for a goal of $100 million for the fund, but scaled back during the global financial crisis. “It was a hard sell,” he said.

Since then, he has invested about $36 million in a dozen companies, placing small bets in various industries. He put $5 million into Acleda Bank, a stake that has soared, and earned double-digit gains on telecoms and utilities in the region.

The money manager has experienced his share of difficulties. The firm took an aggressive stance with Nautisco Seafood, buying debt and forcing a restructuring.

Leopard wound up in court over the deal. The founders charged Leopard with interference, a situation that resulted in big layoffs and an eventual takeover. Leopard denied the allegations, and the suit was eventually dismissed.

Mr. Clayton is applying his experience to investment opportunities across Asia and beyond.

The private equity firm has started the Leopard Haiti Fund, supported by the International Finance Corporation, the Netherlands Development Finance Company and the Multilateral Investment Fund. These three agencies committed $20 million to the fund, which will focus on shifting capital into food processing, tourism, affordable housing and renewable energy.

“This is a big signal to investors looking at Haiti,” said Sergio A. Pombo, an investment officer at the I.F.C.

Mr. Clayton has also looked to the I.F.C. for support in Bangladesh, where Leopard plans to start a $100 million fund. Mr. Clayton compared Bangladesh to neighboring India a few decades ago, with a large, low-cost labor force.

Leopard is also contemplating starting a $15 million to $20 million fund for Bhutan, a former Buddhist kingdom in the Himalayas. Bhutan has no investment funds operating in the country, few industries and only 700,000 people.

Mr. Clayton is most bullish about Myanmar, which is going through major political changes. Largely closed to Western investment by the military regime that has ruled for decades, Myanmar, formerly known as Burma, is suddenly open for business.

“This will be a real core country for Leopard in the future.” He predicted the trajectory will follow other Asian nations in the 1980s to 1990s, only at a more rapid pace. “It really seems full speed ahead.”

Still, he cautioned that challenges remained. Foreign investment laws have only recently been announced, and many industries remain closed. Hotels in the capital of Yangon are packed with business delegations, but many outside investors complain that there are few surefire deals, and corruption is a major worry.

Still, Mr. Clayton is focused on the long-term picture for these frontier markets. “These places can be good for investment,” he said. “You just need to do your research, build good local teams and make the right deals.”

A version of this article appeared in print on 12/27/2012, on page B3 of the NewYork edition with the headline: Looking for Opportunity Where Few Others Invest.

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