User login

Time Magazine Latest Money News

Subscribe to Time Magazine Latest Money News feed Time Magazine Latest Money News
The latest news and commentary on the economy, the markets, and business
Updated: 1 year 2 months ago

Ikea Spikes Article on Lesbian Couple in Russia

Wed, 11/20/2013 - 1:52pm
Ikea said Wednesday that it removed an article about a lesbian couple from the Russian edition of its consumer magazine because of anti-gay “propaganda” laws in the country. The article, about the couple living with their child in London, appeared in the December edition of the Swedish furniture retailer’s club magazine that is available to customers in 25 markets worldwide, the Associated Press reports. Russia has come under fire ahead of the 2014 Winter Olympics in Sochi for its record on gay rights, including a recent law that bans “propaganda of non-traditional sexual relations.” Ikea, which faced criticism last year for removing images of women from the Saudi version of a furniture catalog, spiked the story in Russia following advice from legal experts, spokesperson Yiva Magnusson said. [AP]
Categories: Financial News

Thanksgiving Is the New Black Friday

Wed, 11/20/2013 - 1:00pm
Macy’s, JCPenney and Kmart have recently come under fire for opening doors on Thanksgiving, but research suggests they might benefit from the additional hours. Research firm Placed released predictions for this year’s seasonal retail wars and found that despite the backlash, nearly a quarter of smartphone users surveyed plan to shop on Thanksgiving. The firm surveyed 14,645 users about their holiday plans. While 45 percent said they still intend to shop on Black Friday, the day after Thanksgiving that typically kicks off the holiday shopping season, 22 percent indicated they’ll shop on the holiday itself. Those shopping on Thanksgiving said they are most likely to head to Macy’s, JCPenney, Sears, Best Buy and Target. However, 46 percent of those getting a head start on Thanksgiving will shop online due to the limited number of open stores. Place also identified Aeropostale, Ross, Forever 21, Apple and American Eagle Outfitters as major chains missing out on an opportunity to boost holiday profits by opening on Thanksgiving. While online shopping continues to be a growing trend, the research found that book, toy, beauty and sporting stores are at the highest risk of “showrooming,” when consumers browse brick-and-mortar stores and then purchase items online.
Categories: Financial News

Nissan’s Versa Note: Versatile and Thrifty

Wed, 11/20/2013 - 12:54pm
Nissan’s small Versa hatchback, renamed the Versa Note for 2014, is a low-priced, high-utility car with an attractive, fresh exterior, notable fuel economy and a surprisingly roomy back seat that accommodates even 6-foot adults. The five-seat Versa Note also offers high-tech features not found in other hatchbacks, such as an all-around-view camera system that lets the driver see what is nearby the car on all four sides. Drivers will appreciate that the Note with its 109-horsepower, four-cylinder engine is rated by the federal government at 31 miles per gallon in city driving and 40 mpg on the highway. This top rating is for Notes equipped with a fuel-thrifty continuously variable transmission (CVT). Unfortunately, though, the Versa Note’s engine power is lower than many competitors’. And while the Note is a new version of Nissan’s Versa line, the Note’s safety rating in frontal crash testing by the federal government isn’t any better than the three out of five stars that the longer-running Versa sedan received. Standard safety features on all Notes include frontal, side and curtain air bags, antilock brakes and electronic stability control. Starting manufacturer’s suggested retail price, including destination charge, of $14,800 for a base, 2014 Note is lower than many competitors’. As an example, the base, 2013 Honda Fit hatchback has a starting retail price of $16,215. But be aware that the base Versa Note S comes with five-speed, manual transmission that produced a lower government fuel mileage rating of 27/36 mpg. The base Note also has manual, roll-down windows and a steering wheel that tilts but does not telescope. In comparison, the base Fit with five-speed manual and higher-power, 117-horsepower, four-cylinder engine comes standard with power windows, a tilt and telescoping steering wheel and cruise control, among other things. Meantime, the 2014 Ford Fiesta hatchback, which is 3 inches shorter in overall length than the Note, has a starting MSRP, including destination charge, of $15,395 with five-speed manual and 120-horsepower, four-cylinder engine. The base Fiesta comes standard with telescoping and tilt steering wheel, rear spoiler, Ford’s Sync
Categories: Financial News

3 Ways Ben Bernanke Revolutionized the Fed

Wed, 11/20/2013 - 12:11pm
Ben Bernanke’s eight-year reign as the global economy’s most influential man is coming to a close, and the Fed Chair is taking to the lecture circuit to encapsulate and defend his tenure, which may prove to be the most revolutionary in the central banks 100-year existence. Last night, Bernanke spoke at the National Economists Club Annual dinner, giving a speech which summarized the most important innovations he instituted at the Federal Reserve. Here are the three ways in which Ben Bernanke forever changed America’s central bank: 1. Transparency and Communication: With both markets and the media paying such close attention to each new pronouncement from Ben Bernanke and the Fed, it’s amusing to think that before 1994, the Fed didn’t even announce to the public when it decided to change it’s target interest rates. Over the course of the Fed’s history, it has moved closer and closer towards a policy of transparency, both for the sake of transparency itself and because of the realization that by being forthright about its plans for future actions, the Fed can more effectively manage the economy. But no Fed Chair has steered the central bank in the direction of transparency more than Ben Bernanke. Early on in his tenure, Bernanke broke tradition and sat down for an extended television interview with 60 minutes. He has also held regular press conferences to better explain monetary policy decisions, and gave a series of lectures at the George Washington University to explain the Fed’s response to the financial crisis. 2. Forward Guidance: These acts of transparency are helpful in allowing the press and public to better understand the Federal Reserve, but the most consequential step taken towards transparency was the decision to tell markets about Fed board members expectations for future monetary policy. By explaining where it felt it short-term interest rates would be years into the future, Bernanke believes the bank can get a bigger bang for its policy buck. For instance, by assuring investors that short-term interest rates will remain at zero at least until the
Categories: Financial News

Rupert Murdoch, Wife Reach Divorce Deal in NYC

Wed, 11/20/2013 - 10:23am
(NEW YORK) — Media baron Rupert Murdoch and his wife, Wendi Deng Murdoch, have reached a divorce settlement. The two appeared in a New York court Wednesday to tell a judge they’ve reached a deal to end their 14-year marriage. Terms weren’t disclosed. The Murdochs say in a joint statement that the settlement was amicable. It says they’ll move forward with “mutual respect” and a shared interest in their daughters’ welfare. It was the third marriage for 82-year-old Rupert Murdoch, who leads 21st Century Fox and News Corp. The divorce won’t affect control of the companies or the succession plan for them. Rupert Murdoch controls them through a family trust that benefits his four children from previous marriages. He and 44-year-old Wendi Deng Murdoch have two school-age daughters. They are beneficiaries of 8.7 million non-voting shares being held in a separate trust.
Categories: Financial News

U.S. Business Stockpiles Up 0.6 Percent in September

Wed, 11/20/2013 - 9:43am
(WASHINGTON) — U.S. businesses increased their stockpiles in September by the largest amount in eight months while sales posted a modest gain. The Commerce Department says business inventories rose 0.6 percent in September compared with August. Sales rose 0.2 percent. A big jump in restocking helped drive faster economic growth from July through September. But there is concern that a pullback in inventory rebuilding will dampen growth in the current quarter. Rising stockpiles boost growth because they mean more factory production. The September rise in inventories was the largest since a 1 percent increase in January. It pushed total inventories to $1.68 trillion, up 3.1 percent from a year ago.
Categories: Financial News

U.S. Existing Home Sales Fall 3.2 Percent in October

Wed, 11/20/2013 - 9:39am
(WASHINGTON) — Fewer Americans bought existing homes in October, as higher mortgage rates, the 16-day partial government shutdown and a limited supply of homes reduced sales. The National Association of Realtors says home re-sales fell 3.2 percent last month from September to a seasonally adjusted annual pace of 5.12 million. That’s down from a 5.29 million pace in August and the slowest since June. Sales of existing single family homes declined 4.1 percent, while condominium sales rose 3.3 percent. The median sales price of an existing home was $199,500 in October, up 12.8 percent from a year earlier and the 11th straight month of double-digit annual increases. First-time home buyers accounted for just 28 percent of sales, down from 40 percent in healthier housing markets.
Categories: Financial News

GM Re-Enters Small-Pickup Market With Colorado

Wed, 11/20/2013 - 9:17am
(DETROIT) — GM has reimagined its small pickup truck to cater to outdoorsy folks who haul smelly wet dogs and kayaks. In other words, Subaru buyers. The new Chevrolet Colorado, to be unveiled Wednesday at the Los Angeles Auto Show, has little in common with the old version, which was noisy with a cheap-looking hard plastic interior that didn’t appeal to many buyers. The 2015 model weighs 900 pounds less and is 16 inches shorter than its brawny cousin, the full-size Chevy Silverado. And it’s equipped with bike racks and other accessories that GM hopes will lure Subaru customers — relatively affluent people that GM calls “lifestyle” buyers. To do so, GM knows it must make in-roads in California, Colorado, New York and other places where such buyers are abundant. Subaru’s sales, led by the Forester small SUV, have grown more than 61 percent in the past two years. Subaru doesn’t sell a pickup, but its all-wheel-drive hatchbacks are popular with people who spend a lot of time outdoors, particularly on the coasts. GM wants to replicate that success with a U.S. brand. “If there was a brand, a domestic brand, that could fill that space and really provide those types of things, we thought Chevy was a good place to do it,” said Alan Batey, global Chevrolet chief, at a preview of the Colorado last week in Detroit where he spoke while standing beneath giant posters of people surfing, skiing and bicycling. The Colorado, and its GMC sister, the Canyon, also will be aimed at another market: workers who need trucks, but not as big as the Silverado or the GMC Sierra. The smaller trucks, Batey said, do more than look good. “We didn’t want to just create a really pretty truck that’s accessorized but can’t do anything,” he said. In the late 1990s, the small-truck market in the U.S. was over a million vehicles, but as automakers like Ford and GM pulled out, it dwindled to less than 300,000 annually. GM stopped making the old Colorado last year.
Categories: Financial News

Customize Me: McDonald’s Testing Biggest Burger Change in Decades

Wed, 11/20/2013 - 8:41am
McDonald’s of supersize fame is now exploring the “made-to-order” model, in an effort to compete with growing competition around the country. The world’s biggest hamburger chain is giving customers control of tailoring burgers through wall-mounted iPads in Laguna Niguel, Calif. and Romeoville, Ill., the Associated Press reports. The move comes as mounting competition from chains like Five Guys Burgers and Fries and Chipotle make the “build-your-own” model more popular. The company said it’s too early to tell if the pilot will expand nationally to its more than 14,000 locations, but it is installing “assembly tables” to make room for more ingredients. The new order format means that customers may have to pay more and wait longer. The restaurant is also offering new signature sandwiches with upscale ingredients, including the SoCal burger, which comes a bakery-style bun with white cheddar cheese and chili-lime tortilla strips. [AP]
Categories: Financial News

Not To Be a Grinch, But Holiday Shopping Is Looking Pretty Bad This Year

Wed, 11/20/2013 - 7:59am
Retailers are starting Black Friday sales almost a week early, but that might not be enough to save a dismal holiday shopping season. ShopperTrak predicts sales growth of just 2.4 percent, the smallest increase since 2009, Bloomberg reports. Stores are rolling out deals with rock-bottom prices to clear excess inventory, as consumers are spending modest discretionary income earlier and earlier in the holiday shopping season. “Whichever retailers get those dollars first will win,” Candace Corlett of the consulting firm WSL Strategic Retail told Bloomberg. So even though retailers like Macy’s will be open on Thanksgiving and Walmart is trying to pique consumer interest with big sales (like a television for $98), it might not be enough to save Christmas. Or Christmas sales, at least. It’s not all bad news for retailers. Retails sales jumped 0.4 percent in October, their best gain since July, as Americans spent on cars, clothing and furniture and calmed fears that the government shutdown would dent consumer spending, the Associated Press reports. And JCPenney reported better-than-expected third-quarter earnings on Wednesday.
Categories: Financial News

Steve Ballmer Doesn’t Want His Successor to Kill the Xbox, Bing

Wed, 11/20/2013 - 7:32am
Steve Ballmer, Microsoft’s chief executive, is on his way out. But he made clear what he thinks his successor should do: Ignore calls to sell the company’s Bing search engine and its Xbox video game console business. Speaking at his final annual shareholder meeting on Tuesday, Ballmer described the money-losing units as vital for the future. Their technology is integrated with other Microsoft products, he said, which helps to make them stand out from rivals. Ballmer’s comments are aimed at a chorus of critics who say that Microsoft would be better off narrowing its focus after years of disappointing growth and a depressed stock price. What those critics want the company to do is jettison businesses that hemorrhage cash to instead lift profits and provide funds for investing in other areas. Microsoft’s next chief executive will have to at least consider the idea. The ultimate decision won’t be easy, however. Ballmer, chief executive for the past 13 years, is stepping aside during a challenging time for Microsoft. Once dominant in the technology industry, the company is now under attack by Google, Apple and an array of smaller rivals. Slow to recognize the importance of search and mobile devices, Microsoft now has to play catch-up. Despite big investments and millions of users, Bing and Xbox have never really made much money. Bing, coupled with the rest of the company’s online properties, has lost billions of dollars over the years. The Xbox’s financial performance is somewhat better but still weak. In the last quarter, the division that includes the video game console along with Surface tablets and Windows smartphones lost $110 million. (MORE: Xbox One Review: Microsoft’s Ambitious One-Stop Shop) Earlier this year, Rick Sherlund, an analyst with Nomura Securities, suggested that Microsoft stanch the bleeding by selling both units and focusing on the core Office software and enterprise businesses. Profits would quickly rise, he said, and help to lift the company’s shares, which are down 40% from when Ballmer took the chief executive job in 2000. While people like the Xbox, Sherlund
Categories: Financial News

How Companies Can Survive the “Snarkpocalypse”

Wed, 11/20/2013 - 7:02am
Last week, as JP Morgan Chase stumbled into what commentators are calling “an epic Twitter fail,” hundreds of people attending a major conference on “Managing Complexity” couldn’t help but take notice. The event, the fifth annual Global Drucker Forum in Vienna, was aimed at providing insights into an era in which those running organizations find themselves less and less able to exercise control and are often buffeted by the unexpected—qualities that separate the genuinely “complex” from the merely “complicated.” Seizing on a real-time lesson, a couple of the speakers pointed to the JP Morgan debacle, in which a senior executive was supposed to answer questions from the public on “leadership and life,” only to cancel when the scandal-ridden big bank was deluged with tweets attacking its ethics. (Example: “Is it true that, while you don’t always spit on poor people, when you do, you have perfect aim?”) The “Snarkpocalypse,” as Bloomberg News described it, seemed to underscore perfectly the highly dynamic, unpredictable business landscape that the conference was focused on. But what is any management to do, given how quickly a situation can turn in today’s hyper-connected world? The scholars and executives addressing the forum offered a variety of suggestions—practically all of them echoing, in key respects, the man in whose honor the gathering was held: Peter Drucker. Here are a half-dozen of their prescriptions: First, our institutions need to radically decentralize. Don Tapscott, the co-author of Wikinomics and Radical Openness, made the case that some of society’s most difficult challenges could be met if it were made easier for people to self-organize, especially now that billions of individuals across the planet possess the digital technology to share knowledge and coordinate their activities. Instead, too many leaders get in people’s way in a vain attempt to hang on to power. We’re burdened with the “wrong organizational models,” Tapscott said. Drucker, who died in 2005 at the age of 95, was never comfortable on a computer. But, amazingly, more than 50 years ago he urged organizations to move in the same
Categories: Financial News

6 Tips to Maximize Credit Card Rewards

Wed, 11/20/2013 - 6:42am
Rewards are the primary reason people pick one credit card over another, but many of us don’t really understand the rewards programs that are driving our choices. The Consumer Financial Protection Bureau is investigating how well banks explain those rewards. “We will be reviewing whether rewards disclosures are being made in a clear and transparent manner,” CFPB director Richard Cordray told Bloomberg. If not, he says the CFPB might make card issuers do something about that. In the meantime, here’s what you need to know to make sure you’re getting full credit for the rewards you earn. Points can be whittled away by inflation. “The biggest issue with credit card rewards is the rapid devaluation of points and miles” that customers earn from co-branded travel cards, says Credit.com credit and travel expert Jason Steele. When companies charge more miles for the same trip, Steele says, “The rewards received by credit card users are worth less when they try to redeem them then they were at the time they were received.” If your miles have gotten shorter over the years, consider a rewards card that isn’t tied to a particular airline or hotel chain and offers cash back, instead. Not all redemption values are created equal. “Generally speaking, the best way to redeem rewards on travel credit cards is for travel, the best way to redeem on cash back cards is cash and the best way to redeem on other cards is typically gift cards,” says Anisha Sekar, vice president of credit and debit products at NerdWallet.com. The rewards from a card that promises, say, 1% or 2% cash back might be worth much less, especially if you’re “spending” those points on items in an issuer’s online merchandise catalog. “Typically, redeeming for merchandise is less valuable than redeeming for cash,” Sekar says. (MORE: Walmart Seeks Food Donations to Help Needy Employees) Sign-up bonuses can require heavy spending. Sekar points out that some issuers offer bonuses as high as a couple hundred bucks just for signing up. But earning those points or cash back value requires
Categories: Financial News

This Year, Black Friday Basically Starts a Week Early—If Not Sooner

Wed, 11/20/2013 - 6:40am
Heading into the peak winter holiday shopping period, there’s been a lot of talk about how the rise of stores opening on Thanksgiving Day means that Black Friday sales start earlier than ever this year. The truth is that Black Friday deals launch much earlier than that—like the Friday before Black Friday. Among the many arguments against retailers opening on Thanksgiving, perhaps the best is that holiday store hours seem pretty darn unnecessary. Shoppers justify their curious behavior—running out the door after scarfing down turkey and stuffing, exhaustedly browsing crowded store aisles for deals at midnight or maybe 4 a.m.—because of the presence of supposedly extraordinary prices and promotions. Yet smart shoppers know that year in, year out, many of the best deals don’t pop up until Black Friday weekend has passed. The bargain hunters at dealnews recommend the week of December 8 to 14 as the best period for low prices on toys, for instance, while the consultants at ShopperTrak state that Wednesday, December 4, is the top day of the season for shoppers seeking the elusively blissful combination of great prices and minimal crowds. The reliable appearance of sitewide 50% off specials on Cyber Monday present yet another sensible alternative to hitting the mall on Thanksgiving or any other time during the chaotic Black Friday weekend. (MORE: How to Ruin Thanksgiving, an Hour-by-Hour Guide) What’s more, in many cases impatient shoppers out there don’t have to wait Thanksgiving or Black Friday to start snatching up top deals. Given the shortened, desperately competitive holiday shopping period, this year retailers are trying to get a leg up on the rest of the field by wooing consumers days, even weeks before Black Friday. That means: now. As USA Today reported this week, retailers such as Sears and the Disney Store are introducing Black Friday-style doorbusters—think: 50% off and more—starting November 19, the Friday before Black Friday. In addition to a “Black Friday Week” full of promotions, Amazon is currently hosting a shifting array of limited-time pre-Black Friday Week deals. Perhaps most
Categories: Financial News

JPMorgan $13B Deal May Not End Bank’s Legal Woes

Tue, 11/19/2013 - 11:59pm
(WASHINGTON) — The $13 billion settlement that JPMorgan Chase agreed to Tuesday is the largest ever between the Justice Department and a corporation. Yet it isn’t likely the end of the bank’s legal troubles over the risky mortgage securities it sold before the financial crisis. JPMorgan has several lawsuits pending against it and the mortgage businesses it bought from Bear Stearns and Washington Mutual in 2008. There’s also an ongoing criminal investigation led by the office of U.S. Attorney Benjamin Wagner in Sacramento, Calif. The bank may be negotiating or litigating for years and has set aside $23 billion to cover those costs. Last month, in a filing with the Securities and Exchange Commission, it said it may need up to $5.7 billion more. In a conference call with investors Tuesday, JPMorgan’s chief financial officer, Marianne Lake, said it was “too early” to discuss whether the bank would have to add to its legal reserves. “These things are never ‘one and done,’ and they’ll likely be more civil charges,” said Erik Oja, an equity analyst with Standard & Poor’s who covers the U.S. banking industry. But, Oja added, “these sort of settlements really do help clear away most of the issues.” The deal also included settlements with New York, California and other states. It was reached after months of negotiations and could serve as a template for similar settlements with other big banks. As part of the deal, JPMorgan agreed to provide $4 billion in relief to homeowners affected by the bad loans. The bank also acknowledged that it misrepresented the quality of its securities to investors. JPMorgan was among the major banks that sold securities that plunged in value when the housing market collapsed in 2006 and 2007. Those losses triggered a financial crisis that pushed the economy into the worst recession since the 1930s. “The conduct uncovered in this investigation helped sow the seeds of the mortgage meltdown,” Attorney General Eric Holder said. “JPMorgan was not the only financial institution during this period to knowingly bundle toxic loans
Categories: Financial News

Johnson & Johnson To Pay $2.5B To Settle Hip Replacement Suits

Tue, 11/19/2013 - 4:35pm
(WASHINGTON) — Johnson & Johnson says it will pay $2.5 billion to settle thousands of lawsuits brought by hip replacement patients who accuse the company of selling faulty implants that led to injuries and additional surgeries. The agreement presented in U.S. District Court in Ohio is one of the largest ever for the medical device industry. It resolves some 8,000 cases of patients who had to have the company’s metal ball-and-socket hip implant removed or replaced. J&J pulled the implant from the market in 2010. J&J’s DePuy unit said in a statement it expects to make most of the payments to patients in 2014. The artificial hip, known as the Articular Surface Replacement, was sold for eight years to some 35,000 people in the U.S.
Categories: Financial News

SEC Worker Accused of Lying About His Own Stocks

Tue, 11/19/2013 - 2:30pm
(NEW YORK) — A Securities and Exchange Commission employee responsible for ensuring others comply with the nation’s securities laws was arrested Tuesday on charges that he made false statements to the agency about stocks he owned. Steven Gilchrist, 48, of Bethpage, N.Y., was released on his own recognizance after an appearance in U.S. District Court in Manhattan. His attorney, Laura Miranda, declined to comment. According to court papers, Gilchrist owned stock in several financial companies, including Bank of America Corp., Citigroup and Morgan Stanley. Authorities said he claimed he had sold them when he actually had merely transferred them to an account he controlled that he held jointly with his mother. “We will not tolerate abuses of trust and violations of law by individuals tasked with safeguarding our markets,” U.S. Attorney Preet Bharara said in a statement. “As an SEC examiner, Steven Gilchrist had a duty to avoid conflicts of interest that might compromise or even appear to compromise his integrity. Instead, as alleged, he violated the SEC’s internal rules about stock ownership and repeatedly lied to the SEC about his holdings.” SEC Inspector General Carl Hoecker added: “Making false statements to government agencies undermines the foundation of public integrity.” Gilchrist worked as a compliance examiner, a job whose responsibilities include overseeing broker-dealers, investment advisers, investment companies, clearing agencies and others to make sure they comply with securities laws, according to a criminal complaint unsealed in federal court. Authorities said Gilchrist made false statements to the SEC on three occasions this year about his stock holdings. They said he falsely certified in January through an electronic SEC compliance system that he was in compliance with SEC regulations at the end of 2012. In February, he submitted a financial disclosure form falsely stating that he no longer held prohibited stocks and the same month he falsely certified that he had sold other prohibited stocks, they said. SEC ethical rules were tightened in August 2010 to prohibit employees from buying or holding stocks in entities directly regulated by the agency. It also
Categories: Financial News

Why Boeing is Going to War With Its Employees

Tue, 11/19/2013 - 11:11am
Unlike a lot of businesses, Boeing’s commercial jet division knows what the future will bring. Its order book is stuffed like a Thanksgiving turkey, as the next version of the workhorse 737 rolls on and production of the 787 Dreamliner reaches full tilt after its wobbly start. The latest order book entries are $100 billion worth of the long distance 777x that three Middle East carriers plus Lufthansa have lined up to buy, with deliveries scheduled to begin in 2020. What Boeing doesn’t know is where it will make the 777x. Last week, members of the International Association of Machinists (IAM) angrily voted down a new contract proposal that would have guaranteed the Triple Seven X be built in the Puget Sound region but would freeze their pension program, raise the cost of health care and create an adjusted wage scale for new hires, among other givebacks. Having to failed to lock in the lower long term labor costs that it craved, Boeing basically said it was going to take its marbles and play elsewhere. It already builds 787s in boss-friendly South Carolina, while sites such as Long Beach, California , a historic aerospace hub, Huntsville, Alabama, San Antonio and Salt Lake City have also been mentioned.  You can assume that Boeing will be shopping for a tax and incentives deal. On the face of it, the decision by the machinists seems nuts. Boeing was offering guaranteed work for eight years and even offered a bonus to each worker to take the deal. That’s why the state of Washington coughed up $8.7 billion in tax breaks for the company to keep the work in the state. Still, there’s been a mutual miscalculation. Given what has gone on in the steel, mining, aluminum, chemical, auto and tire industries among others in the last couple of decades, you would think the IAM would understand that labor costs have to be globally competitive. In the global economy, every job is part of a labor arbitrage. Airframe work is already being farmed out by
Categories: Financial News

Chairman of Co-op Group Resigns Amid Scandal

Tue, 11/19/2013 - 9:25am
(LONDON) — The chairman of Co-operative Group resigned Tuesday as the group continued to reel from the emergence of a video that allegedly showed the former chair of its banking unit buying illegal drugs. The group, Britain’s largest mutual society, said Len Wardle resigned because of his involvement in the appointment of Paul Flowers, who was caught in a Mail on Sunday video allegedly buying crystal meth, cocaine and ketamine. Co-op has launched an investigation and pledged to examine the way it makes appointments at the bank. “I have already made it clear that I believe the time is right for real change in our operations and our governance,” Wardle said in a statement. The pressure has been building for weeks at Co-op, which has reshaped its leadership in the wake of troubles that emerged following its 2009 acquisition of the Britannia Building society. The bank has had to plug a 1.5 billion pounds ($2.4 billion) black hole in its finances and recently agreed to a rescue plan that saw hedge funds move in and take a huge share of the bank’s operations. Though the group, which also runs grocery stores, pharmacies and funeral parlors, will retain 30 percent of the bank, it was forced to take out full page advertisements in British newspapers to underscore its commitment to retaining its values. The Mail on Sunday reported that Flowers, a Methodist minister, bought the drugs just days after a parliamentary committee grilled him on the bank’s disastrous financial performance. That committee session was memorable because Flowers apparently failed to know very basic facts about his own bank. Flowers told Treasury Select Committee chair Andrew Tyrie that Co-op’s total assets were about 3 billion pounds ($4.83 billion) — they actually total about 47 billion ($75.7 billion). At a time when the financial crisis already saw the public questioning the ethics of bankers, the testimony raised questions over their competence. Now critics are wondering whether regulators were doing enough to supervise — and monitor — a bank’s most senior leaders and decision
Categories: Financial News

Feds To Investigate Tesla Fires

Tue, 11/19/2013 - 8:12am
The federal auto safety regulator announced Tuesday that it is investigating battery fires in the luxury — and top safety rated — Tesla Model S electric cars following a series of fires. The National Highway Traffic Safety Administration said in documents posted to its website that, following two recent cases in which debris pierced the cars’ batteries, it opened a “preliminary evaluation to examine the potential risks associated with undercarriage strikes” last week. None of the car fires have resulted in injury, and Tesla Motors CEO Elon Musk said in a post to the company’s blog Monday that Tesla had requested the federal investigation with the aim of dispelling concerns over the car’s safety. Musk also said that a software update will give the car more ground clearance at highway speeds, further reducing the fire risk from debris. “Given that the incidence of fires in the Model S is far lower than combustion cars and that there have been no resulting injuries, this did not at first seem like a good use of NHTSA’s time compared to the hundreds of gasoline fire deaths per year that warrant their attention,” Musk wrote on the blog. “However… if a false perception about the safety of electric cars is allowed to linger, it will delay the advent of sustainable transport.” The investigation covers more than 13,000 2013 Model S cars in America, which range in cost from $70,000 to well over $100,000.
Categories: Financial News

Pages